Deloitte Consulting LLP

Commonwealth of Massachusetts
Statewide Strategic IT Consolidation (ITC) Initiative

ITIL v3 Overview
February 23, 2010

- 1 -
Agenda
Introduction to Service Management and ITIL
Why do we care?
What is it? (i.e. ITIL is a framework for service management)

Key Components of ITIL
Service desk
Incident management
Request fulfillment
Change management
Asset/configuration management
Problem management

Next Steps with ITIL (in the context of IT Consolidation)
ITIL Roadmap
Key Next Steps

ITIL v3
- 2 -
Concept of Value
Value is not derived from the elements of a product or a service
Value is derived from the processes with which a product or a service is put together and
offered to the customer
- 3 -
Fidelity Confidential
3
What has Henry Ford got to do with ITIL?
- 4 -
The primary driver Architectural complexity reduces IT efficiency and effectiveness
* An actual application architecture for a consumer electronics company
- 5 -
The Need For IT Service Management (ITSM)
IT (Information Technology) is now a essential part of delivering the key business processes
and results.
IT is increasingly being expected to deliver the same or better quality of service to the
business that the business delivers to their customers.

Increasing visibility of IT

Increasing demands from the business to deliver effective IT solutions
Increasing complexity of IT infrastructure processes
Increasing need for service standards and repeatable processes
Increasing pressure to realize a return on IT investments
- 6 -
What is ITIL?
ITIL (the IT Infrastructure Library) is a set of books and documents that are used to aid the
implementation of IT Service Management. It provides a comprehensive framework of
processes and best practice advice for IT Service Management.
ITIL is What does that mean?
A set of industry Best Practices
(e.g., need for discipline around changes; need to
link capacity planning and budgeting)
Identify and reuse what has worked best in the
past and currently at other organizations
A framework, not a methodology
Provides a body of concepts and resources to
draw from, not specific required steps
Adoptable and adaptable
Select applicable parts of the framework and
adapt them to fit local needs
Not a standard
ISO/IEC 20000 is a standard aligned
with ITIL
Scalable to the organizations
size and need
Can be adapted to fit an organizations specific
size and situation
Platform independent
Flexible to all development and service efforts;
not tied to any particular tool
- 7 -
Why the ITIL framework? Taking Thought Leadership

1. [the] staggering improvements in customer satisfaction and operating
efficiencyare so great that Forrester has concluded that it is just a
matter of time until ITIL becomes the de facto standard for all IT
shops. ITIL is absolutely the best framework available for IT operation

2. at least 60% of relevant public-sector and 30% of relevant private-
sector sourcing dealswill demand ITIL (ISO 20000) certification in
their RFPs


1 CIO Magazine, ITIL Power, September 2005
2 Gartner Research, ISO/IEC 20000 has an Important Role in Sourcing Management, January 2006

ITIL has become the de facto standard for IT Operations

- 8 -
What is our focus? -- ITIL Version 3: Service Lifecycle Model
We will focus on a subset of the ITIL v3 processes. The 6 processes identified below are
also the core focus areas of the Commonwealth-wide Service Excellence initiative:
7 Step Improvement Process
Service Reporting
Service Measurement
Service Desk
Incident Management
Event Management
Request Fulfilment
Problem Management
Access Management
Technical Management
IT Operations Management
Application Management
Strategy Generation
Financial Management
Service Portfolio Management
Demand Management
Service Catalogue Management
Service Level Management
Capacity Management
Availability Management
IT Service Continuity Management
Information Security Management
Supplier Management
Transition Planning & Support
Change Management
Service Asset & Configuration Management
Release & Deployment Management
Service Validation & Testing
Evaluation
Knowledge Management
Continual Service Improvement
Processes:
Service Operation Processes:
Service Transition Processes:
Service Design Processes:
Service Strategies Processes:
- 9 -
What are the benefits of ITIL?
Provides a common vocabulary and allows IT personnel in different groups
to communicate more efficiently
Provides a set of principles and processes that can be adapted
to suit any IT environment
Clearly identifies roles and responsibilities for IT infrastructure and
operations, and establishes accountability
Supports the ability of IT to measure and improve internal performance and
service provisioning, to increase the value provided to the business
Defines IT in terms of services (focusing on the value to the business),
rather than systems (focusing on IT components)
Improves the relationship of IT with the business by matching the
expectations of the business with the service levels provided
Improves the ability of IT to adjust as needs
and legislative mandates change
- 10 -
What about quantifiable benefits?
Organization Key Benefits
Reuters
Reduced quantity of capacity related severity 1 incidents from 3-4 per month to 0 per month by
integrating ITIL Capacity Management with ITIL Incident, Problem, Change and Release
Management 1
DHL
Reduced Service Desk costs by 20% while doubling the quantity of requests handled from
82,000 to 116,000 by implementing a ITIL follow-the-sun Service Desk model and Service
Support processes 2
Liberty Mutual
Observed over a 12 month period a 45% reduction in the quantity of severity 1 incidents and
60% reduction in mean-time-to-repair yielding 12,000 hours of recouped staff time due to
implementation of ITIL Change, Incident and Problem Management processes 3
Visa USA Reduced time to resolve incidents by 75% by adopting ITIL Incident Management guidelines 4
Proctor and
Gamble
Publicly attributes $125M in annual savings or 10% of the IT budget to ITIL by enabling an
effective follow-the-sun support strategy 5
Caterpillar
Improved resolution time of Web incidents from 30% of target to 90% of target Doubled
volume of business over 5 years while only increasing IT budget 1% 6
Adoption of ITIL has yielded tremendous operational benefits for a number of large
enterprises:

