Strategize a Smooth Tenant-to-tenant Migration and Copilot Takeoff
Accounting and chargeback with tivoli decision support for os 390 sg246044
1. Front cover
Accounting and
Chargeback with
Tivoli Decision Support for OS/390
Quickly establish host and workstation
accounting environments
Use financial databases for
multiple analyses
Planning for accounting
in the enterprise
Mike Foster
Budi Darmawan
Joachim Fischer
Ralf Krohn
Wolfgang von Brand
ibm.com/redbooks
2.
3. International Technical Support Organization
Accounting and Chargeback with Tivoli Decision
Support for OS/390
March 2002
SG24-6044-00
20. Mike Foster is an IT Specialist at the ITSO, Austin Center, and holds a
Bachelor of Science degree in Electrical Engineering from the University of
Kansas. He writes extensively and teaches classes worldwide on a variety of
topics, including Tivoli Decision Support for OS/390. Before joining the ITSO
in 1995, he held both management and technical positions in IBM marketing
and development divisions worldwide for over 25 years.
Budi Darmawan is a Tivoli Specialist at the International Technical Support
Organization, Austin Center. He writes extensively and teaches IBM classes
worldwide on Tivoli, DB2 databases, and OS/390. Before joining the ITSO in
February 1999, he worked in IBM Global Services, Indonesia as the lead solution
architect for Tivoli system management and business intelligence services. Budi
is also a Tivoli Certified Instructor and a Tivoli Certified Enterprise Consultant.
Joachim Fischer is a team leader at IBM Global Services Germany. He holds a
electronic engineering degree from the Gerhard-Mercator University Duisburg
and an economic engineering degree from the University Bochum. He joined
IBM Global Services in 1994, where he has worked on accounting, chargeback,
service level management, and performance management using several IBM
and Tivoli Products. His area of expertise include project management and
consultant activity.
Ralf Krohn is an IT Specialist with IBM Global Services in Hamburg, Germany.
He has worked for IBM for 28 years, with 23 years of experience in the area of
performance, accounting, and chargeback. His areas of expertise include
OS/390 System and subsystems, Service Level Reporter, Performance Reporter
for OS/390 (renamed to Tivoli Decision Support for OS/390), accounting, and
performance and capacity management. During his career, he has installed and
customized reporting and accounting systems, performed migrations from
Service Level Reporter to Performance Reporter for OS/390 and release to
release installations. Additionally, he has developed several user defined
components for use with Tivoli Decision Support for OS/390.
Wolfgang von Brand is a Consultant for accounting and performance
measurement projects. He joined IBM in 1963 and his career has included
hardware CE, SW CE for VSE, VM, CICS, and VTAM/NCP. In 1980, he became
a systems engineer focusing on migrations from VSE to MVS. In 1987/88, he
installed one of the first accounting systems based on SLR, tested the dpAM
accounting system, and did some implementations of EPDM (later named
Performance Reporter for OS/30 and now known as Tivoli Decision Support for
OS/390). He teaches and implements dpAM and Tivoli Decision Support for
OS/390 in several countries in Europe.
xviii Accounting and Chargeback with Tivoli Decision Support for OS/390
21. Thanks to the following people for their contributions to this project:
International Technical Support Organization, Austin Center
Wade Wallace
International Technical Support Organization, Poughkeepsie Center
Robert Haimowitz
Tivoli Systems
Fausto Nigioni
IBM System Management Project Office Performance Team
Sharon Brower
Tivoli Decision Support for OS/390 Software Conversion
Page Hite
Special notice
This publication is intended to help enterprise performance administrators and IT
financial analysts install, configure, and use Tivoli Decision Support for OS/390
Accounting Feature for the Workstation. The information in this publication is not
intended as the specification of any programming interfaces that are provided by
Tivoli Decision Support for OS/390. See the PUBLICATIONS section of the IBM
Programming Announcement for Tivoli Decision Support for OS/390 for more
information about what publications are considered to be product documentation.
