ITIL® Version 3 Foundation Self Learning Manual

Table of contents
1. Service Management and the Service Lifecycle ........................................................................ 7
1.1. ITIL® v3 Accreditation and Qualifications ................................................................ 7
1.1.1. The ITIL® v3 Accreditation Structure .............................................................................. 7
1.1.2. The ITIL® v3 Qualification Scheme ................................................................................. 7
1.2. Service Management as a Practice ......................................................................... 9
1.2.1. Best Practice and Good Practice..................................................................................... 9
1.2.2. What is a Service? ......................................................................................................... 10
1.2.3. What is Service Management?...................................................................................... 10
1.2.4. The value proposition of services .................................................................................. 11
1.2.5. What is a Function? ....................................................................................................... 11
1.2.6. What is a Role? ............................................................................................................. 12
1.2.7. What is a Process? ........................................................................................................ 12
1.2.8. Process Control ............................................................................................................. 13
1.2.9. Process Model ............................................................................................................... 13
1.2.10. Process Characteristics ................................................................................................. 14
1.3. Background and History of ITIL ..............................................................................15
1.4. Service Lifecycle ....................................................................................................16
1.4.1. What is the Service Lifecycle?....................................................................................... 16
1.4.2. The Service Lifecycle based on the ITIL architecture ................................................... 17
1.4.3. Structure ........................................................................................................................ 18
1.4.4. ITIL ® v3 Library ............................................................................................................ 18
1.4.5. ITIL ® v3 - Continual Service Improvement .................................................................. 20
1.4.6. ITIL ® v3 – Processes in the Service Lifecycle ............................................................. 20
1.4.7. ITIL ® v3 – Lifecycle Interfaces ..................................................................................... 21
1.5. Generic concepts and definitions............................................................................22
1.5.1. Value of a service: Utility and Warranty ........................................................................ 22
1.5.2. Service Portfolio............................................................................................................. 23
1.5.3. Service Catalogue ......................................................................................................... 23
1.5.4. Business and Technical Service Catalogue .................................................................. 24
1.5.5. Business Case ............................................................................................................... 25
1.5.6. Risk ................................................................................................................................ 26
1.5.7. Service Model ................................................................................................................ 27
1.5.8. Service Knowledge Management system (SKMS)........................................................ 28
1.6. Roles definitions .....................................................................................................29
1.6.1. Process Owner .............................................................................................................. 29
1.6.2. Service Owner ............................................................................................................... 29
1.6.3. RACI .............................................................................................................................. 30
1.6.4. To Build a RACI chart .................................................................................................... 30
1.6.5. RACI Model - Problems ................................................................................................. 30
1.7. Technology and Architecture ..................................................................................31
1.7.1. Service Management technology .................................................................................. 31
1.7.2. Service Automation ....................................................................................................... 33
2. Service Strategy .......................................................................................................................... 34
2.1. Service Strategy in the Service Lifecycle ................................................................34
2.1.1. Goal ............................................................................................................................... 34
2.1.2. Objectives ...................................................................................................................... 34
2.2. Generic Concepts and Definitions ..........................................................................35
2.2.1. Resources & Capabilities .............................................................................................. 35
2.3. Key Principles & Models .........................................................................................36
2.3.1. Service Assets as the basis of Value Creation .............................................................. 36
2.3.2. Value Creation ............................................................................................................... 36
2.4. Service Strategy Processes ...................................................................................37
2.4.1. Four Main Activities ....................................................................................................... 37
2.4.2. Activity 1 – Define the Market ........................................................................................ 37
2.4.3. Activity 2 – Develop the Offerings ................................................................................. 39

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2.4.4. Activity 3 – Develop Strategic Assets ............................................................................ 41

2.4.5. Activity 4 – Prepare for Execution ................................................................................. 43
2.5. Specific Processes: Service Strategy .....................................................................47
2.5.1. Service Portfolio Management (SPM) ........................................................................... 47
2.5.2. Roles .............................................................................................................................. 49
2.5.3. Financial Management .................................................................................................. 49
2.5.4. Roles .............................................................................................................................. 52
2.5.5. Demand Management ................................................................................................... 52
2.5.6. Roles .............................................................................................................................. 53
3. Service Design ............................................................................................................................ 54
3.1. Service Design in the Service Lifecycle ..................................................................54
3.1.1. Goal ............................................................................................................................... 54
3.1.2. Objectives ...................................................................................................................... 55
3.1.3. Business Value .............................................................................................................. 56
3.2. Generic Concepts and Definitions ..........................................................................57
3.2.1. Service Provider ............................................................................................................ 57
3.2.2. Supplier .......................................................................................................................... 57
3.2.3. Service Level Agreement (SLA) .................................................................................... 57
3.2.4. Operational Level Agreement (OLA) ............................................................................. 57
3.2.5. Contract ......................................................................................................................... 58
3.2.6. Service Design Package (SDP)..................................................................................... 58
3.2.7. Availability ...................................................................................................................... 58
3.3. Key Principles and Models .....................................................................................59
3.3.1. Importance of the 4P’s ................................................................................................... 59
3.3.2. Service Design Perspective - links, inputs & outputs .................................................... 59
3.3.3. Major Aspect 1 - Service Portfolio Management ........................................................... 61
3.3.4. Major Aspect 2 - Identification of Business Requirements ............................................ 63
3.3.5. Major Aspect 3 - Technology architectural design ........................................................ 64
3.3.6. Major Aspect 4 - Process design ................................................................................... 66
3.3.7. Major Aspect 5 - Measurement design .......................................................................... 68
3.3.8. 5 Major Aspects – The Big Picture ................................................................................ 69
3.3.9. Sourcing approaches & options..................................................................................... 70
3.3.10. Design and Constraints ................................................................................................. 71
3.4. Service Design Processes......................................................................................72
3.4.1. Service Level Management ........................................................................................... 72
3.4.2. Roles .............................................................................................................................. 74
3.4.3. Service Catalogue Management ................................................................................... 75
3.4.4. Roles .............................................................................................................................. 76
3.4.5. Capacity Management ................................................................................................... 77
3.4.6. Roles .............................................................................................................................. 79
3.4.7. Availability Management ................................................................................................ 80
3.4.8. Roles .............................................................................................................................. 82
3.4.9. Service Continuity Management .................................................................................... 83
3.4.10. Roles .............................................................................................................................. 84
3.4.11. Information Security Management................................................................................. 85
3.4.12. Roles .............................................................................................................................. 88
3.4.13. Supplier Management ................................................................................................... 89
3.4.14. Roles .............................................................................................................................. 90
4. Service Transition ....................................................................................................................... 92
4.1. Service Transition in the Service Lifecycle .............................................................92
4.1.1. Goal ............................................................................................................................... 92
4.1.2. Objectives ...................................................................................................................... 92
4.1.3. Business Value .............................................................................................................. 93
4.2. Generic Concepts and Definitions ..........................................................................94
4.2.1. Configuration Item (CI) .................................................................................................. 94
4.2.2. Configuration Management System (CMS) ................................................................... 94
4.2.3. Definitive Media Library ................................................................................................. 95
4.2.4. Service Change ............................................................................................................. 95
4.2.5. Change types................................................................................................................. 95
4.2.6. Release Unit .................................................................................................................. 96

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4.2.7. The 7 R’s of Change Management................................................................................ 96

4.3. Key Principles and Models .....................................................................................97
4.3.1. The Service-V Model ..................................................................................................... 97
4.4. Service Transition Processes .................................................................................99
4.4.1. Change Management .................................................................................................... 99
4.4.2. Roles ............................................................................................................................ 104
4.4.3. Service Asset & Configuration Management ............................................................... 105
4.4.4. Roles ............................................................................................................................ 109
4.4.5. Release & Deployment Management .......................................................................... 112
4.4.6. Roles ............................................................................................................................ 115
5. Service Operation ..................................................................................................................... 117
5.1. Service Operation in the Service Lifecycle ...........................................................117
5.1.1. Goals ........................................................................................................................... 117
5.1.2. Objectives .................................................................................................................... 117
5.1.3. Business Value ............................................................................................................ 117
5.2. Generic Concepts & Definitions ............................................................................118
5.2.1. Impact, Urgency and Priority ....................................................................................... 118
5.2.2. Categories of Calls ...................................................................................................... 118
5.2.3. Workaround and Error ................................................................................................. 119
5.2.4. Role of Communication ............................................................................................... 119
5.3. Key Principles and Models ...................................................................................120
5.3.1. IT Services vs. Technology Components .................................................................... 120
5.3.2. Stability vs. Responsiveness ....................................................................................... 120
5.3.3. Quality of Service vs. Cost of Service ......................................................................... 121
5.3.4. Reactive vs. Proactive ................................................................................................. 122
5.4. Service Operation Processes ...............................................................................123
5.4.1. Incident Management .................................................................................................. 123
5.4.2. Roles ............................................................................................................................ 126
5.4.3. Event Management ..................................................................................................... 126
5.4.4. Roles ............................................................................................................................ 127
5.4.5. Request Fulfilment ....................................................................................................... 127
5.4.6. Roles ............................................................................................................................ 128
5.4.7. Problem Management ................................................................................................. 128
5.4.8. Roles ............................................................................................................................ 128
5.4.9. Access Management ................................................................................................... 129
5.4.10. Roles ............................................................................................................................ 129
5.5. Functions .............................................................................................................130
5.5.1. Service Desk................................................................................................................ 130
5.5.2. Role ............................................................................................................................. 130
5.5.3. Objectives .................................................................................................................... 130
5.5.4. Organizational Structures ............................................................................................ 131
5.5.5. Staffing ......................................................................................................................... 133
5.5.6. Metrics ......................................................................................................................... 134
5.5.7. Technical Management ............................................................................................... 134
5.5.8. Application Management ............................................................................................. 135
5.5.9. IT Operations Management ......................................................................................... 135
5.5.10. Functions – Organizational Overlap ............................................................................ 136
6. Continual Service Improvement .............................................................................................. 137
6.1. Continual Service Improvement in the Service Lifecycle ......................................137
6.1.1. Goal ............................................................................................................................. 137
6.1.2. Objectives .................................................................................................................... 137
6.1.3. Business Value ............................................................................................................ 138
6.2. Generic Concepts & Definitions ............................................................................139
6.2.1. The role of IT Governance across the Service Lifecycle ............................................. 139
6.3. Key Principles & Models .......................................................................................140
6.3.1. PDCA Model ................................................................................................................ 140
6.3.2. CSI Model .................................................................................................................... 141
6.4. Continual Service Improvement Processes ..........................................................145
6.4.1. 7 Step Improvement Process ...................................................................................... 145

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6.4.2. Step 1 - Define What You Should Measure ................................................................ 146

6.4.3. Step 2 - Define What You Can Measure ..................................................................... 147
6.4.4. Step 3 – Gathering the Data ........................................................................................ 148
6.4.5. Step 4 – Processing the Data ...................................................................................... 151
6.4.6. Step 5 – Analyzing the Data ........................................................................................ 154
6.4.7. Step 6 – Presenting & Using the Information .............................................................. 155
6.4.8. Step 7 – Implementing Corrective Action .................................................................... 156
7. Conclusion ................................................................................................................................ 158
7.1. Acronyms .............................................................................................................158

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 ITIL® Version 3 Foundation Self Learning Manual

What is ITIL® v3?

ITIL ® (IT Infrastructure Library) is a series of comprehensive, consistent publications that are used
to aid the establishment of a quality IT Service Management framework within an organization,
aligned with the international standard, ISO/IEC 20000. The ITIL philosophy has evolved and is
globally recognized as the foundation of IT Service Management best practice, supported by a
professional qualification program.

The latest version of ITIL ® (v3) consists of a core set of five publications that replaces the previous
version of ITIL ® (published in 2000). The core publications, providing the guidance necessary for an
integrated approach as required by the ISO/IEC 20000 standard specification, are:

• Service Strategy
• Service Design
• Service Transition
• Service Operation
• Continual Service Improvement

The core volumes will be supported by complementary titles, addressing the application of the generic
core guidelines in particular markets or technological contexts.

As IT services become more closely aligned and integrated with the business, ITIL ® v3 assists in
establishing a business management approach and discipline to IT Service Management, stressing the
complementary aspects of running IT like a business. Service Management is a set of specialized
organizational capabilities for providing value to customers in the form of services. The core of Service
Management is transforming resources into valuable services.

These capabilities take the form of functions and processes for managing services over a lifecycle,
through strategy, design, transition, operation, and continual improvement. Without these capabilities,
signifying capacity, competency, and confidence for action, a service organization is merely a bundle
of resources that by itself has relatively low intrinsic value for customers.

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Icons
The following icons are used throughout the Learning Program and demarcate the required curriculum
according to topic.

Service Strategy (Awareness)

Service Design (Awareness)

Service Transition (Awareness)

Service Operation (Awareness)

Continual Service Improvement (Awareness)

ITIL ® Certification Scheme (Non-examinable)

Service Management as a practice (Comprehension)

Service Lifecycle (Comprehension)

Key Principles and Models (Comprehension)

Generic Concepts (Awareness)

Roles (Awareness)

Functions (Awareness)

Technology and Architecture (Awareness)

ITIL ® v3 Processes (Awareness)

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1. Service Management and the Service Lifecycle

1.1. ITIL® v3 Accreditation and Qualifications
1.1.1. The ITIL® v3 Accreditation Structure

This section is non-examinable. ITILFND09

Current Examination Institutes:

• APM Group
• EXIN
• ISEB

Official ITIL Accreditor: APM Group

Founder and Copyright owner: OGC

Official publisher: The Stationary Office (TSO)

International user groups: itSMF

1.1.2. The ITIL® v3 Qualification Scheme

This section is non-examinable. ITILFND09

ITIL Foundation
• IT Service Management and Service Lifecycle
• Overview of Core Process Areas
• Standards and Frameworks

Service Capability Courses (5)

Logically grouped areas of expertise
• Service Portfolio and Relationship Management
• Service Design and Optimization
• Service Monitoring and Control
• Release and Deployment Management
• Service Operation and Support Management

Service Lifecycle Courses (5)

This course focuses on the 5 Core Process Areas
• Service Strategy
• Service Design
• Service Transition
• Service Operations
• Continual Service Improvement

Managing through the Lifecycle

This ‘Capping’ course has been introduced as a fail safe mechanism to
ensure that anyone who wants to earn the Diploma in Service Management
does so after passing the course that is essentially at the heart of ITIL v3 –
the Lifecycle.

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Diploma in Service Management

This non-examinable qualification is bestowed upon earning sufficient points
in the ITIL® v3 Qualification Scheme as per Figure 1-2.

Advanced Diploma in Service Management

This non-examinable qualification is bestowed on invitation, with a proven
experience in IT Service Management.

Figure 1 -2

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1.2. Service Management as a Practice

1.2.1. Best Practice and Good Practice

Some organizations in an industry get ahead, because of their adoption or ITILFND01

even development of best practice. Over time, others in the industry adopt 01-1
the same practice or else go out of business. Once the “common practice” is
in place then the industry operates in a state of good practice.

Best Practise
• The approach to an undertaking that has already been proved to be
the most effective.
• It is derived from the practices of the most effective and successful
people in the field.

ITIL® v3 as Good Practice

• What everybody is doing as it’s seen as complete, with no gaps, and
often referred to as the “most appropriate”
• There is a continuous search for improvement

Evolution
• There is a continuous search for improvement.
• Figure 1-3 show how Best Practices becomes Good Practices
becomes Commodity, Generally accepted principles, Perceived
wisdom, or regulatory requirements.

Figure 1-3

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1.2.2. What is a Service?

‘A means of delivering value to customers by facilitating ITILFND01

outcomes that they want to achieve without the ownership 01-2
of specific costs and risks’
- ITIL® v3 Service Strategy

Facilitating outcomes:
• To enhance the performance of associated tasks and reduce the
effect of constraints
• The result is an increase in the probability of desired outcomes

Effect may be:

• Directly on resources and capabilities associated with the task and
constraints
• Performance of a customer task e.g. business process
In IT Service Management (ITIL v3), the customer is anybody that makes
use of a (IT) service to achieve their own outcomes, and can be a
commercial customer of the business or the business itself. Note the
difference between a customer and a user – basically the customer PAYS
(directly or indirectly) for the service on behalf of the user. A customer can
also be a user.

KEY-NOTE:
Broadly speaking, services facilitate outcomes by enhancing the performance
and by reducing the grip of constraints.

1.2.3. What is Service Management?

‘A set of specialized organizational capabilities for providing ITILFND01

value to customers in the form of services’ 01-3
- ITIL® v3 Service Strategy
These capabilities:
• May exist as processes and functions that manage services over a
lifecycle, specializing in strategy, design, transition, operation and
continual improvement.
• Represent a service organization’s capacity, competency, and
confidence for action.
• Are shaped by the challenges they are required to overcome

Without these capabilities, a service organization is merely a resource

grouping with relatively low intrinsic value for customers.

KEY-NOTE: Transforming resources into valuable services is at the core of

service management!

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1.2.4. The value proposition of services

Service assets are the source of value and customer assets are the ITILFND01
recipients. Services have the potential to increase the performance of 01-3
customer assets and create value to the customer organization.
Improvements in the design, transition and operation of services increase
the customer performance potential and reduce the risks of variations on
customer assets.

Customer Performance Service Service

Assets Potential Potential Assets

Figure 1-4
Figure 1-4 illustrates how services derive their potential from service
assets:
• Service potential is converted into performance potential of customer
assets.
• Increasing the performance potential frequently stimulates additional
demand for the service in terms of scale or scope.
• This demand translates into greater use of service assets and
justification for their ongoing maintenance and upgrades.
• Unused capacity is reduced.
• Costs incurred in fulfilling the demand are recovered from the
customer based on agreed terms and conditions.

1.2.5. What is a Function?

‘A logical concept referring to people and automated ITILFND01

measures that execute a defined process, an activity or a 01-4
combination thereof’ - ITIL® v3 Service Strategy

A function is seen as a self-contained, specialized organization unit with

required capabilities and resources, responsible for specific outcomes.
• Have their own body of knowledge through experience
• Optimize their work methods by focusing on outcome

In larger organizations a function may be broken out and performed by

several departments, teams and groups, or it may be embodied within a
single organizational unit. In smaller organizations, one person or group can
perform multiple functions

Process Model
Enables understanding and assists in articulating distinct process features -
ITIL® v3 Service Design.
Functional silos hinder alignment and feedback critical to the success of the
organization as a whole, and process models help avoid this problem with
functional hierarchies by improving cross-functional coordination and control

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1.2.6. What is a Role?

A role can be group, team, unit or person that performs tasks that are ITILFND01
connected to a relevant process. A single department could also be expected 01-4
to play several other roles at different times, e.g. A technical department
can perform the role of:
• Problem Management role when diagnosing the root cause of
incidents
• Change Management role when assessing the impact of changes
• Capacity Management role when manage the performance of devices
under their control

‘A set of connected behaviours or actions that are performed

by a person, team or group in a specific context’
- ITIL® v3 Service Strategy
The definition helps us to understand that the EXPECTED behavior of an
individual can be defined by a role statement. The scope of the role and
trigger is defined by the relevant process and agreed by management.

1.2.7. What is a Process?

A set of coordinated activities combining and implementing ITILFND01

resources and capabilities in order to produce an outcome, 01-4
which directly or indirectly, creates value for the external
customer or stakeholder - ITIL® v3 Service Strategy

Process:
• A structured set of activities designed to accomplish a specific
objective.
• Takes one or more inputs and turns them into defined outputs.
• Includes all of the roles, responsibilities, tools and management
controls required to reliably deliver the outputs.
• May also define or revise policies, standards, guidelines, activities,
processes, procedures and work instructions if they are needed.

Procedures and Work instructions:

Processes are often described using procedures and work instructions.
• A procedure is a description of logically related activities, and who
carries them out. A procedure may include stages from different
processes. A procedure defines who does what, and varies depending
on the organization.
• A set of work instructions defines how one or more activities in a
procedure should be carried out.

Figure 1-5

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1.2.8. Process Control

‘Control - The activity of planning and regulating a process, ITILFND01

with the objective of performing a process in an effective, 01-5
efficient and consistent manner’ - ITIL® v3 Service
Design
• Defined processes should be documented and controlled.
• Controlled processes can be repeated and become manageable.
• The extent of control should be defined, followed by the process
measurement metrics, to enable control and to improve the process

1.2.9. Process Model

‘The Process Model enables understanding and assists in ITILFND01

articulating distinct process features’ - ITIL® v3 Service Design 01-5

Figure 1-6

The generic process elements in Figure 1-6 show:

1. data enters
2. is processed
3. is output
4. the outcome is measured and reviewed

This basic description underpins any process description. A process is always

organized around a set of objectives and the main outputs should be driven
by the objectives which should include process metrics, reports and
improvement recommendations.

A process should have a process owner, responsible to ensure that the

process meets its objectives and for ensuring its improvement. A process
can span organizational and geographic boundaries, often in complex
variants creating unique designs and patterns of execution. Defined
processes should be documented and controlled.

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1.2.10. Process Characteristics

Processes help to organize work - they are aligned to activity and output, ITILFND01
but not necessarily to value. 01-6
Processes are not strategic - You have to know what you want to achieve or
assume that the customer does.

Processes have the following characteristics:

Processes are measurable:

Because a process is performance driven, it can be measured in a relevant
manner.
• Managers measure cost, quality and other variables
• Practitioners are concerned with duration and productivity

Processes have specific results

A process exists to deliver a specific result(s) that must be individually
identifiable and countable. E.g. we can count changes, it is impossible to
count how many service desks were completed (Service desk is a function).

Processes deliver to customers

A process’ primary results are delivered to a customer or stakeholder, who
could be internal or external to the organization, but the process, must meet
their expectations.

Processes respond to a specific event

Whether a process is ongoing or iterative, it should be traceable to a specific
trigger.

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1.3. Background and History of ITIL

The Information Technology Library (ITIL) was first published in the 1980s as the British Government
saw the emerging disparity in the way that Information Technology (IT) was being managed.

The original ITIL was many books, but was revised down to 8 primary books in the mid a1990s. Of
these books there were two that stood out as being the real essence of ITIL; Service Support and
Service Delivery volumes.

These volumes each described in great detail 5 processes at the tactical and operational levels.

Service Delivery - Tactical

• Service Level Management

• Capacity Management
• Availability Management
• IT Service Continuity Management
• Financial Management for IT Services

Service Support – Operational

• Incident Management
• Problem Management
• Change Management
• Release Management
• Configuration Management

The latest version of ITIL focuses on establishing Service Management across a lifecycle. One
important final point is that ITIL is trademarked and copyright protected. Only authorized companies
can directly use ITIL material in training courses and consulting materials.

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1.4. Service Lifecycle

1.4.1. What is the Service Lifecycle?

‘The ongoing multi-dimensional approach to effectively and ITILFND02

efficiently transform strategy into desired output.’ 02-1

This is a limiting definition, so lets examine the Service Lifecycle more

closely. To be effective and efficient, the lifecycle approach requires
specialization and coordination AND feedback and control between the
processes and functions within and across the elements of the lifecycle.

The Service Lifecycle should:

• Provide structure, stability, and strength to service management
capabilities with durable principles, methods, and tools.
• Serve to protect investments and provide the necessary basis for
measurement, learning, and improvement.

