RESOURCE PLANNING AND MANAGEMENT OF

INFORMATION TECHNOLOGY OPERATIONS

IN A BANK

BY

TAM YIN FUN FANNY

Presented to the College of Business

City University of Hong Kong in Partial Fulfillment

of the Requirement for the Degree of

Master of Business Administration

CITY UNIVERSITY OF HONG KONG

2010

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TABLE OF CONTENTS

ABSTRACT .......................................................................................................................................... 1

1 INTRODUCTION ........................................................................................................................ 4

1.1 About The Company ............................................................................................................. 4

1.2 The Challenges ...................................................................................................................... 4

1.3 Project Goal ........................................................................................................................... 6

2 THE CASE .................................................................................................................................... 6

2.1 Background ........................................................................................................................... 6

2.2 Changes in IT Department .................................................................................................... 9

2.3 Symptoms ............................................................................................................................ 12

2.4 Understanding the Problems Behind ................................................................................... 12

2.5 Observations and Findings .................................................................................................. 14

3 INFORMATION TECHNOLOGY INFORMATION LIBRARY (ITIL) ............................. 21

3.1 Overview ............................................................................................................................. 21

3.2 Benefits ................................................................................................................................ 23

3.3 Popularity ............................................................................................................................ 24

3.4 The Five Core Publications ................................................................................................. 25

3.5 Critical Success Factors....................................................................................................... 35

4 POSSIBLE SOLUTIONS AND ANALYSIS ............................................................................ 38

4.1 Problem Categorization ....................................................................................................... 38

4.2 Possible Solutions................................................................................................................ 39

4.2.1 Release and Deployment Management ................................................................. 40

4.2.2 Problem Management ........................................................................................... 41

4.2.3 Facilities Management .......................................................................................... 42

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4.2.4 Availability Management ...................................................................................... 45

4.3 SWOT Analysis ................................................................................................................... 47

4.3.1 Internal Analysis ................................................................................................... 48

4.3.2 External Analysis .................................................................................................. 52

5 IMPLEMENTATION STRATEGY .......................................................................................... 56

5.1 Implementation Priority ...................................................................................................... 56

5.2 Implementation Schedule .................................................................................................... 64

5.3 Key Performance Indicators ................................................................................................ 66

6 EVALUATION ............................................................................................................................ 68

6.1 Release and Deployment Management ............................................................................... 68

6.2 Problem Management.......................................................................................................... 71

6.3 Facilities Management ........................................................................................................ 73

6.4 Availability Management .................................................................................................... 75

7 CONCLUSION ........................................................................................................................... 77

8 SELF EVALUATION AND LESSONS LEARNED ................................................................ 78

9 REFERENCE LIST .................................................................................................................... 80

10 APPENDIX .................................................................................................................................. 82

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LIST OF FIGURES

Figure 2-1: Comparison between income from traditional interest-based business and wealth

management in Yr 2003 and 2004 ................................................................................. 7

Figure 2-2: Organization Chart of ABC Bank .................................................................................. 8

Figure 2-3: Five Focus Areas in ABC Bank for Value Creation ...................................................... 9

Figure 2-4: The Original Workflow and Organization Structure in IT Department .................. 10

Figure 2-5: The New Workflow and Organization Structure in IT Department ......................... 11

Figure 2-6: Two example emails showing work overtime request ................................................. 16

Figure 2-7: Hardware Resources Growth vs Data Center Floor Space Expansion ..................... 18

Figure 3-1: Positioning of Frameworks (Gartner, 2007) ................................................................ 21

Figure 3-2: Evolution of Service Management ................................................................................ 22

Figure 3-3: Relationships: ISO 20000, ITIL and Procedures ........................................................ 23

Figure 3-4: The Service Lifecycle of ITIL ....................................................................................... 26

Figure 3-5: ITIL’s IT Service Lifecycle Management .................................................................... 27

Figure 4-1: Graphical representation showing the server virtualization as the solution of

availability management ................................................................................................. 46

Figure 5-1: The implementation timeline of recommended solutions ........................................... 65

Figure 6-2: Control-M deployment screenshot ............................................................................... 70

Figure 6-3: An e-mail announcement for the program deployment hand over ........................... 71

Figure 6-4: Topics for the first two experience sharing sessions.................................................... 72

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Figure 6-5: Production application of windows platform virtualization in May 2010 ................ 74

Figure 6-6: New resources acquisition and allocation form ........................................................... 76

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LIST OF TABLES

Table 2-1: Summary Table of Interviewees ..................................................................................... 13

Table 2-2: Workload Comparison between mainframe and open platform in PMD .................. 15

Table 3-1: Implementation of IT service management frameworks (Aileen Cater-Steel &

Wui-Gee Tan 2005) .......................................................................................................... 25

Table 4-1: Problem Categorization................................................................................................... 38

Table 4-2: Summary Table of Possible Solutions ............................................................................ 39

Table 4-3: Summary table of the SWOT Analysis .......................................................................... 48

Table 5-1: Summary table of suggested alternatives ...................................................................... 57

Table 5-2: KPIs for the solution implementations .......................................................................... 67

Table 6-1: Progress summary of release & deployment management implementation .............. 68

Table 6-2: Progress summary of problem management implementation ..................................... 72

Table 6-3: Progress summary of facilities management implementation ..................................... 74

Table 6-4: Progress summary of availability management implementation ................................ 75

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ABSTRACT

In 2004, ABC Bank has introduced a 3-year business plan and initiated a series of reforms in major

business models. In order to align the bank‟s business and IT strategies, the IT department of the

bank combined organizational restructuring, process and technological expertise to shape the 5-year

IT development strategy in 2005. One of the major workflow and organization restructuring in IT

department is the application development division (responsible for system design and program

coding) and the system planning division (responsible for user acceptance test co-ordination and

quality control) being changed from departmental-oriented to functional-oriented. Each functional

team will have its own project schedules and commitments to business users. And, all functional

teams will request for involvement of the production management division (PMD) that is responsible

for system management, production support and operations. During the execution of the strategic

plan, various projects are newly initiated or reviewed. In the meantime, problems such as high work

pressures, delay in project schedule and occurrence of repeated incidents arose in the IT department.

The objective of this project is to identify the current inefficiencies on IT resources planning and

management in the bank and make recommendations on technological and methodological changes.

In order to understand the root causes, casual chats and interviews were conducted with staff from

PMD and different functional team. Besides, for further verification, quantitative analysis is

conducted in some areas such as number of deployment requests and floor space utilization in data

2

center. After analysis, the observations and findings shown that biased workload, unrealistic project

schedule estimation, too many repeated manual works, heterogeneous hardware resources etc, are the

root causes of the stated problems.

After search of relevant literatures and finding implementation references in the banking industry, I

realized that the ITIL framework is applicable to the case. And matching the stages and processes of

ITIL to the problems discovered in ABC Bank, the problems can be categorized into four processes

in the ITIL framework, that is, the release and deployment management process under the service

transition stage, the problem management and facilities management processes under the service

operation stage and availability management process under the service design stage. After

categorizing the problems, I try to identify possible solutions that can tackle the stated problems. And,

a SWOT analysis is carried out to evaluate the options for the 4-processes ITIL framework

implementation in the bank. Alternatives and implementation priorities that given the greatest

benefits are identified and the implementation schedule for the recommended solutions is divided

into three phases. Some KPIs such as proportion of automatic deployment and repeated incidents are

defined in order to measure the progress and performance of the solutions towards the project goal.

Up to now, the implementation has reached the halfway mark, the progress and the achievement of

each solution is evaluated. The implementations are in the right track and obvious benefits such as

the shortened duration of major deployments and streamlined process because of procedures and

3

standards review are achieved. Lastly, the challenges that I faced in the project, the success factors of

the project and the lessons learned are documented in order to act as reference for future projects.

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1 INTRODUCTION

1.1 About The Company

ABC Bank is a leading listed commercial banking group in Hong Kong in terms of assets

and customer deposits. With over 270 branches, 470 ATMs and other distribution

channels in Hong Kong, ABC Bank and its subsidiaries offer a comprehensive range of

financial products and services to retail and corporate customers. In addition, ABC bank

and its subsidiaries have 23 branches and sub-branches in the Mainland of China to

provide cross-border banking services to customers in Hong Kong and the Mainland.

