PowerPoint Presentation

Cesnet cost attribution and charging models Radovan Igliar

Agile Portfolio Management and Cost Attribution

I would like to present you our perspective on cost attribution and charging models. My name is Radovan Igliar, and I am from CESNET, Czech Republic.1About meCESNET & me - since Nov. 2012Before:e: Czech Technical University, Brno University of Technology, Siemens Business Services, Fujitsu-Siemens, Cisco Systemsp: Microsoft, PwC, Ness, Zentiva, eGovernment etc.s: 1 fail , 1 exit http://cz.linkedin.com/in/proteo/As I am new in here. I would like to ntroduce myself a little.In Cesnet since November last yeatBefore experience both in Academic and CorporateDone some projects with Also active in Council oF HEIs, and represented students in ESU 2CESNETAssociation of Legal EntitiesUniversitiesAcademy of ScienceCustomersMembers27 universitiesAcademy of science + departmentsNon-members12 elementary schools106 high schools10 private universities25 research40 public administration39health23 libraries26 otherIncome60% MembersAnnual fee based upon size of the organizationAll services on best-effort basis30% Non-membersConnectivity price listNo models for extra services10% ResearchFunding

When I saw this I thought - we are on the same boat great - we have the same problems - but If we want to speak about costs and , the attribution costs we have to also speak about products product portfolio6But

Can I talk about charging model and cost-attribution

.. if we are not certain in our product portfolio?

I can talk, where we are now.Attributing costs to products and servicesThe solution wasfull-cost (cost sharing)CRMProblem is that we still dont have the DATA

Lets talk a little about problem-solving perspectivefull-cost about costsCRM about customers8We identify a problem. ... and we feel stg. has to be done.But we are engineers.

Reasonably smart people can rationalize anything, but engineers are especially gifted at this.Ash Maurya

We have (yet) sufficiency of resource

Reasonably smart people can rationalize anything, but engineers are especially gifted at this.Ash Maurya

so we start building solutions.

Reasonably smart people can rationalize anything, but engineers are especially gifted at this.Ash Maurya

Problem identificationOUR PERSPECTIVEWe dont know our users and how to communicate with them.

We offer right services for the users, but ...

We dont know how does our services cost.

We should present us in a better way.Looking for SolutionsIN REALWe dont know our users and how to communicate with them. Lets implement CRM. Huray!We offer right services for the users, but... We should focus on marketing. That will save us.We dont know how does our services cost. Lets implement full-cost model. Thats the solution.We should present us in a better way. Lets make new website.

Looking for SolutionsIN REALWe dont know our users and how to communicate with them. CRMWe offer right services for the users, but...marketingWe dont know how does our services cost.full-costWe should present us in a better way.website

TOOL PRTOOLONE-WAYLooking for SolutionsIN REALWe dont know our users and how to communicate with them. CRMWe offer right services for the users, but...marketingWe dont know how does our services cost.full-costWe should present us in a better way.website

For whom?Processes?Do we have data?EventsWebsiteIdentifiersAgain -Data?CMSStructureVyberko

17Looking for SolutionsIN REALWe dont know our users and how to communicate with them. CRMWe offer right services for the users, but...marketingWe dont know how does our services cost.full-costWe should present us in a better way.website

year 2 years1+ year1 yearVyberko

18Looking for SolutionsIN REAL and establish a working group to solve it, and

appoint people which identified the problem,

but not those that should participate.Vyberko

19Looking for SolutionsIN REAL.. which leads to communication problems.

So

Employ a new guy to solve it.20Looking for SolutionsSHOULD DOcommunicate Get out of the building. ~ Steve Blankright services Know our segment, products, and added value.cost Know our market and products.present us Start building customer channels. ~Eric Ries

And the answers were there from the beginning.21Back to the

cost attribution and charging models.Attributing costs to products and servicesThe solution was full-cost and CRM.So working-groups were established.Accounting / Booking costs:1. by project (due to fund policy)2. by department (due to internal budgeting)3. not by productsCRMPublic procurement on the SaaS softwareProblem is that we still dont have the DATAfull-cost about costsCRM about customers23Attributing costs to products and servicesBooking costs:1. by project (due to fund policy)2. by department (due to internal budgeting)3. not by products(yet)1+2 works with most extra service, if we dont include share of the price for core services (network, monitoring, NIC, DNS, etc.)metrics:fix rate, percentage, usage?so we still have to do (3), and to know our product portfolioAttributing costs to products and servicesNov. 2012Before only one service charged and offered (connectivity to non-members)Other services offered to member on best-effortProduct managerDec. 2012Stg. Like Service Board establishedProduct portfolioJan. 2013Business development dept. establishedFeb. 2013Proof-of-concepts projectsAttributing costs to products and servicesProduct portfolioLean CanvasInterviews with product ownersOur approachThink big, start small, move fastProof of concept projects

ChallengesStrategyEU/National level: Unclear and changingInternal: not just words, mean themSelf-sustainability and not-competingResearchvs.Service-deliveryRevenue vs.ProfitLegalMembers vs. non-membersLegal form (Association of Legal Entities)Access policy to commercial R&DOpportunity to Public procurement ChallengesProducts and servicesDiversificationImproving user experienceBest effort vs.Guarantee of qualityOutsourcing vs. In-houseMarketingMarketing strategyIdentifying customer segmentsBuilding customer channelsCommunicating the added valueUtilize unfair advantageCampaignsChallengesFinanceCost structure and cost sharingNew business modelsTransformation of CultureHistorySufficiency of resourcesCertaintyProfessional blindness

Product portfolio

connectivityeduroamstoragesecuritymobile

Proof of concepteduroamOrganizations want eduroam, but do not have all the resources.We have the knowledge, but not personal resources.New business modelFocus on revenueOutsourcing of the technical installationUser support (24/7 support desk)Cost structure and cost sharingQuality of service

Proof of conceptdouble-house connectionCommercial R&D companiesNew business modelsAccess-policyFramework for state aid for R&D&IMarketing

Proof of conceptData storageDiversificationBasic service in membership feesExtra service - pricingCost-sharingFocus on profitMarketing

Proof of conceptAntispam mail gatewayNew business modelsCustomer need evaluationProduct life-cycle and planningFocus on profitN: Radovan IgliarE: radovan.igliar@cesnet.czW: https://www.cesnet.cz/L: http://cz.linkedin.com/in/proteo/