ITIL 4 Essentials PDF

ITIL® 4 Essentials Your essential guide for the ITIL 4 Foundation exam and beyond Second edition ITIL® 4 Essentials Your essential guide for the ITIL 4 Foundation exam and beyond Second edition CLAIRE AGUTTER Every possible effort has been made to ensure that the information contained in this book is accurate at the time of going to press, and the publisher and the author cannot accept responsibility for any errors or omissions, however caused. Any opinions expressed in this book are those of the author, not the publisher. Websites identified are for reference only, not endorsement, and any website visits are at the reader’s own risk. No responsibility for loss or damage occasioned to any person acting, or refraining from action, as a result of the material in this publication can be accepted by the publisher or the author. ITIL® is a registered trade mark of AXELOS Limited. All rights reserved. Apart from any fair dealing for the purposes of research or private study, or criticism or review, as permitted under the Copyright, Designs and Patents Act 1988, this publication may only be reproduced, stored or transmitted, in any form, or by any means, with the prior permission in writing of the publisher or, in the case of reprographic reproduction, in accordance with the terms of licences issued by the Copyright Licensing Agency. Enquiries concerning reproduction outside those terms should be sent to the publisher at the following address: IT Governance Publishing Ltd Unit 3, Clive Court Bartholomew’s Walk Cambridgeshire Business Park Ely, Cambridgeshire CB7 4EA United Kingdom www.itgovernancepublishing.co.uk © Claire Agutter 2013, 2019, 2020. The author has asserted the rights of the author under the Copyright, Designs and Patents Act, 1988, to be identified as the author of this work. Formerly published as ITIL® Lifecycle Essentials – Your essential guide for the ITIL Foundation exam and beyond in 2013 by IT Governance Publishing. First published in the United Kingdom in 2019 by IT Governance Publishing ISBN 978-1-78778-160-3 Second edition published in the United Kingdom in 2020 by IT Governance Publishing ISBN 978-1-78778-220-4 FOREWORD Congratulations! You are now in possession of a book that will prove to be of great value to IT professionals at different stages in their IT service management journey: from the ITIL® greenhorns to the veterans looking to solidify their status. ITIL 4 Essentials has been written with a delightfully refreshing approach, one that combines theoretical knowledge with practical know-how, arising from the author’s real-world experience. The author has also painstakingly marked out sections that are specific to the ITIL 4 Foundation certification exam as an easy reference for those who intend to attempt it. Large volumes of theory can often be exhausting and at times uninteresting. One of the standout features in ITIL 4 Essentials is how the author overcomes this by encouraging active participation from the reader through the ‘Have a go’ exercises wherever appropriate. The ‘Practice considerations’ that have been documented add tremendous value to anyone looking to implement various aspects of ITIL 4, as the author shares her real-world concerns and constraints. For those new to ITIL 4, the Service Value System has been covered extensively, with particular emphasis on ‘The 7 guiding principles’ and the ‘34 ITIL practices’. This book is a must-have item on your desk for its simplicity in presentation, thoroughness in detail and pragmatism in approach. Sanjay Nair PREFACE I’ve been involved with ITIL® and IT service management for more than 15 years. In that time, I’ve worked in operational and consulting roles, before setting up my own training and consulting organisations. I know from my professional and personal experience how satisfying it is when technology works, and how frustrating it can be when it doesn’t. When writing this book, I noticed that, while there are many ITSM publications available, there is still little practical guidance for the new ITSM practitioner. There is a wide range of ‘exam pass’ guides, but these don’t add much value once your exam is complete. This book contains everything you need to know to pass the ITIL 4 Foundation Certificate, but much more as well. I’ve covered practices and concepts that are not addressed as part of the Foundation syllabus, and provided practical tips for applying service management. I’ve added to the theory by including practice considerations, based on my experiences. As you proceed through the book, you can easily see which content is related to the ITIL 4 Foundation syllabus, and which isn’t. Content related to the Foundation syllabus is highlighted with this symbol: Content that is not part of the Foundation syllabus is highlighted with this symbol: Unless stated otherwise, all quotations are from ITIL® Foundation, ITIL 4 edition. I wish you every success in your ITIL Foundation exam and hope you will continue to use this book as you work with IT service management in your day-to-day role. Claire Agutter Director ITSM Zone/Scopism ABOUT THE AUTHOR Claire Agutter is a service management trainer, consultant and author. In 2017 and 2018 she was recognised as an HDI Top 25 Thought Leader in Technical Support and Service Management and was part of the team that won itSMF UK’s 2017 Thought Leadership Award. Claire is the host of the popular ITSM Crowd hangouts and Chief Architect for VeriSM. She is the director of ITSM Zone, which provides online IT service management training, and Scopism, a content and consulting organisation. After providing training to thousands of successful Foundation candidates, Claire has written this book to provide essential guidance for ITSM practitioners preparing for their ITIL® 4 Foundation exam. The book also provides practical guidance on the application of ITIL and ITSM concepts in their workplace. For more information, please see: https://itsm.zone; www.scopism.com; and Contact: www.linkedin.com/in/claireagutter/. ACKNOWLEDGEMENTS I would like to thank Anna Leyland; managing consultant at Sopra Steria UK Limited and Sanjay Nair; helpdesk manager at his current workplace, for their time and helpful comments during the development of this book. CONTENTS Chapter 1: Key concepts of service management Why is service management important? Why use ITIL® for service management? A brief history of ITIL Why has ITIL been successful? Value Service management Service management as a professional practice Organisation Co-creation Chapter 2: Service management roles Some role considerations Service provider Stakeholder Service relationship Service consumer Using RACI models for role mapping Chapter 3: All about services Products and services Outputs and outcomes Cost and risk Utility and warranty Chapter 4: Service relationships Service offerings Service relationships The service relationship model Chapter 5: The four dimensions of service management Dimension 1: Organizations & people Dimension 2: Information & technology Dimension 3: Partners & suppliers Dimension 4: Value streams & processes Chapter 6: The Service Value System Chapter 7: The SVS: Opportunity, demand, value Chapter 8: The SVS: Guiding principles Guiding principle 1: Focus on value Guiding principle 2: Start where you are Guiding principle 3: Progress iteratively with feedback Guiding principle 4: Collaborate and promote visibility Guiding principle 5: Think and work holistically Guiding principle 6: Keep it simple and practical Guiding principle 7: Optimize and automate The benefits of automation Getting ready to automate Service management automation Chapter 9: The SVS: Governance Chapter 10: The SVS: The service value chain Activity: Plan Activity: Improve Activity: Engage Activity: Design & transition Activity: Obtain/build Activity: Deliver & support Chapter 11: ITIL practices introduced From processes to practices Process models Chapter 12: General management practices Continual improvement Practice considerations Putting continual improvement to work Architecture management Practice considerations Information security management Practice considerations Knowledge management Practice considerations Measurement and reporting Practice considerations Organisational change management Practice considerations Portfolio management Practice considerations Project management Practice considerations Relationship management Practice considerations Risk management Practice considerations Service financial management Practice considerations Strategy management Practice considerations Supplier management Service integration and management Practice considerations Workforce and talent management Practice considerations Chapter 13: Service management practices Availability management Practice considerations Business analysis Process considerations Capacity and performance management Practice considerations Change enablement Practice considerations Incident management Practice considerations IT asset management Practice considerations Monitoring and event management Practice considerations Problem management Practice considerations Release management Practice considerations Service catalogue management Practice considerations Service configuration management Practice considerations Service continuity management Practice considerations Service design Design thinking Practice considerations The service desk Practice considerations Service level management Practice considerations Service request management Practice considerations Service validation and testing Practice considerations Chapter 14: Technical management practices Deployment management Practice considerations Infrastructure and platform management Practice considerations Software development and management Practice considerations Chapter 15: Service management training and qualifications The ITIL qualification scheme Chapter 16: Multiple-choice exam strategies The ITIL Foundation certificate Sample exams Approaching multiple-choice exams Bibliography Further reading CHAPTER 1: KEY CONCEPTS OF SERVICE MANAGEMENT We’re going to start by taking a look at what service management actually means. Service management describes a way of working within an organisation that helps to deliver value to the organisation’s customers, so it is worth spending time analysing its definition, along with some of the related concepts. Why is service management important? In today’s world, information technology (IT) is a fully integrated part of everyone’s life. Whether using a smartphone, withdrawing cash from an ATM, paying bills, or booking tickets on the Internet, IT is present in everything we do. It often plays a supporting role, so we don’t even think about what we are using until it stops working. In the modern business organisation, we see the same reliance on IT and ITenabled services. Every department, from finance and customer services through to logistics, relies on IT to carry out its role effectively and efficiently. Effectiveness refers to whether IT is able to achieve its objectives. Efficiency refers to whether IT uses an appropriate amount of resources. An efficient IT organisation will use optimal amounts of time, money, staff, etc. Now, more than ever, organisations need effective and efficient IT to survive. IT supports critical business processes that generate revenue, serve customers and allow business goals to be achieved. At the same time, the IT department or IT organisation is under more and more pressure to deliver better services, often at a reduced cost. It needs to find a balance between supply and demand, service cost and service quality. To make sure that IT can support business objectives properly, organisations need service management. Service management makes sure that the IT- enabled services delivered do what the business needs, when the business needs it. With effective support and good-quality IT-enabled services, organisations can adopt bold strategies, including the expansion of existing services and movement into new markets. With poor-quality services, organisations will struggle to deliver what they do now, let alone expand and offer anything new or exciting. Now, when many organisations are adopting a strategy focused on ‘digital transformation’, this topic becomes even more relevant. Why use ITIL® for service management? It is worthwhile asking ‘what is ITIL and why is it important?’ ITIL is considered best practice for IT service management (ITSM). It was originally developed by the UK government, and is now adopted by many organisations in both the public and private sectors globally. ITIL is not a prescriptive standard that must be followed. It does not say what must be done in a service provider organisation, and there is no certificate or award for successfully adopting ITIL in an organisation. Instead, ITIL is a framework that organisations can adopt and adapt to improve the way they deliver their IT-enabled services. ITIL is a widely recognised source of best practice. It supports organisations as they deliver services that meet their customers’ needs, at a price the customer is willing to pay. In today’s economic climate, organisations cannot afford to stand still. They need to review their performance and compare it to their competitors and make sure they are improving constantly. Using best practice available in the public domain can support internal improvement. This thinking doesn’t just apply to the private sector. Public-sector organisations, such as local and central government departments, also need to demonstrate that they offer quality services and value for money. They might not be measured on profit, but there will be service objectives that they have to meet. A brief history of ITIL ITIL was developed by the UK government in the 1980s to help improve the quality of IT-enabled services and IT projects. The Central Computer and Telecommunications Agency (CCTA, later renamed the Office of Government Commerce) was tasked with developing a framework for efficient and financially responsible use of IT resources in a government environment. The earliest version of ITIL was called the Government Information Technology Infrastructure Management (GITIM). GITIM focused on service support and service delivery, but was very different from the current version of ITIL. Large companies and government agencies started to adopt ITIL, spreading service management practices across the globe. In 2000, Microsoft® used ITIL to develop the Microsoft Operations Framework. In 2001, version 2 of ITIL was released, with training based on the Service Support and Service Delivery core publications. Hundreds of thousands of people around the world took ITIL training and achieved certification to help them manage IT-enabled services and environments, and progress in their ITSM careers. In 2007, version 3 of ITIL was released, with an update to v3 in 2011. ITIL v3 was based around a service lifecycle that included: Service strategy Service design Service transition Service operation Continual service improvement The newest ITIL version is ITIL 4. Released in 2019, ITIL 4 has evolved to a value system-focused approach that can be integrated with other management practices and ways of working, such as Agile and DevOps. Why has ITIL been successful? ITIL is not academic and theoretical. It is based on the experience of ITSM practitioners and offers a practical approach that has evolved over many years. The introduction of a value system-focus in ITIL 4 means that organisations must concentrate less on technology and more on how to cocreate value with either internal or external customers. Common processes and practices and a strong service management framework all help to support the focus on value. ITIL is successful because it is: Vendor neutral: ITIL is not linked to one supplier, or one technology, or one industry. This means it can be adopted across all types and sizes of organisation. Non-prescriptive: Organisations need to adopt and adapt the elements of ITIL that work for them and their customers. Best practice: ITIL draws on experience from service management practitioners across the globe. Best practice simply means: Proven activities or processes that have been successfully used in multiple organizations.1 ITIL is seen as being preferable to the proprietary knowledge that builds up inside organisations and the minds of staff members. Proprietary knowledge isn’t usually documented in a consistent way. It exists because it has built up over time. This means it is not challenged or improved – and can create a real risk if an experienced staff member leaves and takes their proprietary knowledge with them. In this chapter, we’re going to take a look at some of the key concepts related to service management. Remember to look out for the symbols that denote content related to the ITIL 4 Foundation syllabus. We’ll be examining syllabus-related content in this chapter. Denotes syllabus-related content. Value Products and services need to add value to consumers to be successful. Value is “the perceived benefits, usefulness and importance of something”. Some products and services are directly purchased by consumers, such as bank accounts and mobile phones. If a consumer doesn’t feel they are receiving value, the service provider organisation will know very quickly because the consumer will choose a different product or service, probably from a rival organisation. Where the service relationship is defined less clearly, the service provider organisation might have to work harder to find out if their consumers feel that they are receiving value. For example, the television package that you pay for might include a news channel that you don’t watch because you feel it’s biased, so you consume news via the Internet instead. Because you still purchase the package, it’s more difficult for your service provider to measure this and identify an improvement opportunity. Value encompasses more than just ‘value for money’. Some products and services are more expensive than others, but consumers choose them because they save time or convey status. Service provider organisations need to understand what it is that consumers value about their products and services. Services also need to create value for the service provider, to allow them to continue to provide the service in the future. Service management Services deliver value to consumers. If a service isn’t carefully managed, the value might be less or might not be delivered at all. An IT-enabled service needs to be measured, monitored and maintained to continue working effectively. An IT organisation can’t just put a service into the live environment and forget about it. ITIL provides good practices for managing IT-enabled services. It doesn’t matter what job you have in IT; your role is part of the overall service that is being offered to the consumer. Most modern organisations rely on IT to be effective. They expect IT to be available and responsive, and communicate with them regularly. Technology alone does not deliver a good service. Technology needs to be managed to meet the customer’s needs. The need for a more holistic approach to IT-enabled services is reflected in the four dimensions of service management described in the ITIL 4 guidance. The definition of service management is: “A set of specialized organizational capabilities for enabling value for customers in the form of services”. Capabilities refer to the ability of an organisation to carry out a task or activity. The more mature the organisation, the better its capabilities should be. Capabilities will be based on an organisation’s experience of customers, processes, services, tools, market conditions, etc. This experience grows over time. Where an organisation has low or immature capabilities, it may choose to source capabilities from an external organisation. An organisation can only develop these specialised organisational capabilities when it understands: The nature of value; The nature and scope of the stakeholders involved; and How value creation is enabled through services. Service management as a professional practice Service management should be viewed as a professional practice. It is supported by an extensive body of knowledge, experience and skills that has built up as the IT industry matured and developed a service focus. There is a global community of professionals that supports service management, including organisations like the IT Service Management Forum. You can read more about the itSMF at www.itsmfi.org, including learning about your national chapter and any resources that are available to support you. The itSMF allows service management practitioners to connect with each other and share feedback, ideas and experiences. The ITIL service management framework is supported by a scheme that provides quality assured education, training and certification. There are also other related training and certification schemes, covering areas such as project management, change management, business analysis, and service integration and management. In addition, there is a wealth of service management information available – including academic research and formal standards related to services and service management, such as ISO/IEC 20000, as well as blogs, forums and other more informal content. Service management has developed as IT’s focus has moved from a technology-centric approach to an end-to-end service and value-based approach. The ITIL 4 approach focuses on the consumer and the quality of service the consumer receives. IT is increasingly seen as a vital business enabler, and IT plans must be aligned to overall business models, strategies and plans. Another factor that has contributed to the advancement and development of service management is the increasing complexity of service delivery. More and more organisations are using shared services or have outsourced some or all IT provision to external organisations. As the number of stakeholders involved with service delivery increases, more sophisticated service management is required to control them. As supply chains get more complex, service management practices need to adapt. The increased complexity of delivery has strengthened and improved service management, as well as imposing greater challenges. Organisation Organisations facilitate value creation. The definition of an organisation is: “A person or a group of people that has its own functions with responsibilities, authorities, and relationships to achieve its objectives”. An organisation could be: A single person; A team within an organisation; A legal entity (a company, or a charity); or A government department or public-sector body. Note that an organisation can be a single person – for example, a sole trader. Within this definition, an organisation does not have to be a legal entity. It could be a team that interacts with other teams inside the same legal entity (for example, the IT department provides services to the marketing department). It’s important to define what the term ‘organisation’ refers to so that relationships can be identified and managed. For example, some businesses expect their IT department to behave like an external service provider organisation and to transact with the other business departments as customer organisations. Other businesses define themselves as a single organisation and see all of their internal departments working together as part of the whole organisation. There is no right or wrong way to structure these relationships, but they do need to be defined and managed. Historically, some organisations did not listen to their customers. They saw their relationship with customers as being: One-directional Distant Without feedback In fact, value is a two-way relationship. Value is co-created, a term that implies involvement from both the service provider organisation and the consumer. The growth of online services allows organisations to capture feedback from their customers much more easily. For example, in the past, a new piece of software may have been released every 12 months, based on an aggregated set of feedback and updated requirements. Now, service provider organisations can track what buttons customers are clicking, how long they spend on a page and even where their eyes are moving. They can release software more frequently – perhaps many times a day – to respond to the feedback they have been monitoring. Co-creation Co-creation focuses on customer experience and interactive relationships. It encourages active customer involvement. Organisations need to collaborate with their customers and consumers, as well as the suppliers that help them to offer valuable services. Each product and service is part of a web of service relationships. Most organisations act as a customer and a service provider as part of service delivery: buying and selling or consuming and supplying services and service elements. For value co-creation to take place, both the consumer and the service provider organisation must get value from the product or service. For example, consider using a travel agent to book a holiday. The outcome that you (the consumer) want is the holiday of a lifetime, and the travel agent (the service provider organisation) will help you achieve this. You need to share information about your budget, desired location, activities, planned dates, etc. The travel agent will then provide you with options tailored to your requirements. They will use other service provider organisations like hotels, airlines and transfer companies to build the service for you. Together, you will create the value you want from your trip. If you, as the consumer, withhold important information from the travel agent, they are unlikely to be able to meet your needs. You receive value as the consumer, but the travel agent also receives value, perhaps through profit, repeat business and your word-of-mouth recommendations. 