What’s hot in IT service management?

Analysis of the presentations at the upcoming IT Service Management Forum (itSMF) UK Conference reveals three “hot topics” coming to the fore. Last year’s emphasis on people is continued, while the oft-neglected ITIL v3 disciplines of service design and continual service improvement get significant coverage. All three need greater exposure and attention within IT organizations. Without this, IT functions place themselves at risk of being unable to adapt to tougher business demands and the rapidly changing IT landscape.

Are IT organizations capable of leveraging people talent?

For last year’s itSMF Conference, Ovum offered the opinion that “the people side of IT, while lauded as part of the oft-quoted ITIL mantra (of people, process, and technology), is well due its time in the spotlight.” But while it’s great to see this year’s conference again focus on people, one has to ask what IT organizations have achieved in this area since last November.

Given the fact that IT functions’ struggle with people (or “talent”) management is a long-held area of concern, one has to ask whether they are ever going to get it right. But something’s got to give. With the increasing focus on IT delivered “as-a-service” and the changing technology landscape, more will be demanded of IT people, and especially of their non-technical capabilities. In particular, the advent of cloud computing will change the way that IT organizations look at, and eventually deliver, IT services. While not requiring an immediate technology change, IT organizations need to be addressing cloud-related people issues and opportunities now.

As the adoption of cloud computing services becomes more prevalent, IT organizations will face a variety of new IT service management challenges. Not only will they need to ensure that existing policies, processes, procedures, and supporting technologies are fit for externally delivered IT services; they must also ensure that the IT organization and its people remain a relevant and effective part of the IT service delivery chain. IT organizations will need to evolve to reflect the change in focus caused by the externalization and loss of immediate management of some infrastructure and services, with an even greater need for IT or business resources to manage service delivery using best practice IT service management processes.

Service design and continual service improvement are key to improving IT organization performance

Many IT organizations neglect the ITIL v3 service design processes of IT financial, service portfolio, and demand management. However, IT organizations cannot continue to ignore the need for IT financial management maturity; they need as a minimum to get the IT financial management basics right. Service costing should also be seen as mandatory, and IT funding models will probably need to change in line with the shift in IT delivery models, potentially with a capital-light and service-centric budget model.

We believe that reactive cost management is no longer enough, and that IT financial management needs to go beyond traditional disciplines to add in the dimension of “value.” An example would be for IT organizations to not just look at the cost of an IT service, but also to gain an understanding of how the related expenditure ultimately delivers value to the organization in support of business processes and corporate goals. Portfolio management processes, tools, and techniques can play a key role in this.

Continual service improvement is not just another ITIL v3 process that can be adopted in isolation. It should be applied across all ITIL domains and processes, and is a capability that needs to stem from a culture of improvement. In our opinion, the continual service improvement process will be sub-optimal without a culture that actively seeks improvements from any part of the organization – an organization where innovation is not just the preserve of senior management. The contribution of people to continual service improvement must therefore be treated as an integral part of ITIL v3 adoption.

Originally published on http://www.ovum.com/news/

Should IT service management go back to basics?

Ovum is witnessing what is hopefully the start of an interesting go-to-market trend for IT service management (ITSM) software vendors – a change of product “markitecture”, from ITIL alignment to addressing key IT challenges in better meeting business needs and demonstrating IT-delivered value. While ITIL is still and will continue to be the de facto best-practice framework for ITSM, this change in vendor messaging is just what ITSM needs to solve the growing gap between ITIL theory and its real-world adoption.

ITIL has long driven the ITSM software market – will and should this continue?

In many ways, ITIL is now a technology blueprint for ITSM vendors. There are both pros and cons to this. The alignment with ITIL allows IT organizations to better understand a product’s capabilities and its use once deployed, and there is no doubt that the availability of fit-for-purpose technology has helped with the worldwide adoption of ITIL. On the downside, the parochial vendor and enterprise focus on ITIL has stifled ITSM innovation and limited the thinking of IT organizations.

However, recent briefings from CA Technologies and HP have provided us with food for thought on this. These vendors have crafted ITIL-light messaging that focuses more on business and IT organization need, than on the adoption of the best-practice framework. This is delivered in a markitecture that depicts the most commonly adopted ITIL v2 disciplines (of incident, problem, service level, and change management) with the ITIL v3 service catalog management process, supported by IT financial management, and asset and configuration management. Importantly, each element is targeted at pertinent enterprise pain points rather being elements of ITIL adoption. This is how ITIL was intended – “adopt and adapt” to business needs.

While ITIL will hopefully continue to change the thinking of IT organizations and be a critical part of their management toolkits, Ovum believes that such a focus on business-driven ITSM over “following the gospel according to ITIL” will benefit everyone, including the OGC and itSMF.

