What We Will Cover In This Module

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What We Will Cover In This Module

What We Will Cover In This Module

General Concepts Around ITIL (V3)

Supporting Processes Principles

ITIL Implementation Life Cycle

Getting Started With A Practical

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Why “Service”?

Why “Service”?

Capacity

Warranty

Continuity

Security

Achieved

Result

Removed

Limitation

Or

Client Value

Utility

Usability +

Application

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The ITIL V3 Service Lifecycle

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Service Strategy

Service Strategy

How to build and refine a service

strategy

Service Lifecycle

IT Financial Management

Demand Management

Service Portfolios

Organizational Design

Generic Technology Requirements

Provide guidance on strategic analysis, planning, positioning, and

implementation with respect to service models, strategies, and strategic

objectives to deliver value to customers and capture value for service

providers

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Service Design

Service Design

How to design services

Sourcing Services

Establishing Service Metrics

Service Level Management

Availability Management

Capacity Management

IT Service Continuity Management

Information Security Management

Supplier Management

Service Acceptance Criteria

Translates strategic plans and objectives and creates the designs and

specifications for execution through service transition and operations

bringing together the infrastructure, applications, systems, and

processes, along with partners and suppliers, to create a superior

service offering

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Service Transition

Service Transition

How to transition services to production

Change Management

Release Management

Service Asset and Configuration

Management

Knowledge Management

Management of Organization and

Stakeholder Change

Service Testing

Service Release Acceptance, Test and

Pilot

Ensures that the design will deliver the intended strategy and

that it can be operated and maintained effectively

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Service Operations

Service Operations

How to operate services while in production

Incident Management

Request Fulfillment Management

Problem Management

Access Management

Common Service Operation Activities

Application Management Activities

Service Monitoring and Control

Manage a service through its production life of day-to-day

management.

service owners, operational staff, vendors and service providers

customers, end users, business and IT management

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Continual Service Improvement

Continual Service Improvement

7-Step Process For Continual

Improvement

Service Measurement

Service Assessment and Analysis

Service Improvement Strategies

Service Control Loop

Service Measurement

Ensure that a service delivers the maximum benefit and measure

its performance through its life, suggesting improvements along

the way

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Supporting Processes Principles

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Process management (process manager)

1.

task

procedure

(work

instruction)

doer

(role)

responsibility

measurement

motivation

evaluation

n.

task

procedure

(work

instruction)

doer

(role)

responsibility

measurement

motivation

evaluation

Start

Objective

Initiation

preconditions

Evaluation

Measurable

result

End

Benefits

Process in General

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Stucture: Functions

IS Dev

Dept

IT Ops

Dept

Data Center

Director

Processes

Processes

Organization – a Collection of Processes

Organization – a Collection of Processes

Change

Management

Configuration

Management

Service Level

Management

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Processes

Processes

Organization – a Collection of Processes

Organization – a Collection of Processes

IS Dev

IT Ops

Process

Mgmnt

Structure: processes

DC

Change

Management

Configuration

Management

Service Level

Management

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Processes

Processes

Organization – a Collection of Processes

Organization – a Collection of Processes

IS Dev

Dept

IT Ops Dept

Data Center

Core (Functional) Processes

Service Management Processes

Change

Management

Configuration

Management

Service Level

Management

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The ITIL V3 Service Lifecycle

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Processes

Processes

• Finance Management

• Service Portfolio Management

• Demand Management

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Processes

Processes

• Service Catalogue Management (SCM)

• Service Level Management (SLM)

• Capacity Management

• Availability Management

• IT Service Continuity Management (ITSCM)

• Information Security Management (ISM)

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Processes

Processes

• Processes Driving this Phase:

– Change Management

– Resource and Configuration Management

– Knowledge Management

• Processes Focusing on Service Transition, but Supporting Other

Phases as Well:

– Transition Planning and Support

– Release Management

– Service Validation and Testing

– Evaluation

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Processes

Processes

• Event Management Process

• Incident Management Process

• Request Fulfillment Process

• Access Management Process

• Problem Management Process

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7 Steps Improvement Process

7 Steps Improvement Process

Identify:

Vision, Mission, Values

Strategy

Tactical Objectives

Operational Objectives

Step 1:

Define, What You

Should

Measure

Step 5:

Analyse the Data (Relations?

