Page Comparison

• CIAM (Process - IAM)

• Core IAM (Process - IAM)

• Governance (Process - IAM)

• Identity Federation (Process - IAM)

• PAM (Process - IAM)

IAM Program CostTCO

Direct IAM Total Cost of the IAM ProgramOwnership

1.2

Organizations typically run IAM programs. Such programs may have widely varying scopes between organizations and across time. Keeping track of the total direct costs of these programs is a critical managerial necessityTo improve their competitiveness, organizations must simultaneously minimize their costs and maximize their added value. Hence, the cost of IAM considered as an overall service to the organization is a fundamental component of IAM performance measurement. TCO (Total Cost of Ownership) is a measurement of the overall cost of an item or service, from conception to acquisition to operations and maintenance (cf. Total Cost of Ownership (Dictionary Entry)). 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). While complex, TCO is further known to outweigh its difficulty to implement disadvantage by providing benefits associated to performance measurement, decision making, communication, understanding and continuous improvement.

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 may be interesting to keep track of is interesting to allocate costs at both the global and cluster levels (providing that the organization does manage these clusters). The IAM TCO indicator is composed of the following series:

• IAM Program Cost TCO = The direct cost TCO of the overall IAM Program.

• Core IAM Program Cost TCO = The direct cost TCO of the core IAM Program.

• PAM Program Cost TCO = The direct cost TCO of the PAM Program.

• Federation IAM Program Cost TCO = The direct cost TCO of the Federation IAM Program.

• CIAM Program TCO = The direct cost TCO of the CIAM Program.

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 because program scopes may differ widely. See 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 time if the program scope changesa long period of time, because the organization evolves and the volumes of identities it manages change. See Identity Average TCO (Indicator - IAM) for a distinct flavor of this indicator that is more adequate for historical comparisons.

If the indicator 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 (i.e. historical forex rates vs current forex rates).

• CISO (Stakeholder - IAM)

• IAM Management (Stakeholder)

• Top Management (Stakeholder)

In large organizations where IAM is organized in regions or otherwise, the indicator may be measured at both global and regional levels.

• The cost of the IAM Program may be confused with the total cost of IAM for the organization, which may mislead top management. See Measuring the cost of IAM - Methodology for a discussion on this topic.TCO is understood as difficult to implement but outweighing the disadvantages of its barriers to implementation (Ellram, 1993).

• 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)

• Cost analysis is not a straightforward task, it is complex and there are different ways to do it. Thus, comparing costs may be prone to errors. (KPMG and Everett, 2009, p. 3, Hurkens et al., 2006)

• Even if cost analysis is exempt of mistake, a sound cost analysis may be subject to misinterpretations or misuse to support political agendas. (Foussier, 2006, chapter 2, Cost Measurement)

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

Yearly.

• Identity Average TCO (Indicator - IAM) Derived Indicator

• Measuring the cost of IAM - Methodology

• Measuring the Cost cost of IAM - Cost CategoriesActivities & Costs

• Total Cost of Ownership (Dictionary Entry)

• David et al., 2002

• Ellram, 1993

• Foussier, 2006

• Hurkens et al., 2006

• KPMG and Everett, 2009