ABC Bank is appointed by the People's Bank of China as the Clearing Bank for

Renminbi business in Hong Kong.

After a successful global IPO, ABC Bank began trading on the main board of the Stock

Exchange of Hong Kong.

1.2 The Challenges

To cater for the increasing complexity, uncertainty and intensifying demand for growth in

the banking industry, ABC bank combines organizational restructuring, process and

technological expertise to shape a 5-year IT Development Strategy in 2005. In order to

align ABC Bank's business & IT strategies for growth, in the past few years, IT

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department has institutionalized the business technology managers in each business

department to enrich the dialog with the various business executives and act as

evangelists on how to best capitalize on emerging technologies for business growth. On

the technological side, Architect office is established to introduce security and

architectural models, standards and guidelines. It also serves to co-ordinate the enterprise

effort to enhance the agility of our existing applications by means of adopting standard

technologies like EAI/SOA. Vigorous project reviews are conducted to ensure

compliance.

In order to carry out the above IT strategies, the bank has invested hundred millions of

dollars in buying new IT resources such as AIX servers, PC servers, blade servers, san

storages and network equipment. As the result of buying so many IT infrastructures, the

production management division of IT department has to manage a complex and huge

pool of IT infrastructures. It becomes harder and harder to maintain the service level

because the complexity and operational overhead is keep on rising. High pressure is put

on colleagues that responsible for the IT resources planning and management. Moreover,

the yearly maintenance fee of those IT infrastructure equipment is a huge figure.

On the other hand, high work pressures also come from the concurrency and tight

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schedules of many projects, colleagues need work overtime frequently during weekends

and public holidays, they are feeling frustrated. Also, project delay and the occurrence

of system failure because of human errors are raised.

1.3 Project Goal

This project will conduct a strategic analysis on IT resources planning and management

in ABC Bank, and aims to identify the current inefficiencies and expenses that can be

solved through technological and methodological changes. And make recommendations

to the management of ABC Bank IT department for future strategic use of policies and

technologies that establishing and maintaining service levels while reducing technology

cost, complexity, and operational overhead.

2 THE CASE

2.1 Background

ABC Bank has more than 13,000 employees and about 5% of them are IT staff. To cater

for the increasing complexity, uncertainty and intensifying demand for growth in the

banking industry, ABC Bank continued to concentrate on business development and

implement the bank‟s strategic initiatives through organizational restructuring, business

re-engineering and operations streamlining. In 2004, the bank introduced a three-year

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business plan and initiated a series of reforms in major business models. With the rising

living standard of Hong Kong people, there is an increasingly sophisticated demand for

dedicated and personalized financial planning services, leading to the need for wider

scope of services for wealth management. Because of the persistently low HIBOR, low

deposit rates, buoyant stock market and volatile currency and bullion markets, the

traditional operating environment is changed. From the bank‟s presentation slide for

2004 annual results announcement as in Figure 2-1, we can see that the net interest

income of the bank is suppressed by persistent low HIBOR while the growth in wealth

management and treasury income is increased significantly.

Figure 2-1: Comparison between income from traditional interest-based business

and wealth management in Yr 2003 and 2004

To response to the strong demand for higher-yielding investments, the major business

structure of the bank changed from interest-income services such as loans and deposits

to non-interest income services such as securities management and wealth management.

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Also, in order to solidify the market positions, as illustrated in Figure 2-2, ABC Bank

went for a business restructuring and different Strategic Business Units (SBU) have

been established to focus on different business and product domains.

Figure 2-2: Organization Chart of ABC Bank

The bank then developed the 2006 – 2011 strategic plan with the objective to be a

top-quality financial services group with a powerful base in Hong Kong, a solid

presence in China and a strategic foothold in the region. With the objective and the

strengths the bank possess, the Strategic Plan 2006-2011 have five focus areas for value

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creation as shown in Figure 2-3.

Figure 2-3: Five Focus Areas in ABC Bank for Value Creation

2.2 Changes in IT Department

To focus on enhancing information technology to support business growth, the first

Chief Information Officer of ABC Bank was appointed in 2005. As mentioned before,

in order to cater for the increasing complexity, uncertainty and intensifying demand for

growth in the banking industry, ABC Bank combined organizational restructuring,

process and technological expertise to shape a 5-year IT Development Strategy in 2005.

Originally, in the IT department, there are mainly 3 different divisions involved in the

application development life cycle. As illustrated in Figure 2-4, the application

development division is responsible to collect business requirement, system design and

program coding. After that, the system planning division is responsible to co-ordinate

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the user acceptance test (UAT) and application quality control. After receiving the

sign-off from business user, the application will pass to the production management

division who is responsible for system management (tasks including environment setup,

system and database administration, program deployment etc), network management,

IT facilities management and operations. Because all requests come from single source

(i.e. the application development division), the allocation of both human resources and

technology resources are well coordinated between different projects.

Figure 2-4: The Original Workflow and Organization Structure in IT Department

However, due to the institutionalization of allocating business technology managers into

each business department to enrich the dialog with the various business executives and

act as evangelists on how to best capitalize on emerging technologies for business growth.

IT department itself also needed organizational change, it is changed from department

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oriented to function oriented; Architect office is established to introduce security and

architectural models, standards and guidelines. But, the major change is the merging of

application development division and system planning division. And the merging team

is further divided into 9 functional teams focus on different domains including channel,

core banking, corporate banking, finance, global market, MIS, operation, personal

banking and risk management. As shown in Figure 2-5, each functional team formed

with its own business analyst who is responsible to communicate with business user,

system analyst and programmers who are responsible for system design and program

coding. Also, each functional team will have its own project schedules, testing plan and

commitments to business users. Each functional team will request for production

management division‟s involvement including hardware and software acquisition,

environment setup, system and database administration, performance tuning and

program deployment.

Figure 2-5: The New Workflow and Organization Structure in IT Department

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2.3 Symptoms

Because of the execution of the 2006 – 2011 strategic plan, various projects are newly

initiated or reviewed. In the meantime, in the IT department, problems arise as below:

High work pressures on colleagues, need work overtime until late night and even

on public holidays, feeling frustrated.

Delay in project schedule.

Rise in the occurrence of repeated incidents.

High hardware maintenance, software licensing and operational cost.

Saturated floor space in data center.

Complexity in managing a huge pool of infrastructure facilities.

Failure to fulfill the need of immediate responses in hardware resources (e.g.

server CPU, memory) acquisition.

Failure to fulfill the need on zero downtime of systems.

2.4 Understanding the Problems Behind

In order to understand why problems stated in the previous section arise, casual chats

and interviews were conducted with the colleagues in the system management section,

IT facilities management section and the operations section under production

management division. To analyze the problems from different points of view, I also

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arranged a few lunch gathering with the colleagues I worked with from the channel and

core banking functional team and listen to their comments and rationales behind.

Fourteen interviews are conducted and the roles of the interviewees are summarized in

Figure 2-1.

Role No. of Interviewees

System administration for mainframe platform systems 2

System administration for open platform systems, resources

management of open platform servers

2

Data center and infrastructure facilities management 2

24-hr production system monitoring, execution of production

special jobs

2

System design and program coding 1

Gather business requirements from users on channel domain 1

IT Project management 1

System design and program coding 1

Gather business requirements from users on core banking domain 1

IT Project management 1

Table 2-1: Summary Table of Interviewees

There are ten questions in the interviews and the questions are divided into three

sections where the first section (questions 1 – 3) is related to the interviewees herself;

the second section (questions 4 – 6) is relating to the team/section the interviewees

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worked in and the last section (questions 7 – 10) is relating to the entire IT department.

The question list is shown in Appendix A.

In addition, after gathering the comments from different colleagues, for further

verification, quantitative analysis is conducted in some areas such as server inventory,

number of requests on program deployment and the floor space utilization in data center.

The findings will be illustrated in subsequent sections.

2.5 Observations and Findings

After summarizing the comments from colleagues of different divisions and analyzing

the statistics gathered, the real problems behind the eight symptoms stated in the

previous section are described below:

Problem (1): High work pressures on colleagues, need work overtime until late

night and even on public holidays, feeling frustrated.

