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ITIL Service Strategy processes adoption in chosen SMEs in Poland.

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 The 4th International Virtual Conference on Advanced Scientific Results
ITIL Service Strategy processes adoption in chosen
SMEs in Poland
Magdalena Ciesielska
Opole University of Technology
Department of Organization and Enterprise Management
Opole, Poland
Abstract—Modern IT companies turn their attention toward
business oriented management of IT services. Achieving this task
is strengthen by the existence of IT service management
frameworks such as ITIL or ISO/IEC 20000. However, to adopt
this approach the strategic management of IT services is to be
deployed. Strategic management of IT service is important
especially to small and medium sized enterprises, that are seeking
for the competitive advantage. This article presents the results of
primary research on 174 small and medium sized enterprises in
Poland, aimed on assessment of attitudes toward ITIL Service
Strategy adoption.
Keywords- ITSM, ITIL, Service Strategy, SMEs
I. INTRODUCTION
Nowadays, small and medium sized IT enterprises are
seeking for competitive advantage on the market. Many
business managers [1][2] have spotted the increase popularity
of IT service management (ITSM). Complexity of IT services
and their increasing number forces enterprises to deliberate on
adopting chosen aspects of IT service management. There are
few IT service management frameworks, that exist on the
market: Information Technology Infrastructure Library (ITIL),
ISO/IEC 20000, CobiT or ISO 27001. The most popular ITSM
framework is ITIL, because it offers the liberty of choosing
areas and processes to implement by the IT company, while
ISO/IEC 20000 standard forces company to adopt all the
processes in order to get the certificate. Both ITIL and ISO/IEC
20000 are developed on the IT service lifecycle basis. First,
and the most important areas of deployment of ITSM approach
in small and medium sized enterprises (SMEs) is the service
strategy. This article consist of five parts, that describe the
issue. In the first part of the article author describes ITSM
frameworks. Second part of the article presents the processes of
ITIL Service Strategy phase, that are: strategic management of
IT service, service portfolio management, financial
management, demand management and business relationship
management (BRM). Third part of the article presents the
methodology of the primary research. Next, the obtained
results are presented, to provide conclusion, that states the fifth
part of the article.
II. IT SERVICE MANAGENT FRAMEWORKS
To implement modern way of thinking about provision of
IT services, organizations first must change their thinking of IT
services: from technology focused approach toward business
oriented approach. This change is important especially for
SMEs that must judge their investment in IT and possess
Business
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limited financial resources. Technology oriented approach
toward the management of IT services is focused on delivering
the high quality IT services, lacking the view of customer’s
business needs. Therefore ITSM approach forces organizations
toward application of business oriented thinking, that result in
improvement of quality of IT services and should improve
customer satisfaction. This article presents the short summary
of the most recognized ITSM frameworks that exists on Polish
market. ITIL has been developed in Great Britain in late 80s of
20th century, as the answer for the growing number of IT
services provided to the Office of Government Commerce and
difficulties in their management. Till now ITIL has evolved
through three versions, and current version to as ITIL v3. ITIL
is developed upon the IT service lifecycle that consists of five
phases: Service Strategy, Service Design, Service Operation,
Service Transition and Continual Service Improvement. ITIL is
described in five publications that describes each of the
lifecycle phase. In each publication the guidance as to what
direction the enterprises must take to adopt ITIL in each area.
Development of ITIL resulted in British Standard 15000.
ISO/IEC 20000 is the first international standard for IT service
management and is developed on the BS 15000. It has been
first published in 2005. The differences between the BS 15000
and ISO/IEC 20000 are scarce. ISO/IEC consists of two parts:
ISO/IEC 20000-1:2005 and ISO/IEC 20000-2:2005. The first
part presents the requirements for management system to be
certified. Second part of the norm includes the objectives and
points the activities, that must be takes to fulfill the
requirements. International standard ISO 27001 constitutes the
requirements for developing, implementing, exploring,
monitoring, reviewing, maintenance and improvement of
Management System of Information Security. ISO 27001 use
the PDCA model. CobiT is internationally accepted set of
guidance for IT governance. CobiT provides the policy
development and good practice for IT control through the
organization. CobiT ensures the knowledge on control
mechanisms in IT organization and presents rather the
activities that must be implemented than guidance. IT
organizations combine using CobiT together with other ITSM
frameworks.
III. PROCESSES OF ITIL SERVICE STRATEGY
Service Strategy is the core phase of Service Lifecycle and
is focused on ensuring that organization’s strategy is defined,
maintained and implemented. Service Strategy provides
guidance to IT managers on how to operate in order to ease
decision making that is based on deep understanding of the
eISSN: 1339-9071, cdISSN: 1339-3561
ISBN: 978-80-554-1234-4
 The 4th International Virtual Conference on Advanced Scientific Results
June, 6. - 10. 2016, www.scieconf.com