Figure 1-7

Figure 1-7 shows the high-level view of the IT Service Lifecycle:

• Business strategy dictates IT strategy
• IT strategy support the business by designing service solutions
• Designed service solutions are tested and deployed to enable/support
the business
• Whilst in operation, services are maintained and supported to ensure
their performance against agreed levels
• To ensure competitiveness, effectiveness and efficiency, a continual
improvement cycle should be adopted

This is not the only pattern of action in the service lifecycle as each element
provide points for feedback and control (governance)

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1.4.2. The Service Lifecycle based on the ITIL architecture

ITIL v3 creates a way of integrating IT processes, people and tools with the ITILFND02
Business Strategy and Outcomes through IT services. 02-1

The volumes of the ITIL Core is based on a Service Lifecycle as represented

in Figure 1-8:
• Service Strategy (SS) represents policies and objectives and is the
axis around which the lifecycle rotates.
• Service Design (SD), Service Transition (ST) and Service
Operation (SO) are progressive phases of the Lifecycle,
representing change and transformation, through which strategy is
implemented.
• Continual Service Improvement (CSI) embodies learning and
improvement, placing and prioritizing improvement programs and
projects according to the strategic objectives.

Figure 1-8

Important: The wheel diagram perfectly illustrates the ongoing challenges

of Service Management (and service delivery).
• It would be unusual for any organization to starting from nothing - so
there is no obvious entry point to the wheel.
• This journey also never ends - so there is no easy exit point from the
wheel.

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1.4.3. Structure

Processes describe how things change whereas structure describes how they ITILFND02
are connected. Structure determines behaviour and should be an organizing 02-1
framework designed for sustainable performance.

A comprehensive approach to service management seeks to:

• understand its structure
• the interconnections between all its components
• how changes will affect the system and its components (Figure 1-
9); “Today’s problem is often created by yesterday’s solution”

Figure 1-9

1.4.4. ITIL ® v3 Library

Service Strategy (SS) ITILFND02

• Guidance on principles underpinning the practice of 02-2
service management
• Useful to develop policies, guidelines and processes
across the Lifecycle
• Guidance useful in conjunction with the other
volumes
• Covered topics include the development of markets, internal and
external, service assets, service catalogue, and implementation of
strategy through the Service Lifecycle.
• Financial Management, Service Portfolio Management, Organizational
Development, and Strategic Risks are among other major topics.

Service Design (SD)

• Guidance for the design and development of
services and processes.
• Covers design principles and methods for converting
strategic objectives into portfolios of services and
service assets.
• Not limited to new services.
• Includes the changes and improvements necessary to increase or
maintain value to customers over the lifecycle of services, the
continuity of services, achievement of service levels, and
conformance to standards and regulations.

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Service Transition (ST)

• Guidance for the development and improvement of
capabilities for transitioning new and changed
services into operations
• Guidance on Service Strategy requirements encoded
in Service Design are effectively realized in Service
Operation while controlling the risks of failure and disruption.
• Combines practices in Release Management, Program Management,
and Risk Management
• Guidance on managing the complexity related to changes to services
and processes
• Guidance is provided on transferring the control of services between
customers and service providers.

Service Operation (SO)

• Guidance on achieving effectiveness and efficiency
in the delivery and support of services to ensure
value to customers
• Strategic objectives are realized, critical capability
• Guidance to maintain stability in service operations,
allowing for changes in design, scale, scope, and service levels.
• Detailed process guidelines, methods, and tools provided for use in
two major control perspectives: reactive and proactive.
• Knowledge provided to make better decisions on managing
• availability of services
• controlling demand
• optimizing capacity utilization
• scheduling of operations
• fixing problems
• Guidance is provided on supporting operations through new models
and architectures
• shared services
• utility computing
• web services
• mobile commerce

Continual Service Improvement

• Instrumental guidance in creating and maintaining
value for customers through better design,
introduction, and operation of services
• Combines principles, practices, and methods from
quality management, change management, and
capability improvement
• Realize incremental and large-scale improvements in service quality,
operational efficiency, and business continuity
• Guidance for linking improvement efforts and outcomes with service
strategy, design, and transition
• A closed-loop feedback system established, capable of receiving
inputs for change from any planning perspective
• Based on the Plan, Do, Check, Act (PDCA) model in ISO/IEC 20000

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1.4.5. ITIL ® v3 - Continual Service Improvement

Figure 1-10 shows that CSI doesn’t start after services are in operations. ITILFND02
CSI is used throughout the lifecycle. 02-2

Figure 1-10

1.4.6. ITIL ® v3 – Processes in the Service Lifecycle

ITIL processes in the Version 3 lifecycle-based core books. ITILFND02

02-2
Figure 1-11 (next page) provides a detailed overview of the ITIL
processes, mapping the Service Lifecycle view (from ITIL V3) with the
traditional Processes view (from ITIL V2).

The columns represent the processes and activities that are carried out
within each of the five stages of the Service Lifecycle and the rows
represent the processes. Some processes exist in multiple Service
Lifecycle stages and others fit within a single Service Lifecycle stage.

The color of a process matches the color of the core ITIL book in which
the full process definition and overview will be found.

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Figure 1-11

1.4.7. ITIL ® v3 – Lifecycle Interfaces

Specialization and coordination are necessary in the lifecycle approach. ITILFND02

Feedback and control between the functions and processes within and 02-2
across the elements of the lifecycle make this possible

The dominant pattern in the lifecycle is the sequential progress starting from
SS through SD-ST-SO and back to SS through CSI. That, however, is not the
only pattern of action.

Figure 1-12

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1.5. Generic concepts and definitions

1.5.1. Value of a service: Utility and Warranty

Value of a service ITILFND03

From the Customer’s perspective, value has two facets: 03-1
• Utility – fitness for purpose
• Warranty - fitness for use

Utility of a service
• Utility is what the Customer gets. It is derived from the attributes of a
service that have a positive effect on performance or desired
outcomes.
• Removal or relaxation of constraints on performance can also be a
positive effect = Fitness for Purpose
• Utility increases the performance average.

Warranty of a service
• Warranty is the assurance that some products or services will be
provided, and the way they are provided will meet certain
specifications
• e.g. available when needed, in sufficient capacity and magnitude, and
dependably in terms of continuity and security = Fitness for Use
• Warranty reduces the performance variation.

Any uncertainty in the service output creates skepticism about the value
realized from services - costs may be certain but utility may vary from one
unit of output to another. To dispel such concerns and convince a customer
of possible gains and losses, the value of a service should be described in
terms of utility and warranty. Customers cannot benefit from something that
is fit for purpose but not fit for use and vice versa.

Figure 1-13 illustrates a useful way to separate the logic of utility from the
logic of warranty for the purpose of design, development, and improvement.
(From left-to-right, top-to-bottom)

Figure 1-13

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1.5.2. Service Portfolio

The Service Portfolio consists of all services, at whatever stage of their ITILFND03
lifecycle. 03-3

3 PHASES:
• Services being developed are in the Service Pipeline.
• Those that may be offered and consumed by customers constitute
the Service Catalogue.
• Retired services remain in the Service Portfolio

Figure 1-14 illustrates this graphically.

Figure 1-14

1.5.3. Service Catalogue

The Service Catalogue is the subset of the Service Portfolio visible to ITILFND03
customers. It consists of services presently active in the Service Operation 03-4
phase and those approved to be readily offered to current or prospective
customers. It is a virtual projection of actual and present capabilities of the
service provider.

Items can enter the service catalogue only after due diligence has been
performed on related costs and risks. Resources are engaged to fully
support active services.
Many customers are only interested in what the provider can commit to now,
rather than in future.

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The Service Catalogue defines the criteria for what services fall under
Service Portfolio Management (SPM) and the objective of each service

Figure 1-15 shows the suggested generic high-level content

Figure 1-15

1.5.4. Business and Technical Service Catalogue

The Service Catalogue has two aspects: ITILFND03

03-4
The Business Service Catalogue
• This is the customer view of the Service Catalogue.
• It contains details of all the IT services delivered to the customer.
• It includes the relationships to the business units and the business
process that rely on the IT services.
• Facilitates the development of a much more proactive or even
preemptive SLM process, allowing it to develop more into the field of
Business Service Management.

The Technical Service Catalogue

• Should underpin the Business Service Catalogue and not form part of
the customer view.
• It contains details of all the IT services delivered to the customer.
• It includes the relationships to the supporting services, shared
services, components and CIs necessary to support the provision of
the service to the business.
• Beneficial when constructing the relationship between services, SLAs,
OLAs and other underpinning agreements and components, as it will
identify the technology required to support a service and the support
group(s) that support the components.

Some organizations maintain either a Business Service Catalogue or a

Technical Service Catalogue. More mature organizations maintain both
aspects within a single Service Catalogue, which is part of a totally
integrated Service Portfolio supported by Service Management. The

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combination of a Business Service Catalogue and a Technical Service

Catalogue is invaluable for quickly assessing the impact of incidents and
changes on the business.

Figure 1-16 illustrates the relationship between the two aspects of the
Service Catalogue:
• Business Service Catalogue
• Technical Service Catalogue

Figure 1-16

1.5.5. Business Case

A business case allows managers to better understand quality requirements ITILFND03

and related delivery costs. It seeks to reduce costs through alternative 03-6
means while maintaining service quality.

• A means to identify business imperatives that depend on service

management
• Model of what a service is expected to achieve
• Provide data and evidence to justifying reasons for:
- Improving service or process
- Pursuing a course of action
• Should present:
- Cost
- Expected benefits

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1.5.6. Risk

Risk is defined as uncertainty of outcome, whether positive opportunity or ITILFND03

negative threat. 03-7

Managing risks requires the identification and control of the exposure to risk
(vulnerability), which may have an impact on the achievement of an
objective.
• Should be visible, repeatable and consistently applied to support
decision making.
• Makes cost-effective use of a risk framework that has a series of well-
defined steps.
• Aim is to support better decision making through a good
understanding of risks and their likely impact.

There are two distinct phases (See Figure 1-17)

Risk Analysis
Concerned with gathering information about exposure to risk so that the
organization can make appropriate decisions and manage risk appropriately.

Risk Management
• Having processes in place to monitor risks, access to reliable and up-
to-date information about risks
• Having the right balance of control in place to deal with those risks
• Having decision-making processes supported by a framework of risk
analysis and evaluation.

Figure 1-17

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1.5.7. Service Model

Service models are blueprints for service management processes and ITILFND03
functions to communicate and collaborate on value creation. 03-8

Figure 1-18

Figure 1-18 illustrates:

• Service Models describe how service assets interact with customer
assets and create value for a given portfolio of contracts -
Interaction means demand connects with the capacity to serve.
• Service agreements specify the terms and conditions in which this
interaction occurs with commitments and expectations on each side.
• The outcomes define the value to be created for the customer, which
rests on the utility provided to customers and the warranty.

Service models codify the structure and dynamics of services, which are
influenced by factors of utility and warranty to be delivered to customers.

Figure 1-19

Figure 1-19 illustrates:

Structure is defined in terms of:

• particular service assets needed and
• The patterns in which they are configured.

Dynamics of a service include:

• Patterns of business activity, demand patterns, exceptions and
variations.
Activities, flow of resources, coordination, and interactions.

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1.5.8. Service Knowledge Management system (SKMS)

Within IT Service Management, Knowledge Management focuses on the ITILFND03

Service Knowledge Management System (SKMS). The SKMS is underpinned 03-16
by data, held in a central logical repository or Configuration Management
System (CMS) and Configuration Management Database (CMDB).

Figure 1-19

Figure 1-19 illustrates the relationship of the three levels:

1. Data being gathered within the CMDB
2. Feeding through the CMS into the SKMS
3. Supporting the informed decision making process.

The SKMS is a broader concept that covers a much wider base of

knowledge, for example:
• The experience of staff
• Records of peripheral matters, e.g. user numbers and behavior,
organization’s performance figures
• Suppliers’ and partners’ requirements, abilities and expectations
• Typical and anticipated user skill levels.

Figure 1-20 illustrates: Data-to-Wisdom maturity.

Figure 1-20

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1.6. Roles definitions

1.6.1. Process Owner

A Process Owner is responsible for ensuring that their process is being ITILFND07
performed according to the agreed and documented process and is meeting 07-1
the aims of the process definition. This includes such tasks as:
• Documenting and publicizing the process
• Defining the Key Performance Indicators (KPIs) to evaluate the
effectiveness and efficiency of the process
• Reviewing KPIs and taking action required following the analysis
• Assisting with and ultimately responsible for the process design
• Improving the effectiveness and efficiency of the process
• Reviewing any proposed enhancements to the process
• Providing input to the on-going Service Improvement Program
• Addressing any issues with the running of the process
• Ensuring all relevant staff have the required training in the process
and are aware of their role in the process
• Ensures that the process, roles, responsibilities and documentation
are regularly reviewed and audited
• Interfaces with line management ensuring, that the process receives
the needed staff resources (line management and process owners
have complementary tasks, they need to work together to ensure
efficient and effective processes. Often it is the task of line
management to ensure the required training of staff)

1.6.2. Service Owner

The Service Owner is responsible to the Customer for the initiation, ITILFND07
transition and ongoing maintenance and support of a particular service. The 07-1
Service Owner has the following responsibilities:
• Act as prime Customer contact for all Service related enquiries and
issues
• Ensure that the ongoing Service delivery and support meet agreed
Customer requirements
• Will identify opportunities for Service Improvements, discuss with the
Customer and will raise the RFC for assessment if appropriate
• Will liaise with the appropriate Process Owners throughout the
Service Management lifecycle
• Will solicit required data, statistics and reports for analysis and to
facilitate effective Service monitoring and performance
• Will be accountable to the IT Director for the delivery of the Service.

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1.6.3. RACI

The RACI model will be beneficial in enabling decisions to be made with ITILFND07
pace and confidence. 07-2
• It clarifies to all involved which activities they are expected to fulfill
• It identifies any gaps in process delivery and responsibilities
RACI is an acronym for the four main roles of:
Responsible - The person or people responsible for getting the job done
Accountable – Only 1 person can be accountable for each task
Consulted - People who are consulted and whose opinions are sought
Informed – The people that are kept up-to-date on progress

Occasionally an expanded version of RACI is used called RACI-VS with 2

further roles as follows:
• Verifies - The person or group that checks whether the acceptance
criteria has been met
• Signs off - this is the person that approves the V decision and
authorizes the product hand off. This could be the A person

A third variation of the RACI model is RASCI where the S represents

Supportive. This role provides additional resources to conduct the work or
plays a supportive role in implementation for example. This could be
beneficial for IT service implementation.

Figure 1-21 illustrates a RACI table.

Figure 1-21

1.6.4. To Build a RACI chart

To build a RACI chart the following steps are required: ITILFND07

• Identify the activities / processes 07-2
• Identify/define the functional roles
• Conduct meetings and assign the RACI codes
• Identify any gaps/overlaps for example where there are 2 Rs or no Rs
• Distribute the chart and incorporate feedback
• Ensure that the allocations are being followed

1.6.5. RACI Model - Problems

Some problems that may be encountered: ITILFND07

• More than one person accountable = nobody responsible 07-2
• Delegation of responsibility without necessary authority
• Focus on matching processes and activities with departments
• Wrong division/combination of functions; conflicting agendas or goal

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1.7. Technology and Architecture

1.7.1. Service Management technology

There is general consensus that a Service Management tool is essential for ITILFND08
the success of the majority of process implementations. 08-1

• It must always reference the Service Portfolio

• It is, however, important that the tool supports the processes – not
the other way around. Don’t modify the process to fit the tool!
• There may not be a tool that totally supports the designed process,
requiring an element of process re-design without limiting
functionality:

Generic core functionality requirements:

• Self-Help
Technology should support the capability to offer ‘Self-Help’
functionality to users. This could include a web front-end allowing
web pages to be defined offering a menu-driven range of Self-Help
and Service Requests – with a direct interface into the back-end
process-handling software.

• Workflow or process engine

This allows the pre-definition and control of defined processes such
as an Incident Lifecycle, Problem Lifecycle, Change Model, etc. This
should allow responsibilities, activities, timescales, escalation paths
and alerting to be pre-defined and then automatically managed.

• Integrated CMS
This allow the organization’s IT infrastructure assets, components,
services and any supplementary CIs (contracts, locations, licenses,
suppliers etc. – anything that the IT organization wishes to control) to
be held, together with all relevant attributes, in a centralized location.
To allow relationships between each of these to be stored and
maintained, and linked to Incident, Problem, Known Error and
Change Records as appropriate.

• Discovery/Deployment/Licensing technology
To populate or verify the CMS data and to assist in Licence
Management, requires discovery or automated audit tools. Such tools
should be capable of being run from any network location and allow
interrogation and recovery of information relating to all CIs in the IT
Infrastructure. It should allow ‘filtering’ and the ability to deploy new
software to target locations. An interface to ‘Self Help’ capabilities is
desirable.

• Remote control
To allow relevant support groups to take control of the user’s desk-
top (under properly controlled security conditions), allowing them to
perform investigations or correct settings, etc. Facilities to allow this
level of remote control will be needed.

• Diagnostic utilities
To use diagnostic scripts and other diagnostic utilities (such as, for

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example, case-based reasoning tools) to assist with earlier diagnosis

of incidents. Ideally, these should be ‘context sensitive’ and
presentation of the scripts automated so far as possible.

• Reporting
It should incorporate good reporting capabilities, as well as allow
standard interfaces which can be used to input data to industry-
standard reporting packages, dashboards, etc. Ideally, instant,
onscreen as well as printed reporting can be provided through the
use of context-sensitive ‘top ten’ reports.

• Dashboards
To allow ‘see at a glance’ visibility of overall IT service performance
and availability levels and can be included in management-level
reports to users and customers. It can give real-time information for
dynamic reporting, and can be used for support and investigation
purposes. Capabilities to support customized views of information to
meet specific levels of interest can be particularly useful. It this only
represent a technical rather than service view of the infrastructure it
may be of less interest to customers and users.

Integration with Business Service Management

There is an IT industry trend to attempt the coordination of business-related
IT with the processes and disciplines of IT Service Management – some call
this Business Service Management. To facilitate this, business applications
and tools need to be interfaced with ITSM support tools to give the required
functionality.

Consider the product’s ability to:

• Perform (CAPACITY)
• Enlarge the size of the databases (SCALABILITY)
• Recover from failure (CONTINUITY)
• Maintain data integrity (SECURITY, AVAILABILITY)
• Conform to international standards
• Enable efficient compliance with Service Management Requirements

Purchasing or developing a tool doesn’t solve all problems – there is a

dependency on:
• Process
• Function
• People (most important)

Remember: ‘a fool with a tool is still a fool’

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1.7.2. Service Automation

Automation can significantly impact the performance of service assets such ITILFND08
as: 08-2
• Management
• Organization
• People
• Process
• Knowledge
• Information

Automation is considered to improve the utility and warranty of services and

may offer advantages in many areas of opportunity:
• Ability to adjust the capacity of automated resources in response to
variations in demand volumes.
• Reducing restriction on time of access for automated resources –
ability to serve outside normal working hours.
• Provide a good basis for measuring and improving service processes
in respect of human resources - service quality and costs vs. levels of
knowledge, skills and experience.
• Address optimization problems such as scheduling, routing and
allocation of resources due to computing power.
• Enables the capturing of knowledge required for a service process -
reducing the depreciation of knowledge when employees move or
permanently leave.

When judiciously applied, the automation of service processes helps improve

the quality of services:
• reduce costs
• reduce risks:
- reducing complexity and uncertainty
- efficiently resolving trade-offs

Service Management can benefit from automation in the following areas:

• Design and modeling
• Service catalogue
• Pattern recognition and analysis
• Classification, prioritization and routing
• Detection and monitoring
• Optimization.

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2. Service Strategy
2.1. Service Strategy in the Service Lifecycle
2.1.1. Goal

Service Strategy assists managers to tackle higher levels of ITILFND02

uncertainty, complexity and conflict, and to select, adapt and tune 02-3
their IT strategies.

To improve strategic impact through design, development, implementation

and practice of service management:
• As an organizational capability
• As a strategic asset

Enable Managers to cope with demands and to tune IT Strategies

Main Activities:
• Define the market
• Develop the offerings
• Develop strategic assets
• Prepare for execution

2.1.2. Objectives

Service Strategy enables a clearer relationship between various ITILFND02

services, systems or processes that are managed and the business 02-3
models, strategies, or objectives they support.

• To improve the strategic impact of Service Management

• To transform service management into a strategic asset
• To establish relationships between services, systems or processes &
business models, objectives or strategies they support.
• Provides strategic management focus in respect of IT Service
• Management through:
- Strategic analysis
- Planning & Positioning
• Provides underpinning principles to assist in developing: Policies,
Guidelines and Processes

Service Strategy answer questions like:

• What services should we offer and to whom?
• How should we define service quality?
• How can financial management provide visibility and control over
value-creation?
• How do we:
- Differentiate ourselves from competing alternatives?
- Truly create value for customers?
- Capture value for stakeholders?
- Choose between different paths for improving service quality?
- Efficiently allocate resources across a portfolio of services?
- Resolve conflicting demands for shared resources?
- Make a case for strategic investments?

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2.2. Generic Concepts and Definitions

2.2.1. Resources & Capabilities

Resources and capabilities are types of assets. ITILFND03

03-2
Resources:
Resources are direct inputs for production such as management,
organization, people, and knowledge are used to transform resources.

Resources are easier to acquire than capabilities

Capabilities:
Capabilities by themselves cannot produce value without adequate and
appropriate resources:
• A service provider is dependent on the resources under its control.
• For example, capabilities such as capacity management and
availability management are used to manage the performance and
utilization of processes, applications, and infrastructure, ensuring
service levels are effectively delivered

Capability represents:
• Coordination
• Control
• Deployment of resources to produce value

It is important to develop distinctive capabilities to retain customers – the

same resources with different capabilities give competitive advantage:
• Two service providers may have similar resources such as
applications, infrastructure, and access to finance.
• Their capabilities, however, differ in terms of management systems,
organization structure, processes, and knowledge assets.
• This difference is reflected in actual performance.

Figure 2-1 provides an overview of what Capabilities and Resources are

made up of.

Figure 2-1

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2.3. Key Principles & Models

2.3.1. Service Assets as the basis of Value Creation

Capabilities represent an organization’s ability to coordinate, control, and ITILFND04

deploy the resources to produce value. Service Assets are used to create 04-2
value in the form of goods & services.

1 Resources input assets for production

2 Management, organization, people & knowledge transforms resources
3 Capabilities coordinate, control & deploy resources to produce value

2.3.2. Value Creation

Business outcomes & customer perceptions defines value. The ability to ITILFND04
quantify value adds value to the concept of value creation, which need not 04-2
necessarily be expressed in financial terms, but can be expressed in feelings,
beliefs and perceptions.

Figure 2-2

Figure 2-2 shows that customers’ perceptions, preferences (expectations)

and the particular features of a service (attributes) allow us to set a baseline
reference value. Over TIME as the supplier aims to demonstrate value and
influence perceptions and respond to preferences then we should see a
higher reference value emerge. The difference in the two values (the net
difference) added to the latest reference value gives us the overall service
“economic value” – as perceived by the customer.

Perceptions are influenced by:

• Attributes of a service
• Customer’s self image (innovator, market leader or risk-taker)
• Expectations

Service Providers should:

• Demonstrate value
• Influence perceptions
• Respond to preferences

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2.4. Service Strategy Processes

2.4.1. Four Main Activities

2.4.2. Activity 1 – Define the Market

Define Services for Strategy & vice versa ITILFND05

• Strategies developed for the services offered 05-1
• Services for Business strategies

For example:
A software vendor decides to offer software as a service:
1. The vendor combines its software development capabilities with new
service management capabilities
2. By bundling its software applications maintenance capabilities with
technical support, it has created a new core service
3. By adopting a service-oriented approach which is now supported by
service management capabilities, it has transformed itself into a
service business

Figure 2-3

Activity requirements:

• UNDERSTAND THE CUSTOMER

In order to define the value of a service, the performance of customer
assets should be the primary focus of service management, because
without customer assets there is no basis to define the value of a
service for a business to achieve its objectives.

