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Q: How are IT costs distributed in your organization?

In our 2012 IT Budgeting Survey, we found that costs are more likely to be distributed in some fashion to the business units that IT serves, rather than simply as part of corporate overhead allocations. According to Bob Benson, "Such a budget structure goes hand-in-hand with much of the belief that management of IT money is the basis for IT governance. This reflects itself in the budget structure used for corporate organizations as compared to business unit (BU) services organizations. In the latter case, there is much more cost assignment or allocation to the business units, as distinct from simply being a part of IT corporate overhead. Indeed, more than half of the budget structures for corporate IT organizations are simply part of the general corporate overhead. This survey result also pushes the need for BU services organization to behave more like a service, with customers and costs. While the largest method of budget structure for them falls under the "cost center" concept of allocation, the allocation for BU services is greatest toward the user, suggesting a process of metering and measuring." Cutter Consortium is in the process of updating our IT Budgeting research. Please participate!

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