The IT Service Portfolio A common sense approach to IT/Business alignment Copyright 2014 Thavron Solutions, LLC
Aug 17, 2015
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
Copyright 2014 Thavron Solutions, LLC
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?
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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
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OVERVIEWIT Services, Service Portfolio: Definitions and Best Practices
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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
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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
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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)
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Catalog & Asset
Management
Supplier / Vendor
Management
IT Service Management
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IT Component CatalogIncident management
Catalog & Asset
Management
Supplier / Vendor
Management
IT Service Management
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IT Component CatalogIncident management
IT Service CatalogIncident Prevention
Catalog & Asset
Management
Supplier / Vendor
Management
IT Service Management
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IT Component CatalogIncident management
IT Service CatalogIncident Prevention
Business Service CatalogCustomer Experience Management
The Service Lifecycle
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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?
The Service Lifecycle
Copyright 2014 Thavron Solutions, LLC
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?
The Service Lifecycle
Copyright 2014 Thavron Solutions, LLC
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.
Copyright 2014 Thavron Solutions, LLC
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
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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
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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
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Deming Cycle
• PDCA • PDSA• Shewart Cycle• “Structured Problem Solving”• Basis for DMAIC
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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
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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.
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Service Portfolio as an InvestmentDevelop a Strategy
(Plan)
Implement the Plan
(Do)
Monitor the plan (Check)
Update the Plan (Act
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The Service Lifecycle
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Design PDCA Cycle
Deliver PDCA Cycle
Delete PDCA Cycle
Triggers for Re-assessment
• Commercial• Social• Economic• Political
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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?
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Catalog & Asset
Management
Service Costing &
Billing
Product & Project
Management
Supplier / Vendor
Management
Service Portfolio
A Framework for Business Service Success
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Financial LifecycleProduct Lifecycle
TM
IT Value Stream aligned to Business Value Stream
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Catalog & Asset
Management
Service Costing & Bill of IT
Product & Project
Management
Supplier / Vendor
Management
Service Portfolio
Driven by Escalations
IT Value Stream aligned to Business Value Stream
Copyright 2014 Thavron Solutions, LLC
Catalog & Asset
Management
Service Costing & Bill of IT
Product & Project
Management
Supplier / Vendor
Management
Service Portfolio
Driven by Escalations
Service Catalog lifecycle management
IT Value Stream aligned to Business Value Stream
Copyright 2014 Thavron Solutions, LLC
Catalog & Asset
Management
Service Costing & Bill of IT
Product & Project
Management
Supplier / Vendor
Management
Service Portfolio
Driven by Escalations
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
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IT Services in the value stream
IT Services
Business Functions
Value Stream
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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
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IT Services have a non-linear relationship to VS
Issue License
Process payment
Payment transaction
system
Deliver license Email
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Portfolio Management Analytics
• Value• Performance• Market Position• Utilization
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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
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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
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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
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Market/Lifecycle Analytics
• Benchmarking• Market Trends versus PBAs
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What does this mean for ITFM?
• Analytics and Data for decision making• Partners in the process
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Catalog & Asset
Management
Service Costing & Bill of IT
Supplier / Vendor
Management
Service Portfolio
IT Financial Management
Copyright 2014 Thavron Solutions, LLC
Annual/Quarterly ActualsAllocated Costs /low transparencyManual Budgeting process
High Forecast variance
Catalog & Asset
Management
Service Costing & Bill of IT
Supplier / Vendor
Management
Service Portfolio
IT Financial Management
Copyright 2014 Thavron Solutions, LLC
Annual/Quarterly ActualsManual Budgeting process
High Forecast variance
Monthly ActualsSemi- Automated Budgeting process
Forecast variance
Catalog & Asset
Management
Service Costing & Bill of IT
Supplier / Vendor
Management
Service Portfolio
IT Financial Management
Copyright 2014 Thavron Solutions, LLC
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
Copyright 2014 Thavron Solutions, LLC
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
Copyright 2014 Thavron Solutions, LLC
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)
Copyright 2014 Thavron Solutions, LLC
Catalog & Asset
Management
Service Costing &
Billing
Product & Project
Management
Supplier / Vendor
Management
Service Portfolio
Leverage ITFM info: build your platform for Success
Copyright 2014 Thavron Solutions, LLC
Financial LifecycleProduct Lifecycle
TM
Discussion
Copyright 2014 Thavron Solutions, LLC
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