• UNDERSTAND THE OPPORTUNITIES

Customers use assets to create value, these assets are means of
opportunities to achieve performance for the business which in return
will enable or enhance value-creation, and thus an organization must
understand the opportunities. New opportunities emerge when changes
in the business environment cause a hitherto well-supported outcome
to be poorly supported

• INSIGHT INTO THE BUSINESS

Business needs to identify the outcomes for every customer and market

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space that falls within the scope of the particular strategy.

• CLASSIFY AND VISUALIZE

Services differ primarily by how they create value and in what context.
Service archetypes are like business models for services.

1 Examine how the services create value + what assets need to be

deployed to create value = Investment appraisal

2 Services with closely matching patterns indicate opportunity for

consolidation or packaging as shared services:
• When services share market spaces they also tend to share
capabilities, resources, costs, risks, challenges, opportunities etc.
• Services with high degree of overlap could be consolidated under
the same operations. Variants of services have very high degree
of overlap.
• Similar services can have the same core service package.

Figure 2-4 illustrates how services can share market space.

Figure 2-4

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2.4.3. Activity 2 – Develop the Offerings

• MARKET SPACE ITILFND05

Market Space is defined by the outcomes that customers desire, 05-1
facilitated by services. It represents a set of opportunities to deliver
value through one or more services. The delivery of value will enhance
relationship building.

Figure 2-4

Figure 2-4 illustrates that Market Space:

o Can be related to one or more categories of assets
(People/Infrastructure/Information)
o Can be linked to services - proper definition of services takes into
account the context in which customers perceive value from the
services.

• OUTCOME-BASED DEFINITION OF SERVICES

Delivering value to customers by facilitating outcomes customers need
to achieve without owning specific costs and risks:
o Well-formed service definitions lead to effective & efficient service
management processes.
o Service definitions are useful when broken down into discrete
elements (Figure 2-5) that can then be assigned to different
groups, who will manage them in a coordinated manner to control
the overall effect of delivering value to customers.

Figure 2-5
• SERVICE PORTFOLIO (As discussed in Generic Concepts in paragraph
1.4.2)

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The Service Portfolio represents all commitments and investments

made by a service provider across all customers and market spaces,
and includes:
o Accurate information (including contracts) relating to all services
(current and future) and service statuses
o Includes third-party services that make up the service offering
o Includes service changes initiated by CSI

Service Portfolio assists with:

o Prioritizing investments and improve the allocation of resources.
o Instilling financial discipline necessary to avoid making investments
that will not yield value.

Figure 2-6

Service Portfolio (Figure 2-6) consists of:

o Service Catalogue
! ‘Menu’ of presently active and approved, planned services
! Subset of the Service Portfolio visible to customers.
! Consists of services presently active in the Service Operation phase and
those approved to be readily offered to current or prospective
customers.

o Service Pipeline
! Services under development for a given market space or customer
! Services are to be phased into operation by Service Transition after
completion of design, development, and testing.
! The general health of the provider is reflected in the pipeline.
! It also reflects the extent to which new service concepts and ideas for
improvement are being fed by Service Strategy, Service Design and
Continual Improvement

o Retired Services
! Services being phased out or retired
! Commitments are fulfilled, service assets are released from contracts

Changes to portfolios are governed by policies and procedures.

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2.4.4. Activity 3 – Develop Strategic Assets

• STRATEGIC ASSETS ITILFND05

Service Management is a strategic asset and should be entrusted with 05-1
challenges and opportunities in terms of customers, services, and
contracts to support. Investing in trusted assets is less risky because
they have the capability to deliver consistently.

• SERVICE MANAGEMENT AS CLOSED-LOOP CONTROL SYSTEM

Service Management represent a set of organizational capabilities
specialized in providing value to customers in the form of services.
Capabilities interact with each other to function as a value creation
system.
o Service assets are the source of value and customer assets are the
recipients (see Figure 2-7).
o Services have the potential to increase the performance of
customer assets and create value to the customer organization.

Customer Performance Service Service

Assets Potential Potential Assets

Figure 2-7

Figure 2-7

Figure 2-7 explains how service assets are the source of value and
customer assets are the recipients:

1. Services derive their potential from service assets.

! Develop and maintain service assets

2. Service potential is converted into performance potential of

customer assets.
! Understand the performance potential of customer assets
! Map service assets to customer assets through services
! Design, develop, and operate suitable services

3. Increasing the performance potential frequently stimulates

additional demand for the service in terms of scale or scope.
! Extract service potential from service assets
! Convert service potential into performance potential

4. This demand translates into greater use of service assets and

justification for their ongoing maintenance and upgrades.
! Convert demand from customer assets into workload for service assets

5. Unused capacity is reduced.

! Reduce risks for the customer

6. Costs incurred in fulfilling the demand are recovered from the

customer based on agreed terms and conditions.
! Control the cost of providing services

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• SERVICE MANAGEMENT AS A STRATEGIC ASSET

Service Management defines the value network to develop strategic
assets for service providers to support the customers, because:
o It enables managers to manage business models and strategies
more efficiently
o The service cost and risks to provide it can be accounted for

• INCREASING THE SERVICE POTENTIAL

This is accomplished through projects that develop or improve
capabilities and resources as increased efficiency in utilization of assets
improves capability. The key objective in Service Management is to
improve the service potential of its capabilities and resources.

• INCREASING PERFORMANCE POTENTIAL

Increasing the Performance Potential provides justification for
customers to procure the services and ensures alignment between
service providers and business needs. This is accomplished by
answering questions such as:
o What is our market space?
o What does that market space want?
o Can we offer anything unique in that space?
o Is the space already saturated?
o Do we have the right portfolio of services developed for a given
market space?
o Do we have the right catalogue of services offered to a given
customer?
o Is every service designed to support the required outcomes?
o Is every service operated to support the required outcomes?
o Do we have the right models and structures to be a service
provider?

• DEMAND, CAPACITY AND COST

Increase in Performance Potential leads to an increase in a customer’s
demand for the service. Service demand is accompanied by
compensation received by service levels, based on the type of
agreement i.e. Higher Service levels achieved increase the
compensation.

An increase in the customer’s demand for services also leads to a

decrease in the cost of providing additional units of service, because of
the effect of fixed costs and overheads.

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2.4.5. Activity 4 – Prepare for Execution

• STRATEGY ITILFND05
Strategy is critical for performance: 05-1
o A process can be represented in a model, around which a strategy
can be built.
o Strategy doesn’t guarantee success – it requires reflection and
examination to make it suitable in a specific context or situation - it
involves thinking as well as doing.

Figure 2-8 illustrates the establishment of Service Strategy.

Figure 2-8

• STRATEGIC ASSESSMENT
The current strategy has to be defined before developing a new
strategy as a core of differentiation could already exist. Answers to the
following questions can identify current distinctive capabilities or reveal
patterns that lend insight to future strategic decisions and objectives:
1. Which of our services or service varieties are the most distinctive?
! Those services that the customer cannot easily substitute or service
attributes not readily found elsewhere, such as product knowledge,
regulatory compliance, provisioning speeds, technical capabilities or
global support structures.
2. Which of our services or service varieties are the most profitable?
! Value may be monetary (higher profits, lower expenses), or social
(saving lives, preventing crime) – it helps to substitute ‘profit’ with
‘benefits realized’.
3. Which of our customers and stakeholders are the most satisfied?
4. Which customers, channels or purchase occasions are the most
profitable?
! The value can be monetary, social or other.
5. Which of our activities in our value chain or value network are the
most different and effective?

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• SETTING OBJECTIVES
Strategies represent the actions to be taken to accomplish objectives.

Manage by objectives as it enables consistent decision making,

minimizing later conflicts by setting priorities and serving as standards.
Avoid:
! Managing by crisis – this allows events to dictate management decisions.
! Managing by extrapolation – doing the same activities in the same
manner because it works.
! Managing by hope – believing that decisions will ultimately work out.
! Managing by subjective – doing the best to accomplish what should be
done (no plan).

Determine metrics: Understand desired outcomes and how best to

satisfy the important (currently underserved) outcomes.

Three data sources through which value can be created:

o Customer tasks: What task or activity is the service to carry out?
What job is the customer seeking to execute?
o Customer outcomes: What outcomes is the customer attempting to
obtain? What is the desired outcome?
o Customer constraints: What constraints may prevent the customer
from achieving the desired outcome? How can the provider remove
these constraints?

Four common categories of information frequently gathered and

presented as objectives. Each of these have risks associated, which
should be avoided:
o Solutions – requirements in the form of a solution to a problem. To
mitigate risk, look for the criteria used to measure the value of a
service.
o Specifications – requirements in the form of specifications. By
accepting specifications, the solution might not be optimal.
o Needs –requirements as high-level descriptions of the overall
quality of the service. This doesn’t include specific benefits - ensure
all input is measurable and actionable.
o Benefits –requirements in the form of benefit statements. There is
risk in the ambiguity of general statements (‘Fast response’ or
‘Improved security’).

• ALIGNING SERVICE ASSETS WITH CUSTOMER OUTCOMES

Service providers should manage assets in the same manner as their
customers, as this will ensure that service assets are coordinated,
controlled, and deployed to maximize the value to customers, while
minimizing risks and costs for the provider.

• DEFINE CRITICAL SUCCESS FACTORS

Critical success factors determines the success or failure of a service
strategy and are influenced by customer needs, business trends,
competition, regulatory environment, suppliers, standards, industry
best practices and technologies.

Critical success factors determine the service assets required to

implement a service strategy successfully. Critical success factors have
the following characteristics:
o They are defined in terms of capabilities and resources
o They are proven to be key determinants of success by industry
leaders

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o They are defined by market space levels, not peculiar to any one
firm
o They are the basis for competition among rivals
o They change over time, so they are dynamic not static
o They usually require significant investments and time to develop
o Their value is extracted by combination with other factors.

• CRITICAL SUCCESS FACTORS AND COMPETITIVE ANALYSIS

As mentioned before, CSFs are determinants of success in a market
space because they evaluate strategic position in a market space and
driving changes to such positions. As such, CSFs should be refined
according to distinct value propositions to customers.

This means that apart from the current position, the future movement,
the magnitude of change, and related probabilities should be
considered. This analysis is necessary to avoid being surprised by
changes that can destroy value-proposition

• PRIORITISING INVESTMENTS
A common problem experienced is prioritizing investments and
managerial attention on the right set of opportunities. Customer needs
are similar to Maslow’s Hierarchy of Needs for individuals. Figure 2-9
shows:
o Customer Portfolio - The importance and current level of
satisfaction of a need, determines the priority in the customer’s
mind for purchases that is where service providers should focus.
o Service Portfolio - Service portfolios should be extended to support
these opportunity areas (requirement for utility and warranty).
o Critical Success Factors - Consider costs and risks as reasons why
needs remained unfulfilled – might require innovation.

Figure 2-9

• EXPLORING BUSINESS POTENTIAL

Providers can be present in many spaces and should analyze their
presence (strengths, weaknesses, opportunities and threats).
o Analyze business potential on ‘unserved’ or ‘under-served’ spaces
o Long-term vitality depends on supporting changing and growing
needs, and exploiting opportunities
o Analysis identifies opportunities (current and prospective)
o Prioritizes investments in service assets based on potential markets
(and those that should be avoided), addressing:
! Services to offer (Service Portfolio)
! Customers to serve (Customer Portfolio)

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! Critical success factors

! Underserved market spaces
! Service models and assets
! Service Pipeline and Service Catalogue.
! Priority and strategic value
! Investments required
! Financial objectives (including profit motive)
! Risks involved
! Policy constraints.

• ALINGNMENT WITH CUSTOMER NEEDS

Understand the mutual relationship between customers and market
spaces:
o Strategy usually determines the placement of spaces and visa-
versa, leading to changes to either, over time.
o Providers’ strategies must be aligned to customers desired
outcomes – think market spaces

• EXPANSION AND GROWTH

Successful expansion strategies should be based on leveraging existing
service assets & portfolios to drive new growth and profitability with
less risk:
o Anchored by core capabilities and demonstrated performance
presents the proven ability to deliver value.

• DIFFERENTIATION IN MARKET SPACES

CSFs determine whether or not providers are competitive in service
offering: affordability, delivery platforms, lead times, availability, etc.
o Use indexes (Figure 2-10, next page) or scales to link
performance to CSFs to determine value curve.
o Establish separation between value curves to determine distinctive
value-proposition offered in services through benchmarking
o Benchmark may be based on industry averages, closest rival or
most attractive alternative for the customer
o Customer perception may be measured on some suitable scale or
index accepted within the industry or region
o Improve through better mix of services – efficiency and
effectiveness

Figure 2-10

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2.5. Specific Processes: Service Strategy

2.5.1. Service Portfolio Management (SPM)

SPM is a dynamic method for governing investments in service ITILFND05

management across the enterprise & managing them for value. 05-2

SPM is responsible for the Service Portfolio (Services at any stage of their
lifecycle), which consist of:
• Service Pipeline - Developed & planned services
• Service Catalogue - Services offered to & consumed by customer
• Retired Services

Figure 2-11 illustrates the position of the Service Pipeline, Service

Catalogue & Retired Services in respect of Service Portfolio.

Figure 2-11

Objectives
• Apply comparable practices to manage service portfolios
• Maximize value while managing risks and costs

Business Value
Value is derived from better service delivery and customer experiences, and
begins with documenting services. SPM demonstrates value through the
ability to anticipate change and the ability to maintain traceability to strategy
and planning. The market space and service portfolio at the Service Strategy
stage drive effectiveness throughout the lifecycle, making it valuable in:
• decision making in terms of the appropriate Service Transition plan,
• And the resource requirements during business-as-usual service
operation.

Service Portfolio Management is aimed at maximizing value while managing

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risks and costs. The value realization is derived from better service delivery
and customer experiences. Managers are better able to understand quality
requirements and related delivery costs. SPM seeks to reduce costs through
alternative means while maintaining service quality.

Basic Concepts
Service Portfolio Management is a dynamic & ongoing process set with the
following work methods:

• Define: inventory services, ensure business cases and validate

portfolio data.
o Establish the Service Portfolio - The actual creation of the Service
Portfolio. It may be as broad as saying: “What are all the services
we would LIKE to have if there were no constraints imposed?”
(These can all feed into the Service Pipeline).
o Collect data from existing and proposed services.

• Analyze: maximize portfolio value, align and prioritize and balance

supply and demand.
o Sets the “strategic intent”
o Answers to the questions determines the SPM outcomes
! What are the long-term goals of the service organization?
! What services are required to meet those goals?
! What capabilities and resources are required for the organization to
achieve those services?
! How will we get there?

• Approve: finalize proposed portfolio, authorize services and

resources.
o Approve and Authorize the “To Be” state for new services and
resources
o Categories for outcomes of existing services (These are the
STATUS that a service could hold – it gives an indication on the
future for the particular service). The OUTCOMES for existing
services could be:
! Retain
! Replace
! Rationalize
! Re-factor
! Renew
! Retire

• Charter: communicate decisions, allocate resources and charter

services.
o List actions and decisions according to budget
o Cleary communicate decisions to the organization:
! Promote newly chartered services to Service Design.
! Retired services begin their sunset to Service Transition.
! Refresh existing services Service Catalogue.
Concept of Refresh (when considering SPM reviews):
- Situations change that invalidate previous calculations and
knowledge (for example, mergers and acquisitions)
- Compliance and Regulatory changes occurs which changes
business needs and service requirements

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2.5.2. Roles

Product Manager ITILFND04

Product Manager is a key role within Service Portfolio Management. 05-2
• Manage services as a product over the lifecycle
• Coordinates, focus and owns the Service Catalogue
• Work closely with Business Relationship Managers – focus on
Customer Portfolio
• Recognized as the subject matter experts on Lines of Service
• Evaluate new market opportunities, operating models, technologies,
and the emerging needs of customers.

2.5.3. Financial Management

‘Financial Management quantifies the value of IT Services, assets ITILFND05

underlying the provisioning of services, and qualifications of 05-2
operational forecasting, in financial terms’

‘Economy does not lie in sparing money, but in spending it wisely.’

- Thomas Henry Huxley
Objectives
Financial Management provides the enterprise with operational visibility,
insight and superior decision making capabilities.

• It provides Business and IT with the quantification:

o In financial terms
o Value of IT services
o Value of underlying assets that provide the services
o Qualification of operational forecasting

• It works together with business and IT to:

o Identify;
o Document;
o Agree the value of services being received;
o Enable demand modeling and management

• It provides value to the business by striving to

o Analyze, package, market and deliver services
o Understand and control factors of demand and supply
o Provide cost effective services

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Basic Concepts

Figure 2-12 (next page) illustrates the commonality of interests and

benefits between the business and IT.

Figure 2-12

• Service Valuation
Financial calculation and assignment of a monetary value required by
the business and IT for services delivered based on the agreed value
of the services.
o Storyline for business to understand exactly what is delivered
from IT
o Means to mutual agreement in what a service is, the components
and the actual cost and worth

• Demand Modelling
Models anticipated usage by the business and how IT support
through service-oriented financial information of demand and supply.
o Identifying the total cost of utilization (TCU)
o Predicting financial implications of future service demand
o Model to:
! Identify funding requirements
! Identifying variations and drivers for the variations
! Assist in managing service demand

• Service Portfolio Management

o Used to make decisions if service should be provisioned internally
o Understanding cost structures applied to provision services to
benchmark service costs against competitors

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• Service provisioning optimization

Make services more competitive in terms of cost or quality
o Examines financial inputs and constraints of services or models to
determine other means of provisioning a service
o SPO helps to reduce an organization’s service cost structure or
enhance service value

• Planning confidence
Provides financial translation and qualification of expected future
demand, focusing on demand and supply variance through:
o Business strategy
o Capacity inputs
o Forecasting

Categorized into 3 areas, representing financial results, required for

visibility and valuation:
o Operating & Capital (general and fixed asset ledgers)
o Demand (need and use of IT services)
o Regulatory and Environmental (compliance)

• Service investment analysis

Obtains a value indication for the total lifecycle of a service based on
o the value received
o costs incurred during the lifecycle of the service

Service investment analysis represents:

o Commitments and investments made by the service provider
across all customers and market spaces
o Contractual commitments, new service development, and
ongoing service improvement programmes initiated by Continual
Service Improvement
o Includes third-party services which are integral part of service
offerings to customers.
o Resources presently engaged or being released in various phases
of the Service Lifecycle.

• Accounting
o Identification and tracking of service-oriented expense or capital
items
o Better understanding and detail is achieved regarding service
provisioning and consumption
o Generation of data that feeds directly into the planning process

• Characteristics
o Service Recording – Assigning a cost entry to an appropriate
service
o Cost Types - higher level expenses categories, assist with
reporting and analyzing demand and usage
o Cost Classifications - designate the end purpose of the cost
! Capital/Operational
! Direct / Indirect
! Fixed/Variable
! Cost Units

• Compliance
o Shows that suitable and consistent accounting practices are being
employed
o COBIT, ISO/IEC 20000, Basel II can be used to assist

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o BASEL II (three pillars for greater stability in the Financial

systems)
! Minimum capital requirement
! Supervisory review
! Market discipline (disclosures)

• Variable Cost Dynamics

VCD analysis can be used to identify a marginal change in unit cost
resulting from adding or subtracting one or more incremental units of
a service. Such an analysis is helpful when applied toward the
analysis of expected impacts from events such as acquisitions,
divestitures, changes to the Service Portfolio or service provisioning
alternatives etc. In performing VCD, the provider must ensure that it:

o Analyze and understands the extent of

! Variables that impact service cost
! Sensitivity of those elements to variability and
! Related incremental value changes

o Identify a marginal change in unit cost - adding or subtracting

one or more incremental units of a service

2.5.4. Roles

IT Financial Manager ITILFND04

• Assist to identify, document and agree the value of services to the 05-2
business
• Participate in Demand Modelling activities (incentive or penalty)
• Provision of cost information for Service Portfolio Management
• Maintain regulatory compliance regarding finance issues

2.5.5. Demand Management

‘Demand Management optimize and rationalize the use of IT ITILFND05

resources’ 05-2

Objectives:
• Reducing the risk of unavailability because of poorly managed
demand through:
o SLA’s
o Forecasting
o Planning
o Tight coordination
• Managing cost and creating value through reducing excess capacity
• Balance supply and demand of resources
• Ensuring quality of service is maintained with sufficient capacity

Figure 2-13 illustrates how consumption produces demand and production

consumes demand in a highly synchronized pattern.

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Figure 2-13

2.5.6. Roles

Demand Manager ITILFND04

• Create and Manage incentive and penalty schemes 05-2
• Participate in creation of Service Level Agreements
• Monitor overall demand and capacity
• Manage capacity potential of individual resources
• Respond to changing Patterns of Business Activity (PBA)

Schemes are required that will influence demand.

Scheme example:
Demand Management techniques such as off-peak pricing, volume discounts and
differentiated service levels can influence the arrival of demand in specific
patterns.

Figure 2-14 illustrates how Demand Management interacts with the

Capacity Plan and introduce schemes to influence consumption

Figure 2-14

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3. Service Design
3.1. Service Design in the Service Lifecycle
'The design of appropriate & innovative IT services, including their ITILFND02
architectures, processes, policies & documentation, to meet current 02-4
and future agreed business requirements'

On the definition:
• Service Design translates strategic plans and objectives and creates
the designs and specifications for execution through service transition
and operations.
• It provides guidance on combining infrastructure, applications,
systems, and processes, along with suppliers and partners, to present
feasible service offerings.

This means:
• Translating strategic plans & objectives and creating designs &
specifications for execution through service transition & operations.
• Combining infrastructure, applications, systems, & processes, with
suppliers & partners, to present feasible service offerings

The main purpose of the Service Design stage of the lifecycle is the design
of new or changed service for introduction into the live environment.

3.1.1. Goal

To create a realistic service outline with: ITILFND02

• Policies – for the design of quality IT solutions, to meet current and 02-4
future agreed business needs
• Architecture
• Portfolios – convert strategic objectives into portfolios of services
• Service Models
• Effective Technology
• Process & Measurement design

It provides guidance on development of Services, Models & processes by

assisting in deciding on activities to be done (how and what)

It maintains or increases value where changes and improvements are

necessary

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3.1.2. Objectives

The Service Design volume provides guidance on the design and ITILFND02
development of services and service management processes. 02-3
• It includes design principles and methods for converting strategic
objectives into portfolios of services and service assets.
• It also provides guidance on the development of design capabilities
for service management.

Service Design is not limited to new services

It includes the changes and improvements required to maintain or increase

value to customers over the lifecycle of services, taking into account:
• The continuity of services,
• Conformance to standards and regulations and
• Achievement of service levels.

Should adopt a holistic approach:

• For all aspects & areas
• To ensure consistency & integration
• Within all activities & processes
• Across the entire IT technology
• To provide end-to-end business related functionality & quality.

Key Message:
It is important that a holistic approach to all aspects of design is adopted
and that when changing or amending any of the individual elements of
design all other aspects are considered.

Thus when designing and developing, it shouldn’t be done in isolation, but

should also consider the impact on:
• The overall service,
• The Service Portfolio and Catalogue,
• The technology,
• The Service Management processes and
• The necessary measurements and metrics.

This will ensure that not only the functional elements are addressed by the
design, but also that all of the management and operational requirements
are also addressed as a fundamental part of the design and are not added
as an afterthought.

