guide-to-enterprise-it-architecture.9780387951324.29702

Igure 129 costbenefit analysis process an area that

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IGURE 12.9. Cost–benefit analysis process. An area that has not been fully defined by TOGAF is the assessment of the current cost of IT. In the context of the CBA, the current cost assessment is restricted to the specific area within which the project is dealing (e.g., migrating the distributed directory service or building a public key infrastructure). However, costs associated with the entire en- vironment covered by the architectural program should be understood. This is especially the case when the overarching strategy is the control (or reduction) of total ownership cost—most of the defined architectural projects will quote a positive benefit (either tangible or intangible) of reducing TCO. The IT group may already have done the necessary benchmarking to provide this information (in a perfect world this is the likely outcome because there is little point in setting a goal of reducing TCO without understanding whether the current TCO is too high for the particular industry sector). If not, it befalls the architecture program to conduct this at least at a high level. There are plenty of models and consulting organizations available to carry out this work, or it may be done in-house using a commercial (or home-grown) benchmarking ap- proach.
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378 12. O PPORTUNITIES , S OLUTIONS , AND M IGRATION P LANNING An aspect to consider when the work packages have been clustered into projects is the evaluation of technical alternatives. Typical CBA is executed against freestanding projects that has little or no relationship with other IT projects. Therefore, the CBA usually dictates that multiple alternatives be considered. This allows decision-makers to compare the relative returns of different options in a single project. Some of the ar- chitectural projects will be considering alternatives. An organization may have a tendering policy that dictates going to the market for the solution. In such cases, architectural projects that require the replace- ment of a current part of the IT environment will have presented a num- ber of options during target architecture development. In other areas where the new technology is not disputed the project’s CBA need not consider any alternatives. The only objective of the CBA for such projects is to determine benefits in relation to costs. Remember that the CBA is a necessary step in the project initiation process that will eventually pri- oritize each project against all others. The completeness and accuracy of cost information are critical to the quality of the project initiation process. There are a number of sources for this information, including: Historical/current organization data Current environment costs Market research Publications Industry analysts Specially funded studies Vendors Commercial cost models (e.g., software development costing tools) The next step is to estimate the costs associated with the project using the cost information gathered. The reliable estimation of costs in IT projects has historically been difficult because the estimation of size or duration is problematic. There is a huge amount of cost-estimation col-
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  • Spring '15
  • Technical Architecture

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