I was interviewed the other day by an IT journalist who was posing some interesting questions on the effect of virtualisation on IT staff - do they need to have different skills? do we need more or less of them? usual kind of questions. But as we discussed the ramifications of increasing the level of virtualisation one area I was keen to press home was the need for really good communication and shared objectives between the IT staff that understand the technology and the accountants who count the cost.

Before virtualisation generally speaking a new application requirement meant new hardware, which offered a simple division for costs between business units and projects. With a heavily virtualised infrastrucure more and more of the hardware and software components are shared between projects and business units, creating a need to divide the cost between them. This is nothing new to the world of accountants as they will attribute the cost of buildings, or shared services between business units using department headcount. But the usage of IT infrastructure has a much more complex set of metrics to consider, relative headcount alone could not fairly attribute cost between departments.

A friend of mine working as a management accountant at a government organisation confirmed that they tend to have an IT budget for the company and then an individual IT budget per business unit. As the level of virtualisation increases the IT departments will want to buy infrastructure more as a pooled resource to be shared between departments. The Company element of the budget will increase and the department element will decrease. So how will they set this budget, and how will they divide it up between business units? They are simple enough sums, but IT staff will need to invite the budget writers into their long term strategy goals and get the buy-in from financial management to ensure they get the money when they need it where they need it.

I've seen IT managers make strategic infrastructure purchases out of budget originally approved for a specific new business requirement . This suggests to me that they do not have the required level of communication open with the purse strings to ensure that shared infrastructure resources are catered for out of the correct pot. The danger with this short term fix is that they are always trying to use sticking plaster to patch up the vital foundations with spare cash from other projects. IT managers need to be proactive in getting the financial managers to understand the financial impacts of the chosen IT strategy so they can get a proper level of attention to the essential fabric that keeps systems running. 

Trouble is my experience of financial people and technical people has shown that they have one thing in common:- they both tend to spend more time staring at computers than they do talking to people, and the only way that these two departments are going to be correctly aligned is if they talk to each other.

Maybe, some of my ex-colleagues who work with mainframes have all the answers, as these issues must be old news for them, they have been sharing large systems between different projects and business units for years. I will track them down and press them for the answers. The UNIX and x86 world has some catching up to do.

I'd be interested to hear from anyone who relates to the issue, or feels that their company has it sorted. My feeling is that the large enterprise will be better at it than the small to medium.

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