1 https://en.wikiversity.org/wiki/IT_Service_Management/Service_Management. CHAPTER 2: SERVICE MANAGEMENT ROLES In this chapter, we look at some of the service management roles and relationships that need to be defined and managed by organisations. These include: Service provider Stakeholder Service relationship Consumer Customer User Sponsor Stakeholders and value types Some role considerations Roles are carried out by people and need to be clearly defined so that those people understand what they are supposed to do. Clear roles and responsibilities are essential for an effective service management organisation. If roles are not clear, tasks may be duplicated – or not done at all. Remember: a single person can fulfil many roles – that’s why it is so important to map roles carefully. Many organisations that are new to ITIL and service management look at all the ITIL practices and panic. They think they need to hire hundreds of new staff to fulfil all the roles – confusing a job or person with a role. In a smaller organisation, one person may have lots of roles. ITIL doesn’t mean hiring lots of staff, but simply means matching the service management roles with the existing IT staff members. For example, one staff member might carry out change enablement and configuration management roles. Service desk staff might have roles within incident management, access management and request fulfilment. Service provider The organisation delivering a service is acting as a service provider. A service provider can be part of the same organisation as a consumer (for example, an IT department offering services to a sales team), or an external organisation (for example, a software solutions provider selling to customers). A service provider organisation must understand who its customers or consumers are, and which other stakeholders are part of its wider service relationships. There is still a common perception that ITIL is only suitable for organisations of certain sizes or in certain sectors, but this is not the case. Every IT service provider organisation, for example, needs change enablement of some type. The type and size of the organisation will influence how change enablement is implemented, but the underlying reason for having change enablement (protecting services while delivering new or updated functionality) remains the same. Stakeholder A stakeholder is “a person or organization that has an interest or involvement in an organization, product, service, practice, or other entity”. Stakeholders can be anyone – internal or external to the organisation. If a service provider organisation doesn’t understand what its consumers want, it has no chance of being able to deliver services to meet their needs. The organisation needs to build relationships with stakeholders to improve communication and really get to know them and their requirements. It is important to remember that the term ‘stakeholder’ covers more than just consumers. Examples of stakeholders could also include: Suppliers and partners Shareholders and investors Auditors Employees There are many techniques available for stakeholder mapping; if this is an area where your organisation could improve, an Internet search will yield much useful information. Service relationship A service relationship is “a co-operation between a service provider and a service consumer. Service relationships include service provision, service consumption, and service relationship management.” Changing our perspective from ‘making a sale’ to managing a relationship can have a big impact on how we behave as a service provider organisation. When an organisation is new or immature, it will chase every single customer it can possibly find, even if that customer may be difficult to work with or even toxic. More mature organisations recognise that there are some customers with which they do not want to work, because the overhead of managing the relationship outweighs the benefits of the initial sale. Managing service relationships requires the service provider organisation to continue to allocate time and resources after a purchase has been made or a service has been provided. Automation can help with this process; for example, you might receive a reminder when your automobile insurance or health insurance is due for renewal, along with an enquiry about whether anything has changed. Effective service relationship management brings benefits for both the service provider organisation and the consumer. The service provider can have confidence that its customers will be loyal, allowing it to invest in its services and take a long-term planning view. The consumer will feel that they are being listened to and should be confident that the service will continue to meet their needs. Service consumer The service consumer is the person or organisation receiving a service. Most organisations will act as service providers and service consumers as part of normal service delivery (for example, as a consumer they buy components to build a service they supply as a service provider). Consumer is a broad term that includes customer, user and sponsor. Table 1: The Service Consumer Customer “The role that defines the requirements for a service and takes responsibility for the outcomes of service consumption.” User “The role that uses services.” Sponsor “The role that authorizes budget for service consumption. Can also be used to describe an organization or individual that provides financial or other support for an initiative.” One individual might act as the customer, the user and the sponsor for a service (for example, an individual who enters into a mobile phone contract fulfils all of these roles). In other situations, the roles are held by separate people (for example, a purchasing department procures mobile phones for staff in a sales team). Defining roles clearly supports: Better communication; Better relationships; and Better stakeholder management. The roles within the ‘consumer’ definition can have different and conflicting expectations about value, agreeing essential requirements, and how much they are prepared to pay. For example, consider a project to provide new laptops to a team of mobile sales representatives: The sponsor works in procurement and has little understanding of the sales role. Its goal is to purchase the cheapest laptops possible. The customer is the sales team leader, who wants the team to be happy but has been office-based for some years, so has lost sight of mobile workers’ requirements. The users are the sales representatives who will receive the laptops, and they are likely to be unhappy as their needs have not been recognised. In this scenario, it would be better for the users to be active in the customer role as well, so that the requirements are clearly defined up front. Different stakeholders receive different types of value. Table 2: Examples of Stakeholder and Value Types Stakeholder Value example Service consumer Receives benefits from the service, and optimises the costs and risks it incurs related to it. Service provider Receives funding or loyalty from consumers, supporting further business development and reputation enhancement. Service provider employees Job satisfaction, financial and non-financial rewards, personal development. Society and community Employment, taxes, corporate social responsibility initiatives. Charity organisations Financial and non-financial contributions. Shareholders Financial benefits, such as dividends. Using RACI models for role mapping The RACI (Responsible, Accountable, Consulted and Informed) model is used to track who is doing what. It provides clear mapping of roles across the different teams in the organisational structure. RACI models are used to manage resources and roles for the delivery of a piece of work or task. Resources can be drawn from different functional areas within an organisation, which makes it challenging for line managers to track what their staff are doing. For example, a technical resource might be involved with incident investigation, problem resolution, a project and working with a new supplier. Only one person can be Accountable for any task. The person who is accountable for the task has the overall authority for the task – but they may not carry out individual pieces of work themselves. Any number of people can be Responsible as part of the RACI model. These are the workers who will get the actual tasks done, and they will report to the Accountable resource about their progress. Sometimes resources are Consulted to get a task done. This might be a person within the organisation who has specific knowledge, or it could be a document store, or even an Internet search engine. These resources need to be tracked to ensure they are available when required. Other resources need to be Informed. These are stakeholders who need to track and understand exactly how the task is proceeding, or they may need an output from the task. Business sponsors, for example, will typically be informed about progress as part of a project. When RACI is applied to service management processes, the process owner will be accountable for all the process activities, even if they are not responsible for carrying them out. RACI models are often shown as a matrix. To build a RACI matrix, these steps need to be followed: Identify activities. Identify roles. Assign RACI codes. Identify gaps or overlaps. Distribute the matrix for feedback. Monitor the roles. Have a go: why not draw your own RACI matrix? You can also find many examples on the Internet. Table 3, below, shows an example of a RACI matrix for a coffee shop making a customer’s coffee order. Notice how someone is accountable for every task. Table 3: A Simple RACI matrix Fulfilling a coffee order Customer Store owner Staff member Providing staff A R/C Providing premises A R Providing ingredients A C Providing order details A/C R/I Making and delivering coffee C/I A/R Confirmation of order fulfilment I A/R Drinking and approving coffee A/R I I Supplier R CHAPTER 3: ALL ABOUT SERVICES This chapter defines: Products and services Utility Warranty Output Outcome Risk Products and services The services an organisation provides are based on one or more products. Products are created from configurations of the resources to which an organisation has access. Resources include: People Information Technology Value streams Processes Suppliers Partners “A product is a configuration of an organization’s resources designed to offer value for a consumer.” “A service is a means of enabling value co-creation, by facilitating outcomes that customers want to achieve, without the customer having to manage specific costs and risks.” Service provider organisations need to consider the following areas to assess whether or not they are delivering value: Cost Risk Outputs Outcomes Utility Warranty Service provider organisations need to balance the areas listed above to deliver attractive services. For example, a free online banking service might be attractive to consumers, but if it is insecure and risky, they will quickly stop using it. Free one-hour delivery for items ordered via a website could also