Governance (Process - IAM)

IAM TCO

IAM Total Cost of Ownership

1.1

To improve their competitiveness, organizations must simultaneously minimize their costs and maximize their added value. Hence, the cost of IAM is a fundamental component of IAM performance measurement. TCO (Total Cost of Ownership) is a measurement of the overall cost of an activity, from acquisition to maintenance. In consequence, the TCO of IAM is a natural measurement of IAM overall cost.

Organizations use centralization, standardization and automation to reduce TCO (David et al., 2002). The evolution of this indicator over time should reflect the performance of these efforts (see § Benchmarking for limitations).

Since TCO is thought to be directly proportional to service levels, it is critical to interpret this indicator in conjunction with the indicators that reflect the service levels delivered by the IAM processes (see § Negative Effects).

Because IAM is composed of process clusters, it is interesting to allocate costs at both the global and cluster levels (providing that the organization does manage these clusters). The IAM TCO is composed of the following series:

• IAM TCO = The TCO of overall IAM.

• Core IAM TCO = The TCO of core IAM.

• PAM TCO = The TCO of PAM.

• Federation IAM TCO = The TCO of Federation IAM.

• CIAM TCO = The TCO of CIAM.

See Measuring the cost of IAM - Methodology for a discussion on how to measure IAM TCO.

Currency This indicator is expressed in the organization’s reference currency.

This indicator is not comparable between organizations. See Core Identity Average TCO (Indicator - IAM) for a distinct flavor of this indicator that is adequate for benchmarking purposes.

This indicator may not be comparable over a long period of time, because the organization evolves and the volumes of identities it manages change. See Core Identity Average TCO (Indicator - IAM) for a distinct flavor of this indicator that is more adequate for historical comparisons.

If the TCO consolidates costs in multiple currencies, the effect of foreign exchange rates may be significant. Depending on the indicator’s usage (e.g. measuring global versus regional performance in large organizations), this effect need to be specifically accounted for.

• CISO (Stakeholder - IAM)

• IAM Management (Stakeholder)

• Top Management (Stakeholder)

In large organizations where IAM is organized for example in regions, the indicator may be measured at both levels.

• TCO is thought as being directly proportional to service levels, hence organizations should strive to simultaneously reduce their TCO while maintaining or improving their service levels. This indicator may induce a focus on costs to the detriment of service levels. For instance, centralization, standardization and automation strategies are not enough to reduce costs without impacting service levels - careful examination of service levels, careful planning and how well these strategies are implemented are key factors. (David et al., 2002)

• estimation

• (Francescini reference)

Yearly.

• Core Identity (Dictionary Entry)

• Measuring the cost of IAM - Methodology

• Measuring the cost of IAM - Activities & Costs

• Total Cost of Ownership (Dictionary Entry)

• David et al., 2002