1 Presentation by Reuters IT department, January 2007
2. INS, Customer Case Study, HP DHL wins prestigious itSMF award, 2003
3 Information Week Optimize, Building Blocks of Process Innovation, 2005
4 SMART Enterprise, Why ITIL Rules, January 2007
5 COMPUTERWORLD Management, Procter & Gamble touts IT services model, saves $500 million, 2002
6 InfoWorld, To survive the 21
st
century, IT must manage itself based on the services it delivers, October 2006



- 11 -
Case study from a leading Financial Services firm
ITIL played a key role in reducing the business impact of incidents:
Quantity of Incidents Business Impact Minutes
Incident 2005 2006 Reduction in
Incidents
2005 2006 Reduction in
Impact Minutes
SEV 1 26 15 11 2,262 1,397 865
SEV 2 357 241 116 96,747 54,948 41,799
Quantity of Change Induced Incidents Business Impact Minutes
2005 2006 Reduction in
Incidents
2005 2006 Reduction in
Impact Minutes
SEV 1 8 2 6 696 254 442
SEV 2 90 58 32 24,390 13,224 11,166
Total Sev1/2 Incidents x Business Impact Minutes

Change Induced Sev1/2 Incidents x Business Impact Minutes

Change induced SEV 1&2 incidents declined due to the implementation of
the ITIL change administration process
2006 saw a significant reduction in the number of SEV 1&2 incidents
- 12 -
ITIL focus across the Commonwealth
Secretariat Current Initiatives
ANF (ITD
Commonhelp)
Expanding Maturity of Incident, Change & Request Fulfillment and
adopting Asset & Configuration and piloting Problem Management
ANF Helpdesk
Consolidation
Expanding Incident Management, (limited Knowledge Management)
across the full Secretariat, DOR (Calls) and Initial Pilot (both Self-
service and Calls) underway with BSB (Bureau of State Buildings)
with further agency deployment to 14 agencies next year and in an
integrated fashion expanding to Change Management and Service
Level Management (SLAs)
EOHHS
Expanding Maturity of Incident, Change & Request Fulfillment and
adopting Asset, Configuration and Contract Management across
EOHHS agencies
EOLWD
Expanding implementation of Incident from DIA to entire EOLWD,
Expanding Asset and Change Management
EOHED
Expanding DOI implementation of Incident and Change
Management to DOB (Div. of Banks) and DPL (Div. Professional
Licensure); Planning also underway for Asset Management
There are a number of in-flight initiatives at the Commonwealth focusing on operational
improvement via ITIL:
- 13 -
Service Desk: Overview
The point of contact between the customer/user and the IT service,
responsible for service requests as well as incident control.
What is a
Service Desk?
What is the
PURPOSE of the
Service Desk?
Provides a single point of contact for customers
Facilitates the restoration of normal operational service with minimal
business impact on the customer within agreed service levels and
business priorities
Manages each user contact/interaction with the IT Service provider
throughout its lifecycle
What are the
OBJECTIVES of
the Service
Desk?
To promote customer satisfaction
To restore normal service as quickly as possible when there is a fault
To attain service level targets for user contact responsiveness and quality
To articulate and route requests to the service provider accurately and
appropriately
To ensure accurate and timely communication of status
To act as a strategic function to identify and lower the cost of ownership
for supporting the computing and support infrastructure
To reduce costs by the efficient use of resource and technology
The Service Desk (or Helpdesk) is a Function, not a Process. Its role is crucial and central
to the whole concept of Service Management.
- 14 -
Service Desk: Structure
- 15 -
Service Desk: Benefits
The value of an effective Service Desk should not be underrated a good Service Desk can often
compensate for deficiencies elsewhere in the IT organization; but a poor Service Desk (or the lack
of a Service Desk) can give a poor impression of an otherwise very effective IT organization!

