Thavron service portfolioforitfm-an_itfma_workshop_norfolk_2014_04

The IT Service Portfolio

A common sense approach to IT/Business alignment

Copyright 2014 Thavron Solutions, LLC

Agenda

• Introductions• Overview– Context– IT Services– Service Portfolio: definitions and best practices

• Service Portfolio Measures and Metrics• ITFM and the Service Portfolio


INTRODUCTIONS


Introductions

• Me: Nan Braun• CEO Thavron Solutions• [email protected]/ @thavronsol / http://thavron.com/blog• Corporate IT – many roles- “hands” on to BRM to architecture• CTO, ontological modeling • Director, TBM Practice

• You?


mailto:[email protected]/

My Biases

• Systems Thinking• Manufacturing– Lean (MESA Lean Manufacturing Strategic Initiative Guidebook author, Toyota Method via GM/Delphi)

– Deming– Go to Gemba

• Modeling/Frameworks• Common Sense


OVERVIEWIT Services, Service Portfolio: Definitions and Best Practices


The IT Evolution

• Corporate IT has spent the last 20+ years re-organizing and re-inventing itself in an attempt to align with the business – without good success.

• IT organizations are in varying stages of maturity in their attempts to run, grow and assist with transforming the business at large.

• IT continues to become more and more commoditized and comfortable for our consumers


IT Lifecycles

• IT organizations typically have several complex processes and lifecycles running ( sometimes at odds with each other).

• All of these are attempts to fulfill perceived business needs, but can drive competing agendas and goals. – Financial/Budgeting Lifecycle– Project Lifecycles– Software Development Lifecycles– Product Lifecycles– ITIL /COBIT/Val-IT– ITSM


What is a Service?

• Service- delivered and consumed at the same time• Enterprise IT is a service• Types of Enterprise IT Services:– Workplace/End User– Application/Functional Services– Technology Services– Infrastructure Services ( IT 4 IT)


Catalog & Asset

Management

Supplier / Vendor

Management

IT Service Management


IT Component CatalogIncident management

Catalog & Asset

Management

Supplier / Vendor

Management




IT Service CatalogIncident Prevention

Catalog & Asset

Management

Supplier / Vendor

Management




IT Service CatalogIncident Prevention

Business Service CatalogCustomer Experience Management

The Service Lifecycle


Design

Deliver

Delete



Design

Deliver

DeleteDesign Questions:

• When does a new Service need to be introduced?

• When does a Service need to be update or changed?

• Should we build or buy this Service?



Design

Deliver

Delete

Deliver Questions:

• Is this Service meeting the needs of the Consumer? • Did this Service provide the predicted ROI?• Are the Consumers using something in place of this Service?



Design

Deliver

Delete Delete Questions:

• Is there a better way to provide this Service?

• Have market trends or business needs deprecated this service?

Bringing Business to the Center

• To align and enable the business, IT must bring the business back to the center of what they do.

• A Business centric Service portfolio, supported by the other IT lifecycles in an iterative and interactive way will create a natural alignment without artificial processes.


What is a Service Portfolio?

– ITIL definition:• Allows management to have a view of all services

– Pipeline– Service Catalog– Retired

– Provides Understanding of how delivery of IT Services provides value to the business, as well as the associated risks and vulnerabilities

– The Decision Point in the Service Lifecycle Transitions


Evaluating Services

• Business Value• Cost to develop and operate the service• Capability to deliver the service• Risks to the Enterprise• Fit to overall IT Strategy• Dependencies• Business Case/ROI


ITIL Service Portfolio meta data

• Name• Description• Status• Classification/criticality• Applications• Data/Schema• Business process supported• Business Owners• Business Users

• IT Owners• SLA references• Supporting Services• Supporting resources• Dependent Services• Contracts/Agreements• Costs • Changes• Metrics


Back to Deming….


Deming Cycle

• PDCA • PDSA• Shewart Cycle• “Structured Problem Solving”• Basis for DMAIC


Portfolio Pitfalls

• Using the existing IT Project Portfolio Management as a model– PPM is about balancing resources and prioritizing– More of a Capacity /Delivery model – Treats Service Portfolios as a finite bucket

• Developing the Service Portfolio and then “presenting” it to the Enterprise

• Metrics that drive wrong/bad behaviors


Service Portfolio as Investment

• Create a Policy Statement -A policy statement is the statement that contains the investor's goals and constraints as it relates to his investments.

• Develop an Investment Strategy - This entails creating a strategy that combines the investor's goals and objectives with current financial market and economic conditions.

• Implement the Plan Created -This entails putting the investment strategy to work, investing in a portfolio that meets the client's goals and constraint requirements.

• Monitor and Update the Plan -Both markets and investors' needs change as time changes. As such, it is important to monitor for these changes as they occur and to update the plan to adjust for the changes that have occurred.


