Service Costs

Service Costs are the full costs of providing an IT service over a period, including direct costs and the proportionately attributed indirect costs. They show what a service actually costs the organization, regardless of whether it is charged internally.

Service costs are determined via the cost model: spending from the cost pools is assigned to the service via keys and rules. Typical components are infrastructure, licenses, staff, external services and allocations of central functions. Related to the service volume, unit costs result: if the email service costs €480,000 per year for 8,000 mailboxes, this equals €60 per mailbox per year. Such values can be compared internally and classified externally via IT Cost Benchmarking.

From service costs and service volumes, the rates of the Rate Card are derived. Service costs must be distinguished from the total costs over the lifecycle (Total Cost of Ownership), which additionally include acquisition, implementation and replacement.