Using Activity-Based Costing to Identify the Cost of Delivering IT Services

The University of Illinois System engaged WTC consulting, Inc. in 2015 to conduct an activity-based costing study to identify the true cost of IT services provided by Administrative Information Technology Services (AITS) following the same process used during previous IT cost studies WTC conducted for University of Illinois Chicago and Urbana-Champaign. The data from this study was used to guide ongoing decisions regarding IT. In 2020, the University of Illinois System re-engaged WTC to simplify the ongoing tracking of AITS costs, update the cost of services, update benchmarks, and strategize alternative ways to analyze costs of IT services. Six alternative views of cost were examined based on: 1) staff and non-staff business function, 2) staff and non-staff activity, 3) non-staff commodity type, 4) non-staff expense type, 5) staff roles, and 6) staff activity on project efforts.

The results of the 2020 study have been used by the University of Illinois System to inform leadership on how funds are being utilized and continue to assist AITS in their financial decision making for internal operations and projecting future needs.