Creating and Maturing a Service Catalog

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1 Creating and Maturing a Service Catalog By Wendy Kuhn and Pam Erskine Third Sky, Inc. Introduction Developing a service catalog can seem like a simple marketing and communications activity or a daunting challenge. Both are true and at the same time neither is true. A service catalog is an excellent marketing and communications tool and a small effort can result in a big improvement in communications between IT and the business customer. A fully matured service catalog that defines all of an organization s IT services, associated service level agreements and unit costs can be a game changer in terms of the effectiveness of the relationship between IT and the business and in terms of identifying opportunities for improvement across an entire organization. This is often too much for an organization to accomplish initially. A middle ground that identifies a starting point for the catalog and a path to maturity is a reasonable approach that keeps the catalog from being either too simple or overly complicated, yet yields incremental benefits with each improvement to the catalog. As always, the effort should be initiated by answering the basic questions: What is the Vision?, Where are we now?, Where do we want to be?, How will we get there? and How will we know when we ve arrived Key considerations when developing the catalog include: The catalog is a key communication tool in the effort to demonstrate IT s commitment to providing business value by supporting required business outcomes. The catalog is a foundational element that can dramatically impact the relationship between IT and the business. In recent years, IT delivery models have matured from focusing on component delivery to models that focus on delivering end-to-end business-focused services. This transition reshapes the IT operating model as services cut across traditional boundaries both within the IT organization and within the business. The relationship with the business transforms to a partnership with IT helping to support the business in meeting their objectives. Catalog maturity is directly tied to the maturity of other ITIL processes and functions. The full benefit of a service catalog can only be realized with the implementation of associated processes. In undertaking a catalog effort, therefore, it is important to realistically assess the status of the other processes and set reasonable goals for the service catalog. Defining services is only the first step toward developing the catalog. Maturing service management processes such as Service Catalog Management, Service Portfolio Management, Service Level Management, Demand Management, Financial Management, and others are critical steps in both service maturity and service catalog maturity. 1

2 With disparate technologies in the environment, IT costs rising, resource/organizational challenges, and vendors providing more services via the cloud, effectively partnering with the business to meet their objectives becomes an urgent need as they demand transparency of both the cost of IT and the value it brings to the business. Elevating the relationship between IT and the business so that IT is seen as a value added partner will require meaningful cost information and demonstrated service level commitments which require defined businessfocused IT services. The organizational implications of the transition to business focused IT services should not be taken lightly. Assigning a single point of accountability for the maturity and performance of a service becomes a necessity for success. A broader restructuring may be a natural outcome of the transition to this approach as business partnering matures. The Catalog and Other ITSM Processes As noted above, the value of the service catalog is truly realized when the related ITSM processes are matured. These processes provide key information relating to the service descriptions and commitments that are documented in the catalog. The ITSM process relationships to the catalog are described below. Financial Management for IT Services Financial Management provides the means for mapping money spent to business value as it relates IT services to business activities. It provides the Business and IT with the quantification, in financial terms, of the value of IT services, the value of assets underlying the services, and operational costs. The more precisely an organization can capture the costs of a service, the more accurately and transparently they can communicate with the business about the service. Consider whether the cost of the service will ultimately be determined and published in the catalog as part of the service identification process. In addition, determine if options exist relating to this service. Service options will allow the business to select only the level of service necessary. Providing costs for service options allows for the business to understand the financial implications of their selection. Demand Management Demand Management provides the means for mapping demand for IT services to business activity which illuminates opportunities to optimize. The overarching goal of demand management is to influence and optimize customer demand for IT services and enable the provisioning of capacity to meet the demand. Strategic level demand management involves the analysis of patterns of business activity and user profiles. As services are introduced into the catalog, consider any comments that should be included regarding demand management and any recommendations to include for the customers and users regarding potential cost savings by adjusting demand patterns. 2

