IT Costs Per Transaction Provide Valuable ROI Basis

November 18, 2009 · Filed Under IT Estimating  - 0 Comment(s)

Here was a recent post on the Harvard Business Blog on understanding the transaction costs of IT.  According to the blog: 

  • the IT cost per equity trade is approximately $0.17
  • the IT cost per hospital bed is $65 per patient
  • the IT cost per trucking mile is $0.18

“…executives usually think about technology in terms of percentage of revenue, or percentage of operating cost — which contains almost no useful operating insight at all”

I thought this was an excellent point and looking at IT costs in this way can add reality to the cost of IT.  What we need now is the business value of IT.  For example, if having IT for a hospital bed includes automated monitoring and reduces staff or increases correct treatment (hospital error is shown to be the third largest cause of death in hospitals, according to some studies) we can make the most appropriate decisions.


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