SESSION 201 Wednesday, March 17, 11:30 AM - 12:30 PM Track: Strategy and Leadership How to Define and Value Services: the Cornerstone of ITSM Hank Marquis Practice Leader, Business Service Management, Global Knowledge [email protected] Session Description Defining and valuing services are the first two steps in ITIL v3 strategy generation, as well as the first steps in the service portfolio process. You simply cannot adopt ITIL or IT service management without defining and valuing your services. The problem is that ITIL does not tell you how to do this. There is a hint, however, in the complementary guidance buried deep within ITIL. Join Hank to uncover the secrets to IT service definition and learn how to define IT services in hours instead of weeks. Also learn an easyto-understand method for valuing services that improves business IT alignment. Key Takeaways: - Figure out where to start IT service definition (it’s probably not where you thought) - Understand how to define IT services in business terms - Learn the secrets of IT service definition, including customer- and resource-facing services and resources - Get going with service catalog development and service portfolio management in just a few hours - Understand where IT service value originates (it may not be where you think) - Learn the secret of IT value creation (business value at risk and the marketplace) - Determine how to prioritize your IT activities based on service value Speaker Background Hank Marquis leads the business service management practice area for Global Knowledge, the worldwide leader in IT and business training. He is responsible for BSM strategy -- integrating ITIL, ISO20000, COBIT, Six Sigma, and project management into seamless solutions for clients. Hank has more than 25 years of information technology industry experience from both enterprise and vendor positions. He holds advanced certifications in BSM topics, is a senior member of the American Society for Quality, and has extensive experience helping IT executives implement IT governance and operational frameworks. He held operational management positions at MCI, was CIO at e-commerce financial services provider Celexis, served as VP of marketing and CTO at management software company Opticom, and rose to senior product management at Compuware. Hank has helped dozens of companies develop and implement ITSM best practices. Copyright ©2010 HDI® All rights reserved. How to How to Define and Value Services: the Cornerstone of ITSM Hank Marquis PhD, FBCS CITP Global Knowledge Copyright ©2010 HDI® All rights reserved. Speaker Bio & Company Information • Practice Leader, BSM, Global Knowledge • APMG Examiner, EXIN Council Member, itSMFUSA committee member • 29 Years IT Experience, Technician to CIO • PhD Organizational Leadership‐ICT • Charted Fellow British Computer Society (FBCS, CITP) • ITIL©, ISO‐20000©, COBIT©, Six Sigma, Project Management Certifications. Copyright ©2010 HDI® All rights reserved. Agenda • How to Define IT Services – 5 Steps • How to Value IT Services – Three‐Step Process Th S P Copyright ©2010 HDI® All rights reserved. How to define IT services HOW TO DEFINE IT SERVICES Copyright ©2010 HDI® All rights reserved. Just Two Types of Services Customer Facing Service (CFS) Customer Aware of and Uses and Uses CFS Ex.: Telephone Ref: TMForum eTOM/NGOSS/SID, ITIL Copyright ©2010 HDI® All rights reserved. Resource Facing Service (RFS) Customer Unaware of RFS Compose CFS Composed of Resources of Resources Ex.: Network, Echo Cancellation, etc. Perception of the Service Rule #1 Does the User Know They are Does the User Know They are Using the Service? Then it’ss Probably a CFS Then it Probably a CFS Copyright ©2010 HDI® All rights reserved. Ability to Acquire the Service Rule #2 Can it be Specified by Customer/End‐ Customer? Can it be Acquired by Itself? Then it’s probably a CFS Copyright ©2010 HDI® All rights reserved. How to Identify RFS • Those Systems that are NOT CFS! – Compose CSF – Can’t be used directly – Can Can’tt be acquired by itself be acquired by itself – Composed of Resources not Services Copyright ©2010 HDI® All rights reserved. BEWARE! CFS & RFS Can Change • CFS and RFS vary by Consumer Point of View • Ex: Ex: – Hosting & Email C Consumer 2 2 App = CFS Server = RFS “App” Consumer 1 Server = CFS “Server” Provider Copyright ©2010 HDI® All rights reserved. Step 1: Select a Marketplace • If you are a Building Materials S Supplier li maybe… Ref: NABSM.ORG Copyright ©2010 HDI® All rights reserved. Design Services Building Products Construction Building Products Select an Enterprise Product • If you chose Building Products maybe… Concrete Lumber Steel Concrete Ref: NABSM.ORG Copyright ©2010 HDI® All rights reserved. Step 2: List End‐ Customers & Users • If you chose Concrete maybe… Architects Builders H Home owners Ref: NABSM.ORG Copyright ©2010 HDI® All rights reserved. Identify Users • Users First – Users Support End‐Customers & End‐Users End-Customers/EndUsers Users Architects (end-customer) Sales, Engineering Builder (end-user) Dispatching Ref: NABSM.ORG Copyright ©2010 HDI® All rights reserved. Identify Customers • Remember Users work for Customers • Customers Specify End-Customers/EndUsers