Service Level Management
GOALS
To maintain and gradually improve IT service quality
trough a constant cycle of agreeing monitoring and
reporting upon IT service achievement and
instigation of actions to eradicate poor service
OBJECTIVES
High quality, cost effective, value-adding IT services
that underpin the organization’s business needs
Play a key role in ascertaining the business
requirements
SLA is written agreement between the customer and
the IT service provider, defining key targets and
responsibilities on both sides
PROCESS
Established Function
Initial Planning activities and Implementation
Implement SLAs
Compile a service catalogue
Establish SLA structure
Establish overview of Service Level Requirements
(SLRs)
Plan UCs and OLAs
Draft and agree SLAs
Manage The Ongoing Process
Monitor and report SLA achievements
Review SLA achievements
Identify Service improvements (SIP)
Periodic Reviews
Review and update SLAs, UCs and OLAs
Review SLM process for efficiency and effectiveness
DEFS
Service Catalog: defines services with default levels
and options. Gives a profile of IT service provider to
org. and overview of services provided to users.
SLR-Service Level Requirements: list of clients reqs.
OLA-Operational Level Agreements: Between 2
intern IT departments
UC-Underpinning Contract: With an external
supplier.
SLA
SIP-Service Improvement Program: SLM with PM
and AM starts a formal project focusing on user
satisfaction
Service Catalog Contents
Version number, date created, date amended; TOC;
Foreword from CIO; IT Service provider profile; Service
times and accessibility of IT Service Provider; Overview
of services and products; Customer focused
service/product description; Specs; Deliverables; Service
times; Maintenance times; Support times; Delivery
times; Quality targets (availability, usability, reliability,
priority); Requirements; Request & Change procedure;
Contigency policy; Pricing & Charging; Index &
Definitions
Financial Management for IT services Capacity Management IT Service Continuity Management Availability Management
GOALS GOALS GOALS GOALS
To provide cost-effective stewardship of the IT assets To ensure that cost-justifiable IT capacity always The goal for ITSCM is to support the overall Satisfy Business objectives
and resources used in providing IT Services exist and that it is matched to the current and future Business Continuity Management process by Achieve sustained level of availability
identified business needs ensuring that the required IT technical and services Ensure cost effectiveness
or facilities can be recovered within required, and Optimize the capability of services and components
Having the appropriate IT capacity and making best agreed, business timescales
use of it
OBJECTIVES OBJECTIVES OBJECTIVES OBJECTIVES
To manage the financial aspects of IT assets and
resources cost-effectively
To account fully for the total spend on the provision
of IT Services and to attribute the cost to the services
delivered
To advise management on IT investment matters by
providing detailed business cases
PROCESS PROCESS – sub-processes PROCESS PROCESS
Budgeting Business Capacity Management Stage 1- Initiation ACTIVITIES
Setting the budget Service Capacity Management Initiate BCM determining the Availability requirements from the business for
IT Accounting Resource Capacity Management Stage2 – Requirements and Strategy a new or enhanced IT Service and formulating the Availability
Building a Cost Model Business impact analysis and recovery design criteria for the IT Infrastructure
Charging ACTIVITIES Risk assessment in conjunction with ITSCM determining the vital business
Setting the Price Monitoring Business Continuity Strategy functions and impact arising from IT component failure
Pricing methods Analysis Stage3 - implementation defining the targets for Availability, reliability and
Differential Charging Tuning Organizational and implementation planning maintainability for the IT Infrastructure components
Billing Implementation Implement stand-by arrangements establishing measures and reporting of Availability, Reliability
Storage of Capacity Management data – the CDB Develop Recovery Plans and Maintainability that reflects the business, User and IT
Demand Management Implement Risk reduction Measures support organisation perspectives
Modeling Develop Procedures monitoring and trend analysis of the Availability, Reliability
Application sizing Initial testing and Maintainability of IT components
Producing of the capacity Plan Stage4 – Operational Management reviewing IT Service and component Availability and
Education and awareness identifying unacceptable levels
Review and audit investigating the underlying reasons for unacceptable
Testing Availability
producing and maintaining an Availability Plan which prioritises
Change Management
and plans IT Availability improvements.