Trends? According to Plan?

Targets Met?)

Step 4:

Process the Data

(Frequency? Format?

System? Accuracy)

Step 3:

Gather the Data (Who?

How? When? Integrity

of Data)

Step 2:

Define What You

Can

Measure

Step 6:

Present and Use the Information,

Assessment Summary, Action

Plans, etc.

Step 7:

Implement Corrective

Action

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Implementing Lifecycle – Theory

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The Program Implementation Lifecycle

The Program Implementation Lifecycle

ITSM

Visioning

ITSM

Visioning

Month 1

Months 2-3

Month 4

Months 5-7

Months 8-11

What Is The

Vision?

Where Are

We Now?

How Will

We Get

There?

How Do We

Know We’ve

Succeeded?

How Do We

Get To Our

Vision?

(Define)

(Measure)

(Assess)

(Implement)

(Control)

ITSM

Visioning

ITSM

Assessment

Visioning

ITSM

ITSM

Planning

Visioning

ITSM

ITSM

Foundation

Visioning

ITSM

ITSM

Control

ITSM

Visioning

ITSM

Initial Wins

ITSM

Visioning

ITSM

Visioning

Month 1

Months 2-3

Month 4

Months 5-7

Months 8-11

What Is The

Vision?

Where Are

We Now?

How Will

We Get

There?

How Do We

Know We’ve

Succeeded?

How Do We

Get To Our

Vision?

(Define)

(Measure)

(Assess)

(Implement)

(Control)

ITSM

Visioning

ITSM

Assessment

Visioning

ITSM

ITSM

Planning

Visioning

ITSM

ITSM

Foundation

Visioning

ITSM

ITSM

Control

ITSM

Visioning

ITSM

Initial Wins

Service

Strategy

Continual

Service

Improvement

Service

Design

Service

Transition

Service

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Implementing Lifecycle – Practical Approach

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Step 1

Build

Portfolio Of

Services

Step 2

Build Cost

Baseline

Step 3

Build IT

Service Model

Step 4

Identify Service

and Cost

Improvements

Step 5

Identify ITSM

Service

Improvement

Roadmap

IT Operating Statement

Service Portfolio

IT Service Model

IT Service Operating

Statements

IT Service Ledger

Integrated Cost/Value

Model

Inventory of Service

Improvement

Opportunities

Prioritized

Service

Improvement

Project Scope

Statements

ITSM Roadmap

A 5-Step Tactical Approach Using ITIL

A 5-Step Tactical Approach Using ITIL

Service Strategy To Transform How IT

Service Strategy To Transform How IT

Manages Itself

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Step 1 – Building The IT Service Portfolio

Step 1 – Building The IT Service Portfolio

1. Inventory IT Services being provided (or

planned to be provided) to the business

2. Inventory IT Business Support Services

drawing them from applications inventories

3. Create high level service descriptions for each

service identified

4. Group services into service lines

5. Create the IT Service Portfolio

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Step 1 - Building The IT Service

Step 1 - Building The IT Service

Portfolio

Portfolio

Service

Title

Email

Status Proposed

Description This service is for delivery of electronic messages to and from bank Associates.

Standard Service Features

• Send and receive email messages, both internally and via the Internet.

• Includes a calendar feature with scheduling capability.

• Easily accessible Global address list of email addresses and “white page” information.

• Allows 100Mb of mailbox storage space by default.

• Send and receive file attachments (such as Word documents, Excel spreadsheets, etc).

• Provides the ability to create “distribution groups” holding a number of e-mail addresses for easy distribution.

• Email and calendar items over 90 days old are automatically deleted, per legal requirements.

