Measuring Success Ryan Ibm May 2010

Measuring Success!

How to Develop and Implement an ITIL

Performance Management Framework

itSMTnz 2010 ConferenceAuckland, New Zealand

Measuring Success! Overview Agenda

Use of Key Performance Indicators in ITILUse of Key Performance Indicators in ITIL33

IT Performance Management and MeasurementIT Performance Management and Measurement11

Internal Use of IT ScorecardsInternal Use of IT Scorecards44

Background of Balanced ScorecardBackground of Balanced Scorecard22

ITIL Service Level Management ITIL Service Level Management55

Questions & Answers Questions & Answers 66

© 2010 IBM Corporation

Measuring Success! Session Objectives

• Define IT Performance Management & Measurement

• Understand the Balanced Scorecard and Use in IT Organizations

• Understand the Use of Key Performance Indicators in the ITIL Framework

• Learn How to Develop and Utilize IT Scorecards to Improve Internal Operations

• Understand and Apply IT Service Level Management










How Does ITIL Define Service Management?


• ITIL defines service as:

…a means of delivering value to customers by facilitating outcomes customers want to achieve without the ownership of specific costs and risk.

• ITIL defines service management as:

…a set of specialized organizational capabilities for providing value to customers in the form of services.

• IT organizations use ITIL to develop, acquire or improve their

- Processes- Methods- Functions- Roles- Activities

What is Performance Management and Performance Measures?


• Performance Management is defined alternatively as:

Performance management is the process whereby an organization establishes the parameters within which programs, investments, and acquisitions are reaching desired results.

Performance management is the process of assessing the progress made (actual) towards achieving the predetermined performance goals (baseline).

• Performance Measures are quantitative and qualitative ways to characterize and define performance. They provide a tool for organizations to manage progress towards achieving predetermined goals, defining key indicators of organizational performance and customer satisfaction.

Business depends on IT performance management

IT Performance Management is a Critical Tool to Enable IT Service Management










The Original Balanced Scorecard Concept


The Original Balanced Scorecard Concept Adapted to an IT Scorecard










What is ITIL?


• ITIL is a framework for service management. The processes described in ITIL exist to improve efficiency (cost) and effectiveness (quality) of IT services. This includes the planning, delivery, and support of those services.

• At its heart, ITIL is nothing more and nothing less than a collection of best practices. It was born in the UK when the Office of Government Commerce (OGC) asked a number of organizations how they perform IT services.

• ITIL is not:– A “how to” manual– Proprietary– Vendor-specific– The complete solution

ITIL V3 Processes and Functions


ITIL V3 Processes Are Decomposed Into Nine Components


Sample ITIL Key Performance Indicators – Change Management Process










Development of IT Scorecards Requires Determining What to Measure


Universe of IT/ITIL Performance

Measures

IT/ITIL Performance

Measures You Determine to

Use

IT/ITIL Performance

Measures You Can Currently

Capture

Development of Specific Key Performance Indicators Requires Targets and Time Intervals

Baseline Current Performance Level

Benchmark Target Performance Level

Desired Time Interval to Achieve Target Performance Level

IT Scorecards Should be Developed at Different Levels of an IT Organization

CIO Scorecard

Division/Geographic Scorecard

Branch/Team Scorecard

Kaplan & Norton Cascading Scorecards

Development and Management of IT Scorecards Requires a Mix of Resources


Organizational Change Management Enables Your IT Scorecard Implementation


•Obtain Executive Sponsorship for your IT Scorecard Project

•Select and Empower a Cross-Functional Internal Team

•Consider use of an external consultancy, or individual expert

•Charter the Project with a defined timeline to completion, measures of success, define key milestones, and define required organizational resources

•Develop a list of key stakeholders to the project, and reach out to these various stakeholders

•Rigorously track the progress of the project, and take corrective action as needed

5 Key Assumptions Supporting Your IT Scorecard Development and Refinement


•Create IT Scorecard unit or embed in existing IT Organizational Units

•Segment Application Development and Application Maintenance performance measures

•Benchmark your current performance measures and design future state

•Include your Enterprise Architect or Data Architect in the development of your IT Scorecard

•ITIL Conformant?

Your IT Scorecards Integrate with Your IT Organization










How Does ITIL Define Service Level Management?


To plan, co-ordinate, draft, agree, monitor and report on Service Level Agreements (SLAs), and to perform the on-going review of service achievements to ensure that the required and cost-justifiable service quality is maintained and gradually improved. ¹

1. Wording from ITIL Service Delivery: Service Level Management 4.1.4 - re-cast for tense

2. ITIL Service Delivery: Service Level Management 4.1.2

• "To maintain and improve IT Service quality, through a constant cycle of agreeing, monitoring and reporting upon IT Service achievements and instigation of actions to eradicate poor service - in line with business or cost justification." 2

• To ensure that customer objectives are translated into service-level objectives that can be (and are) attained and measured by the providers of information technology

• To clarify the goals, commitments, and attainment of service to both the providers of information technology and the customer

• To define remedies for the failure to attain service level commitments.

Process Definition Service Level Management Objectives


Improving IT Service Quality Requires Understanding Potential Performance Gaps

An IT Service Level Framework is Built Upon Key Performance Indicators


IT Service Level Management Process Flow and Outputs


IT Service Level Management is the Focal Point for Performance Management and Reporting










Contact Information


•Bob Ryan [email protected] (703) 627-9814

http://www.thebusinessofitbook.com

•Tim Raducha-Grace [email protected]

877-813-1428

mailto:[email protected]

mailto:[email protected]

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