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IT Services: Costs, Metrics, Benchmarking, and Marketing by Robert E. Matthews, Thomas R. DiPasquale, Anthony F. Tardugno

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9.8. Cost Model

The cost model takes the total hours from the resource model and determines the resource head count for each position in the ISD organization. Then it applies the estimated cost for each resource to calculate the labor cost of the organization. Table 9-1 shows an example of a cost model.

Table 9-1. Cost Model
SA OSA DBA Clerical Network Manager
Staff Year Hrs 2,080 2,080 2,080 2,080 2,080 2,080
Productivity Rate 0.80 0.80 0.80 0.80 0.80 0.80
Vacation Hrs 40 40 40 40 40 40
Training Hrs 40 40 40 40 40 40
Sick Hrs 16 16 16 16 16 16
Workable Hrs 1,568 1,568 1,568 1,568 1,568 1,568
Cost per FTE $100,000 $50,000 $110,000 $30,000 $130,000 $140,000
Total Effort Hrs ...

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