• Provides access to mailbox via a browser (Outlook Web Access)

• Allows for shared messages, contacts, and calendar items through Public Folders.

• Anti-virus and anti-spam functions.

• Allows for SEC compliance. Available only for Associates bound by Section 16 and Section 20 requirements, and other Associates bound by specific licensing.

Delivery Scope Enterprise-wide, within the domestic U.S.

Delivery

Channels BAND desktops/laptops, Blackberry, mainframe terminal (for TAO only) Availability 24 hours 7 days per week including holidays.

User

Requirements • Any standard BAND desktop configuration.

• Active Directory account.

• Exchange 2003 mailbox.

Service

Initiation iOrder; EC website (http://email.bankofamerica.com). Service

Support Service Desks supporting desktop productivity applications: National Help Line for Banking Centers, MTI Help Desks and Foundational Help Desk (800-SUPPORT)

Costs $40/month per account chargeback.

Service Targets • Requests to add, delete, or change the name of an email account are process ed within 3 – 5 days.

• Service restoration within 2 hours for a Severity 1 outage, within 24 hours for

Service Name

Description

Status (i.e. Current, Planned)

Key Features

Scope

Delivery Channels

Customer Expectations

Customer Definition

Customer Demand Levels

Availability

Customer Charges

Current Customer Satisfaction Levels

Current Service Issues

Service Agreements If They Exist

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Step 1 - Building The IT Service

Step 1 - Building The IT Service

Portfolio

Portfolio

IT Business Support Services

(Core business, operations support, basic IT)

Service Design

And Build

Services

Service

Transition

Support

Services

Operational

Management

Support

Services

Resource

Management

Services

Strategy and Control Services

Business Facing Services

IT Facing Services

(Service Design) (Service Transition)

(Service Operations)

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Step 1 - Building The IT Service

Step 1 - Building The IT Service

Portfolio

Portfolio

• IT Will Struggle To Identify Their Services

• The Business May Also Struggle

• Tendency To Make Functions and Features

Separate Services

• Tendency To make Discrete Services By

Technology Platform Or IT Organization

• Struggle To Avoid Technology-Speak When

Describing Services

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Step 2 – Building The Cost Baseline

Step 2 – Building The Cost Baseline

1. Gather existing budgets, financial

documents, leases, cost pools and

chargeback reports

2. Integrate this information into an IT

Financial Ledger

Output From This Step Becomes Your Cost Baseline

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Step 2 – Building The Cost Baseline

Step 2 – Building The Cost Baseline

Costs

Hardware

UNIX Server SaPAPI

UNIX Server SAPDev

etc....

Software

Oracle database Licenses

AIX V6.2 OS Software

SAP License

etc....

Staff

Frank Mesina

Joe Eggemeyer

etc....

External Services

SAP Maintenance

Bangalore Service Desk

SAP Consulting

etc....

Facilities

Building Rental

Utilities

etc....

Other

Service Penalties

Unplanned Labor

etc....

$140,000

$110,500

$180,000

$610,000

$200,000

$100,000

$100,000

$50,000

$124,700

$432,000

$500,000

$110,200

$100,000

$765,200

Total Costs:

$3,522,400

Revenue

Direct

SAP Chargeback

Data Center Leaseback

etc...

Indirect

Company Revenue

$2,525,600

$1,500,000

$35,400,000

Total Revenue:

$39,425,600

IT

Operating

Statement

(Example)

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Step 2 – Building The Cost Baseline

Step 2 – Building The Cost Baseline

Expect These Challenges!

Financ

ial

Inform

ation

Cost Pool Rep

orts

Exp

ense

Rep

orts

Acco

unt L

edger

s

Chargeback Resu

Leases

lts

Budgets

Asset Repositories

Information Is

Everywhere!

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Step 3 – Building The IT Service Model

Step 3 – Building The IT Service Model

1.

Assign resources and assets to the service portfolio

2.

Assign resource percentages based on demand by

each service that uses them

3.

Convert percentages to costs

4.

