The Service Catalog: drivers and challenges of enabling IT as a Service Broker

The Service Catalog: drivers and challenges of enabling IT as a Service Broker Felix Fernandez / June, 2014 @ffromero

New Style of IT - Core Qualities Service Centric Operate Securely Connected IT Intelligence Enterprise Agile Multi Source 2

Hybrid Service Delivery with Multiple Suppliers Centered around Request to Fulfill Service Centric Centered around Strategy to Portfolio Connected IT Intelligence Operate Secure Centered around Detect to Correct Enterprise Agile Multi Source Centered around Requirement to Deploy Centered around Request to Fulfill 3

Is IT loosing control of IT? IT needs to turn outward and regain the control 82% of employees use one or more nonapproved SaaS applications to do their jobs 1 85% of Line of Business Departments have adopted non IT approved business applications 2 35% of procurement for cloud services is "rogue" spending 3 (e.g., not using formal corporate IT decision-making channels and policies) 1 Frost & Sullivan. The New IT: Managing and Delivering Services in a Multi-Vendor Environment. 2013. 2 Frost & Sullivan 2013 Cloud User Survey 3 IDC Worldwide Outsourcing Services 2014 Top 10 Predictions 4

Why do LoB decision makers turn to shadow IT? Reasons Line of Business Employees Utilize Non-Approved Applications (Shadow IT) 3 Frost & Sullivan. The New IT: Managing and Delivering Services in a Multi-Vendor Environment. 2013. 5

End User Demand vs. Operational Constraints Embrace Service Brokering Volume Requests Got to have it now Explosion in the number of services, service requests & service providers Maintaining appropriate risk models is overwhelming Budget Time Do more with less Decreasing budgets and constrained resources IT has to rely on service providers and ready to use services IT must become service broker 6

What are the drivers to become a Service Broker? Agility Faster response to changing business and customer needs Information Applications Infrastructure Innovation Deliver competitive & service advantage Reduce Cost Achieve better ROI & reduce IT costs through service provider & delivery optimization Traditional Private cloud Managed cloud Public cloud Mitigate Risk Mitigate threat of business service failures and inability to comply with regulations Analysts predict enterprise cloud services will be used by 8 out of 10 of the Fortune 1,000 companies 7

What is the optimal number of providers? Optimal number of providers across all outsourced IT and business processes using both traditional and cloud-based delivery models 67% Number of Providers 23% 8% 0% 2% 1-5 6-10 11-20 21-25 > 25 IDC Survey: Q4 2013 U.S. Infrastructure Outsourcing and Cloud Services Survey 8

Will Cloud change the game? Increased shift in spending on cloudbased outsourcing vs traditional Western Europe Applications by Deployment Model, 2012-2018 Cloud Suppliers Other Suppliers SaaS On premises 67% 33% 2012 47% 53% 2017 91,2% 89,1% 86,5% 83,3% 79,7% 75,7% 71,5% 8,8% 10,9% 13,5% 16,7% 20,3% 24,3% 28,5% 2012 2013 2014 2015 2016 2017 2018 IDC Worldwide Outsourcing Services 2014 Top 10 Predictions IDC 2014: Western Europe Software-as-a-Service Applications 2013 2018 Forecast 9

What can we do to deal with the supplier sprawl? Do nothing But the pace is unsustainable Limit the number of vendors you use And suffer vendor lock-in while missing out on best-in-breed technology innovations Let each responsible party select, contract with, and manage their own vendors, to the best of their ability And lose all semblance of consistency and control Transform IT into a service broker, utilizing a Service Integration and Management (SIAM) approach. Frost & Sullivan. Managing Vendor Sprawl: How SIAM Can Help You Gain Control. 2014 10

What does it take to become an IT Service Broker? CIO CIO Internal organization In-house applications Business units Clear responsibilities and accountability Compliance and security Service assurance and quality Data centers Private cloud services Workplace services Demand? Services External suppliers Hosted services Outsourced services Service sourcing strategy Visibility of the service portfolio Cost effective, predictable service usage Cloud services Communication services 11

Reference Architecture IT Service Broker. A new IT Operating Model Standalone Shared Service Service Integrator Service Broker Legacy Standalone Transform Shared Service Delivery Transform Hybrid Service Delivery Transform Open Market Service Delivery Optimize Optimize Transform Optimize Optimize IT Operating Model Process Model Information Model Technology Integration Multi-Supplier Operational focus Low maturity Strategic focus High maturity 12

Risk Enabling the extended outsourcing footprint New Outsourcing Suppliers Context Focus on productivity Standardization Core Focus on differentiation Innovation Internal Supplier Mission Critical Cost-Value model Cost Value Control Traditional Outsourcing Suppliers Commoditization Invention Enabling Entrust Differentiation 13

Single external supplier Internal delivery External supplier External supplier Internal delivery Why does IT need to worry about optimising a multisupplier ecosystem? Business In-house IT Cost 25% Business Demand & supply chain Cost 15% Business Demand & supply chain Service orchestration A right sourced multi-vendor delivery model which includes cloud should lead to savings of 40% Flexibility Sources: internal research and analyst data 14