Service Portfolio as an InvestmentDevelop a Strategy

(Plan)

Implement the Plan

(Do)

Monitor the plan (Check)

Update the Plan (Act




Design PDCA Cycle

Deliver PDCA Cycle

Delete PDCA Cycle

Triggers for Re-assessment

• Commercial• Social• Economic• Political


Service Portfolio must be Strategic

• Pull out of operational mode – Service Portfolio is NOT• Asset management• Capacity planning analysis• Budgeting guideline• Project Portfolio

• What is the Business Strategy?


Catalog & Asset

Management

Service Costing &

Billing

Product & Project

Management

Supplier / Vendor

Management

Service Portfolio

A Framework for Business Service Success


Financial LifecycleProduct Lifecycle

TM

SERVICE PORTFOLIO: MEASURES AND METRICS


IT Value Stream aligned to Business Value Stream


Catalog & Asset

Management

Service Costing & Bill of IT

Product & Project

Management

Supplier / Vendor

Management

Service Portfolio

Driven by Escalations



Catalog & Asset

Management


Product & Project

Management

Supplier / Vendor

Management

Service Portfolio


Service Catalog lifecycle management



Catalog & Asset

Management


Product & Project

Management

Supplier / Vendor

Management

Service Portfolio


Service Catalog lifecycle management

Service Portfolio Management

Value Stream Assessment

• Value Stream – end to end pipelines that cross functions that deliver value– Man, Machine, Material and Information


Value Stream mapping


Basic Value Stream Symbols


IT Services in the value stream

IT Services

Business Functions

Value Stream


IT Services have a non-linear relationship to VS

Value Stream

Business Function

IT service 1

IT Service 2

Business Function 2 IT Service 2


IT Services have a non-linear relationship to VS

Issue License

Process payment

Payment transaction

system

Email

Deliver license Email


Portfolio Management Analytics

• Value• Performance• Market Position• Utilization


Metrics for Portfolio Management Governance

• % of Services with service valuation performed• % of Services with documented customers• % of Services with active business cases• % of Services linked to business outcomes• % of Services with documented risks


Financial Metrics

• Services ranked according to Business Value• % of Services with ROI achieved /% progress for ROI• Budget Control measures for services– Variance– Control chart– Demand impact analysis


Performance/Utilization Metrics

These should have ties to the Pattern of Business Activities ( PBAs)• Utilization/Uptake trends• Overall ratio customer facing services/IT Services• % support service ( cost and/or utilization) per service• Service demand trends• Complaints


Market/Lifecycle Analytics

• Benchmarking• Market Trends versus PBAs


THE IT FINANCIAL MANAGER & THE SERVICE PORTFOLIO


What does this mean for ITFM?

• Analytics and Data for decision making• Partners in the process


Catalog & Asset

Management


Supplier / Vendor

Management

Service Portfolio

IT Financial Management


Annual/Quarterly ActualsAllocated Costs /low transparencyManual Budgeting process

High Forecast variance

Catalog & Asset

Management


Supplier / Vendor

Management

Service Portfolio



Annual/Quarterly ActualsManual Budgeting process

High Forecast variance

Monthly ActualsSemi- Automated Budgeting process

Forecast variance

Catalog & Asset

Management


Supplier / Vendor

Management

Service Portfolio



Annual/Quarterly ActualsAllocated Costs/low transparencyManual Budgeting process

High Forecast varianceMonthly ActualsInfrastructure/TCO costs/transparencySemi- Automated Budgeting process

Forecast variance Rolling /monthly actualsBusiness Service PricesRolling Budget/Forecast

Financial Metrics

• Services ranked according to Business Value• % of Services with ROI achieved /% progress for ROI• Budget Control measures for services– Variance– Control chart– Demand impact analysis


Performance/Utilization Metrics

These should have ties to the Pattern of Business Activities ( PBAs)• Utilization/Uptake trends• Overall ratio customer facing services/IT Services• % support service ( cost and/or utilization) per service• Service demand trends• Complaints


Data Inputs for Service Portfolio Management

• Service Definition/Decomposition ( Service Owners)• Service Costs• Service Consumption• Service Pricing• Service Budgets• Complaints/Instance/Ticket ( Service Desk)• Demand Forecasts ( BRM)


Catalog & Asset

Management

Service Costing &

Billing

Product & Project

Management

Supplier / Vendor

Management

Service Portfolio

Leverage ITFM info: build your platform for Success


Financial LifecycleProduct Lifecycle

TM

Discussion


Follow up questions? Nan Braun

[email protected] 765.252.4509 / http://thavron.com /@ThavronSol

Recommended Further Reading

• Architecture & Patterns for IT: Service Management, Resource Planning and Governance by Charles T Betz

• Service Management for Dummies by Judith Hurwitz, Robin Bloor, Marcia Kaufman, Fern Halper

• Technology Scorecards Aligning IT Investments with Business performance by Sam Bansal

• The Remedy: Bringing Lean Thinking out of the Factory to Transform the Entire Organization

• Implementing Information Technology Governance: Models, Practices and Cases by Steven De Haes

• Thavron Blog: http://thavron.com/blog/Copyright 2014 Thavron Solutions, LLC

Leadership & Management

Thavron service portfolioforitfm-an_itfma_workshop_norfolk_2014_04