ITIL® Foundation Certification Notes : The ITIL® Service Life Cycle & Service Strategy

Service strategy shows organizations how to transform service management from an organizational capability into a strategic asset, and to then think and act in a strategic manner.
Service strategy helps clarify the relationships between various services, systems or processes and the business models, strategies or objectives they support.

3.1 Purpose of Service Strategy

The purpose of the Service Strategy is to define the perspective, position, plans and patterns that a service provider needs to be able to execute to meet an organization's business outcomes

3.2 Objectives of service Strategy

1) Provide business stakeholder value

2) Differentiate the organization

3) Make solid cases for investment

4) Resolve conflicting demands for services

5) Improve service quality by strategic planning

3.3 Scope of service Strategy

1) Generic principles and processes of service management. These generic principles are applied consistently to IT service management

2) Intended for use by both internal and external service providers, and includes guidance for organizations which are required to offer IT services as a profitable business, as well as those which are required to offer IT services to other business units within the same organization - at no profit

3) Two aspects of strategy:

1. a) Defining a strategy whereby a service provider will deliver services to meet a customer's business outcomes.

2. b) Defining a strategy for how to manage those services

3.4 Value to business

1) Provides guidance on how to design, and put in place service management as a strategic asset.

2) Sets the principles for developing service management policies, guidelines and processes across the service lifecycle.

3) Sets objectives and expectations of performance towards serving customers and market spaces.

4) Identifies and prioritizes opportunities.

5) Ensures that organizations can manage the costs and risks associated with their service portfolios.

6) Asks questions and plans a strategy for how to do something before progressing

3.5 Basic concepts in Service Strategy

1) Utility: also called 'fitness for purpose' involves the ability of the service to remove constraints or increase the performance of the customer.

2) Warranty: also called 'fitness for use' is the ability of the service to operate reliably.

3) Assets, Resources and capabilities

a) Assets: Asset is any resource or capability

1. Customer asset: asset used by a customer to achieve a business outcome

2. Service asset: asset used by a service provider to deliver services to a customer

b) Resources are the direct inputs for the production of services.

Example: Money, IT Infrastructure, people, or anything else that might help delivering an IT service.

c) Capabilities are the assets that represent the organization's ability/ knowledge to do something to achieve value

Example: organization, processes, management, etc.

4) Service Portfolio: is the entire set of services under management by a Service Provider. It consists of three major parts: Service Pipeline, Service Catalog, and Retired Services.

5) Governance: Governance ensures that policies and strategy are actually implemented, and that required processes are correctly followed. Governance includes defining roles and responsibilities, measuring and reporting, and taking actions to resolve any issues identified.

6) Business case: is a structured and documented justification for investment in something expected to deliver value in return. Business Cases are used during Service Strategy to evaluate the feasibility and desirability of creating and providing various IT Services.

7) Risk Management: is process of identification, assessing and controlling risks through analyzing asset`s value, threats and how vulnerable each asset is to those threats.

8) Service Provider: There are three types of service providers they are :

1. a) Internal service provider: exists within an organization and provides service solely for a unique business unit.

2. b) External service provider: operates outside the organization.

3. c) Shared service provider: exists within an organization, but provides service for more than one business unit.

9) Supplier: Is a third party responsible for supplying the goods or Services required to deliver IT Services.

10) Types of Services: according to the value for customers services are classified into three types they are:

1. a) Core Services: required directly by customers to deliver an intended outcome.

2. b) Enabling Services: needed to ensure core services can be delivered successfully, not visible to customers

3. c) Enhancing Services: created to add features / values to the customers, not essential.

11) Patterns of Business Activities: Influence the demand patterns seen by the Service Providers.

3.6 Processes

3.6.1 Service Portfolio management:

A) Purpose of Service Portfolio Management

1. Purpose of is to make sure that the service provider has got the perfect set of services so that it can balance the investment in IT with the capacity to get the desired business outcomes. It keeps a track of the investments in services throughout their lifecycle

2. Service portfolio also makes sure that services are defined clearly and linked to the achievement of business outcomes, thus ensuring that all design, transition and operation activities are in line with the value of services.

B) Objectives of Service Portfolio Management

1. 1) To develop and maintain a Service Portfolio that provides a complete picture of all services including their status.

2. 2) To establish conditions and requirements for inclusion of new services in the Service Portfolio.

3. 3) To ensure a Service Catalogue is developed and managed as part of the Portfolio.

4. 4) Agree on the rules for transferring services to the Service Catalogue as they move into transition and out of the Catalogue and as they move into retirement.

5. 5) To ensure that the Service Portfolio meets the functional and performance requirements of its users and that its performance, availability and security meet agreed requirements.

6. 6) To ensure that management reports are produced in line with agreed reporting requirements.

C) Scope of Service Portfolio Management

1. 1) All services a service provider plans to deliver, those currently delivered and those that have been withdrawn from service

   1. a) The primary concern of service portfolio management is whether the service provider is able to generate value from the services.

   2. b) Service portfolio management will therefore track investments in services and compare them to the desired business outcomes

2. 2) Service portfolio management evaluates the value of services throughout their lifecycles, and must be able to compare what newer services have offered over the retired services they have replaced

D) Service Portfolio

1. A Service Portfolio is a complete list of services regardless of where they are in their life cycle (i.e. planning, development, production, retired). The Service Portfolio includes the service pipeline, a service catalog, and a list of retired services.

2. 1) Service pipeline includes services being created for a given market space or customer.

3. 2) Service catalog consists of services presently active in the service operation phase, as well as those approved in the pipeline. The service catalog provides a description of each service, pricing and service level commitments, and terms and conditions. The service catalog is an important tool in service strategy because it is the virtual projection of your actual and present capabilities. It also serves as a service-order and demand-channeling mechanism, as well as a visualization tool for SPM decisions. The service catalog provides a strong link between SPM and service level management (SLM).

4. 3) Retired services are services no longer offered.