Multi-sourcing challenges and hidden costs Vendor selection Searching and contracting a supplier due diligence High investment is a barrier to entry Estimated costs 0.25% - 10% Transition Disparate management platforms Complex on-boarding and handover processes Higher complexity, costs and resource inefficiencies Increase vendor lock-in 2% - 13% Vendor management Disparate architecture and integration standards Governance models are challenging to implement Impair business agility and adaptability Hinders IT alignment with business strategy 3% - 14% Inability to measure and manage services and suppliers Threatens service quality levels and accountability 15 Sources: internal research and analyst data

Service Integration and Management (SIAM): the operating model for multi-sourcing management Service Consumption Service Provider Ecosystem as single entity towards business Service Provider Ecosystem Service Demand Service Brokering SI Governance Lines of Business Service Integrator Demand & Supply Chain Management Service Delivery Service Provision Service Consumption Service Orchestration Service Operations Govern Plan Build Run SIAM Operating model components Governance Obligations, policies and roles Operational Processes Processes, Goals and Metrics Technology Integrated management tools 16

Managing processes that expand across suppliers Business ATL Incident Escalation 1.9 Major Incident Handling IT (service integration layer) 1.1 Interaction Handling 1.11 Complaint Handling 1.2 Incident Logging & Assignment 1.8 Major Incident Confirmation Critical CPS/CDP 1.6 CPS or CDP Incident Investigation & Diagnosis 1.7 CPS or CDP Incident Resolution & Recovery 1.12 Tracking and Escalation Incident Record Alerts 1.10 Closure End Suppliers Standard 1.3 Standard Incident Acceptance 1.3 Standard Incident Investigation & Diagnosis 1.11 Task Management 1.5 Standard Incident Resolution & Recovery Example process flow across multiple vendors for Incident Management 17

HP service integrator solutions An outsourced or retained IT function Contract OLA or Retained IT organization Retained IT organization Service integrator (retained IT function) Service integrator (provided as a service) External suppliers External suppliers 18 Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.

ITIL Best Practice RACI Matrix Roles & Responsibilities. Process Interpretations Quick Reference Cards Level 1 Process Overview Level 2 Individual Module Overview Process Level 3 Individual Module Detail Process and Responsibility Level 4 Work Instructions and Procedures Roles Process Quick ITIL and RACI Reference Best Interpretations Responsibilities Matrix Practice Cards SO 2.1.17 SO 2.1.11 SO 0.4.11 SO 2.1.8 SO 0 Assign Assign Review rejected Incident Customer / Start Monitoring Incident to Close Incident Group Group Interaction information Operator Interaction User Tools Registers Management Incidents based on an event and assigns them to the correct support group. SO 2.2.1 Review Incident information 2.2.2 Incident complete and correctly assigned? SO 2.2.8 Reject Incident Yes Service Desk Agent SO 0 SO 1 SO 2.2.3 SO 2.8.3 Register Interactions based Assign on contact Incident to with Re-assignment Analyst Yes Event user required? SO 2.1 Match Management user Interaction to Incidents, Problems, Management Known Errors, or Knowledge document SO 2.2.4 Solve and close Interactions Incident Review Incident Logging information Provide status updates to users Register Incident SO 2.2.7 based on a user 2.2.5 Interaction and assign to No the correct support Re-assign Incident group Able to resolve to Co-ordinator Incident? Register Request SO for 2 Change, based on a user Interaction Yes Register Service Request, based SO SO 2.2.6 on 2.2 a user Interaction Report and Incident verify a solution Accept to a Incident user Management Monitor Service Level Agreement (SLA) targets of all Incidents registered and escalate, if Assignment required SO 2.3.1 Review Communicate about service outages Incident to all users. Detailed description of the end to end process Industry Definition (Work Quick 1 page 1 page covering covering all processes each module. in scope. Detailed Walkthrough standard Instruction) Reference of of process Responsibility, roles of best and or flow Cards the common practice Level responsibilities for detailing each Accountability, 3 requirement publications Process, module. user for (Procedure) Shows briefly frequently Shows high level links flow between and modules. roles Consulted used for explaining Shows Service including within used and Role Informed Management tool the Swimlanes. tool level steps, functionality, use, for 3 decisions process fields each links. and screenshots. Used Used for for high documentation level overview Used screenshots for and detail, process swim Used requirements and Work lanes to step create process Instructions training manuals, & and overview tool training. design. Audit etc No HP SIAM transformation stages Plan SIAM Transformation Workshop Action and govern SIAM design and implementation services Vision Assessment Roadmap Design Implement SIAM Assessment Service SIAM Roadmap Service SIAM capability framework Service integrator software stack based on HP IT Performance Suite Management of change and training to support adoption Incident Analyst Incident Co-ordinator Education and premier services supporting adoption and ongoing maintenance 19

