How to Get (and Keep) Your ITSM Initiative on Track

H G ( d K ) Y ITSM I i i i T kHow to Get (and Keep) Your ITSM Initiative on Track

Hank MarquisHank MarquisDirector, ITSM ConsultingSr. Analyst, ITSM Automation

Enterprise Management Associatesp g

Source: CA

Service Strategy is Service Portfolio Management

Service Strategy is managing the service portfolio for distinctive performance in the

Opportunity for Service StrategyOpportunity for Service Strategyportfolio for distinctive performance in the

IT commoditization perfect storm.

Plummeting cost of acquisition

Service StrategyService Strategy

Unclear and incorrect customer specifications

What needs to happen 1st, 2nd, 3rd and so on?

Moore’sLaw

Moore’sLaw

Tolerance for Variability Decreasing

Tolerance for Variability Decreasing

IT Budgetand Staffing flat

IT Budgetand Staffing flat

Slide 3

and Staffing flatand Staffing flat

1990 2000 2005 20101995Complexity

and IT Workload Increasing

Complexity and IT Workload

Increasing

Service Strategy (and ITIL v3) in a Nutshell

Service Strategy shakes up the boat with some pretty provocative statements – which by the way are all true critically important and need tostatements which by the way, are all true, critically important and need to be both said and heard.

• A Focus on Process Does Not Yield Success Often leads to unexpected (negative) consequences

• Process is Only the Means to a Strategic EndProcess is Only the Means to a Strategic EndThink first. Then do.

To Win Requires A Competitive Mindset• To Win Requires A Competitive MindsetLow cost or high quality isn’t enough. Differentiated value is key to being “non-optional”

It’s All About Value, but Value Isn't Enough

Thinking outside of the IT box is what Service Strategy is all about (literally!)(literally!)

• Value is More Than Cost ControlsValue is allocating efforts and resources in ways that matter most to the business

• Differentiating IT Providers From CompetitorsUsing customer proximity to be better than alternatives

• Value is Only Visible In Enterprise TermsIt’s more than “utility” and “warranty”

True Value Only Visible at Enterprise Boundaries (Type I & II I.T. Providers)

Customers and Users

End-Customers

Product Offerings Enterprise

and Users

ProductsEnterprise

Internal and External IT Systems

Suppliers andCompetitors

Slide 6 © 2008 Enterprise Management Associates, Inc.

Competitors

Value Is Hard to Grasp

Customers are not always right, our value is helping them understand what they need not giving them what they wantwhat they need, not giving them what they want.

• Value Is Not:Doing what you said or promised to do (warranty)

Always being “up” and performing (utility)

Value Is In The Eye Of The Enterprise• Value Is In The Eye Of The EnterpriseIT Customers & Users Exist to Service End-customers & End-users

IT Must Enhance End customers and End Users Enterprise ExperienceIT Must Enhance End-customers and End-Users Enterprise Experience

Once Again, ITIL Isn't Enough

ITIL always mentioned other frameworks, now, Service Strategy explicitly states that to succeed you must “integrate guidance” from otherstates that to succeed you must integrate guidance from other frameworks.

• Service Strategy Calls Out:gyCMMI-SVC, COBIT, PMBOK, M_o_R, eSCM-SP, eTOM, Six Sigma

ISO20000 and more

• Fear Not!Pragmatic and situational selectionag a c a d s ua o a se ec o

Service Strategy Means Using These Frameworks in the Right Way

How to Make IT a Strategic Asset

Service Strategy is how to achieve BITA or BSM by thinking about and then managing IT as a portfolio of investments purchased to produce athen managing IT as a portfolio of investments purchased to produce a business return.

• Business IT Alignment (BITA) top 2008 Goalg ( ) pLeads quality improvement, managing complexity and cost reduction in surveys

• Service Portfolio Management is BITA:Service Portfolio Management is BITA: Manage Complexity, Show Value, Control Costs and Balance Resources

But Surveys Show A Disturbing Reality• But, Surveys Show A Disturbing RealityWe All Want it, But We’re Heading for a Fall

EMA Research Report, “What are your IT organization’s top three goals in 2008?”

BITA improves quality, controls costs, balances resources and manages


BITA improves quality, controls costs, balances resources and manages IT complexity – everybody wants BITA!

Service Portfolio Management Makes Service Strategy Actionable

“…Service Portfolio, one of the most vital yet often missing constructs for driving service strategies and managing service investments ”driving service strategies and managing service investments.