Preface xix
22. IBM Trademarks
The following terms are trademarks of the International Business Machines
Corporation in the United States and/or other countries:
AFS® AIX®
CICS® DB2®
DFS™ DRDA®
e (logo)® FAA®
IBM ® IBM.COM™
IMS™ Lotus®
MORE™ MVS™
MVS/ESA™ MVS/XA™
Notes® OS/390®
PC 300® Perform™
RACF® Redbooks™
Redbooks Logo RMF™
S/390® Sequent®
System/370™ SP™
VTAM®
Comments welcome
Your comments are important to us!
We want our Redbooks to be as helpful as possible. Please send us your
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xx Accounting and Chargeback with Tivoli Decision Support for OS/390
24. 1.1 Why accounting is important
Technology and technical developments have continued to bring increased
capability, functionality, and complexity to the Information Technology (IT)
industry. These new technologies allow for increasing involvement of IT in the
day-to-day operations of the enterprise. This involvement had lead the business
processes to strongly depend on IT processes.
One of the key elements of the business processes is the time to market for
goods and services. One of the key influences on the IT process is the
decreasing technology cycle. These factors, along with the interdependency of
the business and IT processes, results in an increased total cost of ownership to
secure, operate, and replace IT environments.
The increasing costs and interdependency of IT and business processes has
resulted in increased focus by the enterprise on controlling and managing the
operational costs of IT. Additionally, the enterprise has demanded the IT total
cost of ownership be accurately proportioned to the business processes they
support. Because of these factors, it is important that today’s IT accounting
process measure and assign resource and service utilization accurately.
An effective way to have IT measure, report, and charge for the IT operational
costs and services is to integrate the IT accounting process with the IT
measurement system. As a result, the role of IT accounting has expanded from
capacity planning, resource utilization, and performance monitoring to one of
measuring and charging operational costs for technical resources and end user
services provided by the IT data center.
Some of the main tasks of the IT accounting process are:
Gathering accounting information from different sources
Assigning of IT services to organizational units, such as divisions and/or
departments
Converting technical accounting information into understandable end user
information
Determining the value of provided IT services
Additionally, the IT accounting process needs to be closely linked with both the
Service Level Agreements (SLA) and the IT reporting process to successfully
manage and charge IT related costs. The SLA, IT reporting, and accounting
processes need to exchange and correlate related information to completely and
correctly calculate the total IT costs of operation.
2 Accounting and Chargeback with Tivoli Decision Support for OS/390
25. 1.2 Accounting system overview
With data processing, each department and every project produces costs. The
goal of the accounting and chargeback system is to identify:
Total costs for each cost categories
What caused the costs
Who caused the costs
Distribute the cost
Who to bill
An essential requirement of the accounting and chargeback system is to
accurately identify all costs, measure the usage and correctly distribute the
costs. All resources and services must be analyzed to determine who is
consuming the resource or service and what costs are associated with the
resource or service so the cost can be charged. This process is not simple, and
requires detailed knowledge of the systems to recognize the correct data and
correctly associate the data in the accounting and chargeback system. This is
the job of the IT Financial Analyst.
Additionally, the goal of the IT Financial Analyst is to create an accounting and
chargeback system where the user of the services can understand how the costs
are related to services received and that the charges are repeatable for identical
resources usage or services.
An example of accounting and chargeback would be for batch processing. The
cost is calculated based on direct consumption of CPU time and the SIO count,
which represents the number of I/O operation. Because a batch job can be
associated with a department or group, the costs can then be charged directly to
them.
Computer center costs occur for reasons other than direct system resource
consumption, for example, personnel, building, and energy costs. These costs
also require correct distribution by the accounting and chargeback system.
The Accounting Feature for the Workstation, together with the Tivoli Decision
Support for OS/390, aid the IT Financial Analyst in identifying resource usage
and associating the costs for these resources to the receiver or user of the
resource or services.
Chapter 1. Overview of accounting and chargeback 3
26. 1.3 What chargeback is
The main purpose of an accounting system is chargeback. Chargeback is when
the cost of services provided are identified and charged to the users and
recipients of the services. Without charging for the services, the process of
accounting for services is of little value.
The accounting system is used to discover resource usage and assign the
various resource usages to different causes. By assigning a value to each
resource usage, a chargeback system is developed.