Summarize the costs for each service into Service

Operating Statements

5.

Identify units of work that consume the services and

their volumes (Demand Drivers)

6.

Identify unit costs for those units of work

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Step 3 – Building The IT Service Model

Step 3 – Building The IT Service Model

1) Assign Resources and Assets To Services

....

....

....

....

....

Etc...

....

X

X

X

Oracle DB Licenses

....

X

X

X

Unplanned Labor

....

X

X

Service Penalties

....

X

X

X

Utilities

....

X

X

X

Building Rental

....

X

X

X

Bangalore Service Desk

....

X

SAP Maintenance

....

X

X

AIX V6.2 OS Software

....

X

UNIX Server SAPDev

....

X

UNIX Server SaPAPI

Control

Total

Etc...

HR Support

Email

Manufacturing

Support

....

....

....

....

....

Etc...

....

X

X

X

Oracle DB Licenses

....

X

X

X

Unplanned Labor

....

X

X

Service Penalties

....

X

X

X

Utilities

....

X

X

X

Building Rental

....

X

X

X

Bangalore Service Desk

....

X

SAP Maintenance

....

X

X

AIX V6.2 OS Software

....

X

UNIX Server SAPDev

....

X

UNIX Server SaPAPI

Control

Total

Etc...

HR Support

Email

Manufacturing

Support

Service Allocation

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Step 3 – Building The IT Service Model

Step 3 – Building The IT Service Model

2) Assign Percentages Based On Usage

....

....

....

....

....

Etc...

100%

....

14%

20%

66%

Oracle DB Licenses

100%

....

3%

67%

24%

Unplanned Labor

100%

....

0%

27%

10%

Service Penalties

100%

....

2%

2%

8%

Utilities

100%

....

2%

2%

8%

Building Rental

100%

....

12%

22%

18%

Bangalore Service Desk

100%

....

0%

0%

100%

SAP Maintenance

100%

....

34%

0%

22%

AIX V6.2 OS Software

100%

....

0%

0%

100%

UNIX Server SAPDev

100%

....

0%

0%

100%

UNIX Server SaPAPI

Control

Total

Etc...

HR Support

Email

Manufacturing

Support

....

....

....

....

....

Etc...

100%

....

14%

20%

66%

Oracle DB Licenses

100%

....

3%

67%

24%

Unplanned Labor

100%

....

0%

27%

10%

Service Penalties

100%

....

2%

2%

8%

Utilities

100%

....

2%

2%

8%

Building Rental

100%

....

12%

22%

18%

Bangalore Service Desk

100%

....

0%

0%

100%

SAP Maintenance

100%

....

34%

0%

22%

AIX V6.2 OS Software

100%

....

0%

0%

100%

UNIX Server SAPDev

100%

....

0%

0%

100%

UNIX Server SaPAPI

Control

Total

Etc...

HR Support

Email

Manufacturing

Support

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Step 3 – Building The IT Service Model

Step 3 – Building The IT Service Model

3) Convert Percentages To Costs

$765,200

....

$422,300

$989,600

$1,402,365

Totals:

....

....

....

....

....

Etc...

$180,000

....

$25,200

$36,000

$118,800

Oracle DB Licenses

$765,200

....

$22,956

$512,684

$183,648

Unplanned Labor

$100,000

....

$0

$27,000

$10,000

Service Penalties

$110,200

....

$2,204

$2,204

$8,816

Utilities

$500,000

....

$10,000

$10,000

$40,000

Building Rental

$124,700

....

$14,964

$27,434

$22,446

Bangalore Service Desk

$50,000

....

$0

$0

$50,000

SAP Maintenance

$610,000

....

$207,400

$0

$134,200

AIX V6.2 OS Software

$110,500

....

$0

$0

$140,000

UNIX Server SAPDev

$140,000

....

$0

$0

$140,000

UNIX Server SaPAPI

Control

Total

Etc...

HR Support

Email

Manufacturing

Support

$765,200

....