Users Customer Architects (end-customer) Sales VP Sales Architects (end-customer) Designers VP Engineering Builder ((end-user)) Dispatchers p VP Dispatching p g Ref: NABSM.ORG Copyright ©2010 HDI® All rights reserved. Step 4. Brainstorm IT Systems & Highlight CFS • Remember: – Specified/Acquired by (End) Customer – Perceived/Used by (End) User Users Customer IT Systems Sales VP Sales Phone, CRM, Network, Email, Backup Designers VP Engineering Phone, FTP, CRM, g, Email,, Backup p Hosting, Dispatchers VP Dispatching Dispatching, Backup, Radio, ERP, GPS Ref: NABSM.ORG Copyright ©2010 HDI® All rights reserved. Step 5. Create Product Offerings • For Each Marketplace/Product/Community F E h M k t l /P d t/C it – Ex.: “Design System for Concrete, for Building Products” • • • • • • • • • Marketplace: Product: End Customer/User: User/Customer: CFS: RFS: Resources: Costs: Support: Ref: ITILv3, NABSM.ORG Copyright ©2010 HDI® All rights reserved. Service Level Packages • Service Level Package Frames Service Package for Community of Interest – Ex. “Design System for Concrete, for Building Products Products” Ref: ITIL v3, NABSM.ORG Copyright ©2010 HDI® All rights reserved. Community Availability Capacity Designers M-F 8am-5pm MT Save/Load Design Less than 10 Seconds VP Design 24x7x365 Save/Load D i L Design Less than 10 Seconds Service Catalog Product Offering • Marketing “Turn your laptop into a design studio with Designer System for Concrete. Determine mix and cost at the jobsite just like at your desk. Access all your designs on the road or at your desk.” • • • • • Ref: NABSM.ORG Copyright ©2010 HDI® All rights reserved. Access your data M‐F from 8am to 5pm MT Load or save a document in less than 10 seconds Documents available at jobsite or office P d Produce and send mix orders directly to plant d d i d di tl t l t Print orders for customers at the job site Step‐by‐step guidance, tools and techniques for valuing your IT services. VALUING IT SERVICES STEP‐BY‐STEP Copyright ©2010 HDI® All rights reserved. Stage 1: CFS Impact Analysis Integrity Confidentiality • Modified without Control • Disclosed to non‐ authorized Parties • Unavailable (Loss of Utility and Warranty) • Includes Replacement and Operational Costs Interview S i Service Owner Copyright ©2010 HDI® All rights reserved. Availability Example Impact: CFS Order Processing • How would you rate Confidentiality? 0 1 2 3 4 5 6 7 8 9 10 0 = Public, 1‐5 = Restricted, 6‐9 = Confidential, 10 = Secure • How would you rate Integrity ? How would you rate Integrity ? 0 1 2 3 4 5 6 7 8 9 10 1‐3 = Low, 4‐7 = Moderate, 8‐9 = High, 10 = Very High • How would you rate Availability Requirements 0 1 2 3 4 5 6 7 8 9 10 1‐3 = Low (recover in days), 4‐6 = Moderate (hours), 7‐8 = High (minutes), 9 = Very High (seconds), 10 = Mandatory (can’t be down) Copyright ©2010 HDI® All rights reserved. Impact Assessment • Copy CIA Scores into a Grid – Score Becomes Multiplier Service: Order Processing Owner: H. Marquis Impact Copyright ©2010 HDI® All rights reserved. Value: Confidentiality Integrity Availability 2 8 5 Stage 2: Cost Assessment Legal Standing • Privacy, Regulatory, Legislative • Embarrassment, Market Position Money Safety • Income, Profit, Sales, Fines, Penalties (Includes Replacement & Operational Costs) Operational Costs) • Personal, Environmental Copyright ©2010 HDI® All rights reserved. Cost of Cost of Impact Example Cost: CSF Order Processing • Confidentiality? 0 1 2 3 4 5 6 7 8 9 10 0 = No cost, 1‐4 = Low cost, 5‐7 = Moderate cost, 8‐9 = High cost, 10 = Very High cost • Integrity? 0 1 2 3 4 5 6 7 8 9 10 • Availability? 0 1 2 3 4 5 6 7 8 9 10 Copyright ©2010 HDI® All rights reserved. 0 = No cost, 1‐4 = Low cost, 5‐7 = Moderate cost, 8‐9 = High cost, 10 = Very High cost 0 = No cost, 1‐4 = Low cost, 5‐7 = Moderate cost, 8‐9 = High cost, , , , g , 10 = Very High cost Example Service Valuation • Determine Value of CIA (Impact X Cost) – Ex.: 8 + 48 + 40 = 96 / 3 = 32 – Order Processing is of Moderate Value Service: Order Processing Service: Order Processing Owner: H. Marquis Value: Moderate Value: Moderate Confidentiality Integrity Availability Impact 2 8 5 Cost 4 6 8 Composite 8 48 40 Value 32 1-20 = Low Value | 21-60 = Moderate Value | 61-80 = High Value | 81-100 = Very High Value Copyright ©2010 HDI® All rights reserved. Ranking IT services Consider: • Order Processing = 32 • Fulfillment = 64 • E‐mail = 12 Fulfillment is Most Important • IT Should focus on Fulfillment first for Business Alignment • Measure and Improve Fulfillment First • Describe Improvements in Business Terms Learned from Interviews and Service Valuation Copyright ©2010 HDI® All rights reserved. Recommendations on using your new skills. PROGRAM SUMMARY Copyright ©2010 HDI® All rights reserved. Summary • Define Services using CFS first • Value CFS using CIA Risk Techniques • Use Results to Drive/Justify Actions Copyright ©2010 HDI® All rights reserved. Thank you • Session #201: How to Define and Value Services: the Cornerstone of ITSM Thank yyou for attending g this session. Please fill out an evaluation form. Contact details: Hank Marquis [email protected] www.hankmarquis.info (blog) 1 (603) 838-3393 Copyright ©2010 HDI® All rights reserved.