IT organizations would also benefit from a back-to-basics approach to ITSM

ITIL adoption has continued to gain a foothold in enterprise IT organizations worldwide, as more than 20,000 people per month gain the ITIL Foundation Certificate. The level of ITIL certification, however, belies the real level of ITSM capabilities within enterprises, with it being too easy for enterprises to overstate their position – stating that they “do” ITIL when in fact they only “do” a limited subset of the ITSM best-practice framework’s processes, mostly around the more reactive ITIL disciplines such as incident management. There is also often too heavy an emphasis on process. But just implementing an ITIL process is missing the point – IT organizations neglect the required change in mindset.

The service desk and incident management practices are a good example of this, as far too many IT organizations fail to understand the importance of service desk people on the business’s perception of IT performance. The service desk is the business’s “window into IT”. Service desk analysts are often the IT people that the business deals with most. Rightly or wrongly, their ability to efficiently and effectively resolve business stoppages caused by IT issues constitutes a large part of end-user opinion on IT as a whole. Consequently, an IT organization should take a second look at its service desk, understand its level of customer focus, and improve its ability to prioritize and solve end-user issues based on business impact – especially outside of the prescriptive following of “how-to” scripts. It should ask some difficult questions, such as:

  • Is our service desk only as good as its people? If so, how good are our people?
  • Where do our analysts sit in our IT hierarchy? How are they paid, educated, and trained?
  • How is their performance reviewed? How are they valued?
  • Do we prioritize the resolution of IT issues based on business impact?

Ultimately, service desk people can and should be the backbone of effective IT service management and IT organizations need to start treating them as such.

Originally published on http://www.ovum.com/news

“Resource-strapped IT managers are fighting back,” says research by Numara Software

Numara Software, a provider of service management and asset management solutions, is about to release the findings of its study into the state of IT funding in the UK, Germany, and France, and the consequences of the lack of IT investment during the last few years. The results of this study, entitled “Rebirth of the IT budget” and based on the responses of 300 senior IT decision-makers (none of which are Numara customers), indicate that IT managers are now fighting back, demanding more funds and resources to support the continued provision of quality IT services.

82% of IT managers have seen IT funding affected in some way during the last two years

The recent corporate focus on IT costs and value was inevitable given the growing total cost of IT provision. However, with such a large proportion of IT spend being on “keeping the lights on” activities, many IT organizations are vulnerable to ever-increasing budget cuts. Not unsurprisingly, 52% of respondents state that the financial value of their IT budget has been affected, whether frozen (18%) or, more commonly, reduced (34%). But the decision-making process has also changed for 52% of companies, with 27% saying that it has slowed and another 25% saying more senior people are involved in the sign-off process.

Looking forward, however, the majority of the senior IT professionals surveyed expect things to improve – 15% in mid-2010, 45% by the end of 2010, and 29% in 2011 or beyond. While this might appear somewhat optimistic, 63% of respondents are concerned that the business has become accustomed to the slashing of IT budgets and that if not challenged the practice will continue for years to come.

In our opinion, much of this is to do with the focus on what IT costs rather than the value that it delivers to the business. While the business continues to see IT purely from a cost perspective, it will remain at risk from progressive corporate budget cuts. To address this, IT organizations need to better understand and communicate how individual IT services deliver value to the business and how decreasing IT expenditure will ultimately affect business services. But before they can do this, they need to understand the IT assets employed and how their usage drives both cost and IT service delivery.

92% of enterprises feel under some sort of pressure in relation to asset tracking

The most common pressure is being able to resolve users’ technical issues in line with agreed SLA targets. This is followed by keeping track of IT assets in an ever-changing IT landscape. While not discounting the importance of the former, the latter point is critical for IT organizations on the back of the ever-increasing focus on what IT costs. In our opinion, there are a variety of opportunities for enterprises to gain a better understanding of the assets employed and then use this information for short-term rationalization exercises of hardware, software, applications, and even IT services before creating a longer-term platform for both application and service portfolio management. Asset tracking and service costing will both be key to this.

61% of IT decision-makers consider software maintenance costs to be a burden on their IT budget

Additionally, 40% describe this burden as significant, with 45% describing software maintenance contracts as a necessary evil. There is no doubt that software costs (both initial purchase and maintenance) are a large part of total IT expenditure these days; in fact many IT organizations do not truly appreciate how great a cost this is. Software asset management is a key activity here – not only understanding the licensing position in respect of the installed software base, but gaining an understanding of how software is used to make better use of agreed licensing terms and identifying opportunities to reclaim unused or underused licenses for use elsewhere. From a software maintenance perspective, SaaS-delivery options can help. In the case of IT service management tools, SaaS vendors will often state that the annual subscription charge for everything involved in delivering IT service management capabilities (including the infrastructure) is not dissimilar to the annual support and maintenance charges levied on traditional on-premise tools.

Originally published at http://www.ovum.com/news/euronews.asp?id=8726