be attractive but might be too costly for the organisation to continue offering. Products and services need to be considered holistically; too much focus on one element of a product or a service could mean the ‘big picture’ is missed and the customer doesn’t get the outcome they wanted. Outputs and outcomes A service provider organisation produces outputs, which help its consumers achieve their desired outcomes. This is where co-creation is important; without input or activity from the consumer, no value is created. “An output is a tangible or intangible deliverable of an activity.” “An outcome is a result for a stakeholder enabled by one or more outputs.” Value is created when a service has more positive than negative effects. For example, it might cost a consumer money to pay for an externally provided email service, but it reduces the amount of money the consumer spends on internal resources and transfers the risks associated with hardware failure to another organisation. Figure 1 shows the balance between the costs and risks removed or introduced by a service. Figure 1: Achieving value: outcomes, costs and risks2 The service provider organisation needs to understand the costs of service provision to make sure they are within set budgetary constraints and the organisation is profitable, where relevant. For example, public-sector organisations might be required to meet budget targets rather than generate a profit. Cost and risk Cost is “the amount of money spent on a specific activity or resource”. Risk is “a possible event that could cause harm or loss or make it difficult to achieve objectives. Risk can also be defined as uncertainty of outcome and can be used in the context of measuring the probability of positive outcomes as well as negative outcomes”. Service provider organisations manage the detail of risk on behalf of the consumer. The consumer participates in risk reduction by helping to define the service, and what it needs to do. For example, think about an online file storage service. There is a range of security options that the service provider organisation can offer, from minimal security to full encryption and multifactor authentication. More complexity will add more cost for the service provider, so the consumer’s attitude to risk must be understood for the service to be designed appropriately. Utility and warranty Service provider organisations assess the utility and warranty of a service to check it will create value. Utility describes what the service does (is it fit for purpose?) Warranty describes how the service performs (is it fit for use?) “Utility is the functionality offered by a product or service to meet a particular need.” This describes what the service does and whether it is fit for purpose. A service can provide utility by removing constraints from the consumer, or supporting their performance, or both. “Warranty is the assurance that a product or service will meet agreed requirements.” Warranty describes how a service performs, and whether it is fit for use. Warranty covers areas like availability, capacity, security and continuity; the service must meet the levels required by the consumer. For example, consider a social media platform. Utility requirements could include: Allowing users to ‘follow’ accounts they are interested in; Allowing users to decide if they want to see the most recent or most popular content; and Allowing users to ‘block’ accounts with which they do not want to interact. Warranty requirements could include: The platform is available when users want to access it (for example, it doesn’t fail because of high traffic); The platform keeps users’ details secure; and The platform could be restored if there were a major issue. Cost, risk, utility and warranty all provide a picture of a service’s viability. 2 ITIL® Foundation, ITIL 4 edition, figure 2.2. CHAPTER 4: SERVICE RELATIONSHIPS This chapter explains service relationships in more detail, including: Service offerings Service relationship management Service provision Service consumption Service offerings “A service offering is a description of one or more services, designed to address the needs of a target consumer group. A service offering may include goods, access to resources, and service actions.” Table 4: Service Offerings Goods With goods, ownership is transferred to the consumer; for example, buying a car. The consumer takes responsibility for future use of the goods. Access to resources With access to resources, ownership is not transferred to the consumer; for example, renting a car. Access is granted or licensed under agreed terms and conditions; for example, the consumer might agree not to drive more than 10,000 miles per year. Service actions Service actions are performed by the provider to address a consumer need; for example, roadside assistance if a car breaks down. They are performed according to the agreement with the consumer; for example, paying extra to have guaranteed assistance within one hour. The consumer groups to which a service is offered may be part of the same organisation as the service provider, or they might be external to the service provider. Service providers can offer the same product in different ways to different consumer groups; for example, short-term or long-term car leases, or leases with a right-to-buy at the end of the lease. Service relationships “A service relationship is a cooperation between a service provider and a service consumer. Service relationships include service provision, service consumption, and service relationship management.” Table 5: Service Relationships Service provision “Activities performed by an organization to provide services. This includes management of resources configured to deliver the service, access to these resources for users, fulfilment of agreed service actions, service performance management and continual improvement. It may also include the supply of goods.” Service consumption “Activities performed by an organization to consume services. This includes the management of the consumer’s resources needed to use the service, service use actions performed by users, and may include receiving (acquiring) goods.” Service relationship management “This includes joint activities performed by a service provider and a service consumer to ensure continual value co-creation based on agreed and available service offerings.” Figure 2 shows a generic representation of a service. You could use this figure to map some of your own organisation’s services and assess how they are offered to consumers. Figure 2: A generic representation of a service The service relationship model Figure 3 shows the service relationship model.3 Figure 3: The service relationship model In this figure, services delivered by Organisation A create or modify resources within Organisation B. Organisation B can then use these resources to provide services to its own consumers. For example, laptop manufacturer Organisation B buys chips from Organisation A as part of its production process. It sells its laptops to Organisation C, which gives them to its consultants. This figure shows a supply and consumption chain, but remember that for most organisations, supply and consumption is a more complex network of relationships. 3 ITIL® Foundation, ITIL 4 edition, figure 2.1. CHAPTER 5: THE FOUR DIMENSIONS OF SERVICE MANAGEMENT The four dimensions are: Organisations and people Information and technology Partners and suppliers Value streams and processes The four dimensions of service management are relevant to all elements of the Service Value System (see chapter 6). Failing to consider all four dimensions can lead to services that offer poor quality or efficiency, or may even mean services aren’t delivered at all. The four dimensions can overlap and interact in unpredictable ways and must be considered for every service. Figure 4 shows the four dimensions4: Figure 4: The four dimensions of service management The factors on the edge of the figure can all affect or constrain any of the four dimensions. For example, legal factors might limit in which country an organisation can store information. Any factor can affect any dimension. The factors are based on PESTEL (or PESTLE), a framework used to assess macro-environmental factors. PESTEL is often used within business analysis, and assesses the environment an organisation, product or service is operating in and the impact it can have. PESTEL is described in more detail in Table 6. Table 6: PESTEL Political How might political or government actions affect an organisation, product or service? For example, consider the impact of legislation on organisations like Uber and Airbnb. Economic Will national or global economic performance affect a product, service or organisation? For example, a recession might mean that consumers are less willing to purchase some types of service. Social What is the social environment of the market? Do cultural trends have any impact? For example, seasonal events like religious and public holidays. Technological Are there any innovations in technology that could have an impact? Many new technologies such as artificial intelligence, robotic process automation, etc. have yet to reach their full potential. Environmental These factors can include climate, weather, geographical location, etc. For example, a mild winter might leave a clothes retailer with large numbers of unsold coats. Legal What legislation and regulations affect an organisation, product or service? What policies does an organisation have internally? This can include areas like health and safety legislation. Not considering any of the four dimensions can lead to reduced value or no value at all. For example, an organisation might focus too much on technology and neglect the people who are going to use it, leading to no value being delivered. Dimension 1: Organizations & people “The complexity of organizations is growing, and it is important to ensure that the way an organization is structured and managed, as well as its roles, responsibilities, and systems of authority and communication, is well defined and supports its overall strategy and operating model.” The scope of organisations and people include: Formal organisational structures Culture Required staffing and competencies (skills) Roles and responsibilities Culture is an essential part of an organisation’s success or failure. Considerations include: Trust Transparency Collaboration and shared values Leaders who champion values Coordination Some of the areas that organisations need to consider as part of this dimension include: Management and leadership styles Updating skills and competencies Communication and collaboration Broad knowledge plus deep specialisation Common objectives Breaking down silos Organisational structure describes how roles and responsibilities are allocated and coordinated within an organisation: who does what, who reports to who, and how. Most organisations have adopted one of the following approaches to departmentalisation: Functional structure: activities are grouped by their skills, e.g. Sales, Customer Services or Finance. Divisional structure: activities are grouped by customer region, product or service, e.g. EMEA team, online banking versus retail banking, etc. Matrix structure: a combination of functional and divisional, e.g. a finance expert might work on an online banking project as an advisor. Within the organisational structure, employees might also experience: Formal or informal management: how much of their role is governed by explicit rules and regulations? Centralised or decentralised management: what percentage of decisions are taken by a centralised team? Tall or flat structures: with more or fewer levels of management and hierarchy. The type of structure an organisation adopts will depend on its environment, strategy, history, and more. There is no right or wrong structure, but it is important to ensure that it supports organisational objectives. For example, an organisation that wants to innovate quickly might struggle if it has a formal, centralised management structure. It will not be able to attract the type of employees it wants, and existing employees will find it hard to drive innovation because of the amount of approval needed for any new ideas or changes. Dimension 2: Information & technology “When applied to the Service Value