Hello everyone,

I'm looking to understand what is the right level of costs accuracy that we should aim to achieve within Cost Transparency (CT).

Some Clients want to see IT costs right down to the penny but as I understand CT purpose is to provide an high level view of where all the money is flowing to.

CT is not a financial tracking tool so in our point of view what should the adequate range of accuracy we should expect to see? Do you have an easy way to make Clients understand this? 

Thanks.

@Jose Goncalves,

This is really something that the client will decide during their validation process, but it's something that is good to discuss with them because as you are modeling from the Cost Source up in the model to the various Financial objects then up to the IT Resource Towers and beyond you may see some fallout as not always we will see a 100 percent rollup in all customer cases because the data may not support it.

It is good to discuss with them for a validation effort what is a reasonable amount of fallout from the Cost Source up to the IT Resource Towers.  Typically, I have seen some customers where there is a hardline on wanting to have 100 percent rollup, but again I have seen others where a 1-3 percent fallout is acceptable as long as we explain to them why something is not rolling up (i.e. Cost Center to ITRT Mapping needs to be updated to include a Cost Center that is not rolling up or Labor Headcount file does not have a Cost Center that is mapped to Internal \ External Cost Pool and they know they do not have that data within the Labor Headcount file).

This can also be true in the Infra layer when you are going up to Applications from Servers with the App to Server Mapping where they may have only mapped Production Servers and not their DEV, QA, Test servers in the mapping.  That would fall under a data improvement that would need to done.

Reports contained in the "IT Financials" collection should be pristine (in terms of tying out with other reports management receives or systems they have access to). This collection aims to significantly reduce or eliminate traditional financial reporting, so by extension they need to be of high quality.

In other report collections and objects within your model (other than Cost Source), the accuracy quality depends on your company's adopted strategy. For some company's, it's acceptable to allocate costs onto other objects/areas where a clear connection is defined...leaving behind some costs as unallocated.

Other company's (and my personal approach), is to allocate all costs. If a clear target cannot be identified, it should be possible to isolate the cost as related to an area associated to one of the objects in your model...even if not possible to narrow the association within the object's data. In such a scenario, I have one or more "dummy" or "plugged" rows to capture the "unassigned" costs being burdened onto the object. In this fashion, I can easily call attention to the "unassigned" costs on reports and illicit organic support from management to improve systems, processes, quality, and value served up by our TBM program.