Cloud Buyers' Requirements Questionnaire : FL: Financial and Lifecycle
Express the financial targets and contract and delivery terms for the solution.
If relevant, respond to the following questions for the potential enablement service(s) to be procured.
FL.1: What are your operating organization’s financial parameters?
- Target annual service cost as a % of cost of goods sold (COGS)?
- Target annual service cost as a % of discretionary spend?
- Current and target multi-year TCO for the associated business process(es)?
- TCO, ROI, and resource yield of the existing enablement?
- Target RTI, TCO, ROI, and resource yield of the new enablement solution?
- Target annual service cost as a % of COGS is xx%.
- Target annual service cost as a % of discretionary spend is xx%.
- Current TCO is xx over xx years; target TCO is xx over xx years.
- For the existing enablement, the TCO is xx over xx years, the ROI is in xx months/years, and the resource yield is xx%.
- The targets for the new enablement solution are: TCO of xx over xx years, ROI is in xx months/years, and resource yield of xx%.
FL.2: What are your procuring organization’s financial parameters?
- Current and target ratio of fixed to variable cost?
- Current and target ratio of CAPEX to OPEX?
- Monitoring, metering, and reporting preferences?
- Billing metric preferences?
- Billing periodicity preferences (cash flow)?
- Preferred committed contract length?
- Total Cost of Acquisition (TCA) target, including total cost of decommissioning?
- Current fixed to variable cost ratio is xx:xx; the target is xx:xx.
- Current CAPEX to OPEX ration is xx:xx; the target is xx:xx.
- Monitoring, metering, and reporting preferences are xx.
- Billing metric preferences are xx.
- Billing periodicity preferences are xx.
- Preferred committed contract length is xx.
FL.3: What are your preferences regarding the following contract and delivery terms?
- Sub-contractor restrictions
- Billing metrics, method, and period
- Term and early termination
- SLOs and SLAs – SLA penalties account for timing, duration, and frequency of SLA misses
- Order fulfillment – the delivery processes (including billing and service-level reporting)
- Monitoring, metering, and reporting
- Business SLA: “up” targets – including point of demarcation and periodicity – and penalties for missing. For example, a payroll process that pays employees twice a month has much more stringent targets during the twice monthly pay periods than during the rest of the month.
- Technical SLA examples: acceptable single points of failure (SPOFs) including site failover; degree of resource over-subscription; and recovery time and point objectives (RTO and RPO). For example, a larger penalty is imposed if there are frequent and/or long unplanned outages.