Findings:

Workload is biased. The system management section of open platform (UNIX /

Windows / Linux) is not only responsible for the system administration work (e.g.

environment setup, performance tuning, system and database administration), but

also need to do a lot of program deployment, which is more routine work and can

15

be done by personnel with lower technical skills. Actually, there is a librarian team

in the system management section of mainframe (OS/390, AS/400) that is solely

responsible for the program deployment and UAT execution of the mainframe

environment. From Table 2-2 below, the calculated average workload per head in

the mainframe system management section is 3.76 applications while it is 5.53

applications in the open platform system management section, which is 47% more.

Platform No. of employees in the

system management

section

No. of applications

need to be cater for

Librarian team for program

deployment and UAT

execution exist?

Mainframe 41 154 Yes

Open Platform 53 293 No

Table 2-2: Workload Comparison between mainframe and open platform in PMD

Unrealistic estimation on the required effort and time to complete tasks for

projects. Figure 2-6 below shown two example emails that staff need to work

overtime in order to catch up the project schedule.

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Figure 2-6: Two example emails showing work overtime request

Colleagues that the working time is normal office hours are always

responsible for the tasks that have to be done in non-office hours. Because of

business nature, program deployment is frequently doing in mid-night and public

holidays.

Tasks from different applications are hardly switched among system

administrators.

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Problem (2): Delay in project schedule.

Findings:

Unrealistic estimation on the required effort and time to complete tasks for

projects. As mentioned in symptom (1), because of tight project schedules, project

related staff need to work overtime frequently in order to catch up schedule.

However, sometimes it still fails to catch up the schedule and leads to a delay in

project.

Problem (3): Amount of repeat incidents rise.

Findings:

Tight project schedules and high work pressures make the staffs feeling

nervous and thus the error rates increase.

Too many repeated manual work. Many routine works such as program

deployments and special jobs execution are done manually.

Problem (4): High hardware maintenance, software license and operational cost

(e.g. electricity and cooling)

Findings:

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Monthly hardware maintenance costs few hundred millions, and ~20% of them are

for outdated hardware (i.e. hardware used more than 5 years and the book value is

zero.)

Still maintaining servers with low processing power, low scalability but much

more power consuming (~ 35% of the inventory are outdated resources).

According to the licensing scheme of vendors and suppliers, the maintenance and

license cost is still in full scale charge although the utilization is low.

Problem (5): Saturated floor space in data center.

Findings:

The bank keeps on buying new generation of hardware resources while still

maintaining the outdated ones. The number of hardware keeps rising. Figure 2-7

illustrates that the inventories of different kinds of resources keep on growing up

while there is no expansion in the data center floor space.

Figure 2-7: Hardware Resources Growth vs Data Center Floor Space Expansion

Hardware Resources Inventory

0

200

400

600

800

1000

1200

1400

1600

1800

2000

2006 2007 2008 2009 2010

Year

AIX (CPU)

Windows (Server)

Blade (Server)

Storage (TB)

Data Center Usable Floor Space

(sq. meter)

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Problem (6): Complexity in managing a huge pool of infrastructure facilities.

Findings:

Heterogeneous hardware resources making the data center environment more

complex. There are more than 1,500 servers in the data center, up to three

generations and eight models in a single platform, san storage are also in three

different brands.

All resource allocations and configurations are performed manually that also

increase the complexity as well as the human error rates.

Problem (7): Fail to fulfill the need of immediate/quick responses in resources

(e.g. CPU, memory) acquisition and re-allocation.

Findings:

Resources acquisition and re-allocation requests rise significantly due to the

instability of business environment. For example, rebound in local stock and

property markets in 2009 and 2010.

All resource allocations and configurations are performed manually so that it takes

longer time for analysis and execution.

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Problem (8): Fail to fulfill the need on high availability and zero downtime of

systems.

Findings:

With the widely use of different hardware and software, the need to request

downtime for firmware and patches upgrade increased sharply. The frequency

of requested downtime rises from 1 – 2 times per quarter to 3 – 4 times per quarter.

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3 INFORMATION TECHNOLOGY INFORMATION LIBRARY (ITIL)

After search of relevant literatures and implementation references in the banking industry, I

have found that the Information Technology Infrastructure Library (ITIL) framework is

applicable to the case.

3.1 Overview

Information Technology Infrastructure Library (ITIL) is a public framework that

describes best practice in IT service management. It provides guidance on how IT

resources should be organized to deliver business value, and document the processes,

functions and roles of IT Service Management (ITSM). Being a framework, it is

completely customizable for application within any type of business or organization

that has a reliance on IT infrastructure. The positioning of ITIL framework is shown in

Figure 3-1.

Figure 3-1: Positioning of Frameworks (Gartner, 2007)

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The original version of ITIL was developed at the same time as, and in alignment with BS

15000, the former UK standard for IT Service Management. BS15000 was fast-tracked in

2005 to become ISO/IEC 20000, the first international standard in ITSM. The Office of

Government Commerce (OGC) is committed to the maintenance of alignment between

future versions of ITIL and ISO/IEC 20000. A refreshed version of ITIL was introduced

in 2007 (known as version 3), it is planned to withdraw version 2 following a

consultation on the best way to do this. The pictorial representation of service

management evolution is shown in Figure 3-2

Figure 3-2: Evolution of Service Management

As stated in „Itil & ITSM World‟ (2005), the relationship among ITIL, the ISO20000

service management standard, and a company‟s own in-house procedures is best

described with the aid of a diagram as Figure 3-3. This top down illustration starts at the

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highest level with ISO20000, the BSI standard specification for IT service management.

The next level presents a code of practice for ITSM. ITIL itself is the third layer, with

in-house procedures represented by the bottom layer.

Figure 3-3: Relationships: ISO 20000, ITIL and Procedures

3.2 Benefits

According to OGC (2007), and ILX Group (n.d.), ITIL provides a systematic and

professional approach to the management of IT service provision. Adopting its guidance

offers users a huge range of benefits that include:

Achieve IT-Business Alignment

A more reliable, efficient, and consistent approach to service delivery and service

support

Achieve a high degree of IT governance

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Clearer expectations and responsibilities

Increased productivity and accountability, narrow the gap between the promise of

IT and the actual delivery

Improved service quality and availability

Increased customer satisfaction and internal confidence

Increased competence, capability and productivity of IT staff

Increased staff retention

Reduced cost/ incident

Reduced hidden costs that traditionally increases substantially the total cost of

ownership (TCO)

Better asset utilization

Greater visibility of IT costs

Greater visibility of IT assets

A benchmark to measure performance against in IT projects or services

3.3 Popularity

A study (Aileen Cater-Steel & Wui-Gee Tan 2005) involving 110 companies is being

conducted, the result shown that, ITIL is the most popular framework to be

implemented out of the seven IT service management frameworks. The survey result of

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the comparison of the relative implementation of various frameworks is shown in Table

3-1.

Table 3-1: Implementation of IT service management frameworks (Aileen

Cater-Steel & Wui-Gee Tan 2005)

Given the attractiveness of the ITIL advantages, more and more companies and

organizations across the world such as IBM, HP, P&G and Microsoft have

implemented ITIL. In the banking industry, many top-tier banks also implemented ITIL

in varying degrees. With so many successful examples in the banking industry, I

believe it is worth to implement the ITIL framework in ABC Bank.

3.4 The Five Core Publications

The current version of ITIL (v3) was published at the end of April 2007 and consists of

5 core publications covering the service lifecycle. This re-development provided greater

26

focus upon the alignment of IT and business, through the whole planning to production

lifecycle. The five core publications cover each stage of the service lifecycle as

illustrated in Figure 3-4, from the initial definition and analysis of business

requirements in Service Strategy and Server Design, through migration into the live

environment within Service Transition, to live operation and improvement in Service

Operation and Continual Service Improvement.

Figure 3-4: The Service Lifecycle of ITIL

Each core ITIL publication addresses a stage in the service lifecycle and defines a key

set of process required during that stage. Many organizations and scholars such as Rick

Lemieux (2008), itSMF (2007) and OGC (2007) have introduced the processes,

activities, people and deliverables of each stage, although the terminology in different

books and articles are slightly different, the rationale behind are more or less the same.

Figure 3-5 shows the five domains of ITIL‟s IT Service Lifecycle along with the people,

27

process and products required making each domain fulfill its „silo of purpose‟ within

the IT organization.