System, the information and technology dimension includes the information and knowledge necessary for the management of services, as well as the technologies required. It also incorporates the relationships between different components of the Service Value System, such as the inputs and outputs of activities and practices.” Organisations need to consider: What information is managed by the services? What supporting information and knowledge are needed to deliver and manage the services? How will the information and knowledge assets be protected, managed, archived and disposed of? Technology that supports IT-enabled services includes: IT architecture Databases Blockchain Cognitive computing Applications (including mobile applications) Communication systems Artificial intelligence Cloud computing Technology that supports ITSM includes: Workflow management Communication systems Inventory systems Mobile platforms Cloud solutions Knowledge bases Analytical tools Remote collaboration Artificial intelligence Machine learning Many IT-enabled services rely on effective information management to deliver value (for example, customer loyalty schemes or Cloud storage for photos). Information management includes the areas shown in Table 7. Table 7: Terms Related to Information Management Availability “The ability of an IT service or other configuration item to perform its agreed function when required.” Reliability “The ability of a product, service or other configuration item to perform its intended function for a specified period of time or number of cycles.” Accessibility Accessibility includes making sure information is only available to those who should have access to it along with designing for all consumers, including those with disabilities. Timeliness Is information available at an appropriate or useful time? Accuracy Is information accurate? Relevance Is information relevant? ‘Digital transformation’ is a term used to describe how information technology now underpins every area of business activity. Think about your own role (and, indeed, your personal life). How reliant are you on technology? As the importance of information technology grows, so do the risks associated with it. You’ve probably read news stories about organisations that have suffered a data or security breach. These cyber security incidents can have both financial and reputational consequences. AXELOS, the owner of ITIL, has published RESILIA™ to help meet these challenges. RESILIA is described as “a comprehensive portfolio of tools and training to help your organization achieve global best practice in cyber security. RESILIA helps embed best practice cyber security skills and behaviors throughout your organization, regardless of employees’ roles or responsibilities. With RESILIA you can move beyond effective cyber security and achieve cyber resilience.” Dimension 3: Partners & suppliers “The partners and suppliers dimension encompasses an organization’s relationships with other organizations that are involved in the design, development, deployment, delivery, support and/or continual improvement of services. It also incorporates contracts and other agreements between the organization and its partners or suppliers.” The scope of the partners and suppliers dimension includes: Service provider/service consumer relationships; An organisation’s partner and supplier strategy; Factors that influence supplier strategies; and Service integration and management (SIAM). Supplier and partner relationships range from simple, commodity services to complex partnerships with shared goals and risks. Very few organisations operate completely independently and use no services from other organisations. Table 8: Service Integration and Management Service integration and management As organisations rely on more and more suppliers, it can prove challenging to manage them, particularly when things go wrong. SIAM is a management methodology that uses a service integrator role to coordinate service relationships across all suppliers. Service integration and management might be carried out by staff within the organisation or by an external organisation. Figure 5 shows how the service integrator role sits between service provider organisations and the commissioning (customer) organisation. Figure 5: The SIAM ecosystem5 Table 9 explains the factors that can affect an organisation’s supplier strategy. Table 9: Factors Affecting Supplier Strategy Strategic focus Some organisations value self-sufficiency, whereas others prefer to outsource non-core work. Corporate culture Cultural bias can influence sourcing decisions, perhaps based on previous bad experiences. Resource scarcity Some resources and skills are hard to find, forcing an organisation to source them externally. Cost concerns It may be cheaper to source services externally, e.g. using shared resources to provide 24x7 support. Subject matter expertise Suppliers can bring deep expertise that the organisation cannot build internally. External constraints Legislation and regulation can affect sourcing decisions. Demand patterns Organisations might use external suppliers to help them cope with spikes in demand, e.g. using seasonal staff to provide extra support during holiday periods. The importance of external suppliers in service delivery affects the skills that an ITSM professional needs. Instead of creating a product or service, the ITSM professional might be involved with contract negotiation and agreement. Instead of carrying out activities, they might be overseeing a supplier and managing the ongoing relationship. Commercial issues are more likely to arise if suppliers are chosen and contracts agreed by a procurement team that has little or no contact with the product or service teams. A procurement team might be very price-driven, leading to a contract that delivers an unacceptable level of quality. ITSM professionals need to be able to work across silos to make sure the contracts agreed meet desired outcomes. Dimension 4: Value streams & processes “Applied to the organization and its Service Value System, the value streams and processes dimension is concerned with how the various parts of the organization work in an integrated and coordinated way to enable value creation through products and services. The dimension focuses on what activities the organization undertakes and how they are organized, as well as how the organization ensures that it is enabling value creation for all stakeholders efficiently and effectively.” A value stream is “a series of steps an organization undertakes to create and deliver products and services to consumers”. Value streams and processes define the activities, workflows, controls and procedures needed to achieve agreed objectives. The scope of this dimension includes: Activities the organisation undertakes; How activities are organised; and How value creation is ensured for all stakeholders efficiently and effectively. An organisation needs to understand its value streams to improve its overall performance. Organisations will: Examine work and map value streams Analyse streams and steps to identify waste Eliminate waste Identify improvements Continually optimise value streams Value stream mapping has many benefits. Without an understanding of its value streams, an organisation is unable to explain, measure or improve them. One benefit of value stream mapping that achieves improvements quickly is the ability to identify bottlenecks; in other words, an activity, area or process that is impeding flow. We’ll use a simple value stream to illustrate this. An organisation is mapping its value stream for the deployment of customer relationship management software to sales team members. Sales staff are complaining that the process is too slow and the delay is stopping them carrying out their roles effectively. The organisation decides to map the value stream and try to identify the bottlenecks. The steps it follows are to: Identify all the activities and steps in the process; Record the average time it takes to complete each step and the average wait time between each step; Map this on a simple diagram showing value add times (time to complete each step) and wait times between steps; and Identify the delays that can be reduced, perhaps using the longest delay or the one that is the simplest to fix. The mapping activity produces the value stream shown in Figure 6. Figure 6: A simple value stream Note where the longest delay is: between the approval and the deployment. Perhaps some automation could help here? The key message for processes is: “A process is a set of activities that transforms inputs into outputs. Processes describe what is done to accomplish an objective, and welldefined processes can improve productivity within and across organizations. They are usually detailed in procedures, which outline who is involved in the process, and work instructions, which explain how they are carried out.” A process is a set of interrelated or interacting activities that transforms inputs into outputs. Processes are designed to accomplish a specific objective. Figure 7 shows a simple example: Figure 7: A simple process The word ‘process’ has acquired some negative connotations within an IT environment. Within the DevOps community, previous versions of ITIL have sometimes been seen as bureaucratic, process-driven models that can impede flow and stop work getting done. Some organisations did treat ITIL v3 as a process ‘catalogue’ and made it their mission to implement the full set, exactly as described in the books. It’s important to focus on having ‘just enough’ process to get the job done. Too much process can create barriers (and lead to people avoiding a process altogether), but having no process at all can lead to chaos. Each organisation needs to adopt and adapt processes to help it meet its own organisational goals, and review processes regularly to ensure they are still efficient and effective. The updates in the ITIL 4 guidance and the focus on practices aim to revise this perception. Value streams and processes for products and services help define: What is the generic delivery model for the service, and how does the service work? What are the value streams involved in delivering the agreed outputs of the service? Who, or what, performs the required service actions? 4 ITIL® Foundation, ITIL 4 edition, figure 3.1. 5 Service Integration and Management Foundation Body of Knowledge, Scopism Limited, 2017. CHAPTER 6: THE SERVICE VALUE SYSTEM The ITIL Service Value System (SVS) is “a model representing how all the components and activities of an organization work together to facilitate value creation”. It includes: Guiding principles Governance Service value chain Practices Continual improvement Inputs and outcomes “The ITIL SVS describes how all the components and activities of an organization work together as a system to enable value creation. Each organization’s SVS has interfaces with other organizations, forming an ecosystem that can, in turn, facilitate value for those organizations, their customers, and their stakeholders.” Figure 8 shows the SVS6: Figure 8: The ITIL Service Value System Table 10 further explains the elements of the SVS: Table 10: Elements of the SVS Opportunity/demand Opportunities represent options or possibilities to add value for stakeholders or otherwise improve the organisation. Demand is the need or desire for products and services that originates from internal and external consumers. Opportunity and demand are inputs to the SVS. Value The outcome of the SVS is value. The SVS can enable the creation of different types of value for different stakeholders. Guiding principles The guiding principles are recommendations that can guide an organisation in all circumstances, regardless of changes in goals, strategies, types of work or management structure. The guiding principles are a component of the SVS. Governance Governance is the means by which an organisation is directed and controlled. Governance activities include evaluate, direct and monitor. Governance is an element of the SVS. Service value chain The service value chain is a set of interconnected activities that an organisation performs to deliver a valuable product or service to its consumers and to facilitate value realisation. The service value chain is an element of the SVS. Practices The ITIL practices are sets of organisational resources designed for performing work or accomplishing an objective. Practices are an element of the SVS. Continual improvement Continual improvement is a recurring organisational activity performed at all levels to ensure that an organisation’s performance is always aligned to changing stakeholder expectations. Continual improvement is an element of the SVS. The SVS is designed to combat silos within an organisation. Silos exist when teams or departments focus solely on their own areas of work or influence, ignoring the ‘big picture’ and not looking across the organisation holistically. Silos make it more difficult for an organisation to become agile and resilient, because they limit effective communication and reduce the power of a shared vision. A siloed organisation will experience these symptoms: Inability to act quickly or take advantage of opportunities. Reduced ability to optimise resource use across the organisation. Poor decision making. Poor visibility/a lack of transparency. Hidden agendas and an increase in unhealthy organisational politics. A lack of clarity about value streams, interfaces and handoff points. Looking at the organisation from the value system perspective helps to discourage silos. The value chain activities and practices are not a fixed or rigid structure; instead, they are configured into value streams to meet the needs of the organisation and can be reconfigured as those needs change. The value system provides a structure that enables flexibility. In the next chapters we will study the elements of the SVS: Opportunity, demand, value Guiding principles Governance Service value chain Practices (including continual improvement) Value is created by the SVS; this will not be studied in more detail and has already been covered as a concept in earlier chapters. 