Specific Benefits include:
Improved customer understanding and satisfaction with IT Services
With what the Services are, and how to obtain them
With status on Incidents and Requests
Lower costs to the business through faster resolution of incidents and fulfillment of requests
Improved ability to attain service level targets through the management of the flow of work
Reduced costs by the efficient use of resources and technology simpler work can be done
by Service Desk Analysts rather than by the senior technical staff




- 16 -
Incident Management: Overview
An incident is an unplanned interruption of a Service, or a reduction in
the agreed-to quality of an IT Service.
What is an
Incident?
What is the
PURPOSE of
Incident
Management?
The Incident Management process strives to restore normal service
operation as quickly as possible and minimize the impact on business
operations.
What are the
OBJECTIVES of
Incident
Management?
Restore services as quickly as possible following a deviation from agreed
upon service levels

Log, track, capture and process all incidents in the IT environment
according to existing SLAs and defined interfaces with other processes
and based on defined fault-specifications
- 17 -
Incident Management: Process Diagram
INCIDENT MANAGEMENT
Incident: An unplanned interruption to an IT service or reduction in the quality of an IT service.
Incident Management: The process for dealing with all incidents; this can include failures, questions or queries reported by the users, by technical staff, or by event monitoring tools.
C
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s
t
o
m
e
r
T
i
e
r

1
T
i
e
r

2
T
i
e
r

3
Incident From
Event Mgmt
Incident From
Web Interface
Incident From
User Phone
Call
Email From
Technical
Staff
Incident
Identification
Incident Logging
Incident
Categorization
Service
Request?
Incident
Request
Fulfillment
Incident
Prioritization
Major Incident?
Major
Incident
Procedure
Initial Diagnosis
Functional
Escalation
Needed?
Investigation and
Diagnosis
Resolution and
Recovery
Incident Closure
Functional
Escalation
Level 2
Investigation and
Diagnosis
Resolution and
Recovery
Initial Diagnosis
End
Functional
Escalation
Level 3
Investigation and
Diagnosis
Resolution and
Recovery
Initial Diagnosis
No
Yes
No
Yes
Yes
No
Resolved?
Resolved?
Resolved?
Functional
Escalation
Needed?
Hierarchic
Escalation
Needed?
Management
Escalation
Yes
Yes
No
No
No
No
Yes
Yes
Yes
No
Knowledge Mgmt./
Known Error DB
- 18 -
Incident Management: Benefits
Incident Management is highly visible to the business when it is needed. How well incidents are
resolved has a major impact on Customer Satisfaction with IT support.

Benefits from the process include:

The ability to detect and resolve Incidents quickly, resulting in shorter downtime to the
business, and hence less impact
The ability to align IT activity to real-time business priorities: Urgency and Impact = Priority
The ability to identify potential improvements to services: the data collected helps to identify
where to focus to prevent future incidents
The Service Desk can, during its handling of Incidents, identify additional service or training
requirements




- 19 -
Request Fulfillment: Overview
A Request is any type of demand that is placed upon the IT Department
by the users. Many of these are actually small changes: low risk,
frequently occurring, or low cost, whose fulfillment can be standardized.
E.G., a request to change a password
What is a
Request?
What is the
PURPOSE of
Request
Fulfillment?
The Request Fulfillment process seeks to manage the Lifecycle of all
Service Requests to provide the prompt, complete, and cost effective
provision of the Request.
What are the
OBJECTIVES of
Request
Fulfillment?
To provide a channel for users to request and receive standard services
for which a pre-defined approval and qualification process exists
To provide information to users and customers about the availability of
services and the procedure for obtaining them
To source and deliver the components of requested standard services
To assist with general information, complaints or comments
- 20 -
Request Fulfillment: Process Diagram
- 21 -
Request Fulfillment: Benefits
The primary benefit of Request Fulfillment is to provide quick and effective access to standard
services which business staff can use to improve their productivity or the quality of business
services and products.
Specific benefits include:
Reducing the bureaucracy involved in requesting and receiving access to existing or new
services, thus also reducing the cost of providing these services.
Through centralizing fulfillment, Request Fulfillment also increases the level of control over
these services. This facilitates aggregating demand for suppliers and can result in reduced
costs through centralized negotiation.
Repeatable workflows for fulfilling requests can result in faster performance, fewer errors,
and a lower cost to provision.






- 22 -
Change Management: Overview
What is a
Change?
What is the
PURPOSE of
Change
Management?
What are the
OBJECTIVES of
Change
Management?
ITIL defines a Change as the addition, modification or removal of
anything that could have an effect on IT services, usually stated as a
change to a configurable item or CI.
Respond to changing customer and IT requirements, providing a
structured avenue for implementing Change while minimizing risk,
reducing incidents, and avoiding disruption and re-work
Record changes and then evaluate, authorize, test, implement,
document, and review results in a controlled manner
Manage and minimize the risk of disruption to the business from the
implementation of Changes
- 23 -
Change Management: Process Diagram
- 24 -
Change Management: Benefits
Reliability and business continuity are essential for the success and survival of any
organization. Service and infrastructure changes can have a negative impact on the business
through service disruption.