Figure 3-5: ITIL’s IT Service Lifecycle Management

A more detailed explanation on the stage and processes are introduced below:

Service Strategy – Planning the IT Services

Objective: Service Strategy deals with the strategic analysis, planning, positioning, and

implementation relating to IT service models, strategies, and objectives. It

provides guidance on leveraging service management capabilities to

effectively deliver value to customers and illustrate value for service

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providers.

Process: - Portfolio Management is to decide on a strategy to serve customers, and to

develop the service provider'.

- Financial Management is to manage the service provider‟s budgeting,

accounting and charging requirements. It provides the business and IT with

the quantification, in financial terms, of the value of IT services, the value

of the assets underlying the provisioning of those services, and the

qualification of operational forecasting.

- Demand Management is to understand and influence customer demand for

services and the provision of capacity to meet these demands. At a strategic

level this can involve analysis of patterns of business activity and user

profiles. At a tactical level it can involve use of differential charging to

encourage customers to use IT services at less busy times.

Service Design – Modeling the IT Services

Objective: Service Design translates strategic plans and objectives and creates the

designs and specifications for execution through service transition and

operations.

Process: - Service Catalogue Management is to provide a single, consistent source

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of information on all of the agreed services, and ensure that it is widely

available to those who are approved to access it.

- Service Level Management is to ensure that all operational services and

their performance are measured in a consistent, professional manner

throughout the IT organization, and that the services and the reports

produced meet the needs of the business and customers.

- Capacity Management is to provide a point of focus and management for

all capacity and performance-related issues, relating to both services and

resources, and to match the capacity of IT to the agreed business demands.

- Availability Management is to provide a point of focus and management

for all availability-related issues, relating to services, components and

resources, ensuring that availability targets in all areas are measured and

achieved, and that they match or exceed the current and future agreed needs

of the business in a cost-effective manner.

- Continuity Management is to maintain the appropriate on-going recovery

capability within IT services to match the agreed needs, requirements and

timescales of the business.

- Information Security Management is to align IT security with business

security and ensure that information security is effectively managed in all

30

service and Service Management activities, such that: i) information is

available and usable when required, ii) information is observed by or

disclosed to only those who have a right to know, iii) information is

complete, accurate an protected against unauthorized modification, iv)

business transactions, as well as information exchanges, can be trusted.

- Supplier Management is to obtain value for money from suppliers and to

ensure that suppliers perform to the targets contained within their contracts

and agreements, while conforming to all of the terms and conditions.

Service Transition – Implementing the IT Services

Objective: Service Transition provides guidance on the service design and

implementation, ensuring that the service delivers the intended strategy and

can be operated and maintained effectively.

Process: - Support & Transition Management is to plan and coordinate resources to

ensure that the requirements of Service Strategy encoded in Service Design

are effectively realized in Service Operations, and to identify, manage and

control the risks of failure and disruption across transition activities.

- Change Management is to ensure that standardized methods are used for

the efficient and prompt handling of all changes that are recorded in the

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Configuration Management System and that overall business risk is

optimized.

- Asset & Configuration Management is to identify, control and account for

service assets and configuration items, protecting and ensuring their

integrity across the service lifecycle.

- Release & Deploy Management is to assemble and position all aspects of

services into production and establish effective use of new or changed

services.

- Validation Management is to provide objective evidence that the

new/changed service supports the business requirements, including the

agreed SLAs.

- Evaluation Management considers the input to Service Transition,

addressing the relevance of the service design, the transition approach itself,

and the suitability of the new or changed service for the actual operational

and business environments encountered and expected.

- Knowledge Management is to ensure that the right person has the right

knowledge, at the right time to deliver and support the services required by

the business.

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Service Operation – Managing the IT Services

Objective: Service Operation provides guidance on managing a service through its

day-to-day production life. It also provides guidance on supporting

operations by means of new models and architectures such as shared

services, utility computing, web services, and mobile commerce.

Process: - Event Management depends on monitoring, but it is different. Event

management generates and detects notifications, whilst monitoring checks

the status of components even when no events are occurring.

- Incident Management is to restore normal service as quickly as possible,

and to minimize the adverse impact on business operations.

- Problem Management is to prevent problems and resulting incidents

from happening, to eliminate recurring incidents and to minimize the

impact of incidents that cannot be prevented.

- Fulfillment Management is to enable users to request and receive

standard services; to source and deliver these services; to provide

information to users and customers about services and procedures for

obtaining them; and to assist with general information, complaints and

comments.

33

- Access Management is to provide the rights for users to be able to access

a service or group of services, while preventing access to non-authorized

users.

- Service Desk Function Management provides a single central point of

contact for all users of IT. The Service Desk usually logs and manages all

incidents, service requests and access requests and provides an interface

for all other Service Operation processes and activities.

- Service Operations Function Management is responsible for the

management and maintenance of the IT infrastructure required to deliver

the agreed level of IT services to the business. It includes two functions: i)

IT Operations Control is usually staffed by shifts of operators who carry

out routine operational tasks. They provide centralized monitoring and

control, usually from an operations bridge or network operations centre. ii)

Facilities Management is responsible for management of data centers,

computer rooms and recovery sites. Facilities Management also

coordinates large-scale projects, such as data centre consolidation or

server consolidation.

- Technical Operations Function Management helps to plan, implement

and maintain a stable technical infrastructure and ensure that required

34

resources and expertise are in place to design, build transition, operate and

improve the IT services and supporting technology.

- Application Operations Function Management includes all the people

who provide technical expertise and management of applications. As such

they carry out a very similar role to Technical Operations Function

Management, but with a focus on software applications rather than

infrastructure.

Continual Service Improvement – Measuring the IT Services

Objective: Continual Service Improvement provides guidance on measuring service

performance through the service life-cycle, suggesting improvements in

service quality, operational efficiency and business continuity.

Process: There are many methods and procedures to monitor and measure the

performance as well as apply the corrective actions. Examples are the

7-Step improvement process by itSMF (2007) and the IT Governance

Management, IT Resource Management, IT Quality Management and IT

Security Management by Rick Lemieux (2008).

35

3.5 Critical Success Factors

Concluding the study (Rex Gibson 2008) relating to 10 organizations‟ experience

sharing in the 2008 itSMF Conference and the study (Aileen Cater-Steel & Wui-Gee

Tan 2005) among the 110 companies involved in the survey, result shown that, the most

critical success factors of ITIL implementation include:

Senior management commitment and involvement

Management commitment is about involving, motivating and leading by example,

not just financial commitment. Having an influential project sponsor who believes

in ITIL and setting up a project steering committee with all relevant IT and customer

stakeholders (usually business departments) will help secure management

commitment.

Start Right

First and foremost understand where you are now and develop a vision of where you

want to be. Use customer surveys and ITIL maturity assessments to objectively

36

define gaps. Develop a vision which is meaningful for your organization and which

can be clearly articulated and communicated.

Don’t be Over-Ambitious

Many ITIL projects have failed because of IT organizations trying to implement all

ITIL processes at the same time. Implementing one or two process at a time will

give you the necessary focus and urgency to successfully complete the ITIL

process improvement project.

Champion to advocate and promote ITIL

Effective communication is essential to win support and commitment. “Buy in”

from the staff required a major communications initiative. Engagement also applies

to external providers. To varying degrees, every organization relies on external

suppliers in the provision of IT services. When analyzing, communicating and

driving change make sure that third party providers and advisors are also involved.

37

Ability of IT staff to adapt to change

Recognize that adopting ITIL is as much about organizational change and cultural

change as it is about processes and technology. IT services are increasingly at the

heart of how organizations deliver to their external customers – and are also central

to how organizations themselves operate. In several of the real life examples, ITIL

adoption was used as a means to harmonize business processes across many sites or

divisions.

Quality of IT staff allocated to ITIL

Your project will fail if you do not have the right skills and right experience in

the right place. Most involved the appointment of owners for all key ITIL

processes affected. Having a dedicated process owner will ensure that process is

managed efficiently and effectively and is continuously improved, in order to meet

the process objectives.

ITIL training for IT staff

Use ITIL training to ensure a common language and understanding of best practice.

