We do chargeback and already have a set rate. Is it really that important to revisit the rate when we get a new CPU?

A new CPU might not handle your specific workload mix the same way the old CPU handled it. For example, an outsourcer has a customer (or a company IT department has internal customers) and gets a new CPU. If the new CPU handles the customer’s workload mix better than the old CPU did, the customer’s charges should theoretically go down. (Keep in mind that the outsourcer still needs to cover all the costs of providing service to the customer.)

Most normalization factors are based on the expected speed of a new processor. If the customer’s workload behaves differently than the expected speed, the normalization rate could be incorrect. If it's too high, then the customer ends up paying too much and is unhappy. If it's too low, then the customer pays less and is happy, but the outsourcer recovers less money than expected, and maybe not even enough to cover costs.

Another very important point that most outsourcers and their customers miss is that CPU usage of a workload changes over time due to a myriad of reasons. If you don't reconfirm your chargeback normalization rates on a regular basis, they can change over time by as much as 30 percent before someone realizes it. See FAQ "Why would I need BoxScore II if I'm not upgrading hardware?" for reasons for these changes.

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