In addition to resource usage, the business goals for the enterprise should be
taken into account in the structure of a chargeback system. The business goals
to be considered for inclusion in the IT chargeback system include:
Direct correlation between charges and services provided
Understanding and agreements of the costs and service levels
Cost reductions
Target oriented services
Elements of a correctly established and successfully running accounting and
chargeback process include:
All associated costs are identified and all costs are charged out.
Charges are based on resource usage.
Charges are explained in terms understandable to the charged user.
Costs partly assigned to many areas are included and prorated, for example,
personnel expenditures for executives and system programmers, as well as
floor space and utility costs. In some cases, these prorated costs will need to
be estimated if no physical measurement is available to base the prorated
usage upon.
As far as possible, every customer pays only for the resources they have
actually used.
The charged price and the calculation used to establish it must be clear,
understandable, and comprehensible to the charged user.
The invoice needs to show what costs and services are being charged.
There are five different approaches or methods for performing chargeback, as
shown in Figure 1-1 on page 5. These different levels build upon each other,
starting with the simplest to implement, which is the IT department cost method,
which only charges back to the enterprise.
4 Accounting and Chargeback with Tivoli Decision Support for OS/390
27. The most common way to chargeback to the consumers of IT services is to
create a resource accounting structure and calculate the prices for each service,
as shown in level 2 of the pyramid in Figure 1-1. The examples shown in this
redbook are based on this level of chargeback. In refinements to your
chargeback model, you might want to utilize the higher levels of chargeback
accounting: Application Accounting, Functional Accounting, and Business
Transaction.
s
ost
Charging via business activity, for example, per invoice or
s
n
Business Transaction
ult
per order
dc
(IT-Products)
res
an
eve
s es
Associate transactions and user activities to
chi
ces
n
Functional Accounting functional areas within the enterprise
oa
pro
dt
ess
ire
n Track application usage
sin
equ
n Track transaction volumes
bu
rt r
Application Accounting Shared resourse usage
een
n
ffo
CPU seconds
etw
Lines or pages printed
ge
DASD allocation
pb
sin
n Consultants and Analysis
Resource Accounting n Dedicated resouce usages
shi
rea
Networks
ion
Inc
PCs and printers
at
rel
n IT costs charged directly
er
IT Department Cost to the enterprise with no
s
distinction as to useage
Clo
Cost calculations
are performed at
this level
Figure 1-1 Chargeback methods
1.4 Chargeback influence
The IT chargeback process links to many other IT discipline and business
processes. So it is important to create a structure for the chargeback concept,
because the information from it has an influence on the other enterprise
processes, as shown in the relationship to the business processes shown in
Figure 1-2 on page 6.
Chapter 1. Overview of accounting and chargeback 5
28. Figure 1-2 Chargeback links to business processes
The relationships between the chargeback system and the business processes
shown in Figure 1-2 are listed in Table 1-1.
Table 1-1 Relationship between chargeback and business processes
Business process Relationship to chargeback
Business Planning Departmental understanding of IT
component of business costs
IT knowledge of cost-production
Help for making or buying decisions
Ability to evaluate IT alternatives,
such as outsourcing or outtasking
Management Information Cost recovery information
Tracking and understanding cost
increases
Department budget and variance
information
Improved understanding of IT
overhead
6 Accounting and Chargeback with Tivoli Decision Support for OS/390
29. Business process Relationship to chargeback
Corporate Profit Low cost provider of IT services
Improved analysis of market
opportunities
Running IT as a business
Service Level Management Provide different service quality with
different prices
Provides negotiating leverage to IT
Promotes realistic user selection of
adequate service levels
Capacity Planning Provides indicative or actual workload
forecast
Performance Management Efficient and effective use of IT
resources
Influences user behavior with different
processes for day and night CPU
second usage
1.5 Steps to create a chargeback model
This section gives an introduction to creating a chargeback model for IT services.
The example in this section is based on the OS/390 environment as an
illustration of how to realize a chargeback system. The OS/390 environment is
only a part of the whole IT budget.