38

4 POSSIBLE SOLUTIONS AND ANALYSIS

4.1 Problem Categorization

After realizing the objectives and principles of different stages and processes in ITIL,

and matching it to the problems discovered in ABC Bank, the problems can be

categorized into four processes in the ITIL framework as shown in Table 4-1.

Process in ITIL framework Problem

Service Transition – Release and

Deployment Management

1. High work pressures on colleagues, need work overtime

until late night and even on public holidays, feeling

frustrate.

2. Delay in project schedule.

Service Operation – Problem

Management

3. Occurrence of repeated incidents rise.

Service Operation – Facilities

Management

4. High hardware maintenance, software licensing and

operational cost.

5. Saturated floor space in data center.

6. Complexity in managing a huge pool of infrastructure

facilities.

Service Design – Availability

Management

7. Fail to fulfill the need of immediate responses in hardware

resources (e.g. server CPU, memory) acquisition and

re-allocation.

8. Fail to fulfill the need on zero downtime of systems.

Table 4-1: Problem Categorization

39

4.2 Possible solutions

After categorizing the problems into four processes in the ITIL framework, in this

section, we will try to find out the possible solutions for these four processes in order to

tackle the stated problems. Possible solutions are summarized in Table 4-2 and the

details are described afterward.

Process in ITIL framework Possible Solutions

Release and Deployment

Management

Recruit staff that have experience and certification in project

management aspects

Provide formal project management trainings to current staff

Segregation of duties

Standardize and automate program deployment procedures

Problem Management

Building knowledge database

Organize in-house experience sharing sessions

Prepare standard checklist and procedures for critical problems

Facilities Management

Building a new data center

Data center outsource

Resources consolidation and virtualization

Availability Management

Virtualization for availability

Enhance current procedures and guidelines for resources acquisitions

Table 4-2: Summary Table of Possible Solutions

40

4.2.1 Release and Deployment Management

Recruit staff that have experience and certification in project

management aspects

Professionals with sound project management skills are expected have

the ability to coordinate the efforts of people with diverse backgrounds

and skills in hopes of getting the best overall result. They need to

manage and balance the resources of people, time and money in a more

reasonable manner. With reasonable lead time and expectations provided,

the project schedule should be met and the working pressures should be

reduced accordingly. However, the newly recruited project manager is

not familiar with the culture and working habits so that the outcome may

not fulfill our expectations.

Provide formal project management trainings to current staff

Instead of recruiting new project management professionals, the

department may consider to organize formal project management

training to current staff that are responsible for project management.

Current staff are familiar with the organization environment and culture,

but need time for training.

41

Segregation of duties

According to the roles and responsibilities, arrange the librarian team to

take over all the program deployment jobs. System administrators are

responsible for all other related system administration jobs. This

arrangement may solve problems about project delay and high working

pressure on open platform system administrator, but in the worst case,

the high working pressure may shift from system administration team to

the librarian team.

Standardize and automate program deployment procedures

Standardize and automate the program deployment jobs by writing

standard scripts or by the help of version control and deployment tools in

the market.

4.2.2 Problem Management

Building knowledge database

Setup knowledge database and encourage staff to share their experience

or problems encountered and the corresponding solution. FAQ, known

issues are also stored in the knowledge database for reference.

42

Organize in-house experience sharing sessions

Organize in-house experience sharing sessions; invite different teams to

share experience in a regular basis. Create chances for other staff to

realize problems occurred in other systems and the corresponding

solutions.

Prepare standard checklist and procedures for critical problems

For critical or selected problems, we can document in the standard

checklist and procedures, enforce related staff to check or maintain their

systems according to the checklist, to prevent re-occurrence of incidents

by same mistakes.

4.2.3 Facilities Management

Building a new data center

The problems of saturated floor space, insufficient power and cooling

systems can be solved by building a new data center. Since it is start

from zero, the IT department can design and build new data center in a

sustainable and efficiency way. The new data center may build with

extra capacity in terms of floor space, power and cooling systems. Also,

43

the new data center can be built as a “green” data center that is a

repository for the storage, management, and dissemination of data in

which the mechanical, lighting, power and computer systems are

designed for maximum energy efficiency and minimum environment

impact. In the long run, building a new green data center is cost savings

that can be realized on operations and maintenance. Another advantage

is the fact that green facilities offer employees a healthy, comfortable

work environment.

But, according to a survey done by the Aperture Research Institute

(SteveYellen 2008), the average time required to plan and build a new

data centre is typically three or more years. In addition, it involves huge

investment that needs to be approved by the bank‟s top management.

Therefore, the detailed planning is very important. Requesting for

professional‟s help is a must because this is a high risk task, if the task

fails, the bank may suffer from services outages that will have negative

impacts on the core business.

44

Data center outsource

Data center outsourcing grew in popularity, not only because it is more

affordable, but also it can lift much of the heavy responsibility and

workload from the in-house IT staff such as disaster recovery, adhering

to industry standards, ensuring a secure environment for information

storage and management, and many other practical concerns. In addition,

data center outsourcing can eliminate the demand for power and

cooling systems and solve the problem of saturated floor space

simultaneously. The success or failure of data center outsourcing

depends heavily on the quality of the service provided. And, the

flexibility of resources allocation may be reduced while the lead time

for resources acquisition is increased.

Resources consolidation and virtualization

A major alternative to deploy additional physical machines is to

implement a virtualization strategy. Virtualization is a term that is often

applied to a wide range of technologies. Virtualization of servers, storage

and networks, which has been pursuing for several decades, have the

benefits of i) intelligent resource allocation, ii) increased automation, iii)

45

reduce hardware, software maintenance costs as well as power

consumption because of a lower number of physical servers, iv) free up

floor space in data center, v) increased agility and flexibility and vi)

reduced complexity. On the other hand, virtualization brings another set

of issues and an increased need for performance and availability

management software. Namely, as deployments grow, so too does the

need for automated, cross-platform tools to effectively manage and

monitor the capacity, utilization, configuration, and patching of virtual

machines across their life cycles.

4.2.4 Availability Management

Virtualization for availability

According to the Head of Operations (Clive Taylor, 2008), Metavante

Technologies Ltd which is a strategic partner of IBM, comments that

server virtualization offers high performance and availability. We can

quickly adapt to changing business conditions by activating additional

processors or moving system resources from one partition to another,

all without the delay and complexity of installing new hardware. Also,

it is more flexible for planning of system outages such as firmware

46

upgrade and other maintenance tasks. It is because we can relocate all

partitions from one server to another. A graphical representation of the

high availability and planned outages solution is shown in Figure 4-1.

However, server virtualization involves huge investment of expensive

high-reliability hardware, with fail-over cluster software and even

fault-tolerant hardware.

Figure 4-1: Graphical representation showing the server virtualization as the

solution of availability management

Enhance current procedures and guidelines for resources

acquisitions

Enhance current procedure that outlines the process of software and

hardware acquisition; ensure clear descriptions on the approval

requirement and the elapsed time needed, so that a proper expectation

in terms of lead time and approval personnel is set.

Movement to a

different server

with no loss of

service

Virtualized SAN and Network InfrastructureVirtualized SAN and Network Infrastructure

47

4.3 SWOT Analysis

After identifying the possible alternatives for the four processes in the ITIL framework,

in this section, SWOT analysis will be used as the framework to identify the internal

(strengths, weakness) and external factors (opportunities, threats) of ABC Bank that are

involved in the ITIL processes implementation.

With the help of SWOT analysis, I can look intelligently during the evaluation of

alternatives, at how IT department can best take advantage of the strengths and the

opportunities opened, at the same time that the department can minimize the impact of

weaknesses and protect against the threats.

The following SWOT analysis aims to provide a tool to evaluate the options for the

implementation of the four processes (Service Transition – Release and Deployment

Management, Service Operation – Problem Management, Service Operation – Facilities

Management and Service Design – Availability Management) of ITIL framework in the

bank. The summary table of the analysis is shown in Table 4-3. Detailed explanation is

described in the subsequent sections.

