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After shifting from lease to purchase of IT infrastructure and software licenses, an enterprise has to pay for unexpected lease extensions causing significant cost overruns. The BEST direction for the IT steering committee would be to establish;
Correct Answer: D
Total cost of ownership (TCO) is the purchase price of an asset plus the costs of operation over its lifespan1. TCO includes hardware and software acquisition, management and support, communications, end-user expenses and the opportunity cost of downtime, training and other productivity losses2. By considering TCO in investment decisions, an enterprise can avoid unexpected costs and optimize the value of its IT assets3. A policy to consider TCO in investment decisions can help the enterprise to plan ahead for the lease or purchase of IT infrastructure and software licenses, and avoid cost overruns due to lease extensions or other factors. References := * CGEIT Review Manual (Digital Version), Chapter 4: Value Optimization, Section 4.2: IT Value Delivery, Subsection 4.2.3: IT Resource Management, Page 123 * CGEIT Review Manual (Print Version), Chapter 4: Value Optimization, Section 4.2: IT Value Delivery, Subsection 4.2.3: IT Resource Management, Page 123 * How to Calculate Total Cost of Ownership for Software - GetApp4 * Total Cost of Ownership: How It's Calculated With Example - Investopedia1