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Praise for Service Intelligence

“Sharon Taylor has earned the respect of the service management


industry for her willingness to stretch the boundaries of conventional
wisdom, for example, by extending the principles of service management
through to the full service lifecycle.”
—Ian Head, Research Director, Service Management and Process
Improvement, Gartner Inc.

“This book is a really practical, broad-based, and friendly explanation of


why service management is so important for delivering better service
faster and at lower cost. It is written by an expert with international
status, who has personally shaped the way the service management
industry operates.
—Jenny Dugmore, Director of Service Matters and Chair of the
ISO/IEC 20000 Series Committee

“Customers, vendors and practitioners can all learn from the experience
of Sharon Taylor when it comes to implementing IT Service Management
concepts.”
—Markos Symeonides, Executive Vice President, Axios Systems

“Best practices in the field of IT Service Management today have


matured as a result of Sharon Taylor’s commitment to and leadership in
the industry. Her contributions while Chairman of itSMF International
and work in authoring numerous ITSM books have helped to spread the
adoption of IT best practice across the globe. Taylor is one of the most
well-respected thought leaders in our industry. It is, therefore, no surprise
that she was awarded the ITSM Lifetime Achievement Award in 2008.”
—Emily Sturm, Marketing Manager, Axios Systems

“Service Intelligence is excellent because it is easy to read, easy to follow,


and easy to understand, which for me, are the basic tenets upon which
the best business and technical books are built. Full of examples and
supporting graphics, the journey through the book progresses without
confusion or the need to constantly refer back to earlier chapters. The
lessons contained in the book will be invaluable to all organizations, both
large and small.”
—Malcolm Fry
“Sharon Taylor ‘breaks the eye.’ She takes familiar context and
provides fresh, evaluated views of IT service management at its leading
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—Michael Nieves

“Sharon Taylor has succeeded in bringing together all the necessary


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nurture a healthy relationship with their IT service provider. This is a
must read for anyone seeking successful ITSM partnerships.”
—Pauline Angelico, Managing Director Plus Green IT, MD Itilics, CEO
Marval Asia Pacific

“Sharon Taylor’s leadership continues to drive adoption and maturity


in the service management profession and the abilities of those who
practice it.”
—Dennis G. Ravenelle, Network Integration Project Manager, Harvard
University Information Technology
Service Intelligence
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Service Intelligence
Improving Your Bottom Line
with the Power of IT Service
Management

Sharon Taylor

Upper Saddle River, NJ • Boston • Indianapolis • San Francisco


New York • Toronto • Montreal • London • Munich • Paris • Madrid
Cape Town • Sydney • Tokyo • Singapore • Mexico City
Many of the designations used by manufacturers and sellers to Editor-in-Chief
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designations appear in this book, and the publisher was aware of a Senior Acquisitions
trademark claim, the designations have been printed with initial Editor
capital letters or in all capitals. Katherine Bull
The author and publisher have taken care in the preparation of this Development Editor
book, but make no expressed or implied warranty of any kind and Candace Dunwoodie
assume no responsibility for errors or omissions. No liability is Technical Editor
assumed for incidental or consequential damages in connection Ivor Macfarlane
with or arising out of the use of the information or programs
Managing Editor
contained herein.
Kristy Hart
The publisher offers excellent discounts on this book when ordered
Project Editor
in quantity for bulk purchases or special sales, which may include
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Publishing
Visit us on the Web: informit.com/ph Coordinator
The Library of Congress cataloging-in-publication data is on file. Cindy Teeters
Cover Designer
Copyright © 2012 Pearson Education, Inc.
Alan Clements
All rights reserved. Printed in the United States of America. This
Compositor
publication is protected by copyright, and permission must be
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obtained from the publisher prior to any prohibited reproduction,
storage in a retrieval system, or transmission in any form or by
any means, electronic, mechanical, photocopying, recording, or
likewise. For information regarding permissions, write to:
Pearson Education, Inc.
Rights and Contracts Department
501 Boylston Street, Suite 900
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Fax (617) 671-3447
ISBN-13: 978-0-13-269207-6
ISBN-10: 0-13-269207-4
Text printed in the United States on recycled paper at R.R.
Donnelley in Crawfordsville, Indiana.
First printing August 2011
For all who journey through the challenges of giving,
receiving, and recognizing quality service management.
For those who provide it through leading by example
and energizing their organizations to never settle
for less than their best practices.
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Contents

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Why Read This Book? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Illuminating Your Vulnerabilities . . . . . . . . . . . . . . . . . . . . . . . . 4
Capitalizing on Your Strengths . . . . . . . . . . . . . . . . . . . . . . . . . 5
ITSM—In Good Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Chapter 1 ITSM 101: From Data to Wisdom . . . . . . . . . . . . . . . . . 7


ITSM—Grass Roots . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
ITSM—20/20 Hindsight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
IT Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
IT Compliance and Audit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
International Standards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
ITIL Service Management Practices . . . . . . . . . . . . . . . . . . . . . 19
Maturing ITSM practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Endnotes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Chapter 2 ITSM: The Business Asset . . . . . . . . . . . . . . . . . . . . . . 25


