Are You Spending Enough to Support Your Information Technology Investment?
Cheryl L. Kester
Are You Spending Enough to Support Your Information Technology Investment?
"It's no mystery that the costs of providing technology and technology services are increasing substantially", stated David Smallen (Director of Information Technology Services, Hamilton College) at the beginning of his EDUCAUSE 2000 presentation with Karen Leach (CIO, Colgate University).
Smallen and Leach's presentation, "What do we really understand about the cost of IT support services?", updated attendees on the results of the on-going COSTS project a study of the costs of providing information technology (IT) support services in higher education.
In introducing their most recent findings, the authors noted that institutions of higher education now regularly make multi-million dollar decisions regarding technology. Not surprisingly, campus leaders are starting to assess how to manage IT resources similarly to how they manage other institutional resources.
The COSTS project began when both Leach and Smallen determined that, despite their own extensive higher education IT management experience, they were unable to project accurately the costs of providing certain core technology support services. Certain that colleagues at other institutions must face similar challenges, the two presented a call for participation at the 1996 CAUSE conference http://www.educause.edu/ir/library/html/cem9829.html
Starting in 1997, Smallen and Leach set out to gather data from as many campuses as would participate,analyze the data, and then present the results to "lay people" as well as to IT leaders. Leach and Smallen also wish to use the long-term data to develop benchmarks for IT spending and staffing and to identify exemplary practices that may be replicable to other campuses.
In order to keep the data as relevant as possible and to make it possible to compare data across very different institutions, Smallen and Leach identified the following 11 "core services", key areas of technology support services that are common to most institutions:
computer repair;
helpdesk;
network services;
administrative systems;
instructional support;
student support;
Web support;
installation/replacement;
distance learning;
training; and
planning/management.
They developed detailed questions about campuswide expenditures in each of these areas and surveyed participants.
Leach and Smallen also wanted to use the data to test several "grandmother hypotheses". These, the authors explained, are hypotheses that are so accepted that even someone's grandmother "knows" they are true:
Economies of scale the unit cost of a service will decrease as the number of units increase.
Outsourcing the unit cost of providing services decreases with the degree to which they are outsourced.
You get what you pay for as service levels increase, the unit cost of providing the service increases.
Complexity the unit cost of a service increases with the complexity of the environment in which that service is provided.
Although mentioning the"grandmother" hypotheses raised audience members' awareness of how they might have let certain ideas go unchallenged, the presentation unfortunately did not address whether the COSTS data collected over the last four years supported or challenged the hypotheses. Rather, the remainder of the presentation focused on providing specific survey results in highlighted areas.
For example, Smallen and Leach can report that in 1998-1999, typical survey respondents spent 14-24 per cent of their total IT budgets on replacement costs for computers. They can report that a typical IT staff person supports 87-123 computers and that helpdesk personnel comprise 7-12 per cet of the typical total IT staff. While these numbers are helpful for determining where one's organization fits into national norms, they really are descriptive only.
Leaders from institutions that fall demonstrably short in one or more areas undoubtedly use that data back on their home campuses to argue for more resources. I always made it a point to attend Leach and Smallen's presentations every year at CAUSE and EDUCAUSE for that very reason, and used their data to some success to bolster already existing arguments. However, the authors are not comfortable prescribing that anyone's institution should fit into a certain spot on the scale.
An additional important detail critical to understanding how to apply COSTS findings is the demographic make-up of the study participants. Especially in its earlier years, the COSTS data pool consisted largely of CLAC institutions (Consortium of Liberal Arts Colleges), a group of 59 selective, residential liberal arts colleges with enrollments ranging from 600 to 3,500 students.
Consequently, the first question audience members directed at Smallen and Leach regarded the relevance of the COSTS data to larger institutions. The authors responded that earlier COSTS surveys had included some larger universities (a complete list of institutions that have participated is available at the COSTS Project web site http://www.costsproject.org/particip.htm),but noted the data collection difficulties associated with large state university systems. While any college or university is welcome to participate in the COSTS project, the inherently decentralized nature of IT organizations at larger institutions makes collecting accurate data difficult. Whether or not the data could be extrapolated to any degree of accuracy to larger universities was left unanswered.
Other questions from the audience focused on details particular to those participating in the project such as how decentralized IT organizations (no matter what the size of the institution) could provide institution-wide figures or whether specific items such as media or telecommunications were included in the study figures.
For representatives from smaller colleges and universities, Leach and Smallen do an excellent job of collecting and disseminating information critical to IT leaders. As the focus at EDUCAUSE events is often on larger, well-funded institutions, this opportunity is a welcome alternative.
The full conference presentation is available online at the COSTS Project web site http://www.costsproject.org/1educause2000final.ppt.
Cheryl L. Kesteris Director of Web Services and Webmaster, John Brown University, Siloam Springs, Arkansas. cherylk@jbu.edu.
