Establishing a Chargeback Policy: What the Department of Defense Can Learn from One Company's Approach

A large California-based computer and electronics manufacturer is currently consolidating its Information Technology Centers. This thesis addresses the problems the company is experiencing with implementing the consolidation and developing the chargeback scheme which will be used. The Department of Defense DOD is currently consolidating its own data processing centers and instituting a fee-for-service chargebackcost recovery policy. This thesis will highlight some of the problems DOD may encounter in instituting its own cost recovery policies and other major organizational change. This thesis addresses the companys chargeback dilemma by first analyzing the strengths and weaknesses of several common chargeback techniques. It then critically evaluates the process by which the company is managing the transition and the method it is using to institute its chargeback policy. Finally, the thesis discusses the lessons DOD can learn from this study of the private sector approach to chargeback. Data processing chargeback, Data center consolidation, Major organizational change.