– ITIL v3, Service Strategy, 5.3, Service Portfolio Management

• How to Make Service Strategy Actionable:gyDefine services and validate business case (Service Catalog Management)

Analyze service value and prioritize to balance demand (Financial and Demand Management)

Authorize and allocate resources (Configuration, Change, SLAs, OLAs etc.)

Measure quality (Service Level Management, Supplier Management)q y ( g pp g )

What percentage of your IT services are covered by documented and measured Service Level Agreements (SLAs)?

Services ought not to exist unless covered by an SLA. Otherwise, there is no evidence that they are required for the business. This is the measure of the span of

l f h SLA If l b f i d h SLA' d


control of the SLA process. If a large number of services do not have SLA's agreed, then Service Level Management does not have control over the level of delivery.

What percentage of your IT services are covered by documented workflow and procedures to ensure consistency of delivery (also known as Operating Level Agreements, or OLAs)?g )

OLA’s and Underpinning Contracts grow as SLM is extended to suppliers. No OLAs, no control o er ser ice deli er The res lts mirror the SLA n mbers from the pre io s


control over service delivery. The results mirror the SLA numbers from the previous slide.

Selective Improvement = Differentiated Value

We need Service Strategy to organize ITIL processes and operational activities Without focused strategy you get non-value added effort andactivities. Without focused strategy you get non value added effort, and fail more often than not (unexpected negative consequences.)

• What do we do 1st, ,2nd, 3rd and so on?

Which Process? Why? Low impact on

business

Hi

In What Manner? How?

In What Order? When?

Wh d W S ?

outcomes with high certainty

arra

nty

When do We Stop? High impact on business

outcomes with

Wa

Utility HiLo

low certainty

Lo

Simplified Guide to Using Service Strategy

To realize the benefits of Service Strategy we need to integrate new tools and thinking into our daily activitiesand thinking into our daily activities.

• Don’t Start with Process! Start with Analysis:1. Define Services – eTOM & SID are best here

2. Value Services – M_o_R, CRAMM are best for this

3. Measure Services – SERVQUAL (external) and CMMI (internal), Six SigmaQ ( ) ( ), g

4. Choose Service improvement projects (PMBOK, PRINCE2, Project+)

• Once You Have a Project Identifiedj5. Use ITIL, Buy Software, (Re)Allocate Resources etc.

1. Define Services: ITIL + SID

ts

Customers d U

Customer Facing Resource

Resource Facinge

Pro

duc and Users

Facing Service Facing

Services

Facing Services

Ent

erpr

ise

End-Customers

ound

ary

E

and End-Users

terp

rise

Bo


(IT Resources)

Ent

2. Value Services: M_o_R, CRAMM

Value services based on risk to the business. Risk is the most accurate measure of value – and something the business understands Work withmeasure of value and something the business understands. Work with customers to give each service a risk score – its value.

• Take into account:Replacement Costs

Outage Costs, Business Impact & Revenue

Environmental and Image

Competitive and Industry

C t Ch C t f C t A i itiCustomer Churn x Cost of Customer Acquisition

Fees, Fines, Taxes, Human Resources, Liability Costs

Etc.

3. Measure Quality: SERVQUAL, CMMI, Six Sigma

SERVQUAL is service industry ybest-practice for measuring service quality. Gaps indicate (IT)Gaps indicate (IT) process failures.

After identifying CMMIgaps, use CMMI-

SVC to trace what isn’t getting done. Use Six Sigma to gisolate variation –these are your ITIL improvement opportunitiesopportunities.

4. Choose Projects: Project+, PMBOK, PRINCE2

Knowing when to stop is almost as important as knowing what to do. Every successful IT endeavor is a successful project – because projectsEvery successful IT endeavor is a successful project because projects have a defined charter, start and stop.

• Beware Scope Creepp pGolden Pony Story

• Follow Best PracticesFollow Best PracticesFocus on Scope, Charter, Stakeholders, Team and Metrics

Repeat Until Good Enough & Time to Stop• Repeat Until Good Enough & Time to StopRemember, “Good Enough is Perfect”

Afterword

Service Strategy has many tools techniques modelstools, techniques, models, examples and samples. Study them, pick and choose what works for your unique situationworks for your unique situation.

• Service Strategy is an Intellectual Exercise

• Make Strategy Realwith Service Portfolio Management

• Service Catalog makes gSPM actionable

Th k Y f A di T d ’ P i Thank You for Attending Today’s Presentation.

For more information on EMA, please contact:

Bruce Lehman at 303.543.9500 x112 or

blehman@enterprisemanagement [email protected]

April 5, 2008© 2008 Enterprise Management Associates, Inc.