3 Service Level Management (SLM) Service Level Management ensures that all current and planned IT services are delivered to agreed, achievable targets. This is accomplished through a constant cycle of negotiating, agreeing, monitoring, reporting on and reviewing IT service targets and achievements, and through instigation of actions to correct or improve the level of service delivered. The Service Catalog allows Service Level Management to: Develop meaningful and achievable service level targets with the customer to ensure that service warranty will match business needs Understand the impacts of delivering service warranty, allowing the customer to make informed decisions about what levels of warranty they are willing to fund Monitor and develop meaningful baseline metrics for IT service provision Understand and manage the abilities of internal groups to support IT service provision to customers Understand the impact of Suppliers delivery on IT service provision to customers Mature Service Level Management processes and performance reporting that are routinely reviewed with the business clearly indicate a Service Provider that is accountable for end-to-end results. Recognize that you can t manage what you can t measure. Therefore in the earliest stages of service definition, ensure that the service, as it is defined, will be measurable from a performance, availability, cost, capacity, etc., perspective. Identify pilot services for creating Service Level Requirements, Objectives and Targets. Identify supporting services and establish baseline metrics associated with delivery. Work with the business to understand their requirements and establish objectives and targets. When completing the analysis required to understand the targets, identify the operational level agreements and underpinning contracts that are required to effectively meet the targets. Finally, establish a reporting mechanism to monitor actual performance against targets. Incident Management/Service Desk The purpose of incident management is to restore normal service operation as quickly as possible and minimize the adverse impact on business operations, thus ensuring that agreed levels of service quality are maintained. The service catalog identifies these agreed service levels that represent normal service operation and provides the service desk contact information as a next step. The service desk tool should be able to link incidents and requests to services. In the early stages of defining services, it is important to think through the implications for the service desk tool and to proactively plan for any necessary changes. Request Fulfillment Service request is a generic description for many different types of demands that are placed upon the IT organization by the users the day-to-day consumers of the services. Many of these are typically requests for small changes that are low risk, frequently performed, low cost, etc. or perhaps they are informational requests. The scale and frequent, low- 3

4 risk nature of a request means that they are better handled by a separate process, rather than being allowed to congest and obstruct the normal incident and change management processes. Effective request fulfillment has a very important role in maintaining end user satisfaction with the services they are receiving and can directly impact how well IT is perceived throughout the business Requests support the services identified in the services catalog and can inform service definition and service selection activities. As part of the initial identification of services, consider the most frequently requested items, this may illuminate some opportunities for quick wins. Publishing end user services for frequently requested items and clearly articulating provisioning expectations, service levels, costs, and other key information will reduce confusion and my ultimately, reduce the number of requests in the pipeline. Service Asset and Configuration Management (SACM) SACM is a critical contributor to success for virtually all ITSM processes again, you can t manage what you can t measure. The key output of SACM is a configuration management system (CMS) which is core to understanding how all configuration items (CIs) are interconnected, allowing SLAs to be developed and performance measured. At the same time, SACM is often one of the most challenging processes to implement. Integration of business-focused IT services into the CMS is core to understanding the impact of changes to the services. If each infrastructure component of a service is tracked as a CI within the CMS, modifications to the environment are tracked through the change management process and, therefore, understood when responding to or evaluating service performance or creating cost models. In progressing toward a mature catalog, decide if services will be recorded as configuration items. Where possible identify supporting services and associated configuration items. Create a service catalog taxonomy that can be reflected in the CMS, and link the CMS and service catalog data. Service Portfolio The service portfolio provides the essential data for managing services within the organization. Three categories of data are usually managed within the portfolio. 1. Service Pipeline New or changed services that are currently being evaluated based on customer needs and/or requests. The approved IT services currently being designed and developed are another noteworthy part of the pipeline. 2. Service Catalog Includes existing services deployed within the organization as well as services available for deployment. 3. Retired Services Services that are no longer active As part of developing the service catalog, it is valuable to look at projects and other initiatives that are underway. With the introduction of business-focused IT services, all projects and initiatives should link to one or more service offerings in the portfolio. This is a good way to test the services that are defined. If there are operational projects underway that 4