1.5.1 Step 1: Define the measurements for charging services
The IT organization is made up of services and overhead. You will need to define
all of the services and overhead in your IT organization. Direct cost centers are
those services that can be measured and indirect cost centers are overhead. It is
important to locate those resources which can be directly measured.
Examples of indirect cost centers are IT management and administration.
Examples of direct cost centers and their possible measurements are:
OS/390 system usage CPU seconds per user
Space usage Allocated space per user
Output usage Print pages per user
Help Desk Number of calls
Education Number of days
Chapter 1. Overview of accounting and chargeback 7
30. The result of the definition is the cost element layout. Now all costs are located
and it is possible to assign to a primary cost center and service cost center.
1.5.2 Step 2: Cost center accounting
Once you have defined your services and overhead, you need to determine their
costs. Table 1-2 is an example of cost assignments for the IT organization. In the
table, costs are broken down into categories and subcategories.
For example, the cost of materials is divided into five areas: hardware, software,
network, external, and other. The hardware is further divided into CPU, I/O &
Storage, and Print with the I/O & Storage subdivided into Direct Access Storage
Device (DASD), tape, and robotics. In the indirect or direct cost center columns,
a $ (dollar sign) shows where a cost element (or portion) has been assigned. The
dollar sign in parentheses indicates a potential cost assignment.
At the end of this process, you should have identified all costs for your offered
services. This table is only an example for cost center accounting and it is
possible to expand the cost center or the cost element types.
Table 1-2 Cost element types
Row Cost element types/year Indirect Direct cost center
Number cost
centers
1.. n CPU DASD PARINT
CPU DASD PRINT
1 1. Cost of materials
2 1.2 OS/390 hardware costs
3 1.2.1 CPU ($) $
4 1.2.2 I/O and storage ($) $ $ $
5 1.2.2.1 DASD ($) $
6 1.2.2.2 Tape ($) $
7 1.2.2.3 Tape robotic ($) $
8 1.2.3 Printer ($) $
9 1.3 OS/390 software costs
10 1.3.1Operating system ($) $ $ $
11 1.3.2 Database ($) $
8 Accounting and Chargeback with Tivoli Decision Support for OS/390
31. Row Cost element types/year Indirect Direct cost center
Number cost
centers
1.. n CPU DASD PARINT
12 1.3.3 Subsystem $
13 1.3.4 Print software $
14 1.3.5 DASD/tape software $
15 1.3.6 Software development tools ($) $
16 1.3.7 Standard application software $ $
17 1.1 Network costs
18 1.1.1 Hardware $
19 1.1.2 Software $
20 1.1.3 Network services $
21 1.4 External cost $
22 1.4.1 Desktop PCs $
23 1.4.2 Phone systems $
24 1.4.3 Copy services $
25 1.5 Other cost
26 1.5.1 Training cost $ $
27 1.5.2 Other material costs
28 Sum cost of materials Iines (1 to 27) $ $ $ $
29 2. Personnel cost
30 2.1 Management $
31 2.2 System operating $ $
32 2.3 Administrator $ $ $
33 2.4 Programmer $
34 Sum personnel cost $ $ $ $
35 Sum total cost (line 29. and 34.) $ $ $ $
Chapter 1. Overview of accounting and chargeback 9
32. Row Cost element types/year Indirect Direct cost center
Number cost
centers
1.. n CPU DASD PARINT
36 cost distribution from indirect cost 60% 30% 10%
center (line 35.) corresponding to
portion of the personnel cost (line
34.)
37 Sum indirect cost center multiply $* 60% $* 30% $* 10%
factor
38 Overall Costs (Line 35. and 37.) $$ $$ $$
1.5.3 Step 3: Calculate direct service rates
After step 2, the cost information for the year is known for the offered services.
To calculate the rate, you need information about the direct services usage. In
this example the next step is to calculate the monthly rate for services, such as
CPU seconds, print pages, and allocated DASD.
CPU rate
Table 1-3 gives an example of calculating the monthly rate for CPU seconds. The
costs in the far right hand column come from the information identified in
Table 1-2 on page 8. The calculation of the CPU seconds per month is derived
from the seconds per month times the number of processors times the utilization
percentage (1,971,000 times the number of processors in this example). Finally,
the CPU rate is determined by dividing the CPU cost by CPU capacity (utilized
seconds per month).
