For or those that are new; chargeback is creating an allocation engine that takes in costs and attributes them to objects or services. Those costs are then allocated to a client on a dollar for dollar basis. Less cost equals less charge. Not rocket science. To achieve this result, you are going to need a “model”. You can build something rudimentary in Excel if you are a small shop (or on a shoestring budget). Otherwise, you are going to need a tool. See the tools page here.
Showback takes the costs a client is receiving and then divides them by the by the objects/usage and tries to show roughly what you are spending. Less consumption doesn’t necessarily lead to less spend. On the plus side, you have a basic understanding of the cost base. On the negative side; everything else. It’s not that difficult to see that I favor one model over the other. If you are in a tight spot and you need to drive some change quickly (to justify your job or make a quick impression), I suppose I understand the short term need for showback. Another benefit is that you don’t need any sort of advanced model to make this happen. You just need a clean picture of the cost base and logical groups by which you can divide the costs. Think of it as training wheels as you are on your way to a full charging model. For any other reason, I think it’s half as$ed.
Again, let’s go back to the TBM mantra, “it’s all about driving behavior”. Showback works as an FYI. Chargeback puts money in a wallet or takes it out. Which one do you think actually drives behavior?
I’ve seen some reasonably large organizations run on Showback. Doesn’t mean they are completely ineffective. It just means that they aren’t able to give their applications owners the tools to quickly drive change. Not sure about your org, but they only time we need change is when we want it quickly. There’s nothing worse than being known as the master of all things T B M in the org and not being able to turn the ship when there’s a storm ahead.