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3.1.3. Business Value

With good Service Design it will be possible to deliver quality, cost effective ITILFND03
services and to ensure that the business requirements are being met. 03-2

Reduced Total Cost of Ownership (TCO)

• Through properly implemented services, technology and processes

Improved quality of service

• On an operational and service level

Improved consistency of service

• Services will be designed in conjunction with the corporate strategy,
architectures etc.

Easier implementation of new or changed services

• Service Design is better integrated

Improved service alignment

• New or changed services are better aligned with the business needs

More effective service performance

• Plans are better integrated especially Capacity, Financial, Availability
and IT Service Continuity plans

Improved IT governance
• Enhanced communication and implementation of governance
controls.

More effective Service Management and IT processes

• Quality and cost effective process designs are developed

Improved information and decision making

• More comprehensive and effective measurements and metrics

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3.2. Generic Concepts and Definitions

3.2.1. Service Provider

The entity responsible for delivery of a service (e.g. email, billing) to ITILFND03
customers & business (internal or external). 03-9

3.2.2. Supplier

Any external third parties necessary to provide third and fourth line support ITILFND03
of the components required to provide the service e.g. networks, hardware, 03-10
software.

3.2.3. Service Level Agreement (SLA)

The SLA describes: ITILFND03

• IT Services & Service Level Targets 03-11
• Roles and Responsibilities
• Covers multiple Services or multiple Customers

SLA’s should be reviewed regularly to ensure conformance.

IMPORTANT: Stand-alone SLA’s may not be legally enforceable and

‘represents the goodwill and faith of the parties signing it’. It is in the
interest of signatories that SLA’s are incorporated into an appropriate
contractual framework, to meet the ITIL objective that SLA’s are binding
agreements.

3.2.4. Operational Level Agreement (OLA)

The OLA is any underpinning agreements necessary to deliver the ITILFND03

quality of service agreed within the SLA and defines: 03-12
• Goods or services provided
• Roles and responsibilities of those providing it

OLA’s are established between:

• Service Provider & Procurement
• Service Desk & Support Group

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3.2.5. Contract

A contract is an agreement between two or more parties. It is legally ITILFND03

binding, and covers the obligations each entity has to the other; from the 03-13
first day of the contract, often extending beyond its termination

Formal contracts are appropriate for external supply arrangements which

make a significant contribution to the delivery and development of the
business. A contract is used as the basis for external supplier agreements
where an enforceable commitment is required.

High-value and/or strategic relationships are underpinned by a formal

contract. The formality and binding nature of a contract are not at odds with
the culture of a partnering agreement, but rather form the basis upon which
trust in the relationship may be founded.

3.2.6. Service Design Package (SDP)

Service Design produce a “Service Design Package” for each new service, ITILFND03
major change to a service, removal of a service or change to the “Service 03-14
Design Package”.

The SDP is passed from Service Design to Service Transition and details all
aspects of the service and its requirements through all of the subsequent
lifecycle stages.

3.2.7. Availability

Availability defines the proportion of time that a customer is able to access a ITILFND03
particular service or the ability to perform an agreed function when required 03-15
and is measured from the customer’s point of view and recorded in the SLA.

Availability is determined by:

• Reliability
• Maintainability
• Serviceability
• Performance
• Security

The time/percentage of service availability should match or exceed the

agreed Service Time and Downtime as specified in the SLA.

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3.3. Key Principles and Models

3.3.1. Importance of the 4P’s

Service Management implementation is about preparing and planning the ITILFND04

effective and efficient use of the four Ps (displayed in Figure 3-1) : 04-3
• People
• Processes
• Products (services, technology and tools)
• Partners (suppliers, manufacturers and vendors)

Figure: 3-1

To obtain the best benefits:

• determine the roles of processes and people,
• implement the tools to automate the processes
• facilitating people’s roles and tasks

Develop a model that supports “end-to-end” areas of technology in order to

close the gaps, decrease “silo” and keep the 4 P’s integrated. Without the
integration and close relationship between the 4 P’s any designs, plans and
projects normally fail, because of the lack of preparation and management.

3.3.2. Service Design Perspective - links, inputs & outputs

Service Lifecycle illustrated. ITILFND04

04-4
Figure 3-2 illustrates the links, inputs and outputs involved in each of the
stages of the service lifecycle as well as the key outputs produced by each
stage, which are used as inputs by the subsequent stages. The Service
Portfolio acts as “the backbone” of the service lifecycle.

The key facet is the design of new or changed service solutions to meet
changing business needs. Every time a new service solution is produced it
must be checked against each of the other facets to ensure that it will
integrate and interface with all of the other services already in existence.

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Figure: 3-2

5 Major aspects of Service Design

Service Design is concerned with the following 5 major issues/aspects:

• Service Portfolio Management

Managing and controlling services through their lifecycle with service
management systems and tools.

• Identification of Business Requirements, definition of Service

requirements and design of Services
Services are designed with all the functional requirements, resources
and capabilities needed.

• Technology architectural design

Designing the technology architectures and management systems
required to provide the services.

• Process design
Designing the processes needed for transition, to operate and improve
the services, the architectures and the processes themselves.

• Measurement design
Designing the measurement methods and metrics of the services, the
architectures and their constituent components and the processes.

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3.3.3. Major Aspect 1 - Service Portfolio Management

For an organization to support and automate efficient processes and ITILFND04

effectively manage all aspects of service through their lifecycle, the correct 04-4
management systems and tools needs to be put in place. The Service
Portfolio is one of the management systems used for this in order to
describe a provider’s services in terms of business value.

Service Portfolio
By definition, business value terms correspond to markets terms, providing a
means for comparing service competitiveness across alternative providers.
By acting as the basis of a decision framework, a service portfolio either
clarifies or assists to clarify the following strategic questions:
• Why should a customer buy these services?
• Why should they buy these services from you?
• What are the pricing or chargeback models?
• What are my strengths and weaknesses, priorities and risk?
• How should my resources and capabilities be allocated?

In addressing Service Transition, the Service Portfolio should:

• Form part of a comprehensive Service Knowledge Management
System (SKMS)
• Be registered as a document in the Configuration Management
System (CMS).

Once a strategic decision to charter a service is made, this is the stage in

the service lifecycle that Service Design begins architecting the service,
which will eventually become part of the Service Catalogue.

Figure: 3-3

The Service Portfolio (Figure 3-3) should contain information relating to

every service and its current status within the organization.

The options of status within the Service Portfolio should include:

• Requirements: a set of outline requirements have been received

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from the business or IT for a new or changed service

• Defined: the set of requirements for the new service are being
assessed, defined, and documented and the SLR is being produced.
• Analysed: the set of requirements for the new service are being
analysed and prioritised
• Approved: the set of requirements for the new service have been
finalised and authorised
• Chartered: the new service requirements are being communicated
and resources and budgets allocated.
• Designed: the new service and its constituent components are being
designed- and procured, if required
• Developed: the service and its constituent components are being
developed or harvested, if applicable
• Built: the service and its constituent components are being built
• Test: the service and its constituent components are being tested
• Released: the service and its constituent components are being
released
• Operational: the service and its constituent components are
operational within the live environment
• Retired: the service and its constituent components have been
retired

The Service Portfolio would therefore contain details of all services and their
status with respect to the current stage within the service lifecycle

For an organization to design a Service Portfolio the following content should

be included:
• Service name
• Service description
• Service status
• Service classification and criticality
• Applications used
• Data and / or data schema used
• Business processes supported
• Business owners
• Business users
• IT owners
• Service warranty level, SLA and SLR references
• Supporting services
• Supporting resources
• Dependent services
• Supporting OLA’s, contracts and agreements
• Service costs
• Service charges (if applicable)
• Service revenue (if applicable)
• Service metrics

The Service Portfolio is the main source of information on the requirements

and services and needs to be very carefully designed to meet all of the
needs of all of its users. The design of the Service Portfolio needs to be
considered in the same way as the design of any other IT service to ensure
that it meets all of these needs.

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3.3.4. Major Aspect 2 - Identification of Business Requirements

Identification of Business Requirements, definition of Service ITILFND04

requirements and design of Services 04-4

For an organization to produce a new or changed service, many activities

first need to be completed within Service Design. A structural approach is
needed to produce the new service at the right cost, functionality, quality
and within the right time. In order to design a service solution the following
should be included:

• Analysis of the agreed business requirements

• Review the existing IT services and Infrastructure

To maybe re-use or develop components and services in other
market spaces

• Design the service solutions to the new requirements

including its supporting components in terms of the
following and document this design:
o Facilities, functionality and information required
o Business processes supported, dependencies, priorities, criticality
and impact of the service, with the business benefits delivered by
the service
o Business cycles, business transaction levels, service transaction
levels, the numbers/types of users, anticipated future growth and
the business continuity requirements
o Service Level Requirements and targets with required service
measuring, reporting and reviewing activities
o Time scales involved, planned outcomes and the impact on any
existing services
o Requirements for testing, including any User Acceptance Testing
(UAT) and associated responsibilities

• Service Acceptance Criteria (SAC) requirements

Ensure the contents is incorporated and the required achievements
planned into the initial design

• Evaluate & cost - alternative designs

Highlighting advantages as well as disadvantages of the alternatives

• Agreeing the expenditure and budgets

• Re-evaluate & confirm business benefits (RoI & TCO)

o Return on Investment (RoI) - All service costs, business benefits
and increased revenues
o Total Cost of Ownership (TCO) – start-up costs such as design
costs, transition costs, project budget and all ongoing operational
costs including management, support and maintenance

• Agree the preferred solution and its planned outcomes and

targets (Service Level Requirement -SLR)

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• Check consistency with corporate & IT strategies

Confirm that the solution is consistent with all corporate and IT
strategies, policies, plans and architectural documents. If not revise
either the solution or the strategic with due consideration of the
effect on other strategic documents, services and components.

• Confirm inclusion - Corporate, IT governance & security

controls
Ensure that all of the appropriate corporate and IT governance and
security controls are included with the solution

• Complete IT readiness assessment - ensure effective

operability*
To ensure that the service can be effectively operated to meet its
agreed targets, confirming appropriate capability to deliver the
agreed level. This will include:
o The commercial impact on the organization from both a business
and IT perspective, including all of the business benefits and all
of the costs
o Assessment and mitigation of the risks associated with the new
or changed service, particularly with regards to the operation,
security, availability and continuity of the service
o Business capability and maturity. Should be performed by the
business itself to ensure that all the resources are in place to
operate the new service
o IT capability and maturity:
o Environment and all areas of technology, having considered the
impact on existing components of the infrastructure and existing
services
o IT organizational structure and the roles and responsibilities
o IT processes and its documentation
o Skills, knowledge and competence of the staff
o IT management processes and supporting tools

• Establish supplier & supporting agreements

To maintain and deliver the service.

• Assemble Service Design Package (SDP) for subsequent

stages
Operation and improvement of the new or changed service solution.

3.3.5. Major Aspect 3 - Technology architectural design

This aspect concerns the design of the technology architectures and ITILFND04
management systems required to provide the services are concerned with 04-4
the overall strategic “blueprints” for the development and deployment of an
IT infrastructure (applications and data), which satisfy the current and
future needs of the business.

Although technology underpins the delivery of quality IT services, it cannot

do so alone; it is essential that the people, process and partner / supplier
aspects surrounding these technological components (products) are also
considered.

• Definition: Architecture
The fundamental organization of a system embodied in its

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components, their relationships to each other and to the

environment, and the principles guiding its design and evolution.
• Definition: System
A collection of components organized to accomplish a specific
function or set of functions.
The system could be, e.g. a whole organization, a business function,
a product line or an information system.
Each of these systems will have an "architecture" as defined earlier,
made up of:
o The components of the system
o The relationships between them (such as control interfaces and
data exchanges)
o The relationships between the system and its environment
(political, organizational, technological, etc.)
o The design principles which inform, guide and constrain its
structure and operation, as well as its future development.

• Definition: Architectural Design

The development and maintenance of IT policies, strategies,
architectures, designs, documents, plan and processes for the
deployment and subsequent operation and improvement of
appropriate IT services and solutions throughout an organization.

Architectural design needs to assess and reconcile many types of

needs, which might be in conflict with one another, to ensure that:
o IT infrastructures, environments, data, applications and external
services serve the needs of the business, its products and
services. This includes the technology components and their
management.
o The right balance is achieved between innovation, risk and cost
whilst seeking a competitive edge, where desired by the business
o Compliance with relevant architectural frameworks, strategies,
policies, regulations and standards (fiduciary requirements)
o Coordinated interface is provided between IT designers and
planners, strategists, business designers and planners.

• Definition: Enterprise Architecture

An Enterprise Architecture show how all the components (and others)
are integrated in order to achieve the business objectives both now
and in the future and can be large and complex. We are focusing on
those architectures concerned with the business and the information
systems which support it; each of these architectures calls upon
distinct architectural disciplines and areas of expertise

With the necessary architectures in place, the role of Service Design

is affected as follows:
o Must work within the agreed architectural framework and
standards
o Will be able to re-use many of the assets created as part of the
architecture

If architecture design is to be accomplished effectively and economically, the

documents, processes and activities of the business and architectural design
should be closely coordinated and synchronized.

Key message: The real benefit and ROI of the Enterprise Architecture
comes not from the architecture itself, but from the ability of an organization

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to design and implement projects and solutions in a rapid and consistent

manner.

3.3.6. Major Aspect 4 - Process design

The design of the processes needed to design, transition, operate and ITILFND04
improve the services, the architectures and the processes themselves. 04-4

• Process model
A process model enables understanding and helps to articulate the
distinctive features of a process. It represents the structured set of
activities designed to accomplish a specific objective.
o A process takes one or more inputs and turns them into defined
outputs.
o A process includes all of the roles, responsibilities, tools and
management controls required to reliably deliver the outputs.
o A process may also define or revise policies, standards,
guidelines, activities, processes, procedures, and work
instructions if they are needed.

• Process control
The activity of planning and regulating a process, with the objective
of performing a process in an effective, efficient and consistent
manner. Processes, once defined, should be documented and
controlled; once under control, they can be repeated and become
manageable. Degrees of control over processes can be defined, and
then process measurement and metrics can be built in to the process
to control and improve the process.

Figure: 3-4

• Generic Process Elements

Figure 3-4 shows:
o show how data enters the process,
o is processed,
o is output and
o the outcome is measured and reviewed

A process is always organized around a set of objectives. The main

outputs from the process should be driven by the objectives and
should always include process measurements (metrics), reports and
process improvement.

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• Process Owners
Service Design assist each process owner with the design of
processes to ensure that processes use standard terms and
templates, are consistent and integrate with each other to provide
end-to-end integration across all areas.
Process owners are responsible for:
o The process and its improvement
o Ensuring that a process meets its objectives.

• Measurable Outputs
By defining what the organization’s activities are, which inputs are
necessary and which outputs will result from the process, it is
possible to work in a more efficient and effective manner. Measuring
and steering the activities increases this effectiveness. Finally, by
adding norms to the process, it is possible to add quality measures to
the output. Figure 3-5 provide more detail in this regard.

Figure 3-5

This approach underpins the ‘plan-do-check-act’ cycle of continual

improvement for any quality-management system. Plan the purpose
of the process in such a way that process actions can be reviewed,
assessed or audited for successful achievement and, improved.

• Norms
Define conditions that the results should meet and introduces quality
aspects to the process.

• Perfect Processes?
Adopt a formalized approach to the design and implementation of
Service Management processes. Do not design “perfect processes”,
but design practical and appropriate processes with “in-built”
improvement mechanisms so that the effectiveness and efficiency of
the processes are improved.

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3.3.7. Major Aspect 5 - Measurement design

Continual Service Improvement (CSI): ITILFND04

In order to manage and control the design processes they have to 04-4
monitored and measured.

“If you can’t measure it then you can’t manage it.”

• PROGRESSION:
Be careful when selecting measurements and metrics because the
metrics and measurements chosen will affect and change the
behavior of people working with in the activities and processes being
measured, particularly where this relates to objectives, personal and
team performance and performance related pay schemes.

Only measurements that encourage progression towards meeting

business objectives or desired behavioral change should be selected.

• REQUIREMENTS:
Design solutions that:
o Is “fit for purpose”
o Has the appropriate level of quality
o Is “right first time”
o Minimize “rework” & “add-ons”
o Is effective and efficient

Measurement methods and metrics should:

o Reflect requirements and be designed to measure the ability of
design processes to match these requirements
o Reflect the quality and success of the design processes from the
perspective of the business, customers and users.
o Reflect the ability of the delivered solutions to meet the identified
and agreed requirements of the business.

• APPROPRIATENESS:
Process measurements selected need to be appropriate for the
capability and maturity of the processes being measured.

o Progress: milestones and deliverables in the capability of the

process
o Compliance: compliance of the process to governance
requirements, regulatory requirements and compliance of people
to the use of the process.
o Effectiveness: the accuracy and correctness of the process and
its ability to deliver the “right result”
o Efficiency: the productivity of the process, its speed, throughput
and resource utilization

• BALANCED SCORECARD:
Balanced Scorecards represent a management system which enables
increasing numbers of organizations to clarify their vision and
strategy into action.

The balanced scorecard can be used to develop Metrics Trees or

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Dashboards; the most effective method of measurement is to

establish a “metrics tree” or “KPI tree”. Dashboard presents an
opportunity to view trends over time, rather than static data, in order
that potential performance degradation can be identified and rectified
at an early stage.

3.3.8. 5 Major Aspects – The Big Picture

The aim of Service Design is the design of service solutions to meet the ITILFND04
changing requirements of the business. 04-4

Figure: 3-6

Figure 3-6 shows that when designing solutions, input from many different
areas needs to be considered within the various activities involved in
designing the service solution, from identifying and analyzing requirements
through to building a solution and SDP to hand over to Service Transition.

In order to develop effective and efficient service solutions that meet and
continue to meet the requirements of the business and the needs of IT all of
the inputs and needs of all other areas and processes needs to be
considered to ensure that all service solutions are consistent and compatible
with existing solutions and will meet the expectations of the customers and
users.
(SCD: Supplier and Contract Database)

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3.3.9. Sourcing approaches & options

Although the readiness assessment determines the gap between the current ITILFND04
and desired capabilities, an IT organization should not necessarily try to 04-5
bridge that gap by itself. There are many different delivery strategies that
can be used. Each one has its own set of advantages and disadvantages,
but all require some level of adaptation and customization for the situation
at hand.

Service Provider types (ITIL® v3)

• Type I - Internal
• Type II - Shared
• Type III - External

Delivery Model Options

• In-sourcing:
Utilize internal organizational resources in the design, develop,
transition, maintain, operate, and/or support of a new, changed or
revised services or data centre operations

• Outsourcing:
Utilizes the resources of an external organization or organizations in a
formal arrangement to provide a well-defined portion of a service’s
design, development, maintenance, operations, and/or support.

• Co-sourcing:
o Combination of in-sourcing and outsourcing, using a number of
outsourcing organizations working together to co-source key
elements within the lifecycle.
o This generally will involve using a number of external
organizations working together to design, develop, transition,
maintain, operate, and/or support a portion of a service’s

• Partnership or multi-sourcing:
Formal arrangements between two or more organizations to work
together to design, develop, transition, maintain, operate, and/or
support IT service(s).

• Business Process Outsourcing (BPO):

The increasing trend of relocating entire business functions using
formal arrangements between organizations where one organization
provides and manages the other organization’s entire business
process(es) or functions(s) in a low cost location.

• Application Service Provision:

Involves formal arrangements with an Application Service Provider
(ASP) organization that will provide shared computer based services
to customer organizations over a network.

• Knowledge Process Outsourcing (KPO):

KPO organizations provide domain based processes and business
expertise rather than just process expertise and requires advanced
analytical and specialized skills from the outsourcing organization.

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Sourcing situations

• On-shore
Based within the same country /continent.

• Off-shore
Organizations are in different countries / continents.

Very complex sourcing arrangements exist within the IT industry and it is

impossible to cover all combinations and their implications here.

3.3.10. Design and Constraints

There are considerable constrains that apply and which should be ITILFND04
considered during the Service Design. 04-5

Figure: 3-7

Figure 3-7 illustrates the effect of these constraints in determining an

acceptable solution space.

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3.4. Service Design Processes

3.4.1. Service Level Management

Objectives: ITILFND05
05-3
• To ensure clear understanding between customer and IT (Negotiates,
Agree and documents IT Services)

• To ensure proactive activities to enhance level of services (Monitor,

measure, report and review IT Services)

• To improve customer satisfaction (Close relationship & Communication

with Customers and Business)

Scope:

• To develop relationships with business:

o Negotiate and agree:
! current requirements (SLA)
! future requirements (SLR)
o Develop and manage:
! Align targets with SLA (OLA)

• Review contracts with Supplier management - to ensure that targets

are aligned with SLA targets

• Proactively prevent service failures

• Report and manage services – to limit SLA breaches and weaknesses

• Service Improvement Plan (SIP) - to manage, plan and implement

process and service improvements

Basic concepts:

• Service Level Management (SLM)

A communication channel & relationship with appropriate customers
& business representatives.

• Service Level Agreement (SLA)

Written agreement between an IT service provider & the IT
customer(s), defining the key service targets and responsibilities of
both parties.

• Operational Level Agreement (OLA)

Agreement between an IT service provider & another part of the
same organization that assists with the provision of services.

• Underpinning Contract (UC)

Formal contract between an IT Service Provider & a Third Party.

Service Level Management process activities:

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Figure 3-8 illustrates the Service Level Management process activities

Figure: 3-8

• Service Level Requirements (SLR) - Determine, negotiate, document

and agree requirements for new or changed services in SLRs
• Monitor and measure service performance achievements of all
operational services against targets within SLAs
• Collate, measure and improve customer satisfaction
• Produce service reports Conduct service review and instigate
improvements within an overall Service Improvement Plan (SIP)
• Review and revise SLAs, service scope OLAs, contracts, and any other
underpinning agreements
• Develop and document contacts and relationships with the business,
customers and stakeholders
• Develop, maintain and operate procedures for logging, actioning and
resolving all complaints, and for logging and distributing compliments
• Log and manage all complaints and compliments
• Provide the appropriate management information to aid performance
management and demonstrate service achievement
• Make available and maintain up-to-date SLM document templates and
standards.

Key Metrics:

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• Percentage reduction in:

o SLA targets missed
o SLA targets threatened
o SLA breaches (UC)
o SLA breaches (OLA)

• Percentage increase in:

o Customer perception & satisfaction of SLA achievements
! Service reviews
! Customer Satisfaction Survey responses

• Deliver service as previously agreed at affordable costs:

o Total number and percentage increase in fully documented SLAs
in place
o Percentage increase in SLAs agreed against operational services
being run
o Percentage reduction in the costs associated with service
provision

Challenges

• To become a service provider to the business

• Engaging with business to determine service level requirements
• Identifying internal service portfolios (Planned, developed services)
• Defining a customer-facing Service Catalogue with details of every
service and service package offered by IT with options, parameters
and pricing
• Defining of IT department relationships; negotiating the terms and
responsibilities of the internal relationships, and codifying them with
Operational Level Agreements (OLAs)
• Identifying contractual relationships (UCs to meet business
requirements)
• Create a Service Improvement Plan (SIP) to monitor and improve
levels of service.