Training
Assurance
DEFS INPUTS Recovery Types INPUTS
Cost Model: by service, location, customer (for Technology Do nothing - Few, if any, organisations can function Business availability requirements
charging) SLA, SLR and Service Catalogue effectively without IT Services. Even if there is a Business impact assessment
Cost Types: HW, SW, People, Accommodation, Business plans and strategy requirement for stand-alone PC processing, there is Availability, Maintainability and Reliability requirements
External services, Transfer costs IS/IT plans and strategy still a need for recovery to be supported. Impact assessment for Vital Business Functions
Cost Elements: Sub elements of Cost Types, like HW = Operational schedules Manual Work-arounds - manual Work-arounds can Incident and problem data
NW, Server, Office Deployment and development plans and programs be an effective interim measure until the IT Service is Configuration and monitoring targets
Cost Category resumed wherever they are practical and possible.
Forward schedule of change Service Level Targets
Capital or Operational Reciprocal arrangements - Entering into an
Incidents and problems
Direct/Indirect agreement with another organisation using similar
Service reviews
Absorbed/Unabsorbed Indirect technology. Benefits can exist, in maintaining some
SLA breaches
Fixed/Variable reciprocal arrangements, for example, in the off-site
Budget
storage of backups and other critical information.
CHARGING OUTPUTS Gradual Recovery (cold standby) - up to 72 hours, OUTPUTS
Notional (Invoiced, not payed), Communication of Info Capacity plan without a re-establishment of full IT facilities. Availability and recovery design criteria
(customer informed of charges to be aware), Pricing CDB Accommodation fully equipped with power and local Agreed targets of availability, rel., maintainability
Flexibility (Rates charged annually) network cabling Infrastructure, telecom connections.
Baselines and profiles Reports on achieved A.R.M
Fixed or portable facility.
Thresholds and alarms Availability monitoring
Pricing Method/Policy When opting for a gradual recovery, consideration
Capacity reports (regular, at hock and Exception) Availability improvements plans
Cost Plus – cost + profit rate must be given to highly customised items of
SLA and SLR recommendations hardware or equipment that will be difficult, if not
Going Rate – comparable to other dept services Costing and Charging recommendations
impossible, to replace.
Market Price – match external supplier price Proactive changes and service improvements
Negotiated Contract Price Intermediate Recovery (warm standby) 24 to 72 hour
Revised operational schedule period. It is usually far away (logistics) and shared
Effectiveness reviews with 20 to 30 other companies. Use 6-12 weeks. Can
Audit reports be portable, in a trailer.
Immediate Recovery (hot standby) provides for
immediate restoration. Application systems and
communications already available and data mirrored
from the operational servers. In the event of a system
failure, the Customers can immediately switch to the
backup facility with little or no loss of service.
System can be used as backup and reporting resource.
 Service Level Management
BENEFITS
Customer and IT service provider have a clearer
view of requirements and responsibilities
Commitment on both sides
Specific targets to aim for
Week areas will be identified
Supports supplier management (internal and
external)
Demonstrable performance indicators
Gradual improvements in service quality
Better forward planning / both customers and IT
Will show where customer/user actions are causing
difficulty and identify where working practice need
to be improved
IT service will be defined to meet Service Level
Requirements
SLAs can be used as a basis for charging
Improved communication between IT and customers
Better value for money
PROBLEMS
ensuring targets are achievable (use existing
achievements if known)
verifying targets prior to agreement (prior
monitoring, pilot SLAs)
Monitoring of actual achievement (only agree what
can be monitored)
Inadequate resources and time (process must be
properly staffed and resourced
Lack of understanding (educations)
Differences in perceptions within the customer
community (need to agree relevant targets at all
levels)
Not enough seniority (give Service Level Manager
the appropriate authority)
SLA may not be supported by adequate underpinning
agreements/contracts (review OLAs and contracts)
KEY PERFORMANCE INDICATORS
what number or percentage of Services are covered
by SLAs
are Underpinning contracts and OLAs in place for all
SLAs and for what percentage?