48

Positive Negative

Strengths Weaknesses

Inte

rna

l

F

acto

rs

Employees with variety of technical

skill sets

Bargaining power of suppliers are low

Ease access to latest technologies

Possess of high end hardware resources

Strong financial support

Have staff working around the clock

Varieties of trainings

Lack of project management

expertise

Outdated data center with aging

infrastructure facilities

Inefficient information sharing

Long recruitment process

Opportunities Threats

Ex

tern

al

Fa

cto

rs

Introduction of new technologies and

best practices

Changes in organizational structure

Gains from trainings

Gains from outsourcing

Global financial stability impact

Technologies and resources

become obsolete in near future

High turnover of crucial staff

Table 4-3: Summary table of the SWOT Analysis

4.3.1 Internal Analysis

Strengths

ABC Bank has the following attributes and capabilities that are helpful to

achieve the 4-processes ITIL implementation objective.

49

Employees with variety of technical skill sets

IT department has many system specialists with different technical skill

sets from programming, networking, mainframe knowledge, open

platform knowledge, system design, system architecture, engineering,

cabling etc., it is easily to arrange in-house professionals in different

areas.

Bargaining power of suppliers are low

ABC Bank is always one of the major customers of many vendors and

suppliers in terms of investment amount. Thus, vendors and suppliers

are willing to provide us with premium service such as latest

technology update and trial, on-site support and deep discounts during

procurement.

Ease access to latest technologies

Because of the company culture, staff are encouraged to evaluate latest

technologies through seminars, workshops and formal trainings

conducted by major vendors such as IBM, Oracle and Microsoft.

50

Possess of high end hardware resources

IT Department possesses high end hardware resources that with high

scalability, flexibility, reliability, support enterprise-workload and with

latest technologies configured.

Strong financial support

Since IT is playing an important role in the bank to open up new

markets, new products, new services and efficient delivery channels,

top management of the bank are willing to approve investment in

information technology initiatives such as the procurement of the latest

and top end hardware, kick off IT infrastructure project such as upgrade

of outdated version software.

Have staff working around the clock

The IT department has operation staff working in shifts around the

clock. They are responsible for the monitoring of system healthiness,

conducting system checks, execution of special jobs and alert

application and system management teams in case of production

problems.

51

Varieties of trainings

The training department of the bank always organizes varieties of

trainings in bank operation, interpersonal skills workshops, Putonghua,

presentation skills and many other executive trainings.

Weaknesses

On the other hand, ABC Bank has the following weaknesses that create the

barriers to achieve the 4-processes ITIL implementation objective.

Lack of project management expertise

Lack of project management expertise may lead to inappropriate

resources allocation, bad project definition and scope, underestimated

risks and impact, poorly defined planning and insufficient tests.

Outdated data center with aging infrastructure facilities

The data center of ABC Bank was built over ten years ago, IT

department are already facing day-to-day challenges on managing

increasingly complex technologies in old facilities. But adding new

technology to an aging environment, the legacy data center, cannot

52

support the infrastructure requirements to operate efficiently. Installing

equipment in an aging facility will limit the benefits that can be delivered

by the new technology, and in some cases, will overload the

infrastructure to the point of failure.

Inefficient information sharing

Staff with critical knowledge will often protect it as if it were their own

property. Also, hanging on to their job knowledge gives them a sense of

power and importance because they have specific information that no

one else has.

Long recruitment process

The recruitment of new staff undergoes a very long process, and needs

approval from numerous personnel and departments. In average, the

recruit process needs around 2.5 to 3 months to complete.

4.3.2 External Analysis

Opportunities

The external environmental analysis may reveal certain new opportunities

53

for the 4-processes ITIL implementation.

Introduction of new technologies and best practices

Application of new technologies and best practices in the industry that

may make IT operation become more efficient; improve cost of

management and cost savings.

Changes in organizational structure

To stay competitive, IT department may increase flexibility and

decrease costs by changing and restructuring. Process reengineering,

out-sourcing, job redesign and other approaches to optimize processes

can be implemented to increase operational and process efficiency.

Gains from trainings

A mixture of in-house training and off-site classroom training can

pinpoint employee developmental needs with satisfaction of those

needs then interwoven into current processes and workflow. This can

help lead to increased productivity and efficiency, and of course, an

increase in job satisfaction. Staff that are happy in their work are more

54

likely to work harder and be more valuable to the company, which will

in turn, put the company in a stronger position.

Gains from outsourcing

Identify operations that can be outsourced in order to reduce

operational overhead, improve cost management control, improve

service quality and thus lead to cost and efficiency savings.

Threats

The external environmental factors which could do damage to the

4-processes ITIL implementation.

Global financial stability impact

If the economic market cannot recover from the financial crisis, the

bank needs to control the expenses and may be reluctant to invest

money in the IT technologies and facilities.

Technologies and resources become obsolete in near future

Technologies and resources becoming obsolete may be generally due to

55

three main causes: i) Hardware or software changes to the system

obsolete the functionality of the software. ii) The original supplier no

longer sells the software so that we cannot expand or renew licensing

agreements or maintenance contracts. iii) Digital media obsolescence,

formatting, degradation limits or terminates access to software.

Obsolete technologies and resources may increase operation risk.

High turnover of crucial staff

Crucial staff looking for better salary and benefits or other personal

development, negative effects are loss of productivity, diminished

morale, strained communications between management and employee,

increased costs of recruiting and training new employees.

56

5 IMPLEMENTATION STRATEGY

5.1 Implementation Priority

After analyzing the internal and external factors for the 4-processes ITIL

implementation, the recommended alternatives and implementation priorities that given

the greatest benefits are identified. Solutions that can provide the greatest benefits and

solutions that require much less effort and time to implement so as to achieve

“quick-wins” will be assigned with high priority. Table 5-1 is a summary table for all

suggested alternatives and its priority for implementation. Detailed reasons are shown

afterward.

Domain Suggested Alternatives Implementation

Priority

Release and

Deployment

Management

1. Standardize and automate program deployment procedures High

2. Segregation of duties Medium

3. Provide formal project management trainings to current staff Low

4. Recruit staff that have experience and certification in project

management aspects

Not implement

Problem

Management

5. Prepare standard checklist and procedures for critical problems High

6. Organize in-house experience sharing sessions Medium

7. Building knowledge database Not implement

Facilities 8. Resources consolidation and virtualization High

57

Domain Suggested Alternatives Implementation

Priority

Management 9. Building a new data center Low

10. Data center outsource Not implement

Availability

Management

11. Virtualization for availability High

12. Enhance current procedures and guidelines for resources

acquisitions

High

Table 5-1: Summary table of suggested alternatives

1. Standardize and automate program deployment procedures

Domain: Release and Deployment Management

Recommend to implement?: Yes

Implementation Priority: High

Reasons:

- Currently, most of the system administrators are writing scripts for the program

deployment in order to simplify the tasks. Therefore, it is not difficult to integrate

the deployment scripts with the mature job scheduling and automation tool that is

already used in the open platform environment. Once the deployment scripts is

integrated with the automation tool, the program deployment job will be

simplified a lot (i.e. the responsible person initiates the 1st step according to the

approved application form, then, the remaining steps will be automatically

58

executed.)

- If the tasks are simplified and be automated, we can arrange operators (the section

have staff working around the clock as stated in the SWOT analysis) to do the

program deployment and special job executions. This arrangement can also

support the need of non-office hours or mid-night program deployments.

2. Segregation of duties

Domain: Release and Deployment Management

Recommend to implement?: Yes

Implementation Priority: Medium

Reasons:

- Arrange librarian team to take over program deployment tasks may increase

operational efficiency because it is their key duties and professionalism.

- It is also important for audit compliance that the one who have the privileged

accounts in the production systems should not have access to the program source

code.

- The current librarian team is handling program deployment for mainframe

platform only, therefore, it is more suitable to implement this solution after the

program deployment procedures is simplified and standardized.

59

3. Provide formal project management trainings to current staff

Domain: Release and Deployment Management

Recommend to implement?: Yes

Implementation Priority: Low

Reasons:

- It takes time to arrange the formal trainings and staff need on-the-job training to

accumulate project management experience, this solution cannot solve the

problems in a timely manner.

- However, as shown in the SWOT analysis, lack of project management expertise

is one of our weaknesses, it is still worth for the training department to include

project management skills in future training plans to enrich the knowledge of

middle-level managers.

4. Recruit staff that have experience and certification in project management aspects

Domain: Release and Deployment Management

Recommend to implement?: No

Implementation Priority: Not implement

Reasons:

- Because of the long recruitment process as analyzed from the SWOT, this solution

60

cannot solve the problems in a timely manner.