Table 1-3 Calculate CPU seconds rate
CPU capacity Seconds/ Contributing cost Cost
month elements ($/ Month)
Number of processor n
Hardware CPU $$
Hours per day 24
Minutes 60 Operating system $$
Seconds 60 Database software $$
Days per year 365 / 12 Personal costs $$
Utilization (%) 75 Apportionment of $$
indirect costs
10 Accounting and Chargeback with Tivoli Decision Support for OS/390
33. CPU capacity Seconds/ Contributing cost Cost
month elements ($/ Month)
= CPU second per month n *1,971,000 = Cost per month $$
(n * 24 * 60 * 60 *365 / 12)
Note: The cost rate for CPU seconds is: Cost per month ($) / CPU seconds
per month.
DASD rate
The example given in Table 1-4 calculates the monthly rate for DASD usage. The
costs in the far right hand column come from the information identified in
Table 1-2 on page 8. The calculation of the DASD capacity per month is derived
from the installed DASD times the utilization percentage (80 percent in this
example). Finally the DASD rate is determined by DASD cost divided by DASD
capacity (GBs per month).
Table 1-4 Calculate DASD rate
DASD capacity GBs Contributing cost Cost
elements ($/ Month)
Installed DASD 100 GB Hardware DASD $$
Operating system $$
DASD management $$
software
Personnel costs $$
Utilization (%) 80 Apportionment of $$
indirect costs
= DASD capacity per 80 GBs = Cost per month $$
month
(100 * 80%)
Chapter 1. Overview of accounting and chargeback 11
34. Note: The cost rate for DASD is: Cost per month ($) / DASD GBs.
Print rate
The example given in Table 1-5 calculates the monthly rate for Print usage. The
costs in the far right hand column come from the information identified in
Table 1-2 on page 8. The calculation of the print capacity per month is derived
from the number of installed host printers times the print capacity per hour times
the number of work hours times the number of work days per month times the
utilization percentage (2,112,000 print pages per month). Finally, the Print rate is
determined by Print cost divided by Print capacity (pages per month).
Table 1-5 Calculate print rate
Print page capacity Pages per Cost element types Cost
month ($/ Month)
Number of system laser 2 Hardware $$
printer (PRT1, PRT2)
Print capacity (page/hour) 4.400
Work days per month 20 Print software $$
Work hours per day 16 Personnel costs $$
Utilization (%) 75 Apportionment of $$
indirect costs
= Print capacity 2,112,000 = Cost per month $$
(2 * 4.400 * 20 * 16 * 75%)
Note: The cost rate for Print pages is: Cost per month ($) / Print capacity.
Additional considerations
The examples in this section may need to be expanded to reflect the requirement
in your environment. Some additional areas you may want to consider include:
Further differentiations can be made between workloads on your system,
such as distinguishing between day or night shifts or between job classes
(such as batch and hot batch).
A differentiation between DASD and tape is only necessary if the customer
can choose to store their data on DASD or tape. Many IT departments use
storage management software to control storage usage on DASD and tape.
In this case, it makes no sense to have different prices, because the customer
can not choose their storage medium. If the customer works with special
DASD or tape units, then these resources can be billed as recurrent charges.
12 Accounting and Chargeback with Tivoli Decision Support for OS/390
35. Most remote workstation printers are charged directly to the using department
and are not normally included in the cost of host printing.
Line printer usage or microfiche creation may be considered as an additional
service.
The example in this section utilizes head count has been used to determine
overhead distribution. This distribution method may be simpler than what is
needed in your environment, but a more detailed discussion of overhead
loading techniques is beyond the scope of this redbook.
1.6 Planning consideration
When planning an accounting and chargeback system, there are several issues
that must be considered. Issues likely to have an impact on the implementation
include:
Audit of departmental charges
Generation of accounting data provides information about detailed IT center
usage by each individual department.
