Monday, May 25, 2020

Cost or Profit Center?

An Important Policy Decision
By Chad Greenslade

An important policy decision to be made is whether IT will be a profit or cost center.  This is a decision made by the organization’s executives, not by IT management.  This is because IT, as a business unit, is subject to the same governance as any other business unit.  Although IT executives may be asked to participate in making that decision, this is ultimately a matter of enterprise financial policy.  Definition of these two options are:

(1) Cost Center: Two (2) definitions for the term “cost center” are commonly used in business.  Although they appear close in meaning, they are different.  In this context, the term is used to indicate a business unit or department to which costs are assigned, but which does not charge for services provided.  It is, however, expected to account for the money it spends, and may be expected to show a return on the business’ investment in it.  A cost center is able to focus awareness on costs and enable investment decisions to be better founded, without the overheads of billing.  However, it is less likely to shape users’ behavior and does not give the IT organization the full ability to choose how to financially manage itself (for example, in funding IT investment).  The other definition for the term “cost center” is used in the context for accounting.  In this context, a cost center is anything to which a cost can be allocated (for example, a service, location, department, business unit, etc.).  They also provide meaningful categories for allocating and reporting costs so that they can be understood and influenced by a wide audience.  Care should be taken to read the context of the term to ensure the correct meaning is inferred.

(2) Profit Center: A business unit that charges for providing services is a “Profit Center”.  A profit center can be created with the objective of making a profit, recovering costs, or running at a loss.  As a profit center, IT is able to exercise greater autonomy, even to the extent that it can be operated as a separate business entity, under the ownership and direction of the corporate entity.  IT will also be able to achieve better cost control over service provision and calculate the true costs of IT by customers.  Charging other business units in the same organization can be useful in demonstrating the value that the service provider delivers, and in ensuring that funding is obtained from an appropriate source (i.e. the customer that uses the services).

Saturday, May 23, 2020

Disrespectful Neighbors

You Are Not Entitled to the Street
By Chad Greenslade

The real question that I truly grapple with on a day-to-day basis is does it make me a bad person for reporting my neighbors' parking violations? 

The rules are clear.  The habitual parking of your vehicle in the street is prohibited.  The rules are also clear that your garage is to be used primarily for AUTOMOBILE STORAGE.  You are NOT to run a business out of your garage.  You are not to store your golf carts, instead of your cars, in the garage.  If you didn’t buy the extra ½ garage, you don’t get to have a golf cart, and if you did buy the extra ½ garage, then that is not meant for your woodworking set.  If you own a golf cart, YOU’RE A MORON because we don’t live on a golf course.  The beauty of this community, which is literally the only thing I like about it, REQUIRES that you keep your vehicles off the street.

I don't report everyone.  I certainly don't patrol the neighborhood.  The things I report are literally right in front of my home and I see them daily.  They intrude on my tranquility.  When I look out my home office window, I don't want to see your car, RV, sister's car, jet ski, etc.  In fact, I the only cars that I ever want to see are the types of cars that get parked up front at Legacy West.  You know, nice cars; cars that you and I can't afford.   

The real issue is that you're disrespectful and you don't care that your life is spilling out onto the street.  You can't park your car in the garage because it's full of your stuff.  You have too many cars to park in the driveway because too many people live at your home. 

I tried to work it out with you.  I placed a very nice, polite letter on your windshield, citing the rules, asking for your concurrence and stressing that the rules are meant to beautify our community.  I gently asked for your compliance and enclosed my contact information.  You were surprised when I was unmoved by your reasons for why you should be allowed to park your cars in the street.  I don’t want to know you.  I just want you to not park your cars in the street.  You proceeded to be defiant and I proceeded to have you fined. 

But back to the real question: am I a bad person for continuing to report you, and others, for parking violations?  Am I evil for taking pictures and making time to follow-up?  Is it odd that I have a folder on my hard drive cataloging your transgressions?  I hope not, but I just don’t know.  Since so many of you do it, it makes me think I am the crazy one.  The one thing that I know for sure is that I’m never going to stop getting angry about seeing your vehicle parked in the street.  I am just wired that way.  Some people call it OCD; I call it getting what I pay for.  When I sit down in the morning with my cup of coffee and look out at the beauty that I have paid so handsomely to create for myself, the last thing I want to think about is you, your life, and all of the reasons why I now despise you for parking your car within my view.