IT Infrastructure Insights

Four Common Storage Chargeback Problems – and How to Avoid Them

Jan 06, 2022

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On the surface, chargeback and showback programs seem like they should be relatively straightforward. Whether charging departments directly for their IT usage (chargebacks) or simply showing them how they are using IT resources (showbacks), the goal is to itemize IT costs for each departmental business unit.

Sound simple?

If you have ever been involved with planning chargeback or showback policies, you know they can be anything but simple – especially chargebacks. Here are four of the most common storage chargeback problems that teams face, along with some tried-and-true ideas for each.

Storage Chargeback Problem #1: You don’t know where to assign costs.

One of the first requirements for any chargeback (or showback) policy is knowing which business unit should receive each cost. Are some departments co-opted into a larger department’s budget? Are there similar teams with nonetheless distinct roles that should be segmented as separate business units?

Assigning costs to business units is not as clear-cut as looking at an organizational chart.

Breaking costs down by too few business units can muddle the data (and payment process). For example, assigning storage costs to a department which are incurred by separate teams within that department can quickly create storage chargeback problems.

On the other hand, using too many business units can become operationally unwieldy, especially if some of those teams are sharing storage. It can also result in frequently re-naming or re-categorizing your business units, which can be an inconvenience.

Don’t make these decisions on your own. Work with C-Suite executives to ensure that costs are assigned in units that accomplish their goals and use practical business unit groupings. Communicate with these decision-makers so their goals are not left unspoken. With a little coordination, you can avoid guessing games and frustration.

At the end of the day, you may still need to adjust your assignment categories occasionally. No problem! It’s important to use unambiguous naming conventions so that business units are clearly identified. When you use Visual One Intelligence for your chargeback data collection, you can easily adjust your assignments and naming conventions in a matter of seconds whenever you need.

Storage Chargeback Problem #2: You don’t know how to assign storage costs (ie: your reports look inaccurate).

As you start running chargeback (or showback) reports, you may start noticing numbers you didn’t expect. That’s because when it comes to storage, attributing costs gets complicated quickly.

There’s no single “right” way to attribute costs, but you need to make explicit decisions early in the process and apply those decisions consistently. If your team is not clear up-front about how to attribute costs, they will end up calculated inconsistently. This harms not only the usefulness of the data but also the fairness of the entire chargeback model.

Here are a few key questions that may help you assign costs and avoid storage chargeback problems:

Will you charge based on storage allocation or storage usage?

Charging by allocation is simple and incentivizes departments to only request as much storage as they will use – reducing waste. On the other hand, charging based on actual use ensures that no one has to “pay for air” (ie: pay for storage that wasn’t used). And all-flash storage adds complications, with space allocations that can fluctuate beyond what was initially purchased due to data reduction ratios.

With cloud storage, costs will always be based on allocation. But for everyone else, cost assignments can look very different depending on which attribution model is used.

How will you account for the full costs of a storage platform (not just the platform’s usable storage)?

Let’s say you have a 100 TB array which includes 30 TB of unusable storage. Do you attribute the full storage costs to the 70 TB of usable storage only? Or do you disperse the cost across all 100 TB including the unusable storage?

If you include the 30 TB of unusable storage, who do you assign those costs to if the array is split between multiple business units?

Without a consistent policy, things can get messy fast.

Will you include ancillary storage costs or only charge for the storage space?

Storage infrastructure requires more than arrays. Expenses like floor space, electricity, cooling systems, maintenance, and life cycle management are necessary. Should these costs be passed down? If so, how can they be shared fairly?

These extra costs are important, but be careful. If you pass down too many ancillary costs, it could make storage costs look artificially high and trigger unwanted scrutiny.

Will you charge differently for different storage tiers / speeds?

Some storage is faster or more efficient than others. If you charge the same rates for all storage types, users who receive slower storage may be upset.

If you charge differently for different tiers and speeds, you will need to consider how to set and maintain your rates.

Your answers to all of these questions may change over time, and that’s okay! That’s why it is so important to have a strong data management tool like Visual One Intelligence. With Visual One, you have options for cost assignment policies. Whichever decisions you make, Visual One can adapt and help you carry out your policies according to your specifications.

Storage Chargeback Problem #3: You have duplicated or missed charges.

Sometimes, one LUN will be mapped to more than one host. This can result in charges being duplicated or missed.

It’s important to sort out any host-LUN mapping issues before implementing chargebacks (or showbacks). Visual One Intelligence can do this for you by automatically eliminating duplicate counting.

Storage Chargeback Problem #4: Your data collection process is tedious.

Far too often, organizations abandon chargeback or showback efforts because there is too much manual effort involved. Even some products that allegedly simplify the process end up requiring too much manual effort from staff, creating new storage chargeback problems for teams.

Visual One Intelligence is different, providing chargeback and showback insights without manual efforts or complexity. Visual One makes business unit assignment simple and automates data collection, business unit reporting, and business unit forecasting – all with no human intervention!

Detailed analytics are available on demand through a client portal and downloadable as PDFs or spreadsheets, including:

  • Reports by array by business application (ie: how much of each array business units are taking up).
  • Reports by business unit by array (ie: per business unit, where and how much storage is used on each array).
  • Chargeback reports (showing the cost associated with each business unit as assigned to each array).
  • Forecast models (showing the projected storage usage based on each business unit’s historical usage).

Using Visual One, infrastructure teams can discern things like how much storage space each business unit is consuming, who is contributing to storage consumption growth, and whether the right storage is being used by each business unit.

Start Your Chargeback / Showback Process Now

It should be no surprise: chargeback and showback policies are multi-faceted and take a long time to implement. Even if your organization is not yet officially adopting a chargeback or showback policy, the time to start preparing is now.

As these models become more popular, it will be up to IT departments like yours to be ready to implement them if or when your organization makes a change. When that happens, you’ll want to have the best tools at your disposal.

Join us for a live demo – we’ll show you everything Visual One Intelligence can do, including how it can help make storage chargebacks / showbacks a reality in your organization.