6 ITIL® Foundation, ITIL 4 edition, figure 4.1. CHAPTER 7: THE SVS: OPPORTUNITY, DEMAND, VALUE “Opportunity and demand trigger activities within the ITIL Service Value System (SVS) and these activities lead to the creation of value. Opportunity and demand are always entering into the system, but the organization does not automatically accept all opportunities or satisfy all demand.” Opportunities are ways a service provider organisation might be able to add value for stakeholders or somehow improve their own organisation. Organisations will always need to balance the time and resources they allocate to new or changed services against the time and resources they allocate to improvement opportunities. Too much focus on just one area will lead to problems in the longer term. For example, an organisation that only focuses on improving existing services might find itself unprepared for a major change in its market. An organisation that only focuses on new services might find its existing services are neglected and its customer base becomes unhappy. How do we identify opportunities? This is a crucial question for a service provider organisation. There are many different strategic tools and techniques that can be used to help provide an answer. One such technique is the ‘blue ocean/red ocean’ approach. A red ocean is defined as an established market with entrenched industry practices and intense competition. A blue ocean is an untapped market space, free of competition, where an organisation can create customers. The blue ocean has the potential to provide rapid growth and large profits. Identifying the ‘blue ocean’ for a service provider organisation can help to identify where resources will be best allocated. We could reasonably expect our customers to tell us what they want, which creates opportunities, but this isn’t always simple, particularly in the technology market space. What if our customers can’t imagine how technology can help them? As Henry Ford famously said of motor cars, “If I had asked people what they wanted, they would have said faster horses.” For digital or information technology service provider organisations, part of their ongoing service relationship management priorities will be to help their customers imagine the impossible and appreciate how technology can help them. Equally, not every idea we receive from our customers is a good one. What people believe they want – and what they actually need – can be very different things. If a service provider organisation sees an opportunity but isn’t sure that demand truly exists, it needs to allocate resources very carefully. Agile development describes the use of a minimum viable product (MVP) to provide feedback for future product development. An MVP has just enough features to satisfy early customers and can help to identify any incorrect assumptions that have been made. This reduces the cost and risk associated with the development project. The MVP process can also include carrying out market analysis before any development actually takes place. The MVP will: Allow a product hypothesis to be tested; Use minimal resources; Accelerate learning; Get the product or service to customers as soon as possible; and Provide an opportunity for feedback for future development. CHAPTER 8: THE SVS: GUIDING PRINCIPLES A guiding principle is a “recommendation that guides an organization in all circumstances”. Many things change in day-to-day operations: Goals Key staff Strategies Types of work Management and organisational structure Guiding principles remain constant, no matter what else changes. Using guiding principles allows organisations to integrate multiple ways of working and management methods within service management. For example, some organisations follow a waterfall way of working, while others use methods like Agile and DevOps. The principles allow different ways of working to be used, while making sure appropriate outcomes are delivered. Table 11: Waterfall, Agile and DevOps Waterfall “Waterfall is a development approach that is linear and sequential with distinct objectives for each phase of development.” Agile “Agile is an umbrella term for a collection of frameworks and techniques that together enable teams and individuals to work in a way that is typified by collaboration, prioritization, iterative and incremental delivery and timeboxing. There are specific methods (or frameworks) that are classed as Agile, such as Scrum, Lean and Kanban.” DevOps “DevOps is an organizational culture that aims to improve the flow of value to customers. DevOps focuses on culture, automation, Lean, measurement and sharing (CALMS).” The guiding principles should encourage and support continual improvement. They apply across the organisation at all levels and all staff should be aware of them. In each situation, staff and organisations should consider their principles and what is applicable. Not all principles are relevant in every situation, but they all need to be reviewed on each occasion to assess if they are appropriate. The ITIL guiding principles are: Focus on value Start where you are Progress iteratively with feedback Collaborate and promote visibility Think and work holistically Keep it simple and practical Optimise and automate The ITIL authors recommend putting up posters of the guiding principles in your workplace and meeting rooms to help remind everyone to focus on them. Why not try it? Guiding principle 1: Focus on value “Everything the organization does should link back, directly or indirectly, to value for itself, its customers, and other stakeholders.” Services that offer value are attractive to customers. Services must also offer value to the service provider organisation. ‘Focus on value’ can include: Understanding and identifying the service consumer; Understanding the consumer’s perspective of value; Mapping value to intended outcomes, and understanding these can change over time; and Understanding the customer experience (CX) and/or user experience (UX). Table 12: Customer and User Experience Customer experience CX is “the sum of functional and emotional interactions with a service and service provider as perceived by a service consumer”. User experience UX is the experience of interacting with a product or service focusing on usability and aesthetics (e.g. user interface, touch and feel of the interaction, graphics, content, features, ease of use, etc.). Sometimes known as the digital experience (DX).7 As part of service provision, organisations need to know: Why consumers use services; What the services help them to do (the outcomes they support); How services help them achieve goals; The cost to the consumer; and The risks for the consumer. To successfully apply this principle, service provider organisations need to consider: How consumers use each service; How to encourage all of their staff to focus on value; How to maintain a focus on value in day-to-day operations, not just as an improvement project; and How to embed focus on value in every single improvement initiative. An organisation’s employees can only focus on value if they understand what value looks like for their particular organisation as well as its consumers. Does an organisation value profit above everything else? Does it value long-term customer relationships, or perhaps being seen as an innovator? In organisations with many layers of management and a hierarchical structure, ‘value’ might only be understood at senior levels. Frontline workers may be seen as less important and so ‘value’ isn’t communicated to them. Adopting a flatter structure with fewer layers of management can help to communicate key concepts like ‘value’ to all employees so that they can work effectively. Guiding principle 2: Start where you are “In the process of eliminating old, unsuccessful methods or services and creating something better, there can be a great temptation to remove what has been done in the past and build something completely new. This is rarely necessary, or a wise decision. This approach can be extremely wasteful, not only in terms of time, but also in terms of the loss of existing services, processes, people and tools that could have significant value in the improvement effort. Do not start over without first considering what is already available to be leveraged.” Change can be an evolution or a revolution. Revolution is more disruptive and can have unforeseen negative consequences. Before making any change or improvement, it’s important to assess the current position and see if anything can be reused or built on. ‘Start where you are’ can include: Assess where you are; Observe current services, processes and methods; and Use measurements to analyse what is being observed; remember that measuring can affect the results of what is measured. To apply this principle successfully, service provider organisations need to consider: Being as objective as possible about what exists currently; Assessing whether current practices and services can/should be replicated or expanded; Using risk management skills to support decision making; and Recognising that sometimes nothing from the current state can be reused. Measurement is described as being particularly important for this principle. What to measure, and how, is a challenge for many organisations. For IT-enabled products and services, measurement must be considered as part of the design process. It is much more difficult (and often costlier) to try to retrofit measurement after a product or service is live and in use. Measurement, then, needs to be reviewed continually for usefulness. Are the right people getting the right information to make the right decisions? If not, what needs to change? Some technical organisations are embracing the concept of ‘observability’. “Observability is achieved when a system is understandable, which is difficult in today’s world of increasing software complexity, where most problems are the convergence of many different things failing at once. One early definition of software observability focused on the three so-called “pillars” of logs, metrics, and traces. That was a good first effort at shifting the priorities of the industry, but the definition is flawed. A better and more contemporary litmus test for observability is: can you ask the right questions? And can you do it in a way that’s predictable, fast, and scalable over time – i.e., without having to re-instrument or launch new code?”8 Guiding principle 3: Progress iteratively with feedback “Resist the temptation to do everything