Module 3 - Service Strategy Part II - Processes PDF

Module 3 – Service Strategy Part II - Processes INFO-6084 – Practical Applications of ITIL Agenda Strategy Management Demand Management Service Portfolio Management (SPM) Financial Management (FM) Business Relationship Management (BRM) Learning Outco...

Module 3 – Service Strategy Part II - Processes INFO-6084 – Practical Applications of ITIL Agenda Strategy Management Demand Management Service Portfolio Management (SPM) Financial Management (FM) Business Relationship Management (BRM) Learning Outcomes Go through all the processes that are part of the Service Strategy stage of ITIL, their objectives, scope, value and importance Understand the relationship between the Service Strategy processes and other ITSM processes covered in ITIL Remember where we are in the lifecycle ! Service Strategy Processes Strategy Management Demand Management Service Portfolio Management (SPM) Financial Management (FM) Business Relationship Management (BRM) Section 1 Strategy Management Strategy Management The goal of strategy management is to ensure IT services and their management align with the organization. During this stage, you will assess, define, and execute strategies for your service offerings and evaluate the current market position of the business or service provider Strategy Management (Cont.) Strategy management seeks to answer questions such as the following: o Who are our customers? o What business outcomes do they need? o How do the services we provide support those outcomes? o How can we position ourselves to be the only logical provider of these services? o What market spaces do we operate in? o Are there ways to expand our current service offerings into new markets? o Are there unmet needs in our current market spaces for which we can develop services? Strategy Management (Cont.) These are the Strategy Management for IT Services sub-processes: Strategic Service Assessment: to assess the present situation of the service provider within its current market spaces. This includes an assessment of current service offerings, customer needs and competing offers from other service providers. Service Strategy Definition: to define the overall goals the service provider should pursue in its development, and to identify what services will be offered to what customers or customer segments, based on the results of the Strategic Service Assessment. Service Strategy Execution: to define and plan strategic initiatives, and ensure the implementation of those initiatives. Section 2 Demand Management Demand Management This process is used to evaluate the current customer demand against the services which are being provided to them. Demand Management focusses solely on understanding the customer’s demands and coordinating it with the capacity, availability, and types of services that are provided. Demand Management (Cont.) There are four sequential activities that are performed in this process which are: o Identifying sources of demand and forecasting o Analyzing the patterns of business activity and user profiles o Developing differentiated offerings o Managing operational demand Demand Management Objectives The purpose of demand management is to detect and influence the demand that customers have on IT services. This process involves three main actions: 1. Analyzing current customer usage of IT services: The easiest way to do this is to analyze service desk data regarding incidents, requests, and problems. Network usage and uptime can be measured via a service dashboard, such as the kind used in a network operations center (NOC) environment. 2. Anticipating future customer demands for IT services: Here, the business relationship manager comes into play. He or she may speak with the customer directly about forecasted needs, will analyze trends in usage or tickets, and will make educated projections about future usage based on similar customers trends. Demand Management Objectives (Cont.) 3. Influencing consumption as necessary by financial or technical means: For example, if a customer uses more service than anticipated in the SLA, a service provider may charge fees for the excessive consumption to offset the costs of the unforeseen demand. Demand management also makes sure that the appropriate costs are included in the service design. Formally this involves two processes: Demand Prognosis and Demand Control (not covered in this course) Importance of Demand Management Demand management is essential for one simple reason: It is impossible to adequately plan for and meet service demands based on gut check alone. Predicting how much service will increase based on what you think you remember about current demand versus the demand of other similar customers results in inaccurate data at best and expensive overstaffing at worst. Section 3 Service Portfolio Management (SPM) SPM Service Portfolio Management provides an important source of information for managing services across the lifecycle. This process mainly focuses on the management of the IT service’s portfolios which are offered. Service Portfolio Management process guarantees that the delivered services stay aligned with the goals of Service Strategy. SPM (Cont.) This process is made up of 4 sequential activities which are: o Defining the services o Analyzing services o Approving o Chartering services. SPM Purpose Purpose, to ensure that the appropriate mix of services delivered by the service provider to meet the requirements of the customer Enables tracking of important information about the services, including the investment made and the interaction with other services Ensures that that services are clearly defined and linked to the business outcomes they support SPM Objectives Provide a process that allows an organization to manage its overall service provision Maintain the definitive managed portfolio of services provided Provide an information source allowing the organization to understand and evaluate how the IT services provided enable them to achieve their desired outcomes Provide control over which services are offered Track the organizational spend on IT services Provide information to enable decision making regarding the viability of services SPM Scope Service portfolio management has a very broad scope It covers: o All the services a service provider delivers o All of those that it is planning to deliver o All that have been retired Responsible for evaluating the value of the services provided throughout the whole of their lifecycle The Service Portfolio The service portfolio is the complete set of services Includes the contractual and financial commitments across internal, external, or third-party providers Consists of three sections: o The Pipeline (The Future) o The Service Catalog (The Present) o The Retired Section (The Past) The Service Portfolio (Cont.) The Service Portfolio (Cont.) ITIL’s service pipeline shows what’s coming in terms of the future of the organization. It consists of new services that are in various