Change Management controls the risk and reality of disruption, through requiring all changes
to be thoroughly analyzed, planned, tested, authorized, communicated, and implemented with
appropriate back-out steps planned.

Key benefits are:
Implementing changes that meet the customers agreed service requirements while
optimizing costs
Reducing failed changes and therefore service disruption, defects and re-work
Delivering change promptly to meet business timescales
Aiding productivity of staff through minimizing disruptions due to high levels of
unplanned or emergency change and hence maximizing service availability
- 25 -
Service Asset and Configuration Management: Overview
The hardware and software that IT uses to provide service to end
users, in support of business functions and applications
What is an
Asset?
What is the
PURPOSE of
Asset and
Configuration
Management?
Identify, control, record, report, audit and verify service assets and
configuration items, including versions, baselines, constituent
components, their attributes, and relationships
Ensure the integrity of the assets and configurations required to
control the services and IT infrastructure by establishing and
maintaining an accurate and complete Configuration Management
System
What are the
OBJECTIVES of
Asset and
Configuration
Management?
Support efficient and effective Service Management processes by
providing accurate configuration information to enable people to
make decisions at the right time, with accurate information: to plan
and authorize change and releases, resolve incidents and problems
faster, etc.
Provide management with the information required to optimize IT
resources
The set of items (CIs) and their relationships that comprises IT
services and is the object of most IT tasks
What is a
Configuration?
- 26 -
Service Asset and Configuration Management: Process Diagram
- 27 -
Service Asset and Configuration Management: Benefits
Having complete and accurate information about IT assets and services enables effective
management of those resources

Benefits include:
Faster and less costly resolution of Incidents and Problems, through having
configuration information available to support analysis and planning
Less costly forecasting and planning of Changes and Releases
Full enterprise-wide lifecycle management of IT assets, from specification of need,
through procurement and installation, through disposal
Support for Supplier management, with regard to leases and warrantees, as well as
software licenses
Appropriate protection of organizational information upon asset disposal
Better adherence to standards, legal and regulatory obligations (less non-
conformances)

- 28 -
Problem Management: Overview
What is a
Problem?
What is the
PURPOSE of
Problem
Management?
What are the
OBJECTIVES of
Problem
Management?
The unknown cause of one or more incidents
Reduce the number and impact of Incidents
Identify the Root Cause of Incidents or faults in the IT environment
Prevent incidents from re-occurring
Record information that will improve the way in which IT deals with
problems
Find the root causes of errors
Develop solutions to resolve known errors
Plan and request changes to implement the solutions
Prevent future incidents and problems
- 29 -
Problem Management: Process Diagram
- 30 -
Problem Management is directed toward the stabilization and improvement of service availability
and quality

Benefits include:

Reduction in the number of Incidents due to more effective and efficient incident handling
Increase in user productivity and service quality
Improved reputation of IT Organization due to decrease in the repetition of incidents.
Increase in productivity of Support staff
Ability to proactively identify beneficial system enhancements, amendments and business
opportunities
Improved resolution rates at the Service Desk

Problem Management: Benefits
- 31 - DRAFT FOR DISCUSSION PURPOSES ONLY
Roadmap for ITD Process Improvement


Incident
Management






Change
Management







Problem
Management




1.5
1 3 4
Phase 3 Dec 2010 Legend: Phase 2
2.5 3.0
Institute central
management of dispatched
incidents
Institute regular review
meetings of performance
with improvement actions
assigned as needed
Revise
Process
and
republish
Train staff
on revised
process
3 +
Process
2
Phase 1
OLAs support SLAs and
are managed
Continuous
Improvement
Procedures based on
KPIs
3 + 1.8 2.5 3.0
Revise process to
focus on Change
Results
Initiate Post-
Implementation
Reviews
Documente
d Change
Planning &
Testing
Procedures
for each
technical
team
Audit compliance
with Procedures
Expand use of
Configuration Mgt
data now available

0.8 1.5 2.5
3.0
Initial trend analysis
of Incidents
Formal Recognition
of Problems
Major Incident RCAs
done under Problem
Management
Create Process
Document
Train Staff on Process
KPI in place and
performance is
reviewed
Known Error database
created and used
Known Error Database
utilized for Incident Mgt
Process roles established,
including lead on each
technical team
Downward trend in number
of Incidents
ITD has created a roadmap to mature Service Management processes in the next year:
Low
Maturity
High
Maturity