3.4.2. Roles

Service Level Manager ITILFND05

The responsibilities of the Service Level Manager includes: 05-3

• Awareness of changing business needs

o Assessing impact of service levels
o Identify key stakeholders

• Identify, understand & document current/future service requirements

o Negotiating and agreeing levels of service to the customer
through SLAs & SLRs
o OLAs & Underpinning Contracts

• Production/maintenance of:
o Service Portfolio

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o Service Catalogue
o Application Portfolio

• Ensure Underpinning Contract’s alignment with SLA & SLR targets

o Produce Service reports (focus on preventing breach recurrence)
o Schedule Service performance reviews & actions
o Improvement initiatives & progress reports
o Review service scope, SLAs, OLAs & other agreements

• Develop relationships & communication with stakeholders, customers

& key users
o Define and agree complaints – resolution
o Define and agree complaints – communication

• Measurement, recording, analysis and improvement of customer

satisfaction

3.4.3. Service Catalogue Management

Objective ITILFND05
• To manage the information within the Service Catalogue 05-4
o Current information is correct
o Status, interfaces & dependencies of services running in the live
environment

Basic concepts:

• Service Catalogue
The Service Catalogue consists of the Business Service Catalogue and
the Technical Service Catalogue as depicted in Figure 3-9

Figure: 3-9

• Business Service Catalogue

Interfacing with the business units and business processes and their
supporting IT Services

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• Technical Service Catalogue

Interfacing with support teams, suppliers and configuration
management

3.4.4. Roles

Service Catalogue Manager ITILFND05

The Service Catalogue Manager is responsible for producing and maintaining 05-4
the Service Catalogue, including:
• Ensuring that all operational service and all services being prepared
for operational running are recorded within the Service Catalogue
• Ensuring that all of the information within the Service Catalogue is
accurate and up to data
• Ensuring that all of the information within the Service Catalogue is
consistent with the information within the Service Portfolio
• Ensuring that the information within the Service Catalogue is
adequately protected and backed-up.

The key activities within the Service Catalogue Management process

should include:

• Service definition
Agreeing and documenting services

• Service Portfolio & Service Catalogue

o Interfacing the contents
o Maintain Service Catalogue

• Business Service Catalogue

Interfacing with the business units and business processes and their
supporting IT Services.

• Technical Service Catalogue

Interfacing with support teams, suppliers and configuration
management

• Business & business process alignment

Ensure that the information is aligned to the business and business
process

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3.4.5. Capacity Management

Objectives ITILFND05
05-4
• Produce and maintain an appropriate and up to date Capacity Plan,
reflecting the current and future needs of the business
• Provide advice and guidance to all other areas of the business and IT
on all capacity and performance related issues
• Ensure that service performance achievements meet or exceed all of
the agreed targets, by managing the performance and capacity of
both services and resources
• Assist with the diagnosis and resolution of performance and capacity
related incidents and problems
• Asses the impact of all changes on the Capacity Plan and the
performance and capacity of all services and resources
• Ensure that proactive measures are implemented to improve the
performance of services, wherever it is cost justifiable to do so

Figure:3-10

Figure 3-10 shows the high-level process for Capacity Management

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Basic Concepts

• Balancing Act
The capacity and performance of the IT services and systems should
matches the evolving agreed demands of the business in the most
cost-effective and timely manner (Figure 3-11 – next page).

Figure:3-11

o Balancing costs against resources needed: to ensure

processing Capacity is not only cost justifiable in terms of
business need, but also the need to make the most efficient use
of those resources
o Balancing supply against demand: to ensure that available
supply of IT processing power matches the demands made on it
by the business, both now and in the future; it may also be
necessary to manage or influence the demand for a particular
resource

• Business Capacity Management

Business Capacity Management is focused on the current and future
business requirements; it translates business needs and plans into
requirements for service and IT infrastructure, ensuring that its
quantified, designed, planned and implemented in a timely fashion.
Future requirements come from the service strategy and service
portfolio detailing new processes and service requirements, changes,
improvements and also the growth in the already existing services.

• Service Capacity Management

Service Capacity Management is focused on the delivery of the
existing services that support the business; the management, control
and prediction of the end-to-end performance and capacity of the
live, operational IT services usage and workloads:
o Monitor and measure
o Analyze and report
o Instigate action (proactive and reactive)

• Component Capacity Management

Component Capacity Management is focused on the IT infrastructure
that underpins service provision; the management, control and

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prediction of the performance, utilization and capacity of individual IT

technology components.
o Monitor and measure
o Analyze and report
o Instigate cost effective actions to reduce or avoid potential
impact
Figure 3-12 shows the relationship between Business Capacity
Management, Service Capacity Management and Component Capacity
Management.

Figure: 3-12

3.4.6. Roles

Capacity Manager ITILFND05

The role of the Capacity Manager encompasses the following: 05-4

• Ensure adequate IT Capacity:

o Understand capacity requirements, usage and capacity
o Sizing new services & systems (future requirements)
o Production, review & revision of the Capacity Plan

• Aligning capacity & demand correctly

• Optimize existing capacity

• Set appropriate monitoring levels through

o Performance analysis & reporting
o Incident & problem resolution
o Performance & resource optimization

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o Performance & cost assessment

o Assessment of future demand
o Impact assessment – changes

• Sizing of new services and systems:

o Assessment of new techniques, hardware and software
o Performance testing
o SLA Reporting (effects of demand on performance service levels)
o Determine cost justified, maintainable performance service levels
o Optimization recommendations

• Focal point for capacity & performance issues, including management

reports on current usage, trends and forecasts.

3.4.7. Availability Management

Availability Management should:

• Ensure the agreed level of availability is provided.
• Measure and monitor to ensure availability levels are being met
consistently.
• Continually optimize and proactively improve the availability of the IT
Infrastructure, the services and the supporting organization.

Objectives
The objectives of Availability Management are:
• Produce and maintain an appropriate and up to date Availability Plan
that reflects the current and future needs of the business
• Provide advice and guidance to all other areas on availability related
issues
• Ensure that service availability achievements meet or exceed the
agreed targets, by managing services and resources related
availability performance
• Assist with diagnosis and resolution of availability related incidents
and problems
• Asses the impact of all changes on the Availability Plan and the
performance and capacity of services and resources
• Ensure that proactive measures are implemented to improve the
availability of services wherever it is cost justifiable

Basic Concepts

• ELEMENTS

o Reactive activities: Involves monitoring, measuring, analysis

and management of all events, incidents and problems involving
unavailability.

o Proactive activities: Involves the proactive planning, design

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and improvement of availability.

• INTER-CONNECTED LEVELS

o Service availability: Involves all aspects of service availability

and unavailability and the impact of component availability, or the
potential impact of component unavailability on service availability

o Component availability: Involves all aspects of component

availability and unavailability

• 4 ASPECTS:

o Availability: The ability of a service, component or CI to perform

its agreed function when required.

o Reliability: The measure of how long a service, component or CI

can perform its agreed function without interruption.

o Maintainability: The measure of how quickly and effectively a

service, component or CI can be restored to normal working after
a failure.

o Serviceability: The ability of a third party supplier to meet the

terms of their contract. Often this contract will include agreed
levels of availability, reliability and / or maintainability for a
supporting service or component.

Figure 3-13 illustrates these aspects and their interrelationships

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Figure: 3-13

3.4.8. Roles

Availability Manager ITILFND05

An Availability Manager has responsibility for ensuring that the aims of 05-4
Availability Management are met and includes responsibilities such as:

• Participate in the IT infrastructure design, which includes the

specification of availability requirements for hardware and software:
o All new services should deliver the required availability levels -
validate the final design to meet the minimum levels as agreed
o Enhanced event management systems - automatic monitoring of
IT component availability
o Specification of the reliability, maintainability and serviceability
requirements for components - internal and external suppliers
o Creation of availability and recovery design criteria for each
design

• Monitor actual IT availability achieved - on an ongoing basis and

provide the required reports
o Ensure delivery against agreed SLA levels
o Assist with the investigation and diagnosis of all incidents and
problems that is availability related
o Proactively improve/optimize service availability and deliver cost
effective improvements/benefits to the business

• Responsible to ensure that the process, including its techniques and

methods, are regularly reviewed, audited, and subjected to continual
improvement to remain fit for purpose
o Create, maintain and review an AMIT and a forward looking
Availability Plan - ensure that existing and future business
availability requirements can be met
o Complete and maintain an availability testing schedule for all
mechanisms
o Test availability tests and plans after every major business
change

• Assess change impact on all aspects of availability including overall

service availability and the Availability Plan
o Attend CAB meetings when appropriate

• Ensure that the levels of IT availability required are cost justified -

with Financial Management

• Assessment and management of risk by assisting Security and IT

Service Continuity Management

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3.4.9. Service Continuity Management

Objectives ITILFND05
05-4
• Maintain a set of IT Service Continuity Plans and IT recovery plans that
support the overall Business Continuity Plans (BCPs)
• Complete regular Business Impact Analysis (BIA) exercises to support
continuity plans in respect of business changes
• Conduct regular risk assessment and management exercises with
business, Availability Management and Security Management
• Provide advice and guidance to all other areas on continuity and
recovery related issues
• Establish appropriate continuity and recovery mechanisms to meet or
exceed the agreed business continuity targets
• Asses the impact of all changes on the IT Service Continuity Plans and
IT recovery plans
• Implement cost justifiable measures to improve the availability of
services
• Negotiate and agree required contracts for the provision of necessary
recovery capability with the Supplier Management process

Basic concepts (Figure 3-14)

• Initiation
• Requirements & strategy
• Implementation
• Operation

Figure: 3-14

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3.4.10. Roles

Service Continuity Manager ITILFND05

The Service Continuity Manager must ensure that the aims of Service 05-4
Continuity Management are met, which includes:

• Implement and maintain the ITSCM process in accordance with

the overall requirements of the organization’s Business Continuity
Management process
o Ensure that all ITSCM plans, risks and activities underpin and
align with all BCM plans, risks and activities and are capable of
meeting the agreed targets
o Perform Business Impact Analyses for all existing and new
services
o Perform risk assessment and management to prevent disasters
where cost justifiable and practical
o Communicate and maintain awareness of ITSCM objectives within
supported business areas

• Develop and maintain the organization’s continuity strategy

o Assess potential service continuity issues and invoking the Service
Continuity Plan if necessary
o Manage the Service Continuity Plan while in operation - including
fail-over to a secondary location and restoration to the primary
location
o Develop and manage the ITSCM plans to ensure that the
recovery objectives of the business can be achieved at all times
o Ensure that all IT service areas are prepared and able to respond
when continuity plans are invoked
o Negotiate and manage contracts with third party recovery service
providers

• Maintain a comprehensive IT testing schedule of all continuity

plans in line with business requirements AND after every major
business change.
o Undertake quality reviews of all procedures and ensure their
incorporation into the testing schedule
o Undertake regular reviews (at least annual) of the Continuity
plans with business to ensure that it reflect the business needs
accurately
o Performing post mortem reviews of service continuity tests and
invocations - instigating corrective actions where required

• Assess changes for their impact on service continuity and Continuity

Plans - attend CAB meetings when appropriate

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3.4.11. Information Security Management

Objective ITILFND05
For most organizations, the security objective is met through: 05-4

• Confidentiality – information can only be accessed by those

authorized
• Integrity – information is complete, accurate and protected against
unauthorized modification
• Availability – information is available and can be used when required
• Authenticity & non-repudiation – information exchanges between
parties can be trusted

Basic Concepts

• Security Framework
The Information Security Management process and framework will
generally consist of:
o Information Security Policy (ITP) and specific security policies
that address each aspect of strategy, controls and regulation
o Information Security Management System (ISMS), containing the
standards, management procedures and guidelines supporting
the information security policies
o Comprehensive security strategy closely linked to the business
objectives, strategies and plans
o Effective security organizational structure
o Set of security controls to support the ITP
o Management of security risks
o Monitoring processes to ensure compliance and provide feedback
on effectiveness
o Communications strategy and plan for security
o Training and awareness strategy and plan

• Information Security Policy

Information Security Management activities should focus on the
overall Information Security Policy (ITP) and a set of underpinning
specific security policies.

o Policies should be widely available to all customers and users and

their compliance should be referred to in all SLRs, SLAs, contracts
and agreements.

o Policies should be authorized by top executive management

(business and IT) and compliance should be endorsed regularly –
reviewed/revised annually.

o The ITP should be appropriate, meet the needs of the business

and cover all areas of security:
! use and misuse of IT assets policy
! an access control policy
! a password control policy
! an email policy
! an Internet policy

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! an anti-virus policy
! an information classification policy
! a document classification policy
! a remote access policy
! a policy with regard to supplier access of IT service,
information and components
! an asset disposal policy

• Information Security Management System (ISMS)

The ISMS provide a basis of the development of a cost effective
information security program to support the business objectives.
It will involve the four Ps (People, Process, Products/ technology &
Partners/ suppliers) to ensure high levels of security.

• ISO 27001 (Framework for managing security)

The formal standard against which organizations can obtain
independent certification of their ISMS (Frameworks to design,
implement, manage, maintain and enforce information security
processes and controls, systematically and consistently). The ISMS
shows a widely used approach, also included in ISO 27001.

Figure: 3-15

The five elements, as depicted in Figure 3-15, are:

o Control:
! Establish a management framework to initiate and manage
information security in the organization
! Establish an organization structure to prepare, approve and
implement the information security policy
! Allocate responsibilities
! Establish and control documentation

o Plan:
Devise and recommend the appropriate security measures, based
on the requirements of the organization.

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! Requirements will address business and service risk, plans and

strategies, SLAs and OLAs, and the legal, moral and ethical
responsibilities for information security.
! Factors such as the amount of funding available, and the
prevailing organization culture and attitudes to security must be
considered.

o Implement:
Ensure appropriate procedures, tools and controls are in place to
underpin the Information Security Policy, such as:
! Accountability for assets – Configuration Management and the
CMS are invaluable here
! Information classification – information and repositories should
be classified according to the sensitivity and the impact of
disclosure

o Evaluation:
! Supervise and check compliance with the security policy and
security requirements in SLAs and OLAs
! Carry out regular audits of the technical security of IT systems
! Provide information to external auditors and regulators, if
required

o Maintain:
! Improve security agreements specified in SLAs, OLAs and
contracts
! Improve the implementation of security measures and controls

• Security governance
Information security governance, when properly implemented, should
provide six basic outcomes:
o Strategic alignment
o Value Delivery
o Risk management
o Performance management
o Resource management
o Business process assurance

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3.4.12. Roles

Security Manager ITILFND05

The responsibilities of the Security Manager includes: 05-4

• Develop and maintain the Information Security Policy and a

supporting policies, ensure appropriate authorization, commitment
and endorsement from IT and business management
o Communicate and publish the Information Security Policy to all
appropriate parties
o Ensuring that the Information Security Policy is enforced and
adhered to
o Promote education and awareness of security

• Design security controls and develop security plans

o Develop and document procedures for operating and maintaining
security controls
o Maintain, review and audit all security controls and procedures
regularly

• Assist with Business Impact Analyses

o Identify and classify IT and information assets (Configuration
Items) and the level of control and protection required
o Perform security risk analysis and management - with Availability
and IT Service Continuity Management
o Perform security tests

• Monitor and manage all security breaches - take remedial action to

prevent recurrence wherever possible (see Figure 3-16).
o Reporting, analysis and reduction of the impact and volumes of
all security incidents - with Problem Management
o Participate in security reviews arising from security breaches

Figure: 3-16

• Ensure confidentiality, integrity and availability of the services at the

levels agreed in the SLAs and conform to all relevant statutory

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requirements
o Assess impact of all changes on security aspects, Information
Security Policy and security controls - attend CAB meetings when
appropriate
o Ensure that access to services by external partners and suppliers
is subject to contractual agreements and responsibilities
o Act as a focal point for all security issues

3.4.13. Supplier Management

Objective ITILFND05
05-4
• Obtain value for money from supplier and contracts
• Ensure that underpinning contracts/agreements with suppliers are
aligned to business needs and targets in SLRs and SLAs - with SLM
• Manage relationships with suppliers and their performance
• Negotiate and agree contracts with suppliers and manage them through
their lifecycle
• Maintain a supplier policy and a supporting Supplier and Contract
Database (SCD)

Basic concepts
Supplier Management process activity should be driven by a supplier
strategy and policy from Service Strategy.

Figure 3-17 (next page) illustrates why a Supplier and Contracts

Database (SCD) should be established to achieve consistency and
effectiveness in the implementation of the policy, roles and
responsibilities:

o SD: Supplier categorization and maintenance of the Supplier and

Contracts Database (SCD)
o SD: Evaluation and set up of new suppliers and contracts

o ST: Establish new suppliers

o SO: Supplier and contract, management and performance

o SO: Contract renewal and termination

(The first two are covered in the Service Design stage, the third is
part of Service Transition and the last two are part of the Service
Operation stage.)

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Figure: 3-17

3.4.14. Roles

Supplier Manager ITILFND05

The Supplier Manager responsibilities includes: 05-4

• SLAs, contracts, agreements, etc.

Providing assistance in the development and review of SLAs,
contracts, agreements or any other documents for third party
suppliers
o Ensure that underpinning contracts, agreements or SLAs are
aligned with the business
o Ensure that supporting services are scoped and documented and
that interfaces/dependencies between suppliers, supporting
services and supplier processes are agreed and documented
o Ensure that roles and relationships between lead and sub-
contracted suppliers are documented, maintained and
contractually agreed
o Co-ordinate and support of all individual IT supplier and contract
managers - ensure that each has a nominated owner

• Supplier & Contracts Database (SCD)

Maintain and review a Supplier and Contracts Database (SCD)
o Update contracts/SLAs when required, according to the Change
Management process
o Ensure changes are assessed for their impact on suppliers,
supporting services and contracts - attend CAB meetings when
appropriate

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• Review & risk assessment

Regular review and risk assessment of all suppliers and contracts
o Review lead suppliers processes to ensure that sub-contracted
suppliers meet their contractual obligations
o Perform contract/SLA reviews to ensure consistency with
requirements, standard terms and conditions
o Ensure that value for money is obtained from all IT suppliers and
contracts
o Ensure that all IT supplier processes are consistent and interface
to all corporate supplier strategies, processes and standard terms
and conditions

• Disputes
Maintain a process for dealing with contractual disputes - ensure that
any disputes are dealt with efficiently and effectively
o Maintain a process for dealing with the expected end, early end
or transfer of a service
o Monitor, report and review supplier performance against targets -
identify appropriate improvement actions and ensure their
implementation

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4. Service Transition
4.1. Service Transition in the Service Lifecycle
4.1.1. Goal

'The management & co-ordination of processes, systems & ITILFND02

functions to package, build, test and deploy a release into 02-6
production & establish the service specified in the requirements’

The Goals of Service Transition:

• Set customer expectations on how the performance and use of a new or
changed service can enable business change
• Enable release integration of business processes and services
• Reduce variations in the predicted and actual performance of
transitioned services
• Reduce known errors and minimize risks from transitioning new or
changed services into production
• Ensure that the service can be used in according to the requirements
and constraints specified

4.1.2. Objectives

The Objectives of Service Transition: ITILFND02

02-6
• Plan and manage the resources to successfully establish a new or
changed service into production within the predicted cost, quality and
time estimates.
• Ensure minimal unpredicted impact on the production services,
operations and support organization.
• Increase the customer, user and service management staff satisfaction
with the service transition practices of the new or changed service
(deployment, communications, release documentation, training, and
knowledge transfer).
• Increase proper use of the services and underlying applications and
technology solutions.
• Provide clear and comprehensive plans that enable the customer and
business change projects to align their activities with the service
transition plans.

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4.1.3. Business Value

Business value of Service Transition: ITILFND02

02-7
• Ability to adapt quickly to new requirements and market developments
(‘competitive edge’)
• Transition management facilitates management of mergers, de-mergers,
acquisitions and transfer of services
• Increase success rate of changes and releases for the business
• Improve the predictions of service levels and warranties for new and
changed services
• Confidence in the degree of compliance with business and governance
requirements during change
• Decrease in variation of actual against estimated and approved resource
plans / budgets
• Increase the productivity of business and Customer staff - better
planning and use of new and changed services
• Timely cancellation or changes to maintenance contracts when
components are disposed or de-commissioned - both hardware and
software
• Better understanding of the level of risk during and after change e.g.
service outage, disruption, re-work.

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4.2. Generic Concepts and Definitions

4.2.1. Configuration Item (CI)

A configuration item is an asset, service component or other item which is, ITILFND03
or will be, under the control of configuration management. 03-17

4.2.2. Configuration Management System (CMS)

The Configuration Management System holds all the information for CIs ITILFND02
within the designated scope. Some of these items will have related 03-18
specifications or files that contain the contents of the item e.g. software,
document, photograph. For example, a Service CI will include the details
such as:
• Supplier
• Cost
• purchase date
• renewal date for licenses
• maintenance contracts
• related documentation (SLAs and underpinning contracts)

Figure 4-1 illustrates the type of information the CMS holds for CIs
within scope.

Figure 4-1

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4.2.3. Definitive Media Library

The Definitive Media Library (DML) is the secure library in which ITILFND03
the definitive authorized versions of all media CIs are stored and 03-19
protected.
• It stores master copies of versions that have passed quality assurance
checks and may consist of one or more software libraries/file-storage
areas, separate from development, test or live file-store areas.
• It contains the master copies of all controlled software in an
organization, including definitive copies of purchased software (with
license documents/information), as well as software developed on site.
• Master copies of controlled documentation for a system are also stored
in the DML in electronic form.

4.2.4. Service Change

The addition, modification or removal of authorized, planned or ITILFND03

supported service or service component and its associated 03-20
documentation.
• Changes to a Service will be brought in via Service Design, Continual
Service Improvement and the Service Level Management process.
• Corrective change, resolving errors detected in services, will be initiated
from Service Operations, and may route via support or external suppliers
into a formal RFC.

4.2.5. Change types

• NORMAL ITILFND03
Any service change that is not pre-approved. 03-21

• STANDARD (Pre-Authorized)
A standard Change is a change to a service or infrastructure for
which the approach is pre-authorized by change management that
has an accepted and established procedure to provide a specific
change requirement.
• EMERGENCY
Emergency change is reserved for changes intended to repair an
error in an IT service that is negatively impacting the business to a
high degree.
o Changes intended to introduce immediately required business
improvements are handled as normal changes, assessed as
having the highest urgency.
o Emergency Changes are sometimes required and should be
designed carefully and tested before use or the impact of the
emergency change may be greater than the original incident.
o The number of emergency Changes proposed should be kept to
an absolute minimum, because they are generally more
disruptive and prone to failure.
o Emergency changes may document some details retrospectively.

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4.2.6. Release Unit

A ‘Release unit’ describes the portion of a service or IT infrastructure that is ITILFND03

normally released together according to the organization’s release policy. 03-22,23
The unit may vary, depending on the type(s) or item(s) of service asset or
service component such as software and hardware.

Figure 4-2 depicts a simplified example showing an IT service made up

of systems and service assets, which are in turn made up of service
components.

Figure 4-2

4.2.7. The 7 R’s of Change Management

The following questions must be answered for all changes. Without this ITILFND03
information, the impact assessment cannot be completed, and the balance 03-22,23
of risk and benefit to the live service will not be understood which could
result in the change not delivering all the possible/expected business
benefits or of it having a detrimental/unexpected effect on the live service:
• Who RAISED the change?
• What is the REASON for the change?
• What is the RETURN required from the change?
• What are the RISKS involved in the change?
• What resources are REQUIRED to deliver the change?
• Who is RESPONSIBLE for the build, test and implementation of the
change?
• What is the RELATIONSHIP between this change and other changes?

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4.3. Key Principles and Models

4.3.1. The Service-V Model
According to the Service-V Model, service validation and acceptance test ITILFND04
planning should start with the definition of the service requirements - 04-4
customers that sign off the agreed service requirements will also sign off the
service acceptance criteria and test plan.)

