{ Cost of Services at UVa CSG May 2015

 UVa Background  Background on UVa’s Cost of Services Initiative  Cost of Services Overview  Cost of Services Methodology  Benefits So Far  Limitations/Challenges  Possible Future Uses/Benefits Overview:

 21K Students  11 Schools  Academic Budget (excl. Med. Center): $1.41B  Decentralized IT—approx. ½ outside central IT  Total Central IT Budget: $48M; approx. 35% “charged back” to units today  Next year, fully allocated out under new budget model UVa Background:

 Scope:  Central IT Only  Full Budget  Early Discussions with Indiana, Cornell  Modeled with WTC on Indiana’s activity- based costing (2011)  Continuing simplification and refinement—now into 4 th year Background on UVa’s Cost of Services Initiative:

 Structure:  181 Cost Categories  50 “Lines of Business” (rolled up categories-- ”Hosting Services”, “Network Connectivity”, “Operational & Administrative, etc.)  Coordination with newly-updated ITS Service Catalog Cost of Services Overview:

 Sample “Lines of Business” Cost of Services Overview:  Access Management  Cable TV  Classrooms, Technology- Enhanced  Custom applications and consulting  Data Center Services  Departmental Computing Support  Enterprise applications:  HR/Payroll  Financial Systems  Student Information Systems  Document Imaging System  Emergency Preparedness  Helpdesk  Hosting Services  Identity Management  IT Training  Messaging  Network Connectivity  Operator Services  Operational & Administrative  Records Management Services  Research Consulting  Security and Privacy Administration  Security Incident Response and Investigation  Server Support  Storage Services  Telephony Services, Basic  University Data Center  Video Services

 All Costs:  People’s Time (PS)  Other Than Personal Services (OTPS)  Allocated to Services:  Direct  Indirect  Shared costs (ex.: managers’ salaries to services they work on, etc.)  “Overhead” (ex.: senior leadership allocable expenses) Cost of Services Methodology:

 Process:  Collect staff time through managers—now using personal service allocation tool with definitions/guidance  Allocate purchases to services (becoming more streamlined; approx. 1/3 automatically allocated to services) Cost of Services Methodology:

Personal Service Allocation Tool

 Awareness of All Service Costs and Dependencies (not just those associated with “for fee” services)  Streamlined Rate Setting  Helpful for Sourcing Decisions:  Help Desk  Cloud IaaS  Streamlined Responding to Surveys  Core Data  Hackett Consulting Engagement  Others…  Enabled Greater Transparency with Constituents (schools, advisory groups, etc.) Benefits So Far:

Financial Overview: Budget Breakdown, Cost of Services From IT Support SLA: Baseline Common Good Services Auxiliary Services For Fee Services Summarized Cost of Services [Slide from SLA Meeting with Deans—Transparency on Costs]

 Annual refresh/Sustainable Methodology  Accuracy:  Time Reporting; 72% of costs are personal services  Capital Costs  One-Time Project Costs  Benchmarking/Comparability:  Partial Service Costing:  Examples: ERP, Emergency Preparedness, Classroom Support  How institutions budget (fringe benefits, power, space, etc.)  Managing costs of services that go across organizational boundaries (even within central IT)  Can be overcome; just requires additional work (worth it?) Limitations/Challenges:

 Benchmarking—but would need:  Comparable data/costs  List of services to benchmark—  What would these be?  Common tool/central point for collection  Educause Core Data Survey?  Vendor tool?  Share a consultant to do for a group(s)?  Further discussion on this at the end of our session Possible Future Uses/Benefits:

 CONTACTS:  Virginia Evans, CIO   Susie McCormick, Assistant VP for IT Budget and Administration 