Never mind the buzzwords

It is often said that we live in turbulent times, but that has probably always been so for most enterprises that have striven to satisfy the ever-increasing demands of their customers.

What has changed in recent years is the environment within which this turbulence occurs. Enterprises today are faced with a more dynamic and complex environment: with technology, globalisation, and rapidly changing demographic factors adding to the pressure to deliver shareholder value and meet stringent regulatory controls. While this impacts the whole of the enterprise, the pressures are most visible in IT.

For most enterprises, IT is at the very heart of everything they do. In some cases IT is the business. In the internet age, every little failing of a technology-enabled system is immediately visible to the customer and potentially impacts the bottom line. Strong anecdotal evidence, supported by some empirical findings, indicates that 80 percent of customers using a website will walk away, never to return, if they are dissatisfied with the site’s functionality, usability, security, availability or performance. You’ll never know who they are or why they went.

Progress

Over the years, IT has a poor record of delivering what’s required. Solutions are frequently late, over budget or simply don’t match the expectations of the business. This has increasingly led to enterprises looking for alternatives, including outsourcing. But while this may be the right solution, if the decision isn’t made for the right reasons, it is unlikely that the enterprise will reap the benefits it is seeking. Handing a problem to someone else is rarely successful. Why should they be any more successful than you were?

Enterprises including their IT organisations need to rethink the way they approach the delivery of services. Even if we aren’t talking high-tech internet solutions, people need to understand in business terms the role that technology plays and thus the impact of any deficiency or failure of that technology.

The functionality and usability of any solution is primarily the responsibility of the development teams and most organisations pay a great deal of attention to managing this aspect of an investment program.

Ultimately, it doesn’t matter if you’ve developed the slickest business application in the world. If it isn’t accessible when and where it’s needed and performing to the level required, then it’s worthless. The reality is that most of the cost of any IT investment is incurred during the ‘live running’ phase (Gartner suggests 80 percent) and of course the real killer is that 100 percent of any value provided to the enterprise comes at this stage.

Many IT organisations are failing to deliver the business value sought by the enterprise simply because they don’t approach the operational arena with the right mindset. Frequently the emphasis is inward looking: on managing the technology, rather than business focused on providing service. This managing of service provision is what we refer to when we talk about service management.

Services

In reality, enterprises are engaged in delivering end-to-end services, some components of which happen to be technology enabled. Both business and IT management need to better understand what they each need to contribute in order to ensure that the service to the customer is delivered efficiently and effectively.

Whatever service is being delivered, there are some fundamental facts that have to be recognised and dealt with: the consumers of the service will have expectations of what they are to receive, resources will be needed to meet the expectations and we need to know what and where those resources are, who uses them and how they are inter-related. They will need to be managed to meet fluctuating demands; nothing will remain the same, changes will be required and no matter how hard we try, something will (probably) go wrong.

Solutions

What we need is a holistic solution addressing the complete lifecycle and takes into account people, process and technology. We need the right processes, executed by properly skilled and knowledgeable staff, supported by the appropriate tools to ensure that we can deliver exactly what the enterprise requires within the constraints of what it can afford. This means that enterprises must learn to focus on value not just on cost. The most expensive solution can be deemed acceptable as long as the value returned outweighs the cost of providing it, while conversely a relatively cheap solution can result in a net loss.

Bringing these concepts into the IT world merely highlights the fact that IT service management isn’t really an optional extra – it is fundamental to delivering successful, quality IT enabled solutions.

Let’s take some examples:

• Meaningful service level agreements (SLAs) lay out unequivocally the service targets that are to be achieved – in business terms, not techno-babble. The enterprise performs business activities such as selling insurance, printing and dispatching invoices or paying the workforce. If the IT service supporting any of these activities isn’t available for any reason, the people trying to use it don’t care whether the network has failed, the server has crashed or the application is faulty. They just know that they can’t do their job and that it impacts the enterprise in some measurable financial manner – lost sales opportunities, delays in receiving revenue or a disgruntled workforce.

• When things go wrong, incident management activities enable us to respond appropriately to restore service. But having a true proactive problem management function that analyses trends and seeks out root causes of potential or actual failures and prevents them from occurring or recurring returns a direct benefit to the business through reduced outages.
• There is an old adage that the only constant is change. A strong and effective change management function ensures that the right changes are implemented in the right way at the right time. No more vicious circle of poor changes causing problems leading to more changes ad infinitum, and the business pay-off? Perhaps it’s bringing a new service/product to market ahead of the competition with a commensurate financial advantage.
• Imagine a new service is planned. Early involvement of the capacity management function means resource shortfalls are identified well in advance, investments can be planned and incorporated into budget cycles and favorable terms negotiated. When needed, the right resources are there and ready.

In reality, the service management processes are totally integrated, feeding off each other, supporting each other and all contributing to ongoing service improvement plans.

Many IT organisations will claim that they have such processes and mechanisms in place, but the reality is often different. Their solutions are frequently disjointed, inconsistent and/or incomplete. Often the focus is still technology biased, evidenced by silo structures based upon technologies (server, network, desktop, etc.), rather than customer and service-focused.

