Adjusting Enterprise cost-model for Public Cloud
The Bank for International Settlements (BIS) launched a strategy initiative called "Innovation 2025". This strategic effort consists of a set of initiatives aiming to build a forward-thinking and dynamic BIS that continuously uses its resources effectively to deliver added value to the shareholders.
Daniel Winnips & Svetlana Orlova & Rodî Tyber & Pascal Odermatt & Futsum Kidane Welday, 2022
Projektarbeit/Praxisprojekt, Bank for International Settlements
Betreuende Dozierende: Michael Pülz
Keywords: Public Cloud, OPEX, CAPEX, J2C, Charge Back, IT Governance, Total Cost of Operation (TCO), Technology Business Management (TBM)
BIS currently employs a federated IT model with central IT providing core infrastructure, platforms and applications. The departments that consume these resources are not charged for their consumption, the associated cost is paid from the IT infrastructure CAPEX budget. In-line with the “Innovation 2025” strategy, BIS is reconstructing its IT landscape towards a more cloud focused design. The public cloud adoption brings financial and technological changes. It forces the organization to rethink current accounting principles and IT operations procedures.
To gain a comprehensive understanding of the BIS's IT infrastructure and service delivery practices, interviews were conducted with individuals from various IT departments. Additionally, the head of finance operations was interviewed to gather information about the bank's financial processes. To supplement these findings, internal documents related to cost accounting and governance were reviewed. Furthermore, interviews were held with organizations in comparable industries and relevant literature was studied to provide a broader perspective on the topic.
Internal research has shown that the questioned departments are not aware of internal budget discussions regarding cloud computing. Since IT infrastructure pays for resources, there is a general lack of awareness regarding cloud cost and optimization. Reference cases have shown that other organizations face the same challenges when moving to the cloud. Depending on cloud maturity, these organizations applied frameworks like Total Cost of Operation (TCO) and Technology Business Management (TBM) to mitigate cloud adoption challenges. To prevent cost explosion and combat uncontrolled shadow spend, cost transparency and visibility must be established. This can be achieved by introducing TCO and proper service management practices. To limit impact of cloud adoption cost, project costs can be transferred to departments by using a distribution key. The TBM taxonomy can be adopted to get a fit-for-purpose accounting module that connects IT spending to business value. General cloud awareness needs to be raised within the organization.
Studiengang: Business Information Technology (Bachelor)
Fachbereich der Arbeit:
Art der Arbeit
Bank for International Settlements, Basel
Autorinnen und Autoren
Daniel Winnips & Svetlana Orlova & Rodî Tyber & Pascal Odermatt & Futsum Kidane Welday
Sprache der Arbeit
Business Information Technology (Bachelor)
Public Cloud, OPEX, CAPEX, J2C, Charge Back, IT Governance, Total Cost of Operation (TCO), Technology Business Management (TBM)