stages of design and development. The service catalog is similar to a menu. It describes an organization’s operational (or near-operational) services. Retired services show services that were once in live operation but have become obsolete or are no longer profitable. The Service Portfolio (Cont.) From the service portfolio, you can see the allocation of all the resources in use across the whole service lifecycle. Each stage of the lifecycle will make demands on available resources and capabilities The portfolio allows you to see those allocations and resolve any potential conflicts New projects should have an approved financial plan and allocated budget, showing the cost recovery or return on investment, and this will be captured in the service portfolio The Service Portfolio (Cont.) The service catalog is the only part of the service portfolio that is customer-facing Other information the service portfolio contains may be used as part of customer-facing reports, presentations, and business cases The live operational services, as captured in the service catalog, are the only services expected to demonstrate cost recovery or profitability Section 4 Financial Management (FM) FM Financial management consists of understanding the costs for IT services, including being able to justify the expenditure of those services. This process focusses on financial spending and various services in a business such as budgeting, accounting, charging activities and many more. Financial Management also takes care of the costs that are required to provide services while maximizing its value. This process is made up of three sequential activities which are budgeting, accounting, and charging. FM Purpose To secure an appropriate level of funding to design, develop, and deliver the services that meet the organizational requirements Provide balance between the cost and quality of the service, in line with the balance of supply and demand FM Objectives Defining and maintaining a financial framework to identify, manage, and communicate actual cost Understanding and evaluating the financial impact and implications of any new or changed Securing funding Working with the service asset and configuration management process to ensure all associated costs are recorded Performing basic financial accounting FM Objectives (Cont.) Reporting on and managing expenditure for service provision Management and execution of the organization’s policies and practices relating to financial controls Ensuring that financial controls and accounting practices are applied Understanding the future financial requirements of the organization and providing financial forecasts When appropriate defining a framework for recovering the costs of service provision from the customer FM Scope Financial management for IT services must ensure that the practices are consistent with existing corporate controls and that all activities meet with governance standards The strategy relating to IT funding will be part of the overall accounting approach, but the specifics may be managed locally as part of the IT department FM – The main processes Budgeting predicting and controlling the income and expenditure of money Accounting enables the IT organization to account fully for the way that its money has been spent. It should enable a cost breakdown Charging This is the process required to bill customers for the use of the services FM – Two main cycles Planning (annual) where cost projections and workload forecasting form a basis for cost calculations and price setting Operational (monthly or quarterly) where costs are monitored and checked against budgets, bills are issued, and revenue is collected The Business Case A tool for decision planning and support Helps predict the likely consequences of a business decision Two main considerations: o Business objectives o Business impact Business Case Content Executive Summary: a short description that summarizes the proposal and contains key and salient points Current Situation: describe the current business problem and why it is a problem – Include a brief statement of any mandates that require processes and/or services not currently in place Proposal: what is proposed; how does it solve the problem? Describe how proposal will help the organization achieve anticipated business outcomes Business Case Content (Cont.) Financial Proof: what new income/outcomes will result; can costs afterwards be recouped? Reduced? You also want to provide a clear argument by summarizing key quantitative and qualitative information, including a description of the impact of not implementing the project Conclusion: Summarize the problem/situation. Describe the anticipated outcomes. The conclusion should include answers to questions such as “What are we aiming for?” and “What are the expected benefits to business operations?” Supporting Materials: Supplementary material provided that can help bolster your business case Section 5 Business Relationship Management (BRM) BRM This is the final process in the ITIL Service Strategy stage. Activities like creation and management of customer relationships, comprehension of customer needs, and implementation of required services to meet those needs are performed in Business Relationship Management process. BRM (Cont.) Business Relationship Management ensures an integrated approach to the delivery of services to meet organizational needs. The three sequential activities that are performed in this process are: o Request and complaint handling o Identifying opportunities o Managing business relationships BRM Purpose Establishes a relationship between the service provider and the customer and maintains this by continuing to review the business and customer needs Identify customer needs and ensure that the service provider can meet those needs, both now and in the future BRM Objectives Ensure that the service provider has a clear understanding of the customer’s perspective Ensure that customer satisfaction remains high Establish and maintain a relationship between the customer and service provider Ensure that the organization and the service provider communicate effectively Identify technology changes or trends that may have an impact on the type, level, or utilization of the service provided BRM Objectives (Cont.) Ensure that the service provider is able to articulate the business requirements Provide mediation where there is conflict on the use of services between business units Establish a formal procedure for managing complaints and escalations with the customer BRM Scope Varies depending on the nature and culture of the organization BRM scope of understanding: o Business outcomes o How the customer uses the services o How to manage the services that are being offered o Keeping track of technology trends o Measure the levels of customer satisfaction and respond to any drop in satisfaction with suitable action plans o How to optimize the services provided Next Week Module 4 – Service Design Part I - Introduction Quiz #1 Assignment #2