- New staff need a few months time to realize the working habit and organization

culture.

5. Prepare standard checklist and procedures for critical problems

Domain: Problem Management

Recommend to implement?: Yes

Implementation Priority: High

Reasons:

- In order to reduce the occurrence of repeated incidents in a timely manner; with

the help of impact analysis, we may filter out the critical problems and rewrite the

solution to become steps or procedures and document them in the standard

checklist; then, enforce staff to follow the predefined installation, configuration

and checking procedures.

6. Organize in-house experience sharing sessions

Domain: Problem Management

Recommend to implement?: Yes

Implementation Priority: Medium

61

Reasons:

- Since staff are reluctant to share their experience and problems encountered

actively, the situation can be improved by organizing monthly sharing sessions

and inviting targeting persons to share their experience.

7. Building knowledge database

Domain: Problem Management

Recommend to implement?: No

Implementation Priority: Not implement

Reasons:

- We have no experience in promoting the use of knowledge database and it is

difficult to ensure the quality and accuracy of the knowledge database. This

solution needs helps from knowledge management professionals and is something

related to organizational culture change; it may take years of time to build up the

momentum.

8. Resources consolidation and virtualization

Domain: Facilities Management

Recommend to implement?: Yes

62

Implementation Priority: High

Reasons:

- The consolidation and virtualization technologies are mature.

- Possess of reliable, high-end hardware and software resources that support

consolidation and virtualization is already one of our strengths.

- Many banks has implemented resource (such as servers, san storage, tape)

consolidation and virtualization.

- Since the bargaining power of our suppliers is low, we can request for help or

services from vendors that has experience in this area, for example IBM and HP.

9. Building a new data center

Domain: Facilities Management

Recommend to implement?: Yes

Implementation Priority: Low

Reasons:

- Building a new data center is a common practice in the banking industry to solve

the saturated floor space and aging facilities problems, reference sites include the

new Tseung Kwan O data center of HSBC and the data center of the Standard

Chartered Bank at Millennium City in Kwun Tong. However, building a new data

63

center needs three or more years, therefore, this solution should be considered in

future planning of the data center.

10. Data center outsource

Domain: Facilities Management

Recommend to implement?: No

Implementation Priority: Not implement

Reasons:

- Due to the business nature, there will be a lot of sensitive and financial data in the

systems. Also, we need to strictly fulfill the HKMA compliance requirement. It is

high risk to outsource the data center that the control is not in our hand.

- It is not a common practice to outsource the data center in banking industry.

11. Virtualization for availability

Domain: Availability Management

Recommend to implement?: Yes

Implementation Priority: High

Reasons:

- If virtualization implemented, there will be no service outages although we need

64

to shut down some resources for maintenance.

12. Enhance current procedures and guidelines for resources acquisitions

Domain: Availability Management

Recommend to implement?: Yes

Implementation Priority: High

Reasons:

- Actually, projects or applications that request for resources need to fill in a form

and the required lead time is documented. However, this application process is not

executed very well. Projects always submit the form in the afternoon and request

the resources to be ready in the next day. Therefore, it is easy to enforce project

teams and application teams to follow the rules by formally re-announcing the

application procedures.

5.2 Implementation Schedule

The implementation schedules for the recommended solutions are divided into three

phases. Solutions with high implementation priority are started in 2010 Q1, since

different teams are responsible for different solutions, many implementations can be

started in parallel. Solutions with medium implementation priority are started in 2010

65

Q2 when the majority of high priority implementations are completed in the meantime.

Solutions with low implementation priority will not be considered until 2010 Q4 when

the majority of solutions with high and medium implementation priority are completed.

The implementation timeline is shown in Figure 5-1.

Figure 5-1: The implementation timeline of recommended solutions

Detailed implementation plans will be created for each solution so that the related

parties will know what actual tasks they need to carry out towards the goal. An example

is the detailed implementation plan of program deployment hand over that is shown in

Appendix B.

66

5.3 Key Performance Indicators

Some Key Performance Indicators (KPIs) are defined in order to measure the progress

and the performance of the solutions towards the project goal of the strategic use of

policies and technologies that establishing and maintaining service levels while reducing

technology cost, complexity, and operational overhead. The KPIs for the four areas are

shown in Table 5-2.

Domain KPI Measurement Target

Release and

Deployment

Management

Duration of major

deployments

Average duration of

major deployment

Average duration of

major deployment

shorten by 20%

Proportion of automatic

deployment

% of automatic

deployments

75% of deployments

done automatically

Problem Management Repeated incidents % of repeated incidents

Repeated incidents keep

below 20% of all

incidents

Facilities Management

Incidents due to

capacity shortages

% of incidents due to

capacity shortages

Incidents due to capacity

shortages keep below

10% of all incidents

Response time of

resources acquisition

and re-allocation

request

Average response time

of resources acquisition

and re-allocation request

Average response time of

resources acquisition and

re-allocation request

shorten by 30%

Availability Service interruptions No. of service No service interruptions

67

Domain KPI Measurement Target

Management due to firmware and

patches upgrade

interruptions due to

firmware and patches

upgrade

is due to firmware and

patches upgrade

Table 5-2: KPIs for the solution implementations

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6 EVALUATION

Up to now, the implementation has reached the halfway mark. It is the time to evaluate the

progress and performance of the suggested solutions. All the achievements below are compared

with the baseline period of January – June 2009.

6.1 Release and Deployment Management

The progress summary of the implementation on solutions of release and deployment

management is shown in Table 6-1.

Solution Schedule Progress Final Target Achievements

1. Standardize and

automate program

deployment procedures

Jan – Mar

2010 100%

- The average

duration of major

deployment shorten

by 20%

- 75% of

deployments are done

automatically

- The average duration

of major deployment is

drop from 30 minutes

to 22 minutes (shorten

by 27%)

- The proportion of

automatic deployment

is increased from 23%

to 40%

2. Segregation of duties Apr – Sep

2010

35%

3. Provide formal project

management trainings to

current staff

Start from

Oct 2010

Not yet

start

Table 6-1: Progress summary of release & deployment management implementation

69

In the release and deployment implementation, the standardization and automation of

program deployment procedures is completed. Naming convention for different

environment and application program deployment is established. The new naming

convention standard for program deployment is shown in Figure 6-1. Also, nearly all

the program deployment jobs are integrated with Control-M (the job scheduling and

automation tool). A Control-M deployment screenshot is shown in Figure 6-2. This

implementation makes the achievement of the average duration of major deployment

drop from 30 minutes to 22 minutes (shorten by 27%) which outperforms the target.

Figure 6-1: The new naming convention standard for program deployment

70

Figure 6-2: Control-M deployment screenshot

Regarding the segregation of duties, all program deployment jobs will be handed over

to the librarian team by three phases; it‟s now in the second phase. An e-mail

announcement for the program deployment hand over of two of the applications is

shown in Figure 6-3.

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Figure 6-3: An e-mail announcement for the program deployment hand over

Implementation of this solution let the program deployment carried out by professionals

in that aspect. Automatic deployment for each major release will be setup by the

librarian team 2 days before the exact deployment date. Also, the frequency of overtime

work because of program deployment is reduced. Although the implementation is still

under execution and there is a little bit behind schedule, benefit is still obvious.

6.2 Problem Management

The progress summary of the implementation on solutions of problem management is

shown in Table 6-2.

Solution Schedule Progress Final Target Achievements

1. Prepare standard

checklist and procedures

Jan – Feb

2010

100%

- Repeated incidents

keep below 20% of

- Repeated incidents

drop from 35% to

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Solution Schedule Progress Final Target Achievements

for critical problems all incidents ~30% of all incidents

2. Organize in-house

experience sharing

sessions

May –

Dec 2010 25%

Table 6-2: Progress summary of problem management implementation

The standard checklist and procedures for critical problems is published, examples is

the health check procedures for web-based applications using IBM Websphere and the

setup and configuration for different relational database brands. Also, the in-house

experience sharing sessions is started to organize in a monthly basis. The topics for the

first two sessions are “OS parameter & performance tuning” and “IBM Websphere MQ

Upgrade” respectively as shown in Figure 6-4.