Figure 4-3

The V-model approach Figure 4-3 is traditionally associated with the

waterfall lifecycle, but is, in fact, just as applicable to other lifecycles,
including iterative lifecycles, such as prototyping, RAD approaches.
• Left-hand side: The specification of the service requirements down
to the detailed service design.
• Right-hand side: Focuses on the validation activities that are
performed against the specifications defined on the left-hand side.
• At each stage on the left, there is direct involvement by the
equivalent party on the right.

Within each cycle of the iterative development, the V-model concepts of

establishing acceptance requirements against the requirements and
design can apply, with each iterative design being considered for the
degree of integrity and competence that would justify release to the
customer for trial and assessment.

Acronyms used in Figure 4-3

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o SLP - Service Level Package: (Service Strategy) A defined level of

Utility and Warranty for a particular Service Package. Each SLP is
designed to meet the needs of a particular Pattern of Business Activity
(PBA)

o SDP - Service Design Package: (Service Design) Document(s)

defining all aspects of an IT Service and its Requirements through each
stage of its Lifecycle. A Service Design Package is produced for each new
IT Service, major Change, or IT Service Retirement.

o SPI - Service Provider Interface: (Service Strategy) An interface

between the IT Service Provider and a User, Customer, Business
Process, or a Supplier. Analysis of Service Provider Interfaces helps to
coordinate end-to end management of IT Services.

o SLR - Service Level Requirement: (Service Design & Continual

Service Improvement) A Customer Requirement for an aspect of an IT
Service. SLRs are based on Business Objectives and are used to
negotiate agreed Service Level Targets.

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4.4. Service Transition Processes

4.4.1. Change Management

Objectives ITILFND05
To ensure that changes are recorded, evaluated, authorized, prioritized, 05-5
planned, tested, implemented, documented and reviewed in a controlled
manner.

Scope
The scope of Change Management covers changes to baseline service assets
(Service Portfolio) and configuration items across the whole Service Life
Cycle. The organization should define the changes that lie outside the scope
of their service change process, such as:
• Changes with wider impacts than service changes (departmental
organization, policies, business operations) – would produce RFC’s to
generate consequential service changes
• Changes at an operational level such as repair to printers or other
routine service components.

Figure 4-3 illustrates a typical scope for the service change management
process for an IT department and interfaces with business and suppliers at
strategic, tactical and operational levels.

Figure 4-3

Basic Concepts

• Policies and standards

To define to internal and external providers what must be done,
including the consequence of non-adherence to policy, change
windows, performance standards, etc. Rules that provide a culture and
environment that support the process.

• Statutory compliance requirements

Adherence to relevant country and local legislation, industry codes of
practice, standards and organizational practices.

• Eliminate unauthorized change

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For effectiveness and efficiency, but also legal reasons

• Change naming/numbering conventions

Defining the identification and classification criteria in respect of:
o Change document identifiers
o Change document types, change documentation templates and
expected content
o Impact, urgency, priorities

• Organization, roles and responsibilities

o Accountability and responsibility of all stakeholders
o Approach to independent testing and post evaluation of change
o Change authorization - levels of authorization and rules that govern
decision making, actions & escalation
o Composition of change advisory boards (CAB, Emergency CAB)

• Stakeholders
o Change and release plans to enable stakeholders to do their own
preparation and planning
o Communicate changes, Change Schedule and release plans

• Grouping of related changes

o Into a release, build or baseline
o By linking several child RFC’s to a master RFC

• Procedures
o Change authorization (policies, rules and procedures)
o Raising an RFC (preparation and submission of change proposal)
o How change requests are tracked and managed (change records)
o How change requests are impact assessed and evaluated
o Identifying dependencies and incompatibilities between changes
o Verifying the implementation of a change
o Overseeing and evaluating deliverables from change and release
implementation
o Review changes regularly to identify trends and improvements e.g.
in the success or failure of changes and releases

• Change related incidents

o Keep Service Desk advised of changes (via the Change Schedule)
o Interfacing change, release and configuration management with
the problem and incident management processes to measure and
reduce Change related incidents.
Note: Forward Schedule of Change (v2) is same as Change Schedule (v3)

• Configuration management interfaces

o To provide quality information for impact assessment and reporting
(Compare As-Is to As-Planned configuration)
o To identify high-risk, high-impact CIs
o To capture CIs, configuration baselines and releases
o To capture related deliverables (acceptance criteria, test and
evaluation reports)

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Process Activities (Overall)

Overall change management activities include:
• Planning and controlling changes
• Change and release scheduling
• Communications
• Change decision making and change authorization
• Ensuring there are remediation plans
• Measurement and control
• Management reporting
• Understanding the impact of change
• Continual improvement

Process Activities (Individual changes)

Typical activities in managing individual changes are illustrated in Figure 4-
4

Figure 4-4

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The steps are as follows:

• Create and recording Changes
• Review RFC and change proposal
• Filtering changes (e.g. incomplete, wrongly routed)
• Assess and evaluate the change
o Establish appropriate level of change authority
o Establish relevant areas of interest (who should be involved in
CAB)
o Assess and evaluate the business justification, impact, cost,
benefits and risk of Changes
o Request independent evaluation of a change (if required)
• Authorize the change
o Obtaining authorization/rejection
o Communicate the decision with all stakeholders, including the
initiator of the RFC
• Plan updates
• Co-ordinate Change implementation
• Review and Close change
o Collating the change documentation (e.g. baselines and
evaluation reports)
o Review the change and change documentation
o Close the Change when all actions are completed

Key Metrics
Most of the following metrics/measures can be broken down by category,
organizational division, geography, supplier etc.

• Output Measures
o Number of disruptions, incidents, problems/errors caused by
unsuccessful changes and releases
o Inaccurate change specifications (technical, customer, business)
and incomplete impact assessment
o Unauthorized business/customer change by
business/IT/customer/user asset or configuration item type e.g.
application data
o Percentage reduction in unauthorized changes or time, effort and
cost to make changes and releases (by service, change type,
asset type)
o Percentage improvement in predictions for time, quality, cost,
risk, resource and commercial impact
o Service or application rework caused by inadequate change
specification

• Workloads
o Frequency of change (by service, business area, etc.)
o Volume of change.

• Process measures
o People’s satisfaction with the speed, clarity, ease of use
o Number and percent of changes that follow formal change
management procedures
o Ratio of planned v. unplanned changes (urgent, emergency)
o Ration of accepted to rejects change requests
o Number of changes recorded and tracked using automated tools
o Time to execute a change (from initiation through each stage in
the Life Cycle of a change, ending in completion)

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- By life cycle stage

- By service
- By infrastructure platform
• Staff utilization
• Cost against budget

Challenges
• Almost every business process and service is IT enabled, resulting in
a large Customer and stakeholder group that is involved/impacted by
Service Transition
• There are many contact interfaces/relationships to manage through
Service Transition (Customers, Users, Programs, Projects, Suppliers
and Partners)
• There is little integration of processes and disciplines that impact
service transition (finance, engineering, human resource
management)
• The inherent differences and unknown dependencies among legacy
systems, new technology and human elements can increase the risk
to change
• Achieving a balance between maintaining a stable production
environment and being responsive to the business needs for changing
the services
• Achieving a balance between pragmatism and bureaucracy
• Creating an environment that fosters standardization, simplification
and knowledge sharing
• Being an enabler of business change and is, therefore, an integral
component of the business change programs.
• Establishing leaders to champion the changes and improvements
• Establishing “who is doing what, when and where” and “who should
be doing what, when and where”
• Developing a Culture that encourages people to collaborate and work
effectively together (an atmosphere that fosters the cultural shifts
required to get buy-in from people)
• Developing standard performance measures and measurement
methods across projects and suppliers
• Ensuring that the quality of delivery and support matches the
business use of new technology
• Ensuring that the service transition time and budget is not impacted
by events earlier in the service life cycle (e.g. budget cuts)
• Understanding the different stakeholder perspectives that underpin
effective risk management within an organization
• Understanding and assess the balance between managing risk and
taking risks in affecting the overall strategy of the organization
(potential mismatch between project and business risk)
Evaluating the effectiveness of reporting in relation to risk management and
corporate governance

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4.4.2. Roles

Change Manager ITILFND05

The main duties of the Change Manager, some of which may be delegated, 05-5
are listed below:
• Receive, log and allocate a priority, in collaboration with the initiator,
to all RFC’s and reject any that are totally impractical
• Table all RFC’s for a CAB meeting, issue an agenda and circulate all
RFC’s to CAB members in advance of meetings to allow prior
consideration
• Decide which people will come to which meetings, who gets specific
RFC’s depending on the nature of the RFC, what is to be changed,
and people’s areas of expertise
• Convene urgent CAB or ECAB meetings for all urgent RFC’s
• Chair all CAB and ECAB meetings
• After consideration of the advice given by the CAB or ECAB, authorize
acceptable Changes
• Issue Change Schedules, via the Service Desk
• Liaise with all necessary parties to coordinate Change building,
testing and implementation, in accordance with schedules
• Update the Change log with all progress that occurs, including any
actions to correct problems and/or to take opportunities to improve
service quality
• Review all implemented Changes to ensure that they have met their
objectives. Refer back any that have been backed out or have failed
• Review all outstanding RFC’s awaiting consideration or awaiting
action
• Analyze Change records to determine any trends or apparent
problems that occur. Seek rectification with relevant parties
• Close RFC’s
• Produce regular and accurate management reports

Change Authority
Formal authorization is obtained for each change from a change authority
(role, person or group)

• Levels of authorization should be judged by the type, size or risk of

the change
• Delegated authority may exist within an authorization level, e.g.
delegating authority to a Change Manager according to pre-set
parameters relating to:
o Anticipated business risk
o Financial implications
o Scope of the change

Figure 4-5 illustrates an example of authorization hierarchy (Change

Authorization Model)

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Figure 4-5

Change Advisory Board

A CAB is an advisory body and requires appropriate terms of reference
(meeting regularity, scope of influence, and links to program management)

It is important to emphasize that the CAB:

• Will be composed according to the Changes being considered and
may vary considerably in make-up even across the range of a single
meeting
• Should involve suppliers when that would be useful
• Should reflect both user and Customer views
• Is likely to include the following:
o Problem Manager
o Service Level Manager
o Customer Relations staff

4.4.3. Service Asset & Configuration Management

Objective ITILFND05
To define and control the components of services and infrastructure and 05-6
maintain accurate configuration records.

This enables an organization to:

• Comply with corporate governance requirements
• Control its asset base
• Optimize its costs
• Manage change and releases effectively
• Resolve incidents and problems faster
Basic Concepts

• The Logical Model

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Configuration management delivers a required logical model of the

services, assets and the infrastructure by recording the relationships
between configuration items (see Figure 4-6)

Figure 4-6

The power of the logical model is that it is THE model – a single

common representation used by all parts of IT Service management,
and beyond.

• CI Categories
Some documentation will define the characteristics of a CI whereas
other documentation will be a CI in its own right that needs to be
controlled. There will be a variety of CIs; the following is examples:
o Service Life Cycle CIs provide a picture of the service
provider’s services, how these services will be delivered, what
benefits are expected, at what cost, and when they will be
realized and include the Business case, Service Management
plans, Service Life Cycle plans, Service Design Package, Change
and Release plans, Test plans.
o Service CIs such as:
- Service capability assets: management, organization, processes,
knowledge, people
- Service resource assets: financial capital, systems, applications,
information, data, infrastructure and facilities, financial capital,
people
- Service Model
- Service Package
- Release Package
- Service Acceptance Criteria
o Organization CIs such as the organization’s business strategy,
other internal policies (independent of the service provider),
regulatory or statutory requirements applicable.
o Internal CIs delivered by individual projects, including tangible

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(data centre) and intangible assets (software) required to deliver

and maintain the service and infrastructure.
o External CIs such as external customer requirements,
agreements, releases from suppliers or sub-contractors and
external services.

• Configuration Management System (CMS)

The Configuration Management System holds all the information for
CIs within the designated scope
(Previously discussed in paragraph 1.4.8 – See Figure 4-7 as reminder)

Figure 4-7

Some of these items will have related specifications or files that

contain the contents of the item e.g. software, document, photograph
(Figure 4-8 simply illustrates these relationships).
♦ For example, a Service CI will include the details such as supplier, cost,
purchase date and renewal date for licenses and maintenance contracts
and the related documentation such as SLA’s and underpinning contracts.

Figure 4-8
• Secure Libraries
A collection of software, electronic or document CIs of known type
and status used for controlling and releasing components throughout
the Service Life Cycle (design, build, test, deploy and operate).
Access to a secure library is restricted.

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• Secure Stores
A location that warehouses IT assets and play an important role in
the provision of security and continuity (maintain reliable access to
equipment of known quality)

• Definitive Media Library

Secure library in which the definitive authorized versions of all media
CIs are stored and protected

• Definitive Spares
Secure storage of hardware spares (components and assemblies,
maintained at the same level as the comparative systems in the live
environment)

• Configuration Baseline
The configuration of a service, product or infrastructure that has been
formally reviewed and agreed upon, that serves as the basis for
further activities, that can only be changed through formal change
procedures.

• Snapshot
The current state of a configuration item or an environment (e.g.
from a discovery tool), recorded in the CMS as a fixed historical
record - also referred to as a footprint

Figure 4-9 illustrates the Definitive Media Library (DML) and Configuration
Management Database (CMDB) concepts.

Figure 4-9

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4.4.4. Roles

Service Asset Manager ITILFND05

Works to the overall objectives agreed with the IT Services Manager; 05-6
implements the organization’s Service Asset Management policy and
standards, which includes:
• Asset Management systems - Evaluate existing and design,
implement and manage new/improved systems for efficiency and
effectiveness – including estimating and planning the work and
resources involved, and monitoring and reporting on progress against
plan
• Asset Management processes, standards, plans and
procedures - Agrees scope, function, items to be controlled, and the
information that is to be recorded.
• Awareness - Campaign to win support for new procedures, ensuring
that changes to the methods and processes are properly approved
and communicated to staff before being implemented (Plans,
publicizes and oversees implementation of new Asset Management
systems)
• Staffing - Arranges recruitment and training of staff
• Asset Management tools - Evaluation of proprietary tools and
recommendation of those that best meet the budget, resource,
timescale and technical requirements
• Manages the Asset Management plan, principles and processes
and their implementation
• Agrees assets (CIs) to be uniquely identified with naming
conventions, ensures compliance with identification standards for
object types, environments, processes, life cycles, documentation,
versions, formats, baselines, Releases and templates
• Proposes and/or agrees interfaces with Change Management,
Problem Management, Network Management, Release Management,
computer operations, logistics, finance and administration functions
• Plans population of the Asset DB. Manages the Asset DB, central
libraries and tools, ensuring regular housekeeping
• Provides reports, including management reports (indicating
suggested action to deal with current or foreseen shortcomings),
impact analysis reports and Asset status reports
• To cope with growth and change - Initiates actions needed to
secure funds to enhance the infrastructure and staffing levels
• Assists auditors to audit the activities of the Asset Management team
for compliance with laid-down procedures, ensuring that corrective
action is carried out

Configuration Manager
Works to the overall objectives agreed with the IT Services Manager;
implements the organization’s Configuration Management policy and
standards, including:
• Evaluates existing Configuration Management systems and the
design, implementation and management of new/improved systems
for efficiency and effectiveness – including estimating and planning
the work and resources involved, and monitoring and reporting on
progress against plan
• Agrees scope of the Configuration Management processes,
function, the items that are to be controlled, and the information that
is to be recorded. Develops Configuration Management standards,

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Configuration Management plans and procedures

• Mounts an awareness campaign to win support for new
Configuration Management procedures. Ensures that changes to
the Configuration Management methods and processes are properly
approved and communicated to staff before being implemented.
Plans, publicizes and oversees implementation of new Configuration
Management systems
• Staffing - Arranges recruitment and training of staff
• Manages the evaluation of proprietary Configuration Management
tools and recommends those that best meet the organization’s
budget, resource, timescale and technical requirements
• Manages the Configuration Management plan, principles and
processes and their implementation
• Agrees CIs to be uniquely identified with naming conventions.
Ensures that staff comply with identification standards for object
types, environments, processes, life-cycles, documentation, versions,
formats, baselines, Releases and templates
• Proposes and/or agrees interfaces with Change Management,
Problem Management, Network Management, Release Management,
computer operations, logistics, finance and administration functions
• Plans population of the CMS. Manages CMS, central libraries,
tools, common codes and data. Regular housekeeping of the CMS
• Provides reports, including management reports (indicating
suggested action to deal with current or foreseen shortcomings),
impact analysis reports and configuration status reports
• Initiates actions needed to secure funds to enhance the infrastructure
and staffing levels in order to cope with growth and change
• Assists auditors to audit the activities of the Configuration
Management team for compliance with laid-down procedures.
Ensures corrective action is carried out.

Configuration Analyst
• Proposes scope of the Asset and Configuration Management
processes, function, the items that are to be controlled, and the
information that is to be recorded. Develops Asset and Configuration
Management standards, plans and procedures
• Trains Asset and Configuration Management specialists and other
staff in Asset and Configuration Management principles, processes
and procedures
• Supports the creation of the Asset and Configuration Management
plans and principles and their implementation
• Creates Asset and Configuration Management processes and
procedures. This includes CI registration procedures; access
controls and privileges. Ensures that the correct roles and
responsibilities are defined in the Asset and Configuration
Management plans and procedures
• Proposes and agrees with the Asset and Configuration Manager CIs
to be uniquely identified with naming conventions. Ensures that
developers and configuration system users comply with identification
standards for object types, environments, processes, life cycles,
documentation, versions, formats, baselines, Releases and templates
• Liaises with the Configuration Administrator / Librarian on population
of the Asset and CMS. Manages Asset and CMS, central
libraries, common codes and data. Ensures regular housekeeping
of the Asset and CMS

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• Uses or provides the Asset and CMS to facilitate impact

assessment for RFCs and to ensure that implemented Changes are
as authorized. Creates Change records, configuration baselines, and
package Release records in order to specify the effect on CIs of an
authorized Change. Ensures any changes to Change authorization
records are themselves subject to Change Management procedures.
Ensures that the Asset and CMS is updated when a Change is
implemented
• Uses the Asset and CMS to help identify other CIs affected by a
fault that is affecting a CI
• Performs configuration audits to check that the physical IT
inventory is consistent with the Asset and CMS and initiates any
necessary corrective action
• Creates and populates project libraries and CM system.
Checks items and groups of items into the CM tools
• Baselines:
o Accepts baselined products from third parties and distributes
products
o Builds system baselines for promotion and release
• Maintains project status information and status accounting records
and reports
• Monitors problems (test incidents) and maintains database for
collections and reporting of metrics.

Configuration Administrator/Librarian
The Configuration Administrator/Librarian is the custodian and guardian of
all master copies of software, Assets and documentation CIs registered with
Asset and Configuration Management. The major tasks of this role are:
• to control the receipt, identification, storage, and withdrawal of all
supported CIs
• to provide information on the status of CIs
• to number, record, store and distribute Asset and Configuration
Management issues

CMS / Tools Administrator

• Evaluates proprietary Asset and Configuration Management tools and
recommends those that best meet the organization’s budget,
resource, timescale and technical requirements. Directly or indirectly
customizes proprietary tools to produce effective Asset and
Configuration Management environments in terms of databases and
software libraries, workflows and report generation.
• Monitors the performance and capacity of existing Asset and
Configuration Management systems and recommends improvement
opportunities and undertakes standard housekeeping and fine tuning
under change control

• Liaises with the Configuration Analyst and Administrator / Librarian on

population of the Asset and CMS. Provides technical administration
and support for Asset and CMS, central libraries, Tools common
codes and data. Undertakes regular technical housekeeping of the
Asset and CMS
• Ensures the integrity and operational performance of the CM systems.

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Configuration Control Board

The Configuration Control Board is required to ensure that the overarching
intention and policies of Configuration Management are employed
throughout the Service Management Lifecycle and with specific
consideration for every aspect of the complete service. The board will have
the following responsibilities:
• Defining the Service Baseline in terms of applications, information,
Service, technical, infrastructure, core and support services ensuring
that they meet the requirements established in the Service Design
• Reviewing changes in the service configuration for compliance with
contractual and internal requirements
• Originating requirement changes for Service configuration to comply
with contract change requests.

4.4.5. Release & Deployment Management

Objectives ITILFND05
Establish clear and comprehensive release and deployment plans that enable 05-6
the customer and business change projects to align their activities with
these plans.
• Enable a release package to be built, installed, tested and deployed
efficiently to a deployment group or target environment successfully
and on schedule.
• That a new or changed service and its enabling systems, technology
and organization are capable of delivering the agreed service
requirements (utilities, warranties & service levels)
• Ensure that there is knowledge transfer to enable the customers and
users to optimize their use of the service to support their business
activities.
• Ensure that skills and knowledge are transferred to operations and
support staff to enable them to effectively and efficiently deliver,
support and maintain the service according to required warranties
and service levels.
• Minimize unpredicted impact on the production services, operations
and support organization.
• That customers, users and service management staff are satisfied
with the service transition practices and outputs e.g. user
documentation and training.

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Basic Concepts

• Big Bang vs. Phased

o Big-bang option – the new or changed service is deployed to all

user areas in one operation, when consistency of service across
the organization is considered important

o Phased approach – the service is deployed to a part of the user

base initially, and then this operation is repeated for subsequent
parts of the user base via a scheduled roll out plan (Figure 4-
10)

Figure 4-10

• Push and Pull

In order to deploy via ‘push’ approach, the data on all user locations
must be available. Pull approaches do not rest so heavily on accurate
configuration data and they can trigger an update to user records. As
some users will never ‘Pull’ a Release it may be appropriate to allow a
“Pull” within a specified time limit and if this is exceeded a Push will
be forced e.g. for an anti-virus update.

o A Push approach is used where the service component is

deployed from the centre and pushed out to the target locations.
In terms of service deployment, delivering updated service
components to all users – either in big-bang or phased form –
constitutes ‘push’, since the new or changed service is delivered
into the users environment at a time not of their choosing.

o A Pull approach is used for software releases where the software

is made available in a central location but users are free to pull
the software down to their own location at a time of their
choosing or when a user workstation restarts. The use of ‘pull’
updating a release over the internet has made this concept
significantly more pervasive. A good example is virus signature
updates, which are typically pulled down to update PCs and
Servers when it best suits the customer, however at times of
extreme virus risk this may be overridden by a release that is
pushed to all known users.

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• Automation vs. Manual

Whether by automation or other means, the mechanisms to release
and deploy the service components are correctly configured should
be established in the release design phase and tested in the build and
test stages of the new or changed service.

o Automation will help to ensure repeatability and consistency.

The time required to provide a well designed and efficient
automated mechanism may not always be available or viable.

o If a Manual mechanism is used it is important to monitor and

measure the impact of many repeated manual activities as they
are likely to be inefficient and error prone. Too many manual
activities will slow down the release team and create
resource/capacity issues that affect the service levels.

• Testing: Release & Release Packages

o Figure 4-11 shows that you start the build and release from the
Infrastructure architecture, through Application architecture, then
Service Architecture to Business architecture levels
(This is logic – dependencies)

Figure 4-11

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o Figure 4-12 illustrates where the ‘LAB’/Test phase fits into the
high-level flow

Figure 4-12

4.4.6. Roles

Release and Deployment Manager ITILFND05

Responsible for managing all aspects of the end-to-end release process. The 05-6
Release and Deployment Manager will report to the Service Transition
Manager as will the Service Test Manager; however these roles should
always be undertaken by separate people, i.e. never combined, to ensure
that there is always independent testing and test verification.

The Release and Deployment manager is responsible for the planning,

design, build, configuration and testing of all software and hardware to
create the Release package for the delivery of, or changes to, the
designated Service.