are SLAs being monitored and are regular reports
being produced?
are review meetings being held on time and correctly
minuted?
is there documentary evidence that issues raised at
reviews are being followed up and resolved (e.g. via
an SIP)
what number or percentage of Service targets are
being met and what is the number and severity of
service breaches?
are service breaches being followed up effectively?
are service level achievements improving
are Customer perception statistics improving?
are IT costs decreasing for services with stable
(acceptable but not improving) service level
achievements?
are SLAs, OLAs and underpinning contracts current
and what percentage are in need of review and
update?
CRITICAL SUCCESS FACTORS
Meeting Customer Needs And Priorities
Adherence To Service Levels
Providing Services Cost Effectively
Controlling Service Delivery
Maintaining Recognized Industry Acceptance For IT
Quality
Maintaining An IT Service Culture
Financial Management for IT services
BENEFITS
Increased Confidence in budgets
Accurate information supplied for investment and
TCO purposes
Increased professionalism and efficiency
Warning over or under usage of service
Sound business method of balancing IT service
provision with business requirements
The cost of doing or not doing a Change
PROBLEMS
Lack of understanding leading to inefficient, overlay
expensive or over-complex systems
Monitoring tools inaccurate or too expensive
Delay in obtaining, or inaccurate, information
Difficulty in recruiting staff with accountancy and IT
skills
Unable to respond to changes quickly enough
Lack of management understanding and support
KEY PERFORMANCE INDICATORS
Overall cost of delivery per customer
Percentage of IT costs not accounted for
Dollar value of budget variances/adjustments
Percentage of IT financial objectives met
IT Service Headcount
CRITICAL SUCCESS FACTORS
Effective stewardship over IT finances
Establishing Process
Planning
Implementation
Operational
Managing change
Managing variances
Capacity Management
BENEFITS
Minimize risk of failing to meet SLAs and SLRs
More confident forecasting
Value to the applications lifecycle
Increased efficiency
Cost savings and cost avoidance
Timely enhancements and upgrades
PROBLEMS
Unrealistic expectations
Vendor influence
Lack of accurate information
- business data
- technical data
Distributed environments
Level of monitoring to be implemented
KEY PERFORMANCE INDICATORS
Resource forecasts
- timely production of forecasts
- accurate forecasts if trends in resource util.
- incorporation of business plans into cap. plan
Technology
- ability to monitor perf and troughput
- impl. Of new tech. in line with business
requirements (time cost functionality)
- use of old technology does not result in breached
SLa due to problems
Cost effectiveness
- a reduction in panic buying
- not significant over-capacity
- accurate forecasts of planned expenditure
Plan and implement the appropriate IT capacity to
match business needs
- reduction in lost reduction in the incidents due to
poor performance
- reduction in lost business due to inadequate
capacity
- new services are implemented which match SLR
-recommendation made by capacity mgt. are acted
upon
CRITICAL SUCCESS FACTORS
Accurate business forecasts
knowledge of IT strategy and plans, and that the
plans are accurate
an understanding of current and future technologies
an ability to demonstrate cost effectiveness
interaction with other effective Service Management
processes
an ability to plan and implement the appropriate IT
Capacity to match business need
IT Service Continuity Management
BENEFITS
The annual spend on ITSM can be controlled
Cost justifiable risk reduction measures can be
implemented
The ability to recover in a controlled manner
All staff aware of their role relating to ITSCM
Potential lower insurance premiums
Meetings regulatory requirements
Better business relationships
Positive marketing of contingency capabilities
Organizational credibility
Competitive advantage
Contingency Plan
IT infrastructure, comprising the replacement system,
plus contracts/agreements necessary for recovery
IT Infrastructure Management and operating
agreements/procedures during a disaster
Personnel - details of those needed at contingency
site plus accommodation required
Security instructions, emergency contacts and items
for home site
Contingency site: location, people, facilities, security
and transport arrangements
Return to normal - dependencies affecting the return
KEY PERFORMANCE INDICATORS
Percentage of Vital Business Functions covered by IT
Service Continuity Plans
Percentage of Vital Business Functions covered by
annual IT Continuity tests
Number of annual IT Service Continuity Plan testing
failures
Number of 3rd party recovery support contracts not
agreed
Number of audits performed on IT Service
Continuity Plan
Number of business issues logged against IT Service
Continuity.