$422,300

$989,600

$1,402,365

Totals:

....

....

....

....

....

Etc...

$180,000

....

$25,200

$36,000

$118,800

Oracle DB Licenses

$765,200

....

$22,956

$512,684

$183,648

Unplanned Labor

$100,000

....

$0

$27,000

$10,000

Service Penalties

$110,200

....

$2,204

$2,204

$8,816

Utilities

$500,000

....

$10,000

$10,000

$40,000

Building Rental

$124,700

....

$14,964

$27,434

$22,446

Bangalore Service Desk

$50,000

....

$0

$0

$50,000

SAP Maintenance

$610,000

....

$207,400

$0

$134,200

AIX V6.2 OS Software

$110,500

....

$0

$0

$140,000

UNIX Server SAPDev

$140,000

....

$0

$0

$140,000

UNIX Server SaPAPI

Control

Total

Etc...

HR Support

Email

Manufacturing

Support

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Step 3 – Building The IT Service Model

Step 3 – Building The IT Service Model

4) Summarize Costs Into Service Operating Statements

Costs

Hardware

UNIX Server SaPAPI UNIX Server SAPDev etc....

Software

Oracle database Licenses SAP License etc.... Staff Frank Mesina Joe Eggemeyer etc.... External Services SAP Maintenance Bangalore Service Desk SAP Consulting etc....

Facilities

Absorbed Building Rental Absorbed Utilities etc.... Other Service Penalties Unplanned Labor etc.... $140,000 $110,500 $90,000 $200,000 $15,000 $50,000 $50,000 $25,200 $432,000 $22,000 $12,200 $0 $210,500

Total Costs:

$1,402,365

Revenue

Direct SAP Chargeback etc... Indirect Product Sales $2,525,600 $17,500,000

Total Revenue:

$20,025,600

Service Operating Statement – HR Support

Costs

Hardware

UNIX Server SaPAPI UNIX Server SAPDev etc....

Software

Oracle database Licenses SAP License etc.... Staff Frank Mesina Joe Eggemeyer etc.... External Services SAP Maintenance Bangalore Service Desk SAP Consulting etc....

Facilities

Absorbed Building Rental Absorbed Utilities etc.... Other Service Penalties Unplanned Labor etc.... $140,000 $110,500 $90,000 $200,000 $15,000 $50,000 $50,000 $25,200 $432,000 $22,000 $12,200 $0 $210,500

Total Costs:

$1,402,365

Revenue

Direct SAP Chargeback etc... Indirect Product Sales $2,525,600 $17,500,000

Total Revenue:

$20,025,600

Service Operating Statement – Email

Costs

Hardware

UNIX Server SaPAPI UNIX Server SAPDev etc....

Software

Oracle database Licenses SAP License etc.... Staff Frank Mesina Joe Eggemeyer etc.... External Services SAP Maintenance Bangalore Service Desk SAP Consulting etc....

Facilities

Absorbed Building Rental Absorbed Utilities etc.... Other Service Penalties Unplanned Labor etc.... $140,000 $110,500 $90,000 $200,000 $15,000 $50,000 $50,000 $25,200 $432,000 $22,000 $12,200 $0 $210,500

Total Costs:

$1,402,365

Revenue

Direct SAP Chargeback etc... Indirect Product Sales $2,525,600 $17,500,000

Total Revenue:

$20,025,600

Service Operating Statement – Manufacturing Support

Costs

Hardware

UNIX Server SaPAPI UNIX Server SAPDev etc....

Software

Oracle database Licenses SAP License etc.... Staff Frank Mesina Joe Eggemeyer etc.... External Services SAP Maintenance Bangalore Service Desk SAP Consulting etc....