In the mainframe era, we talked about (and had) robust systems management solutions. As the technology became more distributed and pervasive, Network Management came to the fore. Recently, IT service management has been the buzzword, and now ‘business service management’ is starting to emerge.

Behind the buzzwords

However, when you really get to the hub of it, the processes are really exactly the same. What is different is the audience for the information generated from the processes. Hence, as is shown in the diagram below, it is the granularity of the data/information and the timescales involved that change with the audience’s perspective. So at the lowest level, instantaneous, real-time events affecting individual components are reported and possibly handled automatically by software but are also recorded for analysis and aggregation. Such aggregated data is used to understand what is happening at a service level, possibly in a different timeframe, enabling the relevant response. Often, further aggregation will happen and business decisions based on the information will be taken in an even longer timescale, such as capacity requirements being linked to an annual business planning cycle.

But of course, the impact of any single event can also be directly mapped to the business.

For enterprises seeking to improve the quality of their service provision, making the necessary changes isn’t a trivial undertaking. Typically, you will be trying to engender a cultural change, shaking people out of their comfort zones and asking them to modify their behaviour. Organisational change of this kind is challenging and requires commitment and investment.

Commitment is required from all levels, especially management, both in IT and the business. Walking the talk is often one of the keys to success.

Another key is having and articulating a clear vision and purpose. A clear understanding of the benefits sought provides both motivation and a rationale for decision-making. Everyone within the enterprise needs to understand why they are being asked to change their working practices and embrace a new service-focused philosophy. Business and IT alike must embrace the changes.

Adaptation

If the prospect of further investment in the IT sphere causes raised eyebrows in the enterprise, remember to focus on value. Not just a one-off value, but long-term sustainable value through effective management and continuing improvement. Or perhaps the enterprise should ask itself, what is the cost of not managing service provision properly? Quantify the cost of those lost orders, the extra overtime, the rework, the time spent handling complaints, or the waste of staff time, as people do things they’re neither trained nor paid to do.

In recent years, many organisations have successfully implemented effective service management solutions and are reporting significant returns on the investment, not just by reducing costs but by delivering significantly higher value. Most of these organisations have based their solutions on the advice and guidance contained within ITIL (produced by the OGC but contributed to by many individuals from enterprises all around the world).

ITIL isn’t a solution in itself; enterprises need to use it wisely, adapting and adopting the guidance to suit their culture and organisational needs. Although it is couched in terms of managing IT services, the concepts are applicable to managing any services. So extending the activities that are covered is both possible and probably desirable.

For organisations that want assurance that their IT Service management solution is a quality one, certification against an international standard is possible. This standard ISO/IEC 20000, released in December 2005, is an almost exact replication of the original British standard BS 15000. The standard is aligned with ITIL and the relevant ‘owning’ parties are committed to ensuring this alignment in the future.

Perhaps one of the most challenging aspects of this space is the lack of universal, precise definitions of what is meant by ‘business service management’ and ‘IT service management’.

To some, this is a severe hindrance since it makes it difficult to pigeonhole everything with absolute certainty. To others, this is the very strength. Having a framework focused on processes without prescription enables enterprises to develop a solution that is exactly fit for their needs but, of course, it requires effort to develop and implement. Those enterprises seeking an easy life by purchasing a ‘solution in a box’ are likely to be sadly disappointed. Hard work is required in order to reap the rewards.

Following the philosophy behind the ‘best practice’ and standards’ publications helps enterprises to realign their focus, to ensure that everyone within the enterprise is working towards the common goal and that IT-enabled solutions that are developed truly do deliver the business requirements.

Aidan Lawes, FISM,
Chief Executive Officer, itSMF UK & International

Aidan is one the world’s leading authorities on IT Service Management.

Educated in New Zealand, he has 30 years’ experience in the IT industry in a wide range of roles and has worked in many countries and market sectors. For the last 16 years he has focused on ITSM, firstly for ICL and now in a full-time role for itSMF. Under his stewardship, itSMF UK has more than quadrupled its membership and turnover and the number of International chapters has increased five-fold.

Aidan was one the earliest holders of the ISEB Managers Certificate in IT Service Management and is a Fellow of the Institute of Service Management. He has contributed to many of the publications in ITIL and to other ITSM publications, is one the authors of the BSI standard (BS15000) and its International successor (ISO20000) and participates in many initiatives to raise professional standards in the IT industry.

He is a regular, sought-after speaker worldwide and the author of articles for a wide range of publications.

About the itSMF:

The itSMF is the only totally independent, internationally recognised body dedicated to promoting and helping to set the standards for best practice in IT Service Management. In doing so, it works in partnership with the Office of Government Commerce (OGC), the British Computer Society (BCS) and the British Standards Institution (BSI) as well as various examination institutes.

In addition, itSMF provides a range of services including book sales, seminars & conferences and web-based facilities. It is a not-for-profit organisation, wholly owned, and principally run, by its members.