CRITICAL SUCCESS FACTORS
Ensuring IT Service Recovery Within Agreed
Timescales
Availability Management
BENEFITS
A single point of accountability for availability is established
within the organization
IT Services are designed to meet the IT Availability
requirements of the business
the levels of IT Availability provided are cost justified
the levels of Availability required are agreed, measured and
monitored to fully support Service Level Management
shortfalls in the provision of the required levels of Availability
are recognised and appropriate corrective actions identified and
implemented
a business and User perspective of IT Service Availability is
taken to ensure optimal usage and performance of the IT
Infrastructure is achieved to deliver maximum benefit
the frequency and duration of IT Service failures is reduced
over time
IT support organisation mindset moves from error correction to
service enhancement; from reactive to proactive attitude
the IT support organisation is seen to 'add value' to the
business.
PROBLEMS
Defining availability levels that are meaningful to the business
Managing internal and external providers is made difficult by
lack of agreed availability targets
Assessing achievable and cost-effective levels of IT service
availability
New services are implemented without full consideration of
availability requirements
Loss of business and reputation due to unstable IT services
Lack of accountability
DEFINITIONS
Availability – Ability of an IT Service or CI to perform its
required function at a stated instant or over a stated period of time
Reliability – freedom from operational failure. Rel. of an IT
service is determined by rel. of each component delivering the
service.
Maintainability – ability of a CI to be kept in, or to be restored to
an operational state.
Serviceability – describes contractual arrangements made with 3rd
party IT service providers to assure Avail., Rel. and
Maintainability. of IT services and their CIs.
Resilience – capacity of an IT service to allow continued operation
of IT despite the failure of one or more sub-systems.
Vital Business Function – business critical element of business
process.
Security – deals with confidentiality, integrity and availability of
data.
AMDB – record & store info reqd. for support of key activities:
reporting, analysis and availability forecasting...
Service Window – period in which maintenance can be completed
on a service
CRITICAL SUCCESS FACTORS
 Service Level Management
RESPONSIBILITIES SLMgr
creates and maintains a catalogue of existing
Services
formulates, agrees and maintains an appropriate SLM
structure (SLA, OLA, Contracts, accommodating
service improvement plan within SLM)
negotiates, agrees and maintains the Service Level
Agreements with the Customer
negotiates, agrees and maintains the Operational
Level Agreements with the IT provider
negotiates and agrees with both the Customer and IT
Provider any Service Level Requirements for any
proposed new/developing services
analyses and reviews service performance against the
SLAs and OLAs
produces regular reports on service performance and
achievement
organizes and maintains the regular Service Level
review process
initiates any actions required to maintain or improve
service levels
conducts annual (as appropriate) reviews of the entire
Service Level process and negotiates, agrees and
controls any amendments necessary
acts as co-ordination point for any temporary
Changes to service levels required
SMART: Specific- Measurable- Achievable- Realistic -
Time based
SLA STRUCTURES
Customer Based – With a customer group
Service Based – For customers of a service (e-mail)
Multi-Level SLAs
Corporate Level – cover generic SLM issues
Customer Level
Service Level
Meeting Customer Needs and Priorities: Customer
satisfaction score/rating ; Average time to implement
SLA requests ; Number of SLAs in renegotiation ;
Number of SLAs requiring changes (targets not
attainable, etc.) ; Number of SLA issues logged
Adherence To Service Levels: Number of SLA targets
missed ; Number of SLA targets threatened
Providing Services Cost Effectively: Current cost per