at once. Even huge initiatives must be accomplished iteratively. By organizing work into smaller, manageable sections that can be executed and completed in a timely manner, the focus on each effort will be sharper and easier to maintain.” Feedback can help service provider organisations to understand: End-user and customer perception of value; The efficiency and effectiveness of their services and value chain; The effectiveness of governance and management controls; The interfaces between the organisation and suppliers and partners; Demand for products and services; and Improvement opportunities, risks and issues. Working iteratively and using feedback help service provider organisations to be more: Flexible; Responsive to changing requirements; Capable of identifying and responding to failures; and Quality-focused. To successfully apply this principle, service provider organisations need to consider: Comprehending the whole, but doing something; starting small; That the ecosystem is always changing, so feedback is essential; and Going fast doesn’t mean work is incomplete; iterations may be small, but they are still producing results. How do we know if feedback is meaningful or accurate? Some service provider organisations dismiss feedback if they feel that it represents a dissatisfied minority. It is true that tools like customer satisfaction surveys are often completed by customers who feel either extremely positive or extremely negative about their experience. Service providers need to follow the basics of statistical sampling and avoid biased sampling techniques. Guiding principle 4: Collaborate and promote visibility “When initiatives involve the right people in the correct roles, efforts benefit from better buy-in, more relevance (because better information is available for decision-making) and increased likelihood of long term success.” Collaboration can be viewed as working together towards a shared goal. It can help to remove silos within organisations, allowing everyone to work together more effectively. Collaboration can happen anywhere – inside and outside of the organisation (for example, with other internal teams, or with external suppliers). Promoting visibility makes work more transparent in the organisation. This helps everyone to: Understand what is a priority; Balance improvement work and daily work; Understand the flow of work; Understand where there are bottlenecks; and Identify where time, resources and money are being wasted. To apply this principle successfully, service provider organisations need to consider that: Collaboration does not mean consensus; it’s not essential that everyone agrees, but everyone must understand why decisions are made; Communication must match the audience; different stakeholder groups will need a different message and communication type; and Good decisions can only be made when there is visible data to support them. Collaboration won’t just ‘happen’. The leaders within a service provider organisation need to create an environment where collaboration can thrive and be rewarded. Collaboration thrives in high trust environments, which are characterised by: Good communication; Support between individuals; Respect; Fairness; and Predictability Think about your own organisation, and whether it is ready for more collaborative working. What might need to change? Guiding principle 5: Think and work holistically “No service, practice, process, department or supplier stands alone. The outputs that the organization delivers to itself, its customers and other stakeholders will suffer unless it works in an integrated way to handle its activities as a whole, rather than separate parts. All the organization’s activities should be focused on the delivery of value.” To apply this principle successfully, service provider organisations need to consider that: The complexity of the system will affect how this principle is applied; higher complexity can create challenges; Collaboration supports holistic thinking and working; Automation can support holistic working; and Patterns in the needs of and interactions between system elements can help identify the holistic viewpoint. Much recent management thinking has focused on functional specialisation. Value streams are divided into tasks, and resources are directed towards completing one individual task in as near a perfect way as possible. For example, think about a fast-food outlet, with one team member preparing fries, one assembling burgers, one serving customers, etc. This can be highly effective, but also adds a risk that team members lose sight of the big picture. If the team member assembling the burgers decides to save time by leaving out the pickle (thinking that no one likes it anyway!), they create problems for the team member serving customers, who has to deal with complaints. Think about your own role and your team’s role within your organisation. How do you and your team fit into the big picture? Guiding principle 6: Keep it simple and practical “Always use the minimum number of steps to accomplish an objective. Outcome-based thinking should be used to produce practical solutions that deliver valuable outcomes.” Processes and services are designed to meet the majority of consumers’ needs. Every exception cannot be designed for. It is better to create rules that can be used to handle exceptions when necessary. To successfully apply this principle, service provider organisations need to: Ensure value comes from every activity; Recognise that simplicity can be more challenging to create than complexity; Do fewer things; do them better; Respect people’s time; don’t make them do unnecessary work; Consider that simplicity can support quick wins; and Remember that processes or services that are easy to understand are more likely to be used. In the DevOps community, process is sometimes described as the ‘scar tissue’ that organisations develop over time (first described by Bridget Kromhout). What this statement describes is the way that an organisation will add extra steps and checks and balances each time something goes wrong, to try to prevent the same situation happening in future. For example, a software patch that has been manually tested might fail in the live environment. In response, an automated test is added and a requirement for sign-off from a test manager. If the patch fails again, sign-off might also be added from a change manager or the application owner. Unintentionally, organisations add complexity to how they work, which can lead to the unintended outcome of employees circumventing the process entirely. This principle is advising us to continually reassess how we work, and look for ways to make things simpler, without compromising value. Guiding principle 7: Optimize and automate “Organizations must maximize the value of the work carried out by their human and technical resources. The four dimensions model provides a holistic view of the various constraints, resource types, and other areas that should be considered when designing, managing, or operating an organization. Technology can help organizations to scale up and take on frequent and repetitive tasks, allowing human resources to be used for more complex decision making. However, technology should not always be relied upon without the capability of human intervention, as automation for automation’s sake can increase costs and reduce organizational robustness and resilience.” Optimisation means “to make something as effective and useful as it needs to be. Before an activity can be effectively automated, it should be optimized to whatever degree is possible and reasonable.” Automation typically refers to “the use of technology to perform a step or series of steps correctly and consistently with limited or no human intervention”. Optimisation activities include: Understanding and agreeing the context for optimisation; Assessing the current state; Agreeing the future state and prioritise, focusing on simplification and value; Ensuring stakeholder engagement and commitment; Executing improvements iteratively; and Monitoring the impact of optimisation continually. It’s important to simplify and/or optimise activities before automation is attempted. Automation can include: Focusing on simplification and optimisation before automation; Defining metrics to measure impact and value; and Using complementary guiding principles: Progress iteratively with feedback Keep it simple and practical Focus on value Start where you are The benefits of automation Once a task or process has been introduced and performed regularly, often, the next step is to try to automate it. Automation can improve the performance of people, processes, management and organisation structures. It can also improve the way that knowledge and information are shared between parts of the organisation. Automation can improve the utility and warranty of services, for example: Automated resources can have their capacity adjusted more easily; Automated resources don’t need human intervention, so can be available across time zones or service hours; Automated systems can be measured more effectively and improved; Computers can optimise services and processes in ways that humans could not; and Automation can capture knowledge about a process and share it more easily. Used carefully, automation can improve service quality and reduce costs and risks. It does this by removing the human element and minimising the chances of a task being performed in different ways by different people. Automation should reduce complexity and uncertainty. To be automated, a task or process must be clearly defined and understood, or the automation will fail. Getting ready to automate Automation will only work if the task or process is broken down into logical steps as part of a workflow that can be programmed into the relevant tool. There are four main areas to consider when looking at automation: Table 13: Preparing for Automation Automation consideration Details Simplify the process before automating Simplification on its own can reduce variation and should not adversely affect the process outcome. However, removal of necessary information or tasks will make the process less useful. As a general rule, simplify as far as possible without negative effect, and then automate from this point. Clarify the process before automation This will include process activities, tasks and interactions, and inputs. Automate, clarify, test, modify and then automate again, being sure to involve all process agents and stakeholders. Reduce enduser contact with the underlying systems and processes We need to try to present our customers with simple options so that they can easily submit demand and extract utility. Don’t rush to automate complex or non-routine tasks Automation is of benefit to high volume, low complexity processes. For example, if a user is requesting a workstation for a new starter, they should not have to answer an endless list of questions about what type of PC they want, how much memory, which supplier it will be ordered from, and so on. Not everything is suitable for automation, and we may have to accept that some processes are too complex, or not mature enough, to be automated. Service management automation Most service management practices will benefit from some level of automation. For example, incident management works well when incident information can be captured and easily transferred between teams. Incident management tools can also automatically notify someone when they are about to breach a target, and something needs to be escalated. There are many service management tools available, aimed at small, medium and large organisations. Selecting the correct tool can be a real challenge. When selecting a tool, remember these key points: Invest time in requirements gathering, including analysis of your existing toolset; it will pay off. Create a long list of available options. Carry out a paper review. Create a short list and invite suppliers in to demonstrate. Select the tool most closely aligned with your budget and requirements. Every organisation will have different requirements for a service management toolset, but there are some generic considerations, as shown in Table 14. Table 14: Generic Service Management Toolset Requirements Generic toolset requirement Self-help Considerations Self-help allows users to