Figure 6-4: Topics for the first two experience sharing sessions

However, benefit of the implementation is not as good as expected as seen in the

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achievement, there is only 5% reduction of repeated incidents. It is due to the audience

of the experience sharing sessions are not applying what they have learnt from the

sessions to their jobs. They just treat the experience sharing sessions as ordinary

seminars instead of paying attention to prevent same mistake occuring in the

applications that they are responsible for. Therefore, in the remaining time of the

implementation, I think we need to take more efforts on the promotions and explain

more clearly about the purpose and expectations of those experience sharing sessions.

6.3 Facilities Management

The progress summary of the implementation on solutions of facilities management is

shown in Table 6-3.

Solution Schedule Progress Final Target Achievements

1. Resources

consolidation and

virtualization

Jan – Sep

2010 70%

- Incidents due to

capacity shortages

keep below 10% of

all incidents

- Average response

time of resources

acquisition and

re-allocation request

shorten by 30%

- Incidents due to

capacity shortages drop

from 15% to 5% of all

incidents

- Average response time

of resources acquisition

and re-allocation

request drop from 5

days to 3 days

2. Building a new data

center

Start from

Oct 2010

Not yet

start

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Solution Schedule Progress Final Target Achievements

(shorten by 40%)

Table 6-3: Progress summary of facilities management implementation

Since not all the resources are suitable for consolidation and virtualization, an in-scope

list is created for implementation and VMWARE is selected as the virtualization

software in phase 1 and implemented on Windows platform. The windows platform

virtualization is completed in May as shown in Figure 6-5.

Figure 6-5: Production application of windows platform virtualization in May 2010

Since the hardware resources are virtualized, all resources can be treated as a share pool,

ad-hoc resources re-allocation is configured to be done automatically according to the

predefined rules. After the full implementation of virtualization on windows platform,

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there is no incident that is related to the capacity shortage of windows platform

resources. There are still some incidents due to capacity shortage of UNIX resources.

We have high confidence that this situation can be improved after the implementation of

virtualization on UNIX platform which has just been started in July, we have invited

IBM as the consultant for the implementation. Seminars and skill transfers sessions

have been organized to let system administrators familiar with the concepts and

techniques needed in future maintenance.

The management of the resource pool becomes simpler due to resources consolidation;

therefore, the time needed to finish a resource acquisition and re-allocation request is

shortened from 5 days to 3 days.

6.4 Availability Management

The progress summary of the implementation on solutions of availability management is

shown in Table 6-4.

Solution Schedule Progress Final Target Achievements

1. Virtualization for

availability

Jan – Sep

2010

70%

No service

interruptions is due to

firmware and patches

upgrade

No. of service

interruptions due to

firmware and patches

upgrade dropped from 2

to 1.

2. Enhance current

procedures and guidelines

for resources acquisitions

Jan – Feb

2010 100%

Table 6-4: Progress summary of availability management implementation

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The application procedure is reviewed and a new form is created for resource

acquisition and reallocation as shown in Figure 6-6. Besides, formal procedures and

lead time needed for different resources is also well explained in the application

guideline in order to streamline the resources acquisition process. As the virtualization

of resources is completed by 70% as stated in the previous section, there is no need to

require downtime for the firmware and patches upgrade for windows platform. The

same benefit can be foreseen in the UNIX platform when the UNIX platform

virtualization is completed.

Figure 6-6: New resources acquisition and allocation form

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7 CONCLUSION

This project has conducted an in-depth analysis on information technology resources planning

and management in ABC Bank after the organization structure changed from

department-oriented to function-oriented. The current inefficiencies on IT resources planning

and management in ABC Bank including high work pressures on staff, delay in project

schedule, occurrence of repeated incidents, high hardware maintenance cost, high software

licensing and operational cost, saturated floor space in data center, complexity in managing a

huge pool of infrastructure facilities, failure to fulfill the need of quick responses in resources

acquisition and re-allocation and failure to fill the need on high availability and zero downtime

of systems. By the 4-processes ITIL implementation, the above problems can be solved through

technologies and methodological changes that include standardization and automation of

program deployments, segregation of duties, standard checklist preparation and procedures

review for critical problems, organizing in-house experience sharing sessions, resources

consolidation and virtualization and finally the current procedures and guidelines enhancement

for resources acquisitions.

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8 SELF EVALUATION AND LESSONS LEARNED

By facing success and challenges, I have attained valuable personal learning through this

project. One of the challenges I faced is the team communication during the implementation of

the “segregation of duties”. I found that some staff in the librarian team are not willing to take

over the deployment jobs because they feel they are doing jobs for others and it is not fair to

them. The occurrence of this situation is due to the poor communication of objectives and

targets across the team. Luckily, the situation is improved by strengthening communication on

areas of concerns with team members by conducting sharing and review sessions. Another

challenge is about the lack of ownership, especially for those implementations that involved

different teams, the project participants are not held accountable for their results, and this is

improved by allocating a dedicated person to lead and co-ordinate the activities for various

parties.

On the other hand, this project also has important success factors that can be referenced by

future projects. Making the project goal and objectives very clear are important and tried to tie

into the direction, strategic goals and vision for the whole organization. Well communicating

with the management to get their commitment and support in the project will give a great help

for the implementation. Acquired experience, the skills and knowledge to operate and maintain

the constructed modules / tasks after implementation is also critical.

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Although challenges arose, the project is succeeded in giving great benefits to the bank. The IT

operations were streamlined, the operational burdens and costs were minimized, the risk due to

repeated human errors was also mitigated, and the system service availability was maximized. I

was being notified by management to continue on the remaining implementations and positive

feedbacks were also received from related parties and stakeholders involved in the project. I

am sure the continuity of this project may lead to continual improvement in the resource

planning and management of information technology operations in the bank.

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9 REFERENCE LIST

APM Group, OGC, TSO 2007, What is ITIL?, viewed 10 January 2010,

http://www.itil-officialsite.com/AboutITIL/WhatisITIL.asp

ILX Group n.d., Why ITIL? ITIL Benefits?, viewed 10 January 2010,

http://www.itiltraining.com/itil-benefits.asp

itSMF Ltd 2007, An Introductory Overview of ITIL V3, Alison Cartlidge, Ashley Hanna, Colin

Rudd, Ivor Macfarlane, John Windebank, Stuart Rance.

BC Associates WF2 2005, ISO 20000, BS15000 and ITIL, viewed 6 February 2010,

http://www.itil-itsm-world.com/itsm-kit.htm

OGC 2007, ITIL V3 (ITIL Refreshed) – Complete Library Plus, TSO, UK.

Rick Lemieus 2008, „ITIL’s IT Service Lifecycle – The Five New Silos of IT’, 1 January 2008, p.

1, viewed 6 February 2010,

http://www.itsmsolutions.com/newsletters/DITYvol4iss01.htm

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Dee Smith, Ed Holub 2007, ITIL Implementation Best Practices, Gartner.

Aileen Cater-Steel & Wui-Gee Tan 2005, Implementation of IT Infrastructure Library (ITIL) in

Australia: Progress and success factors, Toowoomba.

Rex Gibson 2008, What Makes for Successful ITIL Implementation? Lessons from Real Life

Case Studies, viewed 7 April 2010,

http://www.focus-on-training.co.uk/wp_itil_implementation/

Christian Sarkar 2009, What, No BSM? Gartner’s Top 10 Strategic Technologies for 2010,

viewed 27 March 2010,

http://www.bsmreview.com/blog/release-deployment-management/

Steve Yellen 2008, Data centres are out of date and nee updating, viewed 27 March 2010,

http://www.datacentremanagement.com/management-news-77/472-data-centres-are-out-of-date

-and-need-updating.html

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10 APPENDIX

Appendix A – Question list of the interviews

1. What are the major duties of your job?

2. What major problems have you encountered in your job? What is the consequence of these

problems? Which one frustrates you the most? What do you usually do about it?

3. What things annoy you most in your work day?

4. What factors do you think are crucial within your team/section and must be present for you

to work most effectively?

5. What difficulties do you see in your team/section?

6. What problems do you think within your team/section should be solved with high priority?

7. What factors do you think are crucial within the IT department and must be present for you

to work most effectively?

8. What actions and support do you think to make a project proceed successfully?

9. What difficulties do you see in the IT department?

10. What problems do you think within IT department should be solved with high priority?

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Appendix B – Detailed implementation of the program deployment hand over solution