The overall responsibilities are:

• Managing all aspects of the end-to-end release process
• Updating the S-KMS and SACM
• Ensuring co-ordination of build ,test environment team and release
teams
• Provides management reports on release progress
o Service Release and Deployment policy and planning
o Release package design, build and configuration
o Release package acceptance including business sign-off
o Service rollout planning including method of deployment
o Release package testing to predefined acceptance criteria
o Sign-off of the release package for implementation
o Communication, preparation and training
o Audits of hardware and software prior to and following the
implementation of release package changes
o Installation of new or upgraded hardware
o Storage and traceability / audit ability of controlled software in
both centralized and distributed systems
o Release, distribution and the installation of packaged software.

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Release Packaging and Build Management

Release Packaging and Build management is the flow of work (establish
requirements, design, build, test, deploy, operate and optimize) to deliver
applications and infrastructure that meet the Service Design requirements.

The main duties of the Release Packaging and Build Manager are:
• Responsibility for establishing the final release configuration (e.g.
knowledge, information, hardware, software and infrastructure)
• Builds the final release delivery
• Tests the final delivery prior to independent testing
• Establishes and reports outstanding known errors and workarounds
• Provides input to the final implementation sign-off process.

Deployment
Deployment is responsible for the following activities:
• Responsible for the final physical delivery of the service
implementation
• Co-ordinates release documentation and communications, including
training and customer, service management and technical release
notes
• Plans the deployment in conjunction with Change and SKMS and
SACM
• Provides technical and application guidance and support throughout
the release process, including known errors and workarounds
• Provides feedback on the effectiveness of the release
• Records metrics for deployment to ensure within agreed SLA’s.

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5. Service Operation
5.1. Service Operation in the Service Lifecycle
5.1.1. Goals

Definition ITILFND02
02-8
Assists Service Operation practitioners to achieve a balance between:
• the business to meet its objectives
• the effective functioning of components that support services
to focus on effectively managing the day-to-day aspects while maintaining a
perspective of the greater context.

Service Operation Goals

• Responsive, stable services
• Robust end to end operations practices
• Redesigned incident and problem processes
• New functions and processes
• Event, technology and request fulfillment
• Influencing strategy, design, transition and improvement
• SOA, virtualization, adaptive and agile service operation models

5.1.2. Objectives

• Manage services at agreed levels through coordination and perform ITILFND02

activities to deliver processes 02-8
• Manage the technology that is used to deliver and support service
• Conducts, manages and controls day-to-day operation of processes
(using Service Design and Service Transition)
• Enable Continual Service Improvement through monitoring
performance, assess metrics and gather data

5.1.3. Business Value

• The only value that matters, is that perceived by the customer - Service ITILFND02
Operation is where the value is delivered & judged. 02-9
• Service Strategy
• Where service value is modeled
• Service Design & Service Transition
• Where cost of services is designed, predicted & validated
• Continual Service Improvement
• Where measures for optimization are identified

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5.2. Generic Concepts & Definitions

5.2.1. Impact, Urgency and Priority

Impact: ITILFND03
Impact is based on how Service Levels will be affected and measures the 03-27
effect of an Incident, Problem or Change on Business Processes

Urgency:
How quick a solution is required; a high Impact Incident may have low
Urgency, if the Impact will not affect the Business until the end of the
financial year.

Priority:
Time required for actions to be taken; SLA may state that Priority2 Incidents
must be resolved within 12 hours.

Priority is a function of Impact & Urgency

Figure 5-1 is an example – Each of the Impact, Urgency and Priority Level
should be clearly defined.

Figure 5-1

5.2.2. Categories of Calls

• Service Request ITILFND03

User requesting information for a change or access to an IT Service 03-28, 24,
o Reset a password provide standard IT Services for a new User. 25, 26, 29
o Handled by a Service Desk, nor RFC necessary

• Event
Notification created by a service, CI or monitoring tool. Caused by
deviation to the performance of the infrastructure or the delivery of the
service and will regularly require Incidents to be logged.

• Alert
Warning or notice about threshold, change or failure that has occurred.
Created and controlled by System Management tools and the Event
Management Process.
• Incident
Unexpected interruption or reduction in quality of an IT service. A

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failure of a CI that has not yet impacted service is also an Incident.

• Problem
A cause of one or more Incidents. Usually known at the time a Problem
Record is created, and the Problem Management Process is responsible
for further investigation.

5.2.3. Workaround and Error

• Workaround ITILFND03
Temporary means to resolve issues or difficulties e.g. by restarting a 03-30,31,32
failed Configuration Item.
o Workarounds for Incidents that do not have associated Problem
Records are documented in the Incident Record.
o Workarounds for Problems are documented in Known Error
Records.

• Known Error
A Problem that has a documented Root Cause & a Workaround. Known
Errors are created and managed throughout their Lifecycle by Problem
Management.

• Known Error Database

Storage for previous knowledge on requests and known errors

5.2.4. Role of Communication

Please note that there is no definitive medium for communication, nor is ITILFND03
there a fixed location or frequency. There should therefore be a policy 03-33
around communication within each team or department and for each
process. Although this should be formal, the policy should not be
cumbersome or complex.

Properly established communication channels can assist in preventing or

mitigating issues. A Communication Policy must therefore indicate the
intended purpose or resultant action, as well as a clear audience, involved in
determining the need for communication. Types of communication include:
• Meetings
• Email
• SMS/Pagers
• VOIP
Document sharing utilities

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5.3. Key Principles and Models

5.3.1. IT Services vs. Technology Components

Organizations should focus on both business requirements and how they will
deliver it as well as what services they support on internal systems to deliver
value. Differences/ imbalances stem from the Management culture and leads
to low maturity

• IT Services
How customers/users experience services. Customers/Users don’t worry
about the details of what technology is used to manage services, but
are only concerned that the services are delivered as required and
agreed.

• Technology Components
How IT components and systems are managed to deliver the services.
Different teams or departments manage technology, thus each should
focus on achieving good performance and availability of ‘its’ systems.

Figure 5-2 illustrates IT Services vs. Technology Components

Figure 5-2

5.3.2. Stability vs. Responsiveness

• Stability
o Develop & refine standard IT management techniques & processes
o Service components needs to be available & perform consistently

• Responsiveness
o Ability to respond to changes without impact to other services
o Take care when agreeing to required changes - Consider ALL
requirements and impact of delivering change

Figure 5-3 illustrates Stability vs. Responsiveness

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Figure 5-3

For example: a Business Unit requires additional IT Services, more capacity

and faster response times.
• To respond to this type of change without impacting other services is a
significant challenge.
• Many IT organizations are unable to achieve this balance and tend to
focus on either the stability of the IT Infrastructure or the ability to
respond to changes quickly.

5.3.3. Quality of Service vs. Cost of Service

Achieving balance between Quality and Cost assist in consistency when

delivering at agreed levels while keeping costs & resource utilization at an
optimal level. Service Level Requirements can be used to deliver service at
appropriate cost and avoid “over sizing” or “under sizing”.
• Too much focus on quality – deliver more than necessary at higher cost
• Too much focus on cost – deliver on or under budget, risk due to sub-
standard services

Figure 5-4 illustrates Quality of Services vs. Cost of Service

Figure 5-4

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Achieving a balance will ensure delivery of the level of service necessary to

meet Business requirements at an optimal cost as illustrated in Figure 5-5

Figure 5-5

5.3.4. Reactive vs. Proactive

• Reactive ITILFND04
No action occurs unless prompted by external driver 04-7

• Proactive
Always seeking ways to improve current situation
o Continually scan, looking for potentially impacting changes
o Seen as positive behavior
o Can be expensive
o Better to manage proactively

Proactive achievement depends on:

o Maturity
o Culture
o Role of IT, influence on strategy and tactics
o Level of Integration of processes and tools
o Maturity and scope of Knowledge Management

Achieving Balance
Achieving balance between reactive and proactive, requires:
• Formal, Integrated Problem and Incident Management processes
• Ability to prioritize technical faults and demands - needs to be done
during Service Operation, but the mechanisms need to be put in place
during Service Strategy and Design.
• Data from Configuration and Asset Management - provides data where
required, saving projects time and making decisions more precise
• Ongoing involvement from Service Level Management in Service
Operations

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5.4. Service Operation Processes

5.4.1. Incident Management

Objectives ITILFND05
• To Restore normal service operation as quickly as possible 05-7
• Minimize the impact on business operation
• Maintain optimal levels of service quality & availability

Scope
• Any event which disrupts, or could disrupt a service:
o Includes Events communicated directly by users or tools or
technical staff
• Not all Events are Incidents.
• Many classes of Events are not related to disruptions at all, but are
indicators of normal operation or are simply informational

Figure 5-6 illustrates where Incident Management fits into (Orange Arrows)

Figure 5-6

Basic Concepts

• Incident Models
o Agreed method of predicting steps to handle a process
o Ensures ‘standard’ incidents handled in pre-defined path
• Evidence preservation activities
• Timescales & thresholds
• Escalation Procedures
• Responsibilities

• Timescales
Must be agreed for all handling stages
o Based on response and resolution targets in SLA and OLA
o Tools should be used to automate timescales and escalate
o Support groups must be informed

• Major Incidents
o Shorter timescales and greater urgency
o Incident with higher impact or priority – potential business impact

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Process Activities
The typical activities involved in Incident Management are illustrated in
Figure 5-7 (a basic Incident flow).

Figure 5-7

• Incident Identification
o Work cannot begin until incident is known

• Logging
o All incidents fully logged, date/time stamped
o Relevant information recorded

• Categorization
o Record correct type of call
o Establish trends for Problem Management, Supplier Management
o Organizations are Unique – difficult to give generic guidance

• Prioritization
o Agree and allocate appropriate prioritization codes
o Determined by impact and urgency
o Clear guidance for all support staff to determine correct urgency
and impact levels

• Initial Diagnosis
o Carried out by the Service Desk
o Attempt to discover full symptoms and exactly what went wrong
o Diagnostics scripts and known error information can be used

• Escalation
o Unable to resolve incident within agreed service hours
o High priority – notification to managers
• Functional Escalation – Escalate to the second level support
• Hierarchic Escalation – “investigation”, “recovery & resolution” steps
take too long – Escalates to IT Managers, normally Priority 1 Incidents
• Exact levels to be agreed, based on SLA targets, embedded in tools

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• Investigation & Diagnosis

o Determine the nature of request
o Support groups to determine what's gone wrong, all activities
documented in record to maintain historical information
Actions include:
• Establish what has gone wrong
• Understand order of events
• Confirm impact, and number of users
• Identify triggering events
• Knowledge searches of previous occurrences

• Resolution & Recovery

o Identify resolution – apply and test
o Specific actions involved:
• Ask user to do directed activities
• Service Desk implement centrally or remotely
• Support groups implement specific recovery actions
• Third-party supplier / maintainer resolve fault
o Sufficient testing must be performed – ensure recovery action is
complete
o Incident record must be updated with relevant information and
details

• Closure
o Service Desk check incident fully resolved, users satisfied, agreed to
close
o Service Desk also to:
• Closure Categorization
• User Satisfaction Survey
• Incident Documentation
• Ongoing or recurring Problem?
• Formal Closure
o Rules for re-opening

Key Metrics
Monitor and report to determine effectiveness & efficiency
• total numbers of Incidents
• breakdown of incidents at each stage
• size of current incident backlog
• number and percentage of major incidents
• average cost per Incident etc

Challenges
• Ability to detect incidents early
• Ensuring all incidents are logged
• Availability of information: Problems & Known Errors
• Integration:
o Assist Incident Management to correctly assess the impact and
priority of Incidents and relationships between CI’s & history
o SLM: to correctly assess impact and priority and use defined
escalation procedures

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5.4.2. Roles

Incident Manager ITILFND05

The main duties of the Incident Manager are listed below: 05-7
• Drive efficiency & effectiveness
• Produce management information
• Manage work of Incident support staff (1st & 2nd line)
• Monitor effectiveness of process & recommend improvement
• Develop & maintain Incident Management systems
• Manage Major Incidents
• Develop & maintain the process & procedures

5.4.3. Event Management

Objectives ITILFND05
05-8
• To detect and analyze events – make sense of events
• To determine appropriate control action – basis for Operational
Monitoring and Control
• To automate Operations Management activities – communicate
operational information:
o Warnings
o Exceptions
• To provide entry point for execution of processes and activities
• To compare actual performance and behavior against design standards
and SLA’s

Basic Concepts
Events can be categorized according to the following symptoms:

• Indicate regular operation

o Notify when scheduled workload has completed
o User logged into application
o Email reached intended recipient

• Indicate an exception
o User attempts login with incorrect password
o Device CPU above utilization threshold
o PC scan indicated unauthorized software

• Indicate unusual, but not exceptional, operation

o Situation may require close monitoring

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5.4.4. Roles

Event Manager ITILFND05

It is deemed unnecessary to appoint an Event Manager as events tend to 05-8
occur in multiple contexts and for many different reasons.
Event Management activities are delegated to the Service Desk or IT
Operations Management.

Technical and Application Management must ensure that the staff are
adequately trained and that they have access to the appropriate tools to
enable them to perform these tasks.

• Service Desk
o Communicating information - about the type of incident to the
relevant Technical or Application Management team and, where
appropriate, the user.
o Investigation and resolution of events - Service Desk escalates to
the appropriate Service Operation team(s)

• Service Design
Classify events, update correlation engines and ensure that any auto
responses are defined

• Service Transition
Ensure that events are properly generated and that the defined
responses are appropriate

• Service Operation
Perform Event Management for the systems under their control. It is
unusual for teams to have a dedicated person to manage Event
Management, but each manager or team leader will ensure that the
appropriate procedures are defined and executed according to the
process and policy requirements

• Technical and Application Management

Will also be involved in dealing with incidents and problems related to
events

5.4.5. Request Fulfilment

Objectives ITILFND05
05-8
• Provide channel to request & receive standard services
• Provide information about availability & obtaining services
• Source & deliver components of requested services
• Assist with general information

Basic Concepts
• Service Requests will frequently recur, so a predefined process flow (a
model) can be devised to include the stages needed to fulfil the request,
• Service Requests will usually be satisfied by implementing a Standard
Change

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5.4.6. Roles

The ownership of Service Requests resides with the Service Desk, which ITILFND05
monitors, escalates, dispatches and often fulfils the user request. 05-7
• Service Desk & Incident Management staff handles Service requests
• Eventual fulfilment of requests will be undertaken by appropriate Service
Operation team(s) or departments and/or by external suppliers, as
appropriate

5.4.7. Problem Management

Objectives ITILFND05
05-8
• Manage the lifecycle of all problems
• Prevent problems & resulting incidents
• Eliminate recurring incidents
• Minimize impact of incidents that cannot be prevented

Basic Concepts
• Problem Models
o Incidents may re-occur because of dormant or underlying problems
o Creating Known Error record in the KEDB – ensure quicker
diagnosis
o Similar to Incident Models

• Known Error (Previous discussion)

Understanding the root cause of an issue/failure, not necessarily having
the solution, and recording it for future reference to aid in restoring
services more efficiently

• Known Error Database (Previous discussion)

Storage for previous knowledge on requests and known errors, and
how they were resolved to allow quicker diagnosis if they occur

5.4.8. Roles

Problem Manager ITILFND05

05-8
• Liaison with all problem resolution groups to ensure swift resolution of
problems within SLA targets
• Liaison with suppliers, contractors etc to ensure that third parties fulfill
their contractual obligations, especially with regards to resolving
problems and providing problem-related information and data
• Ownership & protection of the Known Error Database
• Gatekeeper for the inclusion of all Known Errors
• Formal closure of all Problem records
• Arrange, conduct, document & follow-up all review activities

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5.4.9. Access Management

Objectives ITILFND05
05-8
• Provide user rights to enable use of a service or group of services
• Enable the execution of policies and actions

Basic Concepts

• Access
o Level & extent of functionality or data that a user can use

• Identity
o Unique distinguishing information of an individual, verifies status

• Rights
o Actual settings to allow access (privileges)

• Services of Service Groups

o Access to set of services or group of users, not individual access to
separate services

• Directory Services
o Tool to manage access & rights

5.4.10. Roles

Access Management is an overlap of Security Management and Availability ITILFND05

Management. It is unlikely that an “Access Manager” needs to be appointed, 05-8
but the policies, practices and procedures must be defined and
communicated to other groups and individuals.

• Service Desk
The Service Desk acts as an initial filter for access management. It will
check validity against authority tables and if passed the Service Desk
can then actually grant accesses for simple, lower levels; but will
escalate to specific functional groups any access to critical systems or
sensitive areas within the company infrastructure.

• Technical & Applications Management

Technical and Applications Management play different parts for Access
Management throughout the Service Lifecycle.
o Service Design – ensure simplified controls are built in and define
abuse counter-measures
o Service Transition – test the designed controls
o Service Operations - carry out access management for systems
within their control area and deal with access related Incidents and
Problems

• IT Operations Management
The IT Operations manager must ensure that Standard Operations
Procedures (SOPs) cater for access management issues. They will also
collate access data for reporting purposes (including actual access and
rejected requests)

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5.5. Functions
5.5.1. Service Desk

5.5.2. Role

The Helpdesk is a functional unit that serves as a single-point-of-contact ITILFND06

(SPOC) for IT users on a day-by-day basis. It is made up of staff dealing 06-1
with service events, via telephone calls, web interface, or automatically
reported infrastructure events.

Increase:
• accessibility -> single point of contact for users
• quality and turnaround times of requests

Improve:
• customer service, perception and satisfaction
• teamwork and communications

Reduce negative business impact

Provide more meaningful management information

5.5.3. Objectives

• To quickly restore normal services ITILFND06

o SD will do anything to allow the user to return to work satisfactorily 06-1

• To log all relevant requests

o categorization and prioritization codes will be allocated to the call

• To provide first-line support

o Proper investigation and diagnosis

• To escalate
o Requests unable to resolve

• To resolve incidents

• To keep users informed

• To close all resolved requests

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5.5.4. Organizational Structures

Local Service Desk ITILFND06

Figure 5-8 illustrates a Local Service Desk 06-1

Figure 5-8
• Characteristics:
o Co-located in/around user community
o Aids communication, clearly visible
o Can be inefficient and expensive if staff waits to deal with incidents

• Disadvantages:
o Language and cultural / political differences
o Time Zones
o Specialized groups
o Specialized services exist needing specialists
o Status of users (VIP)

Centralized Service Desk

Figure 5-9 illustrates a Centralized Service Desk

Figure 5-9
• Characteristics:
o Reduce number of service desk by merging into one location

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o More efficient and cost effective – fewer overall staff for higher
volumes
o Lead to higher skills levels – frequency on occurrence of events
o Need to maintain some ‘local presence’ – physical support

Virtual Service Desk

Figure 5-10 illustrates a Virtual Service Desk

Figure 5-10
• Characteristics:
o Personnel spread or located in a number of geographical or
structural locations
o Technologies and corporate support tools
o Meet user demand through:
• Home working
• Secondary support groups
• Off-shoring
• Outsourcing
o Safeguards required to ensure consistency and uniformity in service
quality

Follow the Sun

This is a combination of geographically dispersed service desks, providing a
24hr service at relatively lower cost. It also handles it’s own incidents during
normal work times. Safeguards must be addressed, namely:
• Common processes
• Tools
• Shared databases
• Culture

For example, a Service Desk in Asia-Pacific handles calls during office hours and at
the end of this period they hand over responsibility for any open incidents to a
European based desk. That desk will handle these calls alongside its own incidents
during its standard day and then hand over to a USA based desk – which finally
hands back responsibility to the Asia-Pacific desk to complete the cycle.

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Specialized groups
• Specific requests can be directly routed to a specialized group
• Faster resolution - greater familiarity and specialist training

Environment
The environment of where the SD is makes a big difference on the staffs
morality and effectiveness of resolving indents.
• Sufficient natural light and overall space
• Adequate acoustic control
• Pleasant surroundings
• Separate rest facilities

5.5.5. Staffing

Staffing Levels ITILFND06

Ensure correct number of staff to match demand levels. The following 06-1
factors should be considered:
• Customer service expectations
• Business requirements
• Size, relative age, design and complexity of the service catalogue and
infrastructure
• Number of customers and users to support
• Requests Types
• Period of support cover required
• Type of response
• Level of training
• Processes and procedures
• Existing skill levels
• Support technologies

Skill Levels
Ensure correct level and range of skills:
• Basic (high handling, low resolution rate)
• Technical (Low handling, high resolution rate)
• Skill levels are driven by:
o Target resolution times
o Complexity of support systems Cost
o Level of customization or specialization of supported services

Training
Ensure staff’s knowledge is current and that they are adequately trained as
they are the interface to organization. Introduce a formal induction program
for new staff. An ongoing training program can be complimented by having
experienced staff ‘shadow’ others as mentors

Retention
Significant staff turnover (loss) can be disruptive and lead to inconsistency
of service. Guard against the Service Desk being used as a stepping stone.
Managers should be considerate of their staff’s feelings in this high stress
environment.

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Super Users
Appoint or designate Super Users to act as liaison between IT in general and
the Service Desk. These users require additional training and awareness, but
could assist in filtering requests and issues. They become an important
communication channel that can cascade information from the Service Desk
outwards to communities. They can also assist with training, providing
support and be involved in release roll-outs

5.5.6. Metrics

• Evaluate performance of SD on regular intervals ITILFND06

• Assess health, maturity, efficiency and effectiveness 06-1
• Analysis and detailed metrics such as:
o First-line resolution rate
o Average time to resolve an incident
o Average time to escalate an incident
o Average time to review and close a resolved call
o The number of calls broken down by time of day and day of week,
o Percentage of customer or user updates conducted within target
times
• Customer Satisfaction Survey

For example, the total number of calls received by the Service Desk is not in itself an
indication of either good or bad performance – and may in fact be caused by events
completely outside the control of the Service Desk – for example a particularly busy
period for the organization, or the release of a new version of a major corporate
system.

5.5.7. Technical Management

Role ITILFND06
Technical Management plays a dual role: 06-2

• Custodian of technical knowledge and expertise: Ensures

knowledge required to design, test, manage and improve services is
identified, developed and refined

• Provides actual resources to support Service Management

Lifecycle: Ensures resources are effectively trained and developed to
design, build, transition, operate and improve technology to deliver
services

Objectives
Assists with the planning, implementation and maintenance of a stable
infrastructure through:
o Well designed and highly resilient, cost-effective technical topology
o Use of adequate technical skills to maintain the technical
infrastructure
o Swift use of technical skills to speedily diagnose and resolve any
technical failures

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5.5.8. Application Management

Role ITILFND06
Technical Management plays a dual role: 06-2

• Custodian of technical knowledge and expertise: Ensures

knowledge required to design, test, manage and improve services is
identified, developed and refined

• Provides actual resources to support Service Management

Lifecycle: Ensures resources are effectively trained and developed to
design, build, transition, operate and improve technology to deliver
services

Objectives
Assists with the planning, implementation and maintenance of a stable
infrastructure through:
o Well designed and highly resilient, cost-effective technical topology
o Use of adequate technical skills to maintain the technical
infrastructure
o Swift use of technical skills to speedily diagnose and resolve any
technical failures

5.5.9. IT Operations Management

Role ITILFND06
06-2
• Perform ongoing activities and procedures required:
o To manage and maintain the IT infrastructure
o To deliver and support Services at the agreed levels.

