Wearing out your Sandals

Let us paint you a picture: it is summer, you have been working hard all year and treat yourself and the family to a nice, relaxing holiday in the Caribbean. Your hotel of choosing: Sandals, an all-inclusive luxury resort that suits the challenge perfectly. You pay well, you are served well. You enjoy your vacation, when you suddenly notice the vast amount of expensive prawns your neighbour is devouring. And then it hits you: nobody in your family eats fish…

Who is paying for this?

As you might know, Sandals is a group of upscale all-inclusive hotels in the Caribbean. Each resort has a large selection of restaurants, sports infrastructure and other high-end options to choose from. These services are accessible all day and even come with a personal butler should you want one. It is a perfect solution for a hassle-free, top-quality holiday under the sun. The flipside of all this luxury is that it comes with a hefty price tag. So, if you are not doing any sports, you will still pay for the water sports department that someone else is using. And if you are not drinking any alcohol, you are still treating one of your neighbours to a fine wine experience.

What happens in the all-inclusive hotel is what we often see happening within IT too. Business units request a new project and create a business case. Next, the project passes approvals, gets implemented and by doing so it disappears into the big financial black box of shared infrastructure and is no longer actively managed from a financial point of view.

Afterwards, each IT systems-manager makes his budget for the next year which gets rejected with the strategic advice to “do more with less”. All of this while businesses can keep enjoying this free lunch deal. This hardly feels fair, urging for a shift in accountability and a more transparent culture of cost awareness.

Accountability shift

The advent of cloud computing presents a transformative opportunity with regards to the picture painted above. Unlike traditional IT-infrastructure, the cloud offers a unique advantage: the ability to allocate hosting costs directly to specific applications, business units, or any other relevant dimension. This transparency allows for unparalleled visibility into the costs associated with running various workloads.

Behavioural change

At the initial stage, this transparency can be offered through real-time dashboards, showcasing consumption evolution. This visibility alone triggers a behavioural change; confronted with actual numbers, stakeholders become conscious of unnecessary expenses. A compelling example illustrates this phenomenon, where an HR application, costing a significant sum annually, raised eyebrows when it was revealed that only a handful of employees were using it.

Structural refunds

Taking this transparency a step further, IT can implement chargeback systems. Different business units are billed according to their consumption. Involving these units in budgeting and forecasting exercises completes the transformation, creating a paradigm shift in cost accountability. IT ceases to be a mere cost centre; it becomes an essential enabler for the business, a change tangibly reflected in the financial records.

In conclusion, the cloud doesn’t just revolutionise technological infrastructures. It revolutionises the financial mindset of IT-management.

By bringing transparency, accountability, and fairness to the table, cloud computing transforms IT from a mere cost to a strategic asset, aligning business goals with financial realities. In this new era, cloud computing not only powers the business but also empowers it financially, fostering a culture of efficiency, responsibility, and collaboration. Or in other words, less frustration about your neighbour eating stuff you ended up paying for.

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