access a range of services without speaking directly to someone in the IT department. It is often offered via a web front-end, which needs to connect directly to back-end process handling software. Self-help technology integrates these user requests into the backend process management software so that they can be treated in a consistent manner. Using technology and automation in this way can mean, for example, that fewer people are required on the service desk answering the phone, and phone calls could be limited to service emergencies and high-priority incidents. Workflow/process engine Automation of workflows and process flows helps ensure that less manual intervention is required when information is passed from team to team, or person to person. Responsibilities, mandatory activities and escalation points can also be programmed into a tool with workflow management – so that these are managed automatically too. Integrated configuration management system (CMS) An integrated CMS allows information about specific configuration items to be accessed at any time. Configuration items can be linked to incidents, problems, changes and known errors – all via the integrated CMS. (See chapter 11 for more information about configuration management.) Discovery/deployment/licensing Automated discovery tools dramatically ease the task of updating and changing data in a CMS. Automatically discovering every configuration item on the network means only non-networked configuration items will need to be discovered manually and recorded. This removes the danger of people making mistakes during the population of the CMS and allows ongoing verification of the data. Any unauthorised changes made to a configuration item will be quickly picked up by the discovery software. This means you can prevent unauthorised items being connected to the network, as well as identifying any configuration items that disappear without approval. Discovery technology can also be used to deploy software packages. This helps the organisation to keep track of its software licensing position, as software installs can quickly be compared to the number of licences entered in the CMS. An interface to self-help facilities can also be provided via the toolset, to allow request and download of approved software. If this is automatically handled by the deployment software, the service request can be fulfilled with no human intervention, again saving resources. Remote control Remote control allows an agent to operate an end user’s PC from another location. With remote control, the service desk can resolve more incidents at the first point of user contact. Remote-control facilities involve security implications, and these will need to be considered carefully. The organisation might, for example, require a user to click to accept an agent having access to their PC. Diagnostic utilities Diagnostic utilities include specially written scripts, routines and programs that are executed to analyse information quickly and provide feedback, typically to help diagnose or record an incident. Within many support organisations, second-line support teams are often critical of the quality of information passed to them by the service desk. Involving these teams in the preparation of diagnostic utilities and scripts means the incident management process can be made more efficient by ensuring that the correct level of information is collected first time. Utilities and scripts will also need to be regularly audited to make sure they are still up to date and fit for purpose. Reporting All service management tools should come with some preprogrammed reports that you can leverage quickly, as well as the option to create your own reports – these should be tailored to your organisation and the specific targets you have to meet. Effective reporting is vital to service management, so any data entered into a toolset should be easy to manipulate and review. Dashboards Dashboards provide instant information about service management. For example, a dashboard can allow service level agreement target breaches to be identified quickly and appropriate action taken. Many organisations already use dashboards, often with red-amber-green colours signifying certain conditions. Dashboards can be used within IT or made available to customers. 7 VeriSM™: Unwrapped and Applied, 2018, C. Agutter, J. Botha and S. D. Van Hove, Van Haren Publishing. 8 www.honeycomb.io/observability/. CHAPTER 9: THE SVS: GOVERNANCE Organisational governance is responsible for evaluating, directing and monitoring an organisation’s activities, including its service management. “Every organization is directed by a governing body, i.e. a person or group of people who are accountable at the highest level for the performance and compliance of the organization. All sizes and types of organization perform governance activities; the governing body may be a board of directors or executive managers how take on a separate governance role when they are performing governance activities. The governing body is accountable for the organization’s compliance with policies and any external regulations.” The level of governance within an organisation will be defined by many factors: its size, the industry sector, whether or not it is publicly listed, and the culture within which it operates. If the governing body doesn’t provide clear direction, there is a risk that managers will make decisions that are not aligned with the organisation’s overall goals. For example, consider the Volkswagen emissions scandal. Volkswagen Group’s vision is “we are a globally leading provider of sustainable mobility”, including being a “role model for environment, safety and integrity”. Clearly, this vision was not understood by the departments that were creating tests that allowed polluting vehicles onto the road – a decision that ultimately destroyed shareholder value, as well as damaging Volkswagen’s reputation with a broader group of stakeholders.9 9 www.theguardian.com/business/ng-interactive/2015/sep/23/volkswagen-emissions-scandalexplained-diesel-cars. CHAPTER 10: THE SVS: THE SERVICE VALUE CHAIN The service value chain is the central element of the SVS. It is an operating model that outlines the key activities required to respond to demand and facilitate value through products and services. The activities in the value chain are: Plan Improve Engage Design and transition Obtain/build Deliver and support Figure 9 shows the service value chain10: Figure 9: The ITIL service value chain Activities in the chain don’t necessarily happen in a linear flow. Activities may happen in parallel, be repeated, or occur as a series of iterations. Different products, services and consumers will lead to different streams of work and different routes through the value chain. For example, developing a new application will be different from amending an existing one. These are an organisation’s value streams: combinations of practices and value chain activities that lead to value. Each value chain activity relies on inputs and creates outputs for other activities. To convert inputs into outputs, the value chain uses combinations of ITIL practices, which are sets of resources designed for performing certain types of work. Each activity can potentially use: Resources Processes Skills Competencies from one or more ITIL practices, and from inside or outside the organisation. The activities are all interconnected. Skipping an activity, or spending less time on it than is needed, will impact the whole value chain as other activities will not receive the inputs they need. There are some key points to remember about the service value chain activities: Engage includes all engagement interactions – for example, with internal or external customers, suppliers, subject matter experts participating in the organisation’s value chain activities, etc. All new resources are obtained through Obtain/build. All planning takes place in the Plan activity. Component, product and service creation, modification, delivery, maintenance and support are performed in an integrated way by the Design & transition, Obtain/build, and Deliver & support activities. Products & services, Demand and Value are SVS components, but they are not value chain activities. Activity: Plan “The purpose of the Plan value chain activity is to ensure a shared understanding of the vision, current status, and improvement direction for all four dimensions and all products and services across the organization.” Information inputs into the Plan activity are used to create key outputs including improvement opportunities (for Improve) and contract agreements (for Engage). Table 15: Key Inputs and Outputs of the Plan Activity Key inputs to the Plan activity Policies, requirements and constraints; Consolidated demand and opportunities (from Engage); Value chain performance information, improvement initiatives and plans (from Improve); Improvement status reports (from Improve); Knowledge and information about new or changed products and services (from Design & transition and Obtain/build); and Knowledge and information about externally provided service components (from Engage). Key outputs from the Plan activity Strategic, tactical and operational plans; Portfolio decisions for Design & transition; Architectures and policies; Improvement opportunities (for Improve); Contract and agreement requirements (for Engage); and Product and service portfolio (for Engage). Activity: Improve “The purpose of the Improve value chain activity is to ensure continual improvement of products, services and practices across all value chain activities and the four dimensions of service management.” Deliver & support provides service performance information and Engage provides stakeholder feedback. Outputs include improvement initiatives, status reports and service performance information for Design & transition. Table 16: Key Inputs and Outputs of the Improve Activity Key inputs to the Improve activity Product and service performance information (from Deliver & support); Stakeholder feedback (from Engage); Performance information and improvement opportunities (from all value chain activities); Knowledge and information about new or changed products and services (from Design & transition and Obtain/build); and Knowledge and information about externally provided service components (from Engage). Key outputs from the Improve activity Improvement initiatives and plans (for all value chain activities, products and services); Value chain performance information (for Plan, and the governing body); Improvement status reports (for all value chain activities); Contract and agreement requirements (for Engage); and Service performance information (for Design & transition). Activity: Engage “The purpose of the Engage value chain activity is to provide a good understanding of stakeholder needs, transparency, and continual engagement and good relationships with all stakeholders.” Engage provides oversight of requests and feedback from customers, as well as incidents to help identify Improve opportunities. Engage is not only about engagement with customers but also with suppliers, subject matter experts in the business, management and all stakeholders. Table 17: Key Inputs and Outputs of the Engage Activity Key inputs to the Engage activity The product and service portfolio (from Plan); Demand and opportunities for products and services (from internal and external customers); Detailed requirements, requests and feedback (from internal and external customers); Incidents, service requests and feedback (from users); Information on the completion of user support tasks (from Deliver & support); Marketing opportunities (from current and potential customers and users); Cooperation opportunities and feedback (from partners and suppliers); Contract and agreement requirements (from all value chain activities); Knowledge and information about new or changed products and services (from Design & transition and Obtain/build); Knowledge and information about externally provided service components (from partners and suppliers); and Improvement initiatives and improvement status reports (from Improve). Key outputs from the Engage activity Consolidated demands and opportunities (for Plan); Product and service requirements (for Design & tr

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