![]() ![]() Several years ago Freddie Mac documented their services in an IT service catalog. We needed transparency to lift the veil,” explains Brown. Back-end services like disaster recovery were “out of sight, out of mind - a magical free thing they get from IT,” says Kevin Brown, IT Assets Manager at Freddie Mac. The business knew IT for its support of their laptops, phones and printers. Costs appeared on BUs’ Profit and Loss statements (P&Ls) in terms of accounts and cost centers, in technology terms that were difficult to decipher within the business. IT costs were charged back to BUs (business units) based on a complex collection of fixed percentage allocations and cross-charges accumulated over time in spreadsheets. Within the business, IT costs were seen as unavoidable. For example, it was the first to automate the underwriting process, allowing lenders and borrowers to find out in seconds if they are pre-approved for a loan. The Challengeįreddie Mac has always invested in technology innovation. The Federal Home Loan Mortgage Corporation (FHLMC), known as Freddie Mac, buys mortgages on the secondary mortgage market and sells them as mortgage-backed securities on the open market to fulfill their mission of helping to create a stable and affordable U.S. The business was so pleased to be brought “out of the darkness and into the light” with the consumption based showbacks that they led the charge to replace the company’s fixed IT cost allocations with a consumption-based cost model. To communicate cost and value to its business units, Freddie Mac uses TBM to translate IT component and resource costs into service costs theīusiness values and choices they can make. ![]()
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