• Operations Control – overseas execution and monitoring

o Console Management - defines central observation and monitoring
to exercise monitoring and control activities
o Job Scheduling - management of routine batch jobs or scripts
o Backup and Restore – for Technical and Application Management
teams or users
o Print and Output management - collation and distribution of all
centralized printing or electronic output
o Performance of maintenance activities – for Technical or Application
Management teams or departments

• Facilities Management
o Managing physical IT environment,
o Coordinates large scale consolidation projects

• Executes activities and performance standards

o Stability of infrastructure and consistency is primary concern

• Part of the process of adding value to the different lines of business and
to support the value network

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Objectives
• To maintain ‘Status Quo’ to achieve stability
• To regularly scrutinize and improve services
• The swift application of operational skills to diagnose and resolve
failures

5.5.10. Functions – Organizational Overlap

The functions illustrated in Figure 5-11 are necessary to manage the ITILFND06
‘steady state’ operational IT environment. 06-2

Figure 5-11

Service Desk
• primary point of contact for users
• separate from the other Service Operation functions because it will
utilise the functions of say technical management or application
management depending on the type of call

Technical Management
• provides detailed technical skills and resources to support the ongoing
operation of the IT Infrastructure
• Even if activities are part of Technical Management, the staff who
performs these activities are logically part of IT Operations

IT Operations Management
Overlaps with Technical and application management
• IT Operations Control - Ensures that routine operational tasks are
carried out.
• Facilities Management - Manage the physical IT environment

Application Management
• Managing applications throughout their lifecycle.
• Even if activities are part of Application Management, the staff who
performs these activities are logically part of IT Operations

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6. Continual Service Improvement

6.1. Continual Service Improvement in the Service Lifecycle
6.1.1. Goal

To continually align & re-align IT services to changing business ITILFND02

needs by identifying & implementing improvements to IT Services 02-10
that support Business Processes.

CSI is about looking for ways to improve:

• process effectiveness
• efficiency
• cost effectiveness

Consider the following saying about measurements and management:

• You cannot manage what you cannot control.
• You cannot control what you cannot measure.
• You cannot measure what you cannot define.

THUS: Define " Measure " Control " Manage!!!

If ITSM processes are not implemented, managed and supported using

clearly defined goals, objectives, and relevant measurements that lead to
actionable improvements, the business will suffer. Depending upon the
criticality of a specific IT Service to the business, the organization could lose
productive hours, experience higher costs, loss of reputation or, perhaps,
even a business failure.

That is why it is critically important to understand what to measure, why it is

being measured and carefully define the successful outcome.

6.1.2. Objectives

To review, analyze & make recommendations on improvement opportunities ITILFND02

in each lifecycle phase: Service Strategy, Service Design, Service Transition 02-10
and Service Operations.

• Review and analyze Service Level Achievement results

• Identify and implement individual activities to improve IT Service quality
and improve the efficiency and effectiveness of enabling ITSM
processes
• Improve cost effectiveness of delivering IT Services without sacrificing
customer satisfaction
• Ensure applicable quality management methods are used to support
continual improvement activities

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6.1.3. Business Value

ITILFND03
• Increased organizational competency 03-10
• Integration between people & processes
• Reduction of redundancy increases business throughput
• Minimize lost opportunities
• Assure regulatory compliance which minimize costs & reduce risk
• Ability to react to change rapidly

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6.2. Generic Concepts & Definitions

6.2.1. The role of IT Governance across the Service Lifecycle

“IT is a service business” ITILFND03

03-5
Existing internal IT organizations must transform themselves into effective
and efficient IT service providers or they will cease to be relevant to the
business and, soon after, cease to exist. This continual and unceasing drive
toward greater business value with greater internal efficiency is at the heart
of CSI.

• Enterprise governance:
Considers the whole picture - ensure that strategic goals are aligned &
good management is achieved

• Corporate governance:
Promoting corporate fairness, transparency and accountability

• IT governance:
Responsibility of the board of directors and executive management
o “Integral part of enterprise governance and consists of the
leadership, organizational structures and processes that ensure that
the organization’s IT sustains and extends the organization’s
strategies and objectives”

• Governance Models:
o Basel II – Governance for Banking
o SOX – Sarbanes Oxley – Corporate Governance (USA)
o CLERP 9 –Corporate Goverance (Australia)*
o King Report – Corporate Goverance (South Africa)

*CLERP: Corporate Law Economic Reform Program

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6.3. Key Principles & Models

6.3.1. PDCA Model

Figure 6-1 shows the four key stages of the Deming Cycle, which are 'Plan, ITILFND04
Do, Check, Act' after which a phase of consolidation prevents the 'Circle' 04-8
from 'rolling back down the hill'. The CSI goal in using the Deming Cycle is
steady, ongoing improvement.

Figure: 6-1

The Deming Cycle is critical at two points in CSI:

• Implementation of CSI initiatives and for the application of CSI to
services and service management processes.
o At implementation, all four stages of the Deming Cycle (Plan, Do,
Check, Act) are used.
o With ongoing improvement, CSI draws on the Check and Act
stages to monitor, measure, review and implement initiatives.

The cycle is underpinned by a process-led approach to management where

defined processes are in place, the activities are measured for compliance to
expected values and outputs are audited to validate and improve the
process.

Planning for Improvement Initiatives (Plan)

Establishes goals for improvement : Perform a ‘Gap Analysis’, then define
the action steps to close any gaps. Establish and implement measures to
assure that the gaps have been closed and benefits achieved

Implementation of Improvement Initiative (Do)

Development & implementation of a project: Close the identified gaps by
implementing the improvements to Service Management processes. Monitor,
measure and review services

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Management Processes (Check) –

Compare implemented improvements to the measures of success:
Monitor, measure and review that the CSI objectives and plans are being
achieved

Improvement (Act)
This stage requires implementing the actual Service and Service
Management process improvements. A decision to keep the status quo,
close the gap or adding necessary resources needs to be made to determine
if further work is required to close remaining gaps, allocation of resources
necessary to support another round of improvement. Project decisions at
this stage are the input for the next round of the PDCA cycle, closing the
loop as input in the next Plan stage.

Too many people and too many organizations are looking for the “big-bang”
approach to improvements. It is important to understand that a succession
or series of small planned increments of improvements will not stress the
infrastructure as much and will eventually amount to a large amount of
improvement over time.

6.3.2. CSI Model

The improvement process can be summarized in six steps, as illustrated in ITILFND05

Figure 6-2: 05-3

Figure: 6-2

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Embrace vision
The vision should align the business and IT strategies.

Assess current situation

This baseline assessment (snapshot of where the organization is right
now) is an analysis of the current position in terms of the business,
organization, people, process and technology.

Understand & agree on improvement priorities

The full vision may be years away but this step provides specific goals
and a manageable timeframe.

Detail CSI plan to achieve higher quality

Detailing the CSI plan to achieve higher quality Service provision by
implementing ITSM processes and developing

Verify that measurements & metrics are in place

Verify that measurements and metrics are in place to ensure that
milestones were achieved, processes compliance is high, and business
objectives and priorities were met by the level of service.

Ensure that the momentum for quality improvement is

maintained
Assuring that changes become embedded in the organization.

CSI Elements

Business Value

• Role of measurement for Continual Service Improvement

Service Measurement is a key process of CSI, responsible for
measurement, analysis and reporting on IT Services and ITSM results.

• Why Measure?
o To validate - monitoring and measuring to validate previous
decisions
o To direct - monitoring and measuring to set direction for activities
in order to meet set targets. It is the most prevalent reason for
monitoring and measuring
o To justify - monitoring and measuring to justify, with factual
evidence or proof, that a course of action is required
o To intervene - monitoring and measuring to identify a point of
intervention including subsequent changes and corrective actions

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• 3 Questions
The four basic reasons (Figure 6-3) to monitor and measure lead to
three key questions:
o “Why are we monitoring and measuring?”
o “When do we stop?”
o “Is anyone using the data?”

To answer these questions, it is important to identify which of the

above reasons is driving the measurement effort. Too often, we
continue to measure long after the need has passed. Every time you
produce a report you should ask, “Do we still need this?”

Figure: 6-3

Baselines

An important beginning point for highlighting improvement is to establish

baselines as markers or starting points for later comparison. Baselines are
also used to establish an initial data point to determine if a Service or
process needs to be improved.

It must be established at each level:

• strategic goals and objectives,
• tactical process maturity
• operational metrics and
• KPIs

If it is not initially established the first measurement efforts will become the
baseline.

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That is why it is essential to collect data at the outset (Figure 6-4), even if
the integrity of the data is in question. It is better to have data to questions
than to have no data at all.

Figure: 6-4

Metrics

There are three types of CSI metrics:

• Technology metrics – these metrics are often associated with
component and application based metrics such as performance,
availability etc.

• Process metrics – these metrics are captured in the form of CSF’s,

KPI’s and activity metrics for the Service Management processes. These
metrics can help determine the overall health of a process.

• Service Metrics – these metrics are the results of the end-to-end

service. Component metrics are used to compute the Service Metrics.

KPI’s answers quality, performance, value and compliance of following the

process.

CSI would use these metrics as input in identifying improvement

opportunities for each process.

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6.4. Continual Service Improvement Processes

6.4.1. 7 Step Improvement Process

Figure 6-5 illustrates the 7 Step Improvement Process. ITILFND05

05-9

Figure: 6-5
Steps 1 and 2:
Strategic, tactical and operational goals to support measuring and CSI
activities:
• Defines service management processes
• Defines existing technology and capability
• iterative during the rest of the activities

Steps 3, 4 and 5:
Relates to gathering data, processing the data into the required format and
analyzing the results to look for answers to questions

Steps 6
Takes the knowledge and present it, turn it into wisdom by utilizing reports,
monitors, action plans, reviews, evaluations and opportunities

Steps 7
Use the knowledge gained to optimize, improve and correct services.

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6.4.2. Step 1 - Define What You Should Measure

Define What You Should Measure ITILFND05

Talk to the business, the customers and to IT management. Utilize the 05-9
service catalogue as your starting point as well as the service level
requirements of the different customers. This is the place where you start
with the end in mind. In a perfect world, what should you measure? What is
important to the business?

Compile a list of what you should measure.

What is important to the business?
• At the onset of the Service lifecycle, Service Strategy and Service Design
should have identified this information.
• CSI can then start its cycle all over again at “Where Are We Now?”
• This identifies the ideal situation for both the Business and IT.

Inputs:
• Service level requirements and targets
• Service Catalog
• Vision and mission statements
• Corporate, divisional and departmental goals and objectives
• Legislative requirements
• Governance requirements
• Budget cycle
• Balanced Scorecard

Roles:
Individuals involved with decision making from IT and the business who
understand the internal and external factors that influence the necessary
elements that should be measured to support the business, governance and,
possibly, regulatory legislation (Figure 6-6).

Nature of Activities Skills

Higher management level Managerial skills
High variation Communication skills
Action oriented Ability to create, use (high level) concepts
Communicative Ability to handle complex/uncertain situations
Focused on future Education and experience
Figure: 6-6

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6.4.3. Step 2 - Define What You Can Measure

“Where Do We Want To Be?” ITILFND05

By identifying the new Service level requirements of the business, the IT 05-9
capabilities (identified thru Service Design and implemented via Service
Transition) and the available budgets, CSI can conduct a gap analysis to
identify the opportunities for improvement as well as answering the question
“How Will We Get There?” Perform a gap analysis between the two lists and
report findings to the business, customers & IT Management.

Typical tools will include:

• service management tools
• monitoring tools
• reporting tools
• investigation tools
• others
It is possible that new tools are required or that configuration or
customization is required to be able to measure what is required.

Compile a list of what each tool can currently measure

• Perform a gap analysis between the two lists
• Report findings to the business, customers & IT Management

Where do you actually find the information?

• within each process, procedure and work instruction
• look at existing reports and databases

Inputs:
• List of what you should measure
• Process flows
• Procedures
• Work instructions
• Technical and user manuals from existing tools
• Existing reports

Role:
Individuals involved with providing the Service (internal and external
providers) who understand the capabilities of the measuring processes,
procedures, tools and staff (Figure 6-7).

Nature of Activities Skills

Intellectual effort Analytical skills
Investigative Modelling
Medium to high variation Inventive attitude
Goal oriented Education
Specialized staff and business management Programming experience

Figure: 6-7

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6.4.4. Step 3 – Gathering the Data

“Did We Get There?” ITILFND05

Data must first be gathered (through Service Operations), processed and 05-9
analyzed. Data is gathered based on the vision, mission, goals and
objectives. Data processing, aligned with CSFs and KPIs takes place before
the information is analyzed to identify gaps, trends, along with reasons
before it is presented to the business.

This activity needs to clearly define the following:

• Who is responsible for monitoring and gathering the data?
• How the data will be gathered?
• When and how often is the data gathered?
• Criteria to evaluate the integrity of the data
Gathering data is defined as the act of monitoring and data collection.
Gathering data requires having some form of monitoring in place.
• Monitoring could be executed using technology such as application,
system, and component monitoring tools or even be a manual
process for certain tasks.
• Monitoring will focus on the effectiveness of a service, process, tool,
organization or CI.

Three types of metrics are used in support of CSI and other

activities
• Technology metrics – these metrics are often associated with
component and application based metrics such as performance,
availability etc.
• Process metrics – these metrics are captured in the form of CSF’s,
KPI’s and activity metrics for the Service Management processes. These
metrics can help determine the overall health of a process. Four key
questions that KPI’s can help answer are around quality, performance,
value and compliance of following the process. CSI would use these
metrics as input in identifying improvement opportunities for each
process.
• Service Metrics – these metrics are the results of the end-to-end
service. Component / technology metrics are used to compute the
Service Metrics. .

What do you actually measure?

• identified data both needed and measurable

Health of Service Management

• Process compliance - Are the processes being followed? Process
compliance seeks to monitor the compliance of the IT organization to
the new or modified Service management processes and also the use of
the authorized Service management tool that was implemented
• Quality - How well are the processes working? Monitoring of the
individual or key activities as they relate to the objectives of the end-to-
end process
• Performance - How fast or slow? Monitoring of the process efficiency
such as throughput or cycle times
• Value - Is this making a difference? Monitoring for the effectiveness and

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perceived value of the process to the stakeholders and the IT staff

executing the process activities

Inputs:
• New Business Requirements
• Existing SLAs
• Existing monitoring and data capture capability
• Availability and Capacity Plans
• Service Improvement Programs
• Previous trend analysis reports
• List of what you should measure
• List of what you can measure
• Gap analysis report
• List of what to measure
• Customer satisfaction surveys

Process:
Figure 6-8 illustrates the process of gathering data.

Figure 6-8

Outputs:
• Updated Availability and Capacity Plans
• Monitoring procedures
• Identified tools to use
• Monitoring plan
• Input on IT capability
• Collection of data
• Agreement on the integrity of the data and that it makes sense

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Roles:
Individuals involved in day-to-day process activities within the Service
Transition and Service Operations lifecycle phases (Figure 6-9).
Nature of Activities Skills
Procedural Accuracy
Routine tasks Precision
Repetitive Applied training
Automated Technical experience
Clerical level
Low variation
Standardized
Figure 6-9

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6.4.5. Step 4 – Processing the Data

Convert the data into the required format and for the required audience. ITILFND05
Follow the trail from metric to KPI to CSF, all the way back to the vision if 05-9
necessary as illustrated in Figure 6-10).

Figure 6-10

“Did We Get There?”

Data must first be gathered (through Service Operations), processed and
analyzed. Data is gathered based on the vision, mission, goals and
objectives. Data processing, aligned with CSFs and KPIs takes place before
the information is analyzed to identify gaps, trends, along with reasons
before it is presented to the business.

Key questions to be addressed in the processing activity are:

• What is the frequency of processing the data? This could be

hourly, daily, weekly, or monthly. When introducing a new Service or
Service management processes it is a good idea to monitor and process
in shorter intervals than longer intervals. How often analysis and
trending activities take place will drive how often to the data is
processed.

• What format is required for the output? This is also be driven by

how analysis is done and ultimately how the information is used.

• What tools and systems can be used for processing the data?

• Evaluation of the accuracy of the processed data?

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There are two aspects to data gathering:

• Automated: More accurate

• Manual: It is important for staff to properly document their compliance

activities, to update logs and records. Common excuses are that people
are too busy, that this is not important, or that it is not their job. On
going communication about the benefits of performing “administrative”
tasks is of utmost importance. Tying these administrative tasks to job
performance is one way to alleviate this issue.

Inputs:
• Data collected through monitoring
• Reporting requirements
• SLAs
• OLAs
• Service Catalog
• List of metrics, KPI, CSF, objectives and goals
• Report frequency
• Report template

Process:
Figure 6-8 illustrates the processing of data, flowing from the previous
process.

Figure 6-11

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Roles:
Individuals involved in day-to-day process activities within the Service
transition and Service operations lifecycle phases (Figure 6-12).

Nature of Activities Skills

Automated Numerical skills
Procedural Methodical
Structures Accurate
Mechanistic Applied training
Medium variation Programming experience
Specialized staff Tool experience
Figure 6-12

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6.4.6. Step 5 – Analyzing the Data

ITILFND05
“Did We Get There?” 05-9
Data must first be gathered (through Service Operations), processed and
analyzed. Data is gathered based on the vision, mission, goals and
objectives. Data processing, aligned with CSFs and KPIs takes place before
the information is analyzed to identify gaps, trends, along with reasons
before it is presented to the business.

When analyzing data, it is important to seek answers to questions

such as:
• Are operations running according to plan? – this could be a project plan,
financial plan, availability, capacity or even IT Service Continuity
Management plan.
• Are targets defined in SLAs or the Service Catalogue being met?
• Are there underlying structural problems that can be identified?
• Are corrective actions required?
• Are there any trends? – if so then what are the trends showing?
• Are they positive trends or negative trends?
• What is leading to/causing the trends?

Roles
Individuals involved with providing the Service (internal and external
providers) who understand the capabilities of the measuring processes,
procedures, tools and staff.

Nature of Activities Skills

Intellectual effort Analytical skills
Investigative Modelling
Medium to high variation Inventive attitude
Goal oriented Education
Specialized staff and business Programming experience
management
Figure 6-13

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6.4.7. Step 6 – Presenting & Using the Information

“Did We Get There?” ITILFND05

The information must be formatted and communicated in whatever way 05-9
necessary to present to the various stakeholders as an accurate picture of
the results of the improvement efforts. Knowledge is presented to the
business in a form and manner that reflects their needs and assists them in
determining the next steps.

Presenting the knowledge:

The final stage is to take our knowledge and present it; that is, turn it into
wisdom by utilizing, reports, monitors, action plans, reviews, evaluations and
opportunities. Consider the target audience, make sure that you identify
exceptions to the service, benefits that have been revealed, or can be
expected. Data gathering occurs at the 4th level of an organization. Format
this data into knowledge that all levels can appreciate and use to gain
insight into their needs and expectations.

Identify:
• Exceptions to the service
• Benefits that have been revealed (or can be expected)

There are usually three distinct audiences:

• The Business - Their real need is to understand whether IT delivered
the Service they promised at the levels they promised and if not, what
corrective actions are being implemented to improve the situation.
• Senior (IT) Management - This group is often focused on the results
surrounding CSFs and KPIs such as, customer satisfaction, actual vs.
plan, costing and revenue targets. Information provided at this level
helps determine strategic and tactical improvements on a larger scale.
Senior (IT) Management often wants this type of information provided in
the form of a Balanced Scorecard or IT Scorecard format to see the big
picture at one glance.
• Internal IT - This group is often interested in KPIs and activity metrics
that help them plan, coordinate, schedule and identify incremental
improvement opportunities.

Roles:
Individuals involved with providing the Service (internal and external
providers) who understand the capabilities of the Service and the
underpinning processes and possess good communication skills. Key
personnel involved with decision making from both IT and the Business
(Figure 6-14, next page).

Nature of Activities Skills

Higher management level Managerial skills
High variation Communication skills
Action oriented Ability to create, use (high level) concepts
Communicative Ability to handle complex/uncertain situations
Focused on future Education and experience
Figure 6-14

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6.4.8. Step 7 – Implementing Corrective Action

Use the knowledge gained ITILFND05

To optimize, improve and correct Services. Managers identify issues and 05-9
present solutions. The corrective actions that need to be taken to improve
the Service are communicated and explained to the organization.

Prioritize improvement activities.

Based on goals, objectives, and types of Service breaches, an organization
needs to Improvement initiatives can also be externally driven by regulatory
requirements, change in competition, or even political decisions.

Improve Service and/or Service Management process

After a decision to improve a Service and/or Service management process is
made, then the Service Lifecycle continues.

Build or modify Service Lifecycle phase

Each Service Lifecycle phase requires resources to build or modify the
Services and/or Service management processes:
• potential new technology or modifications to existing technology
• potential changes to KPIs and other metrics and possibly even new or
modified OLAs / UCs to support SLAs

Following this step the organization establishes a new baseline and the cycle
begins anew. While these seven steps of measurement appear to form a
circular set of activities, in fact, they constitute a knowledge spiral. In actual
practice, knowledge gathered and wisdom derived from that knowledge at
one level of the organization becomes a data input to the next.

Reporting
Understanding the order your intended audience occupies and their drivers
helps you present the issues and benefits of your process (Figure 6-15).
• At the highest level of the organization are the strategic thinkers.
Reports need to be short, quick to read and aligned to their drivers.
• The Second Order consists of Vice Presidents and Directors. Reports
can be more detailed, but need to summarize findings over time.
Identifying how processes support the business objectives, early warning
around issues that place the business at risk, and alignment to existing
measurement frameworks that they use are strong methods you can use
to sell the process benefits to them.
• The Third Order consists of Managers and High Level Supervisors.
Compliance to stated objectives, overall team and process performance,
insight into resource constraints and continual improvement initiatives
are their drivers. Measurements and reports need to market how these
are being supported by the process outputs.
• Lastly at the Fourth level of the Hierarchy are the staff members and
team leaders. At a personal level, the personal benefits need to be
emphasized. Therefore metrics that show their individual performance,
provide recognition of their skills (and gaps in skills) identifying training
opportunities are essential in getting these people to participate in the
processes willingly.

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Figure 6-15

Continual Service Improvement is an ongoing activity of:

• monitoring and gathering data
• processing the data into logical groupings
• analyzing the data for meeting targets
• identifying trends
• identifying improvement opportunities

An organization can find improvement opportunities throughout the entire

Service Lifecycle.
An IT organization does not need to wait until a Service or Service
management process is transitioned into the Operations area to begin
identifying improvement opportunities.

Improvements can be incremental in nature but also require a huge

commitment to implement a new Service or meet new business
requirements.

CSI commitment requires:

• ongoing attention,
• a well thought out plan,
• consistent attention to monitoring,
• analyzing and reporting results with an eye toward improvement

Roles
Individuals involved with providing the Service, both internal and external
(Figure 6-16).

Nature of Activities Skills

Intellectual effort Analytical skills
Investigative Modelling
Medium to high variation Inventive attitude
Goal oriented Education
Specialized staff and business management Programming experience
Figure 6-16

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7. Conclusion
7.1. Acronyms

AMIS Availability Management Information System

CI Configuration Item

CMDB Configuration Management Database

CMIS Capacity Management Information System

CMMI Capability Maturity Model Integration

CMS Configuration Management System

CSF Critical Success Factor

CSI Continual Service Improvement

DIKW Data, information, knowledge and wisdom

DML Definitive Media Library

ISO International Standards Organization

IT Information Technology

ITIL® IT Infrastructure Library®

ITSM IT Service Management

KEDB Known Error Database

OLA Operational Level Agreement

ROI Return on Investment

SACM Service Asset and Configuration Management

SCM Service Capacity Management

SD Service Design

SDP Service Design Package

SKMS Service Knowledge Management System

SLA Service Level Agreement

SLM Service Level Management

SO Service Operation

SOA Service oriented architecture

SS Service Strategies

ST Service Transition

TCO Total Cost of Ownership

VOI Value on Investment

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