Investment costs
Costs of building a new or expanded IT capability, as considered in project planning.
What are investment costs?
In IT planning, investment costs here mean expenditure to establish a new or expanded capability intended for longer use. This may include initial implementation, setup or procuring required technology. This planning category needs a clear boundary from later operating costs. It does not imply automatic balance-sheet capitalisation; accounting classification needs separate clarification.
In a fictional portal project, initial implementation and setup are recorded as establishment costs. Ongoing hosting and agreed maintenance sit in a separate operating plan. If setup is already priced in the implementation package, it must not be added again. A sound comparison records scope, internal contributions and open items. A low establishment price alone says little about later total costs.
Sources
Related terms
- Operating costsExpenditure to plan for the ongoing operation of an IT solution.
- Migration costsEffort and expenditure for the planned move of data or functions to another environment.
- Exit strategyA prepared route to switch, take over or retire an IT service in an orderly way.
- Scope creepScope creep is gradual expansion of project scope without adequate assessment and corresponding changes to the plan.
- Project summaryA project summary briefly brings together an initiative’s purpose, boundaries, owners and key constraints.
- Decision briefA decision brief prepares a specific choice by presenting options, rationale, consequences and unresolved assumptions.
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