customer for delivery of services ; Percentage
improvement in delivery cost per customer
Controlling Service Delivery: Number of OLA issues
logged ; Number of Underpinning Contract issues
logged
Maintaining Recognized Industry Acceptance For IT
Quality: Number of ITs articles/white papers published ;
Percentage IT Operations staff in industry (i.e; itSMF)
programs ; Percentage progress towards industry
certification (i.e; ISO9000) ; Dollars spent on external
communications activities
Maintaining an IT Service Culture: Percentage of IT
Operations staff ITIL-aware ; Number of IT Operations
staff ITIL certified ; Number of IT Operations staff with
advanced ITIL certification ; Number Of Agreed SLAs
Not Supported By OLAs/UCs
SLA Content
General details
Service hours
Roles and responsibilities
Availability, Reliability, Maintainability &
Serviceability
Service Performance
Customer Support
Example incident targets
Printing
IT Service Continuity
Security
Change management Procedures
Charging
Quality / Customer perception
Administration (Reporting, service reviews,..)
Financial Management for IT services
RESPONSIBILITIES
Budgeting:
manage the IT organisation budget
prepare budget forecasts and assist Customers in
preparing IT elements of their budgets
report regularly to IT managers and Customers on
conformance to budgets
Accounting:
select suitable tools and processes for gathering Cost
data
develop suitable cost models
agree suitable IT Accounting policies, e.g.
Depreciation
assist in developing cost-benefit cases for IT
investments
advise senior management on the cost-effectiveness
of IT solutions
Charging:
identify methods of charging within the organisations
charging policy
provide justifications and comparisons for charges
prepare regular bills for Customers
prepare a price list of Services, if required
INTERFACES
CfgM:
- manages assets and cost information
SLM :
- cost provision impacts service..;
- Supplied with cost of meeting current and new
requirements
CM, AM:
- Supplied with cost of meeting cap. and avail.
- some data shared – e.g. Machine data sharing
Cost types:
Hardware, Software, Employment, Accommodation,
External services and Transfer
Cost Elements:
Breakdown of cost types (HW/ server/ NT/ HR server…)
ELEMENTS of fin. management
Budgeting
Accounting
Charging
Fin Management Cycle
Planning annual:
Budgeting (agree overall expenditure)
IT Accounting (Establish standard unit cost for each
IT resource)
Charging (Establish Pricing policy, Publish price list)
Operational monthly:
Budgeting (take actions to manage budget
expectations or charged costs)
IT Accounting (Monitor Expenditure by cost-centre)
Charging (Compile and issue bills)
Capacity Management
RESPONSIBILITIES
ensures that appropriate levels of monitoring of
resources and system performance are set, and that
the information recorded in a CBD is kept up-to-date
and used by all parts of the Capacity Management
process
produces Capacity Plans in line with the
organisation's business planning cycle, identifying
Capacity requirements early enough to take account
of procurement lead times
documents the need for any increase or reduction in
hardware based on SLRs and cost constraints
produces regular management reports which include
current usage of resources, trends and forecasts
sizes all proposed new systems to determine the
computer and network resources required, to
determine hardware utilisation, performance service
levels and cost implications
recommends resolutions to performance-related
Incidents and Problems
recommends to IT management when to employ
Demand Management, to dampen Customer
demands on systems
carries out ad-hoc performance and Capacity studies
on request from IT management
is represented on the CAB, assessing and authorising
Changes
ensures that regular and ad hoc audits are carried out
on the Capacity Management process
INTERFACES
IM- scripts for diagnostics
- performance counters
PM- scripts for diagnostics
- performance counters
ChM- assist in CAB assessing business impact
- raise RFC if needed
RM- helps with distribution strategy (network
bandwidth,..)
