ETS Rate Model Development2015/17

Agenda

Brief History of ETS Rates DevelopmentOutcomes of Rate Development ProcessesBenefits of using proposed rate methodologyService LinesProcess & Key Planning decisionsTimelineRate ElementsCustomer Input

Rate Development History

History – Lessons Learned

Iterative Methodology AdjustmentsDefining ServicesUnitsCost Allocations

Resulted in continuous rate adjustmentsRate Transparency requested

Today’s RatesBringing forward learning from the pastTrue Cost of Delivering a ServiceEliminate subsidization

•Compensation•HW/SW•Maintenance•Overhead

Forecast Costs

Forecast Usage

÷ = Unit Rate

Pricelist

Customer Budget

•Estimates by Customer by Service line

•Trend Analysis•Growth Projections•Customer Feedback

Forecast Usage×

=

Outcomes & BenefitsList of products and services

Clearly defined Discrete products

Stabilize ratesCollaborative planning with customersRefine our usage and cost projectionsInvestment vs. Refund

Outcomes & Benefits cont.Publish Rate & Pricelist

Eliminate subsidizationTrue cost of service deliveryBudget predictabilityA-87 compliant rates

Service BenchmarksDemonstrate value for services provided

Questions

?

Rate Sheet & Pricelist Example

CUB Responsibilities

Review and approve methodologyKey meetings to review work to dateTransparency of rate model includes internal and

external scrutinyFinal layer of CUB scrutiny

Final rate approval

ETS Rate Methodology

Define services to meet business demandUnit descriptionsForecasted current customer usage & growthNew customer projectsNew customers

ETS Rate Methodology cont.

Pessimistic and optimistic forecastsStaffing assumptionsForecasted externalForecasted overhead costs

Service Rate Development

Pricelist & Rates

ETS Rate Model and Project Timeline

ETS Services Lines

Application ServicesApplication DeliveryE-Government

Data Network ServicesLocal Area NetworkState Network Access

Data Storage ServicesBackupData Storage

ETS Services Lines cont.IT Professional ServicesManaged Computing Services

CollocationHosting

Workplace Productivity ServicesComputer LabDesktop ServicesEnterprise EmailPhone

Example of a Computing Rate

ETS Rate Development - Common Terms

FullCost ™ ToolTool used to define services, develop business plan,

budget planning and calculate ratesBudget Units

An aspect of our planning tool that allows the ETS budget to be segregated by services offered

Internal CostsBuy and sell services within the organization

Common Terms cont.External Costs

Expenses paid outside the organizationDeliverables

A service or product sold to the customerCost Pools

A collection of costs spread across more than one deliverable or allocated to a specific service

Key MessagesCUB & ETS experienceValueCollaborative Planning

Thank you!!!