Understandable units of work
The output of an accounting system needs to show the usage of the IT center
resources in a way that is understood by non-IT professionals. This may
require the showing of usage in terms related to the business unit being
charged. One universal term is money, compared to IT terms, such as
CPU-seconds or MB per day.
Allow IT to influence user behavior
The introduction of information for different, changing schemes may force
users to use cheaper resources where possible and reduce overloading more
expensive machines. For example, an overnight batch job may be charged
less than a peak time batch, so the user may choose to run most of their
batch work during off-peak periods.
Easy and economical to handle
The accounting and chargeback system must be implemented while taking
both the IT and finance organization into consideration. It is useless to invest
$1000 to do a detailed chargeback of a $1 resource.
Changes to an accounting rule
Any changes in the accounting system should normally take effect at the
beginning of an new chargeback cycle. This can be a new month or even a
new year, depending the needs of the business.
Chapter 1. Overview of accounting and chargeback 13
36. An accounting/chargeback system will only be as accurate as the input data
you receive from all sources.
1.7 Important concepts
This section provides some important concepts that must be understood in order
to implement an accounting system. These are:
Naming conventions
To set up an accounting system, it is important to provide a unique name that
can be interrelated with the user who received the service from the IT
department. So it is necessary to define a naming convention for the Job
name, the Account ID, TSO user ID, Terminal-Name, and data set names.
Only unique names should be provided. Each usage measured must be
interrelated to a unique account.
Accounting IDs
The account ID is the smallest part of the accounting system to locate the
usage of resources. During the planning cycle, these IDs must be defined or,
if it already exists, the structure must be documented. All tasks must be
connected to an account ID and may be connected to a customer ID. The
customer ID is an aggregate accounting ID and normally the receiver of the
final bill. A customer ID may be connected to one or more account IDs.
Cost center
A cost center is an entity where we can charge for a collection of resource
usage. A cost center is typically associated with a department or project for
which a specific account ID or customer ID are allocated.
Forecast
In IT accounting, it is not easy to predict the consumption and usage of IT
resources at the beginning of the year. However, this information is
necessary for budgeting purposes. Thus, it is necessary to calculate or
forecast some of the usage of these resources. There are two ways to do this:
an estimate or a projection based on historic usage data. The Accounting
Workstation Option of TDS/390 uses mathematical methods to create a
forecast based on historic usage data. This forecast prevents seasonal
fluctuations (vacation, year-end work, and so on), which can be considerable.
On the other hand, such a forecast requires a series of usage data, which
means that the first projections will certainly hold sway.
14 Accounting and Chargeback with Tivoli Decision Support for OS/390
37. Normalization
Some of the resources may need to be normalized, for example, CPU usage.
A faster CPU may accomplish a job quicker, which mean less CPU time. For
example, a job might run for 10 seconds on CPU-1, but run for five seconds
on CPU-2, which is quicker. Without normalization, the job will be accounted
at half price for running at CPU-2, which is faster (and therefore should be
accounted as more expensive). A normalization factor should be accounted,
so a job running at CPU-2 will get a normalization factor of, for example, 2.1.
This means that a job running on CPU-2 for five seconds will be charged 10.2
seconds for CPU time.
Chapter 1. Overview of accounting and chargeback 15
38. 16 Accounting and Chargeback with Tivoli Decision Support for OS/390
40. 2.1 Resource Accounting Feature
The Resource Accounting Feature (RAF) is a feature of Tivoli Decision Support
for OS/390 (TDS/390). It consists of several Tivoli Decision Support for OS/390
subcomponents that provides the accounting features. These accounting
features collect and generate accounting data and also interface with a
workstation program called the Accounting Feature for the Workstation for billing
and chargeback application.
Before installing the Tivoli Decision Support for OS/390 RAF subcomponents,
the corresponding base features have to be installed in order to have the
supporting component records definitions available. For example, the IMS
component needs to be installed before the RAF IMS subcomponent.
2.1.1 RAF data flow
Figure 2-1 shows the data flow for accounting information during the collection
process on the host side in Tivoli Decision Support for OS/390.
Figure 2-1 Resource Accounting Feature - Data Flow
18 Accounting and Chargeback with Tivoli Decision Support for OS/390