Facilities

Absorbed Building Rental Absorbed Utilities etc.... Other Service Penalties Unplanned Labor etc.... $140,000 $110,500 $90,000 $200,000 $15,000 $50,000 $50,000 $25,200 $432,000 $22,000 $12,200 $0 $210,500

Total Costs:

$1,402,365

Revenue

Direct SAP Chargeback etc... Indirect Product Sales $2,525,600 $17,500,000

Total Revenue:

$20,025,600

Service Operating Statement – HR Support

Costs

Hardware

UNIX Server SaPAPI UNIX Server SAPDev etc....

Software

Oracle database Licenses SAP License etc.... Staff Frank Mesina Joe Eggemeyer etc.... External Services SAP Maintenance Bangalore Service Desk SAP Consulting etc....

Facilities

Absorbed Building Rental Absorbed Utilities etc.... Other Service Penalties Unplanned Labor etc.... $140,000 $110,500 $90,000 $200,000 $15,000 $50,000 $50,000 $25,200 $432,000 $22,000 $12,200 $0 $210,500

Total Costs:

$1,402,365

Revenue

Direct SAP Chargeback etc... Indirect Product Sales $2,525,600 $17,500,000

Total Revenue:

$20,025,600

Service Operating Statement – HR Support

Costs

Hardware

UNIX Server SaPAPI UNIX Server SAPDev etc....

Software

Oracle database Licenses SAP License etc.... Staff Frank Mesina Joe Eggemeyer etc.... External Services SAP Maintenance Bangalore Service Desk SAP Consulting etc....

Facilities

Absorbed Building Rental Absorbed Utilities etc.... Other Service Penalties Unplanned Labor etc.... $140,000 $110,500 $90,000 $200,000 $15,000 $50,000 $50,000 $25,200 $432,000 $22,000 $12,200 $0 $210,500

Total Costs:

$1,402,365

Revenue

Direct SAP Chargeback etc... Indirect Product Sales $2,525,600 $17,500,000

Total Revenue:

$20,025,600

Service Operating Statement – Email

Costs

Hardware

UNIX Server SaPAPI UNIX Server SAPDev etc....

Software

Oracle database Licenses SAP License etc.... Staff Frank Mesina Joe Eggemeyer etc.... External Services SAP Maintenance Bangalore Service Desk SAP Consulting etc....

Facilities

Absorbed Building Rental Absorbed Utilities etc.... Other Service Penalties Unplanned Labor etc.... $140,000 $110,500 $90,000 $200,000 $15,000 $50,000 $50,000 $25,200 $432,000 $22,000 $12,200 $0 $210,500

Total Costs:

$1,402,365

Revenue

Direct SAP Chargeback etc... Indirect Product Sales $2,525,600 $17,500,000

Total Revenue:

$20,025,600

Service Operating Statement – Email

Costs

Hardware

UNIX Server SaPAPI UNIX Server SAPDev etc....

Software

Oracle database Licenses SAP License etc.... Staff Frank Mesina Joe Eggemeyer etc.... External Services SAP Maintenance Bangalore Service Desk SAP Consulting etc....

Facilities

Absorbed Building Rental Absorbed Utilities etc.... Other Service Penalties Unplanned Labor etc.... $140,000 $110,500 $90,000 $200,000 $15,000 $50,000 $50,000 $25,200 $432,000 $22,000 $12,200 $0 $210,500

Total Costs:

$1,402,365

Revenue

Direct SAP Chargeback etc... Indirect Product Sales $2,525,600 $17,500,000

Total Revenue:

$20,025,600

Service Operating Statement – Manufacturing Support

Costs

Hardware

UNIX Server SaPAPI UNIX Server SAPDev etc....

Software

Oracle database Licenses SAP License etc.... Staff Frank Mesina Joe Eggemeyer etc.... External Services SAP Maintenance Bangalore Service Desk SAP Consulting etc....