5 do not support a service in the service catalog, it may be that services are missing. Note that when reviewing the project portfolio, it is possible and perfectly reasonable to have process related projects that do not support a specific service but rather supports all services through the efficiency and effectiveness of the IT organization. Road to Maturity The matrix below indicates how the various processes relate to improving the maturity of a service catalog. Beginning Service Catalog Service Catalog Partially implemented Service catalog completely implemented Service Catalog integrated in tool set Mature Service Catalog Identified/ Defined Services Efforts undertaken to identify services (could be supporting or customer-facing IT Services only, depending on goals) Supporting services are identified Catalog sets clear, accurate expectations for the customer. Incident/Service Desk General information is available about hours of support and priority approach Incident reporting system can track incidents to the services in the catalog they impact (may be a manual process) Service desk staff can easily and readily respond to questions about the service catalog and offerings Links exist on the catalog to allow self help and incident reporting Request Fulfillment Basic request processes are identified in the service catalog Begin to identify easy way to initiate requests from catalog Requests can be initiated from catalog Requests are identified and listed within the service catalog Request and Service catalog are fully integrated Service Level Management There are some agreements (formal and informal) regarding service provision OLAs are in place with providers of supporting services SLAs are developed and socialized with the appropriate customers SLA commitments are clearly defined within the catalog framework. Clearly defined SLAs. Historical performance data is provided. SACM Configuration items are identified Service architecture is known and tracked in the CMS. Configuration items are clearly identified and linked with each service they impact. Service Portfolio Management The organization can link all services to business strategies The organization s project portfolio is directly linked to the services portfolio Planned services and retired services are included in the service catalog Financial Management Cost information is provided for each service. Service options are provided. Costs for a service fully incorporate the lifecycle costs of the service, include supporting services and chargeback is possible The economics of provisioning a service against adoption and value metrics are understood allowing for business partners to understand the full cost & value of I/T to enabling a specific business activity Continual Service Improvement Underpins all Elements of the Service Catalog Implementation and Operations 5

6 Recommendations Areas for focus when initiating a service catalog can include: Establish a governance structure for the catalog initiative. Governance is necessary for strategic direction, decision making, and organizational planning. Consider having business representation within the governance structure. Align the definition of a service with the industry. Consider including services that are not necessarily a rigid productized offering. Projects can be performed in the context of a service, e.g., to implement an instance of the service, and this does not distract from managing the service using ITSM best practices. This will enable clear expectations on offerings and it will help to ensure a common language going forward. Assign a single service owner for each of the services defined. A Service Owner has responsibilities in all of the ITSM processes. They are accountable for service maturity and performance. Establish baseline metrics for end to end service delivery. For services that exist in the environment today, establish baseline metrics. If new services are being introduced as part of the catalog initiative, establish targets for service delivery. Compare actual service delivery against baseline and/or targets to highlight areas for improvement. Manage organizational implications of providing end to end services. Delivering end-to-end services requires synchronized, seamless delivery of components of service across traditional IT silos (e.g., applications, infrastructure, etc.). Monitor and measure the delivery of each component to illuminate areas for improvement or potential organizational challenges. Adopt a service maturity framework and assess services against the framework. The maturity of IT services will vary dramatically. It is important to understand the value of the services to the business as well as where each service falls in a consistent maturity scale in order to determine where to invest IT funds. Identify a taxonomy or structure for the catalog and validate it with the customer and user communities. By knowing the structure the catalog will follow, it will be far easier to add in future services. In addition, by engaging the customer and user communities in the discussion, it will increase buy in for the effort. Create a marketing and communication plan for the initiative. The introduction of a catalog and the delivery of the services within the catalog can represent a significant, positive step for the organization. For IT, there are organizational implications. A marketing and communication plan can help to create awareness within both IT and the business. Conclusion The development of a service catalog requires a thoughtful approach. Identifying and defining IT services is a reasonable first step. Elements of the service definition such as general expectation setting and the request process are critical to ensuring customer satisfaction. Incremental steps to continue maturing both the service definition and the related ITSM processes will yield additional benefits to the IT organization and begin the journey to transform the relationship with the business to that of a value added partner. Advance planning for the catalog initiative and a thorough understanding of how other ITSM processes are interconnected to achieving the full benefit of the service catalog will greatly enhance the outcome of any catalog initiative. 6

7 About Third Sky Third Sky is a full service IT Service Management consulting, education and technology provider with offices in San Francisco (HQ), Boston, Charlotte, Detroit, New York, San Diego, Seattle, Colorado Springs, and Washington, DC. Our approach to Business Driven IT leverages frameworks such as ITIL, CobiT, PMBOK and ISO/IEC20000 to align the business strategy with IT objectives to both reduce cost of delivery and improve customer satisfaction. For more information, visit. 7

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