HP SIAM Assessment Service A deep dive maturity assessment on a number of ITSM and SIAM disciplines Future planning based on accurate and valid data Determine process maturity, efficiency and effectiveness Identify and address risks to the reliable delivery of service Prioritise service improvement initiatives and align them with transformation plans Baseline for measuring achievements/improvements Best practices including IT Infrastructure Library (ITIL) HP Service Management Reference Model ISO/IEC 20000 IT service management COBIT IT governance control ISO/IEC 17799 security management PMI/PRINCE2 project management Microsoft Operations Framework Service integration and multi supplier management practices 20

Ensuring Service and Supplier Performance IT Performance Management and Continuous Service Improvement Single source for reporting IT business performance information KPIs to measure Supplier Performance Performance data for Benchmarking and Decisionmaking 21

with a Unified Experience for enterprise employees A single user experience, easy integrations and quick onboarding of multiple services providers for Service Brokers." HP Propel Service Portal & Catalog HP Propel Service Exchange (SX) Traditional ITSM / Social Private Cloud Cloud Business + Consumer Managed Cloud Future Services Public Cloud 22

The Service Catalog is a strategic initiative Which of the following best describes your service catalog initiative? 2012 2013 25% 31% Only 50% of Service Catalog implementations have been successful 12% 16% 13% 18% 18% 17% 16% 7% 7% 7% 2% 3% 2% 2% 3% 3% We are not interested in a service catalog We are interested but currently lack the funds to commence an initiative We are planning for a service catalog We are currently working on our service catalog initiative We have a service catalog and have realized or exceeded the anticipated benefits We have a service catalog but have not realized the anticipated benefits We have killed our failed service catalog initiative Don't know Other Source: Forrester/itSMF US Online Survey. Q3 2012 and Q3 2013 23

Key ideas for your Service Catalog strategy Etc. Roles & Access Usage period Asset Tracking Service levels compliance Financial impact Etc. Number of requests 1) Create the Front Door to IT: User satisfaction is decreasing since IT does not treat users as consumers. User experience does not keep up with consumerization. Need to provide agility for adding items to the pane. 2) Address Catalog Sprawl: 71% of IT organizations have up to 5 customer-facing catalogs. This increases IT costs and decreases the value of services. 3) Untangle Point-to-Point Integrations: Point-to-point integrations halts agility and stifles innovation. Increases IT costs and decreases efficiency. 24

HP Propel - Over 300 Customers already engaged 25

Value From a cutting-edge service catalog to service lifecycle automation Manage the service lifecycle Transform the Service Catalog Single point of access for request Knowledge access Become a 21 st Century IT department Manage the total service experience Standardize on services Integrate with incident, request, problem, change Include Supplier services Become a service provider Capability Automate provisioning Integrate with other fulfillment engines Manage Catalog lifecycle Integrate Supplier fulfillment processes Become a service broker 26

Designing the Service Catalog Unified Experience Consumer-oriented shopping experience Seamlessly integrated to internal and supplier services A Menu of IT services A menu of services that business users understand Service Map structure and scope aligned to Business customers Defining the relationship between: Services and Business functions/processes Services and Business Organization Services and customers/service consumers Service Map Service Portal Service brochures 27

SIAM Reference Architecture to Transform IT into a service broker Line of Business Hybrid IT Delivery HP Propel Portal and Catalog HP Propel Service Exchange Supplier Governance Supplier on-boarding and off-boarding Service Orchestration Service Assurance Process Model Information Model Technology Integration Suppliers & Cloud Vendors 28

Enterprise 2020: Managing a mosaic of services An IT Service Broker needs to shield the business from the complexity of managing it all. confidence 100% 80% 60% 40% 20% Managing a mosaic of services Year IT execs expect to confidently manage business processes across services spanning data centers and public and private clouds 0% 29 2012 2013 2014 2015 2016 2017 2018 2019 2020 http://www.hp.com/go/enterprise 2020

Discover your own journey Service Centric Connected Intelligence IT Operate Secure HP IT Management Transformation Workshop HP Enterprise Agile Transformation Workshop HP DevOps Transformation Workshop HP Converged Security Transformation Workshop Enterprise Agile Multi Source HP Supplier Integration Transformation Workshop 30

Transformation Workshop Customize for your workshop! What it is A complete IT transformation journey in only a day! Build IT Management transformation roadmap to success Unique, slide-free and interactive! Shape a service centric IT Management vision Business and IT priorities in the IT Management context HP IT Management solution portfolio Participants CIO and/or senior staff or initiative owners (5-8 persons) 2-3 senior HP Consultants, HP Sales Location HP office or hotel (Customer site is not recommended!) 31

Customer feedback The best presentation in comparison to other vendors. Andey Peshiy, CIO, Kievstar Ukraine (Telecommunications) It is more then a modernization, it completes my dream as a CIO. Dennis Chen, CIO, Shin Kong Financials Holding & Life Insurance Co., Ltd. (Financial Industry) Got a good overall view. Like the process and the breadth of information received. Dr. Harald Ruckser, Vice President ebusiness / IT, Voestalpine Automotive (Manufacturing) 32

Thank you www.hp.com/go/siam www.hp.com/go/propel www.hp.com/go/hpswprofessionalse====== ==rvices www.hp.com/go/hpexperts www.hp.com/go/software felix.fernandez@hp.com