Facilities

Absorbed Building Rental Absorbed Utilities etc.... Other Service Penalties Unplanned Labor etc.... $140,000 $110,500 $90,000 $200,000 $15,000 $50,000 $50,000 $25,200 $432,000 $22,000 $12,200 $0 $210,500

Total Costs:

$1,402,365

Revenue

Direct SAP Chargeback etc... Indirect Product Sales $2,525,600 $17,500,000

Total Revenue:

$20,025,600

Service Operating Statement – Manufacturing Support

Costs Are

Summarized

In Service

Operating

Statements

***Revenue=Chargeback,

Contribution or Budget

Dollars

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5) Identify Units Of Work (Demand Drivers)

Number of Customers

Number of Sales

Number of Employees

Number of Service

Locations

Number of Messages

Number of Reports

Number of Requests

Number of Products

Manufactured

Number of Products Sold

etc...

Examples of

Units of Work

(Demand

Drivers)

Step 3 – Building The IT Service Model

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Step 3 – Building The IT Service Model

Step 3 – Building The IT Service Model

6) Cost Units Of Work (Demand Drivers)

Email Service

Service Total Cost:

$989,600

Work Unit:

Employee

Work Unit Volume:

4,800

Cost Per Unit:

$206.17

($989,600 / 4,800 )

Manufacturing Support Service

Service Total Cost:

$1,402,365

Work Unit:

Widget

Work Unit Volume:

3,565,200

(39)

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Step 3 – Building The IT Service Model

Step 3 – Building The IT Service Model

• Deriving percentages

• Handling depreciation for service assets

• Handling capital versus non-capital cost assumptions

• Handling costs put off until later – i.e. planned upgrades

• handling requested expenditures versus approved expenditures

• Whether to use net present value calculations in assumptions

• Maintaining accurate cost assumptions over time

• Ensuring cost model matches Step 2 output

• Demand drivers may be more complicated – i.e. not all

customers equal

(40)

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Step 4 – Identifying Service & Cost

Step 4 – Identifying Service & Cost

Improvements

Improvements

1. Assess an Operating IT Service Portfolio

2. Identify future Business and IT plans and strategies

3. Model impact of future business and IT plans and

strategies

4. Identify Service Improvement Actions (Lens Analysis)

5. Inventory and Rank Service Improvement Actions

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Strategic And Critical Now

Not Strategic But Necessary

Not Strategic and Not Necessary

Strategic But Not Critical Now

Email

Desktop Support

Data Warehousing Services

De-Invest

Focus

Investments

Delay

Investments

Reduce

Costs

Online Catalog Service

IP Telephony

Sales Lead Mgt Service

Pipeline Analysis

Opportunity Mgt

Catalog Print Distribution

Server Hosting

Flyer Production

Parts Catalog

Step 4 – Assessing an Operating IT Service

Step 4 – Assessing an Operating IT Service

Portfolio

(42)

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Increase Business From 35 to 50 States

Complete Acquisition of ABC Bank – Will Add 2,000

Employees

Across the Board 15% Budget Cut For IT

Reduce Headcount by 33%

Add Credit Card and Retail Banking Services

Free Up Non-Discretionary IT Spend to Support New Banking

Services

Identifying Business/IT Planned Strategies...

Step 4 – Identifying Service & Cost

Step 4 – Identifying Service & Cost

Improvements

(43)

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Demand Driver

Demand

Volume

Number of employees 5,000

Average Mailbox Size

100mb

...Then Model Their Impacts

Demand Driver

Demand Volume

Number of employees

7,000

Average Mailbox Size

100mb

Current State

Future State

Adding 2,000 More

Employees

70 Servers

100 Storage Devices

5,000 SW Licenses

98 Servers

140 Storage Devices

7,000 SW Licenses

Step 4 – Identifying Service & Cost

Step 4 – Identifying Service & Cost

Improvements

(44)

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Lens

Things To Look For

Cost

Wasted costs, costs too high, costs out of line for this

type of service, service penalties

Efficiency

Redundant processes, labor intensive, wasted labor

Frustration

Availability, Responsiveness, Reliability, Hard to use

Time

Takes too long, wastes staff time, creates bottlenecks

Risk

Compromises Security, Maintainability, Serviceability

Regulatory

Compromises ability to meet audit criteria, controls

requirements

Customer

Satisfaction

Creates poor perception of service, customer issues,

poor satisfaction ratings

Future

Can service still be sustained in the future given planned

business changes?