- after distribution capacity audits
CfgM- gets information about CIs
- stores capacity information in CMDB
SLM - Perf. And capacity targets
- assist SLM drafting OLAs
FM - cost summary as part of capacity plan
- resource utilization basis for charging
ITSCM - capacity needed for recovery options used
- maintain ITSCM capacity requirements in line with
production
AM - Share common goal slow performance is
effectively the same as unavailability
IT Service Continuity Management
RESPONSIBILITIES ITSC Manager
Develop and manage the ITSCM Plan to ensure that,
at all times, the recovery objectives of the business
can be achieved.
Ensure that all IT Service areas are prepared and able
to respond to an Invocation of the Continuity plans.
Maintain a comprehensive IT testing schedule.
Undertake quality reviews of all procedures and
ensure that these are incorporated into the testing
schedule.
Communicate and maintain awareness of ITSCM
objectives within the business areas supported and IT
Service areas.
Undertake regular reviews, at least annually, of the
Continuity plans with the business areas to ensure
that they accurately reflect the Business processing
Environment.
Negotiate and manage contracts with providers of
third party recovery services.
Manage the IT Service delivery during times of crisis
including:
o Co-ordination with the crisis control team
o Invocation of the appropriate recovery
facilities
o Resource management, direction and
arbitration
o Recovery site management.
INTERFACES
SD, IM, PM
- Provides historical data
- Customer liaison
ChM
- Ensures the on-going accuracy of continuity plans
- - SLR provide availability requirements
CfgM
- Identifies the core infrastructure
SLM
- understands the obligations of IT service provision
FM
- - Input from AM is the availability and design criteria tom
CM
- ensure business requirements are fully supported
trough the appropriate IT hardware resources
AM
- delivers risk reduction measures to maintain
business-as-usual
Availability Management
RESPONSIBILITIES (A. Manager)
to be accountable for the deployment of the AM process and
associated methods and techniques
to be responsible for ensuring the AM process is regularly
reviewed and audited, and that all of these are subject to cont.
improvement and remain fit for purpose
to be responsible for determining the Av. requirements from the
business for new or enhanced IT Services
to be responsible for the creation of A and recovery design
criteria to be applied to new or enhanced Infrastructure design
to be responsible for ensuring the levels of IT A. required are
cost justified
defining the targets of A. required for the IT Infrastructure and
its components that underpin a new or enhanced IT Service as
the basis for an SLA
establishment of measures and reporting that reflect business,
User and IT support org. requirements
responsible for the monitoring of actual IT A. achieved vs
targets and to ensure shortfalls are addressed
to be responsible for the production and maintenance of an A.
Plan which prioritises and plans IT A. improvements
to promote AM awareness and understanding within the IT
support organisation
to maintain an awareness of technology advancements and IT
best practice, e.g. ITIL.
INTERFACES
ChM
- Input from AM is details of the planed maintenance regime
- input to AM is schedule of planned maintenance activities
SLM
- provide information what is availability of the system for SLA
FM
- input to FM is cost of nonavailability
- output from FM cost associated with proposed upgrades to the
infrastructure
ITSCM
- output from ITSCM is business impact assessment
maintain “business as usual” by preventing or minimizing
impact of failure by use CFIA
CM
- input from AM is completed CFIA
- input from CM is capacity plan
AM methods and techniques
Redundancy and resilience
Component Failure Impact analysis (CFIA)
Fault tree Analysis (FTA)
CCTA Risk Analysis & Management Method (CRAMM)
Service Outage Analysis (SOA)
Technical Observation Post (TOP)
Incident Lifecycle Management
Continuous Improvements
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