The Roadmap . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
IT Governance—What to Look For . . . . . . . . . . . . . . . . . . . . . . 37
IT Compliance and Audit—Reasons to Have It . . . . . . . . . . . . . 40
IT Service Practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Endnotes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

Chapter 3 The Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55


The Anatomy of a Service—Building the Services
You Want . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Service Ingredients . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
We’ll Have What They’re Having, Please! . . . . . . . . . . . . . . . . 57
Service Catalog . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
The Service Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
X S E RV I C E I N T E L L I G E N C E

Chapter 4 The IT Service Provider . . . . . . . . . . . . . . . . . . . . . . . . 69


Types of ITSP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
ITSP Competences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
ITSP Sourcing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
What Should Influence Your Sourcing Decisions? . . . . . . . . . . 79

Chapter 5 The Negotiation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81


Decision Styles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
Negotiation Steps . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
Agree Upon the Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
The Service Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90

Chapter 6 The Service Agreement . . . . . . . . . . . . . . . . . . . . . . . 95


Core Service Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Service Package Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Service Description . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
Service Hours . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
Customer Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
Management of Incidents . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
Management of Problems . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
Change Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
Service Reporting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
Service Complaints . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
Service Reviews . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106

Chapter 7 The Partnership in Action . . . . . . . . . . . . . . . . . . . . 109


The Partner Compass . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
Service Monitoring . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115
Identifying Trigger Points . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117
Service Roles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119

Chapter 8 Service Performance in Action . . . . . . . . . . . . . . . . 127


Service Performance Indicators . . . . . . . . . . . . . . . . . . . . . . . 127
Performance Dashboards—A Picture Paints
a Thousand Words . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137
CONTENTS XI

Chapter 9 The Bottom Line . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143


Common Cents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143
Transformations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145
Your Bottom Line . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147

Appendix A IT Strategy Template . . . . . . . . . . . . . . . . . . . . . . . . 149

Appendix B Service Contract Template . . . . . . . . . . . . . . . . . . . . 157

Appendix C Service Agreement Template . . . . . . . . . . . . . . . . . . 165

Appendix D References for Further Reading . . . . . . . . . . . . . . . 173

Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 177
Preface

This book is a compilation of the basics of IT Service Management drawn


from the leading best practices in the industry. It is presented from a busi-
ness point of view and is intended to inform, educate, and provoke a new
level of thinking by business leaders about the importance and relevance
of IT Service Management to their companies.
As with all best practices, time turns them into common practices, and
the next innovation in thought leadership will create new best practices.
The topics included in this book are intended to stand the test of time and
form the basis for strong service partnerships, which will make service
excellence commonplace in companies and become the benchmark for
others to innovate from.
The IT Service Management industry offers a wealth of information
and platforms for the exchange of ideas. Until this book, most of this was
written for the ITSM industry and its providers. Now, in these pages, busi-
ness finds a home within ITSM, and by offering ITSM a place at the cor-
porate table, can reap the benefits of decades of practice by other
high-performing businesses.
Acknowledgments

I would like to acknowledge the following individuals, without whom this


book could not have achieved its best.
Katherine Bull, Pearson, who believed in the idea of a book about ITSM
that would help business achieve more.
Ivor Macfarlane, IBM, a service management pioneer and my mentor
from the early days of ITSM and still today for his thorough and thought-
provoking technical review.
Candace Dunwoodie, Aspect Group Inc., a highly respected business
thought leader who kept all of us real with her sharp style of review and
challenging perspective.
Very special thanks to my family, who through their sacrifice of my
absence, their patience, motivation, and support made this book achiev-
able and finished on time.
About the Author

Sharon Taylor, President of the Aspect Group, is a well-known and


respected figure within today’s IT Service Management community.
As the former Chief Architect and current Chief Examiner for ITIL®, the
world’s leading IT Service Management best practices, she has shaped the
direction of ITSM and helped hundreds of companies achieve their service
management goals.
Sharon is the author of numerous service management books, is a reg-
ular columnist for a variety of global IT management publications, and is
a sought-after keynote speaker in the industry.
She was the Chairman of the Board for the Chair of the itSMF
International, an IT service management forum responsible for ensuring
global growth and governance of ITSMF in more than 50 countries. The
itSMF is at the center of best practice development and endorsement.
Sharon is also past President of the North American Institute of
Certified Service Management Professionals and the recipient of the pres-
tigious ITSM Lifetime Achievement Award, which is voted on by experts
in the IT industry.
Her contributions to the community and to best practice are based upon
her extensive professional experience in the industry.
As the President of Aspect Group Inc., she is leading AGI’s consultancy,
training, and ITSM practice, working with clients throughout North
America, Asia, and Europe.
As a long-time CEO, Sharon brings a business background and focus to
IT service management and devotes her business experience to influencing
the directions of the IT service management industry.
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