Value

Is there opportunity to deliver more value for this

service?

Examine each

business support

service using a

Lens approach to

identify candidate

cost and service

improvement

opportunities

Applying

Lens

Analysis

Step 4 – Identifying Service & Cost

Step 4 – Identifying Service & Cost

Improvements

(45)

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Regulatory

Efficiency

Frustration

Cost

Lens

Category

Identify SOX audit

control weaknesses and

bolster them with

improved processes and

reporting

Financial

Service

Support

Financial support

services have

warnings from recent

SOX audit

004

Review Change

management process for

this service and identify

bottlenecks

Manufacturing

Support

IT Personnel are slow

to respond to needed

manufacturing system

changes

003

Conduct Availability

analysis for

Manufacturing Support

Services and identify

root causes

Manufacturing

Support

Frequent outages

impacting production

lines

002

E-Mail

Service

Costs exceed $3,000

per year per E-Mail

customer

Finding

Examine E-Mail

overhead resources to

identify cost reductions

to target $1,000 per

E-Mail customer

001

Action Items

Ref

Regulatory

Efficiency

Frustration

Cost

Lens

Category

Identify SOX audit

control weaknesses and

bolster them with

improved processes and

reporting

Financial

Service

Support

Financial support

services have

warnings from recent

SOX audit

004

Review Change

management process for

this service and identify

bottlenecks

Manufacturing

Support

IT Personnel are slow

to respond to needed

manufacturing system

changes

003

Conduct Availability

analysis for

Manufacturing Support

Services and identify

root causes

Manufacturing

Support

Frequent outages

impacting production

lines

002

E-Mail

Service

Costs exceed $3,000

per year per E-Mail

customer

Finding

Examine E-Mail

overhead resources to

identify cost reductions

to target $1,000 per

E-Mail customer

001

Action Items

Ref

Step 4 – Identifying Service & Cost

Step 4 – Identifying Service & Cost

Improvements

(46)

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• Need to work across all of IT to develop improvement

actions

• Will need to gain acceptance for rankings and action

items

• Capacity Planning people will lack experience in business

and service capacity planning tasks needed for this effort

• Need to handle competing interests

Expect These Challenges!

Step 4 – Identifying Service & Cost

Step 4 – Identifying Service & Cost

Improvements

(47)

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1. Establish Service Improvement Program and

Steering Committee

2. Build work plans for each improvement action

3. Create overall Service Improvement Project

Charter

4. Obtain agreement on the roadmap

5. Assign resources to identified projects

You’re On Your Way!!

Step 5 – Identify ITSM

Step 5 – Identify ITSM

Service Improvement Roadmap

(48)

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19/11/2009, 48

Can ITIL Return Significant ROI?

Can ITIL Return Significant ROI?

Company

Situation

Results

Fortune 100 credit

processing company

Exponentially growing

IT infrastructure costs

with high business

demand and growth

exceeding 25% per

year

$58.7M cost reduction

in year 1 - $100.9M

by year 5

Fortune 500

Telecommunications

Company

Major data center

relocation and service

consolidation project

with cost constraints

Recouped $130M

project investment in

first 6 months –

reduced operating

costs by $60M in 5

years

Fortune 1000

National Health

Insurance Agency

Very expensive

network infrastructure

producing poor quality

voice, data and video

services

10% cost reduction

per year for the

networking

infrastructure plus

total recovery of all

project an

(49)

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Latvija

19/11/2009, 49

Which Is Better?

Which Is Better?

We need $312,000*

For Server

Upgrades...

We expect the number

of Widgets produced to

increase by 800,000 next

year – at a service cost

of $0.39 per Widget, this

represents and

additional $312,000

needed for IT

Manufacturing Support

OR...

With A Service Approach –

The Entire Dynamic With The

Business Has Radically

Figure

Updating...

References

Related subjects :