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The Value of ITIL
As World economy lingers it is increasingly more important to justify any inv...
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Evergreen Systems, Inc. July 2006
Developing the Business Value of ITIL 2006 Survey Results
In Q3 2006 Evergreen conducted a survey on developing the business value of ITIL at the September itSMF NationalConference. One hundred (100) IT managers, directors and executives from 90 companies, organizations and institutionsparticipated in the survey, designed to:
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Gauge their organization’s commitment to ITIL initiatives such as Change, Problem and Incident Management.
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Assess how thoroughly these organizations had analyzed and re-engineered their processes to conform to these coreinitiatives.
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Calculate how many of these efforts had been quantified and measured via standardized metrics.
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Identify if the targeted projects were being delivered via phases and milestones.A very broad range of industries was represented, lead by Financial Services, Insurance, Retail, Government, Education,Health Care, Energy/Utilities and Pharmaceuticals.This paper provides an analysis of how leading companies approach ITIL process improvements and how these sameorganizations are analyzing their primary pain points and calculating the metrics of improvements.
Key Findings
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Respondents rated service quality, efficiency/cost reduction and IT/business alignment as their top drivers for ITILinitiatives. 80 % of respondents rated service quality as the top business driver for ITIL initiative, with cost reduction(74%) and alignment between IT and the business (64%) rating second and third in importance.
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Resistance to organizational change (78%) and unproven business value (50.5%) were rated as the most significantbarriers to ITIL initiative adoption.
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57% reported that their current ITIL direction focuses on improvement of end-to-end IT service delivery, stressingchange, configuration and release management.
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Top ITIL initiatives were identified as CMDB (64%), Incident and Problem Management (57%), Service Catalog (57%)and Change and Release Management (52%). Only 34% have a published ITIL strategy.
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Less than half (45%) have analyzed their top 5 incidents by call volume, and of these only 31% have performed rootcause analysis on their top problems and less than 10% have business goals with ROI to improve these processes.
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Less than 30% have baselined their top 5 change workflows end-to-end. Of these, less than 19% have re-engineeredthese and less than 10% have quantified risk reduction and quality/cost efficiency gains that could result from re-engineering.
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Less than 19% have implemented four to five reusable change models based on risk and materiality.
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Primary IT service management vendors were identified as BMC/Remedy (29%), HP/Peregrine (25%), CA (8%),Mercury (1%), Other (20%) and None (19%).
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40% reported that 26% or more of their changes were emergency, short-notice changes.
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Fully 44% still use an informal risk management process for Change Management.
Table of Contents
Overview..................................................................................1Key Findings.............................................................................1Background.............................................................................2Survey Findings......................................................................2Key Recommendations.........................................................4Summary and Conclusions..................................................4
Background
As ITIL (Information Technology Infrastructure Library) gains greater acceptanceand adoption, key enterprises continue to drive specific ITIL process improvementinitiatives into their organizations. This survey focused on not only organizations’ITIL maturity level, but also examined in detail which ITIL initiatives theyconsidered primary business drivers, how they were identifying and analyzingthose initiatives, and the metrics, measurements and methodologies they areusing to implement them.This survey focused on a number of areas:
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Gauge their organization’s commitment to ITIL initiatives such asChange, Problem and Incident Management.
•
Assess how thoroughly these organizations had analyzed and re-engineered their processes to conform to these core initiatives.
•
Calculate how many of these efforts had been quantified andmeasured via standardized metrics.
•
Identify if the targeted projects were being delivered via phases andmilestones.
Although ITIL initiatives are on the radar screen for a majority ofenterprises, organizational resistance to change and unproven businessvalue, due to a lack of metrics, still plagues the implementation of many ofthese projects.
Service quality and service delivery are still top priorities, andenterprises seem more focused than ever on exactly which initiatives are beingtargeted, (CMDB, Service Catalog, Incident and Problem Management and Changeand Release Management). However, a good deal of work needs still to be done inthe areas of root cause and work flow analysis, and organizations that haveactually done this work and have metrics and deliverables associated with theanalysis are few and far between.
Survey Findings
Service Quality is far and away the top business driver for ITIL adoption, at 80 %.This focus seems to suggest an increasing concern about the currenteffectiveness of IT in delivering quality services.At 73 % and 64 % respectively, cost reduction/efficiency and IT/businessalignment are the second and third most common business drivers. These threecomponents combine as top drivers to illustrate respondents’ interest not just insaving money, but in making wise business trade-offs between quality of service,costs and efficiencies and in aligning IT goals with those of the restof the business. IT business alignment saw a 35% rise in importance from June’ssurvey on Change Management.
80.2%73.6%63.7%27.5%27.5%0.0% 20.0% 40.0% 60.0% 80.0% 100.0%Service QualityEfficiency/CostReductionIT/bus. AlignmentRegulatoryComplianceBus. Continutity/riskreduction
Business Drivers for Using ITIL
Barriers to the adoption of ITIL initiatives continue to be driven by organizationalresistance to change (78%), followed closely by unproven business value (50%).Linkage between ITIL initiatives and business value continues to grow inimportance as both a driver and (if lacking) a barrier to adoptions.
29.7%41.8%50.5%78.0%0.0% 20.0% 40.0% 60.0% 80.0%Not sure where to startLack of executive supportUnproven business valueOrganizational resistance tochange
Most Significant Barriers to ITIL Adoption
Improvement of end-to-end IT service delivery, focusing on Change, Configurationand Release management was listed by 57% as driving their ITIL direction.
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Evergreen Systems, Inc. P2 October 2006
57.1%26.4%20.5%0.0%20.0%40.0%60.0%
Improve end-to-end IT servicedelivery, focused on svc, chg,conf & rel mgmtApply all ITIL disciplines, acrossinfrastructure & applics end-to-endImprove Service ManagementHelpdesk
Current ITIL Direction
Top ITIL initiatives were ranked almost equally as important by participants, withCMDB coming in at 64%, Incident and Problem Management and Service Catalog at57% and Change and Release Management at 52%.
63.7%57.1%57.1%52.1%0.0% 20.0% 40.0% 60.0% 80.0%
Configurationmanagement/CMDBIncident/problemmanagementService CatalogChange & Rls Mgt
Top ITIL Initiatives
Although most companies were able to rank their most important ITIL initiatives,only 37% had a published ITIL strategy.Less than half of participants (45%) have analyzed their top 5 incidents by callvolume, and of these only 31% have performed root cause analysis on their topproblems and less than 10% have business goals with ROI to improve theseprocesses.
45.1%51.6%40.0% 45.0% 50.0% 55.0%YesNo
Those That Have AnalyzedTop 5 Incidents by CallVolume
30.8%62.6%0.0% 20.0% 40.0% 60.0% 80.0%YesNo
Performed Root Cause Analysis onTop 10 Problems
9.9%20.9%0.0% 5.0% 10.0% 15.0% 20.0% 25.0%YesNo
Top 10 Problems Have BusinessGoals and ROI Improvement by Phase
67% of respondents admitted to not having done baseline analysis on their top 5change workflows end-to-end. Of those that had performed baselines, only 19%have re-engineered those workflows on an end-to-end basis.
29.7%67.0%0.0% 20.0% 40.0% 60.0% 80.0%YesNo
Have Baselined Top 5 ChangeWorkflows End to End
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Evergreen Systems, Inc. P3 October 2006
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Business Value ITIL Survey part 1
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