VMware Monitor
Financial Management - Variable Cost Dynamics
Variable Cost Dynamics (VCD) focuses on analysing and understanding the multitude of variables that impact service cost, how sensitive those elements are to variability, and the related incremental value changes that result. Among other benefits, VCD analysis can be used to identify a marginal change in unit cost resulting from adding or subtracting one or more incremental units of a service. Such an analysis is helpful when applied toward the analysis of expected impacts from events such as acquisitions, divestitures, changes to the Service Portfolio or service provisioning alternatives etc.
This element of service value can be daunting since the number and type of variable elements can range dramatically depending on the type of service being analysed. The sensitivity analytics component of Variable Cost Dynamics is also a complex analytical tool because of the number and types of assumptions and scenarios that are often made around variable cost components. Below is a very brief list of possible variable service cost components that could be included in such an analysis:
- Number and type of users
- Number of software licences
- Cost/operating footprint of data centre
- Delivery mechanisms
- Number and type of resources
- The cost of adding one more storage device
- The cost of adding one more end-user licence.
The analysis of Variable Cost Dynamics often follows a line of thinking similar to market spaces, covered elsewhere in this publication. The key value derived from this body of knowledge focuses on more precisely determining what fixed and variable cost structures are linked to a service, and how they alter based on change (either incremental or monumental), what the service landscape should look like as a result, how a service should be designed and provisioned, and what value should be placed on a service.
Other ITIL Processes
In order to have a good understanding of ITIL and the importance of configuration management, we first define what ITIL is: ITIL is literally a collection of documentation.
This documentation can help IT organizations implement the best practices. The documentation grows and grows as more successful techniques are documented and guidelines established for what can make others successful. The latest ITIL resources are published by the UK Office of Government Commerce (OGC).
Integrated service delivery refers to the need for Configuration Management, Change Management, Incident Management, Problem Management and Release Management processes that are linked together in a meaningful manner. For example, the process of releasing components to the live environment (the domain of Release Management) is also an issue for Configuration Management and Change Management whilst the Service Desk is primarily responsible for liaison between IT providers and the Users of services. This section highlights the links and the principal relationships between all the Service Management and other infrastructure management processes.
ITIL processes fall under Operational Layer or Tactical Layer, as follows:
| Operational Layer: | Configuration Management - Service Desk Management - Incident & Problem Management - Change Management - Release Management |
| Tactical Layer: | Service Level Management - Availability Management - Capacity Management - Continuity Management - Financial Management |