offered services [3]. Service Strategy is to ensure the business provider, current investments, design of the new services,
units to support business, handle the costs and risks associated plans, contracts and third-party services. The service portfolio
to the IT services in service portfolio. Below author presents represents the commitments and investments made by a service
the description of five ITIL Service Strategy processes. This provider across all customers and market spaces. According to
part consists of five parts that are devoted to each Service ITIL service portfolio consist of three main components:
Strategy process. service pipeline, service catalog and retired services. Service
pipeline consists of these services that are:
A. Strategy management for IT Service
The objective of ITIL strategy management for IT is to  The service pipeline consists of service under
assess the service provider’s offerings, capabilities, competitors development for a given market space or customer.
and current and potential market spaces in order to ensure The pipeline presents the service provider’s growth and
maximum value for the organization. Therefore the strategic strategic approach toward provision of the IT services.
management for IT service according to ITIL, is responsible  Service Catalog is a subset of service portfolio that is
for definition and maintaining the perspective, position, plans visible to customers. The service catalog In the service
and patterns of organization regarding to organization’s catalog services are decomposed into components.
services and their management. The process consists of three Catalogue items are clustered into Lines of Service
sub-processes: strategic service assessment, service strategy based on common patterns of business activity they
definition and service strategy execution. IT service can support. Service catalog serves a services order and
management approach forces organizations to adopt the demand channelling mechanism. The service catalog
strategic management, that is a must of the modern IT presents actual and present capabilities of the service
organization. The service strategy management is crucial provider. Service catalog is essential to identify client’
especially to small and medium sized enterprises, as they lack needs and it is recommended that it should be easily
the strategic approach toward provisioned services. Hence, the and widely accessed by clients and technical staff [4,
process is deployed, the KPIs are developed. The KPIs p.15]
examples are: number of planned services, number of
unplanned new services, number of strategic initiatives,  Retired services consists of services that are phased out
number of new customers or number of lost customers. or retired. Phased-out services are not available to new
customers or contracts, unless special business case is
TABLE I. EXAMPLES OF HOW SERVICE POTENTIAL IS INCREASED BY made.
STRATEGIC SERVICE MANAGEMENT
Implementation of service catalog in small and medium
Service management Increasing service Increasing service
initiative potential from potential from
sized enterprises provides some benefits. Most of all service
capabilities resources catalog supports partnership among the service provider and
Data centre Better control over Increases the capacity the client. It supports provision of business oriented IT services
rationalization service operations of assets and focuses on achieving business results. The service catalog
Lower complexity in Increases economies supports financial management of IT services, and ease the
infrastructure of scale and scope identification of costs of its provision. The development of
Development of Capacity building in
infrastructure and service assets service catalog is a challenging task, especially to small and
technology assets medium sized enterprises, because it is essential to identify the
Training and Knowledgeable staff Staffing of key service provider’s stakeholders, process owners, clients and
certification in control of service competencies third-party contractors. To achieve benefits from service
lifecycle Extension of Service catalog development, small and medium sized enterprises must
Improved analysis and Desk hours
decisions
implement process of its management. The service catalog
Implement incident Better response to Reducing losses in management process is responsible for maintaining the service
management process service incidents resource utilization catalog and ensuring its updating.
Prioritization of
recovery activities C. Financial Management
Develop service Systematic design of Reuse of service Financial management is the process that ensures the
design process services components operational visibility and insights in the costs of IT services in
Enrichment of design Fewer service failures
portfolio through design
the organization. Financial Management is a strategic tool that
Thin client computing Increased flexibility in Standardization and should be applicable to among whole organization. Financial
work locations control of management provides the business and IT with the
Enhanced service configurations quantification, in financial terms, of the value of IT services,
continuity capabilities Centralization of the value of assets underlying the provisioning of those
admin functions services and the quantification of operational forecasting [3,
Source: [3, p.128].
p.148]. The benefits of financial management are: enhanced
decision making, speed of change, service portfolio
B. Service Portfolio Management management, financial compliance and control, operational
control, value capture and creation, better objective
Service portfolio is the set of all IT services, that are
formulation, current information on costs, more efficient use of
provided by the service provider. Service portfolio is broadly
IT resources and increased human capital capabilities. The use
defined, that covers such issues as: obligations of the service

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 The 4th International Virtual Conference on Advanced Scientific Results
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of financial management to provide services with the cost persons and which have an annual turnover not exceeding 50
transparency, that can be understood by the business and million euro, and/or an annual balance sheet total not
reflected in the planning processes for demand management, exceeding 43 million euro [6]. The research techniques was
what leads to the cost saving and demand management Computer Assisted Web Interview (CAWI) and Computer
capabilities. Financial management is an input to the service Assisted Telephone Interview (CATI). More than 2000 SMEs
portfolio management. Benchmark of cost against other were requested to complete the questionnaire. The author
providers and reasonable decision making are enabled by received 174 usable responses. The sample is not representative
application of financial management within the organization. to all SMEs from 62nd division of PKD. The respondents
characteristic is presented in the Table II.
D. Demand Management
There is an obvious relationship between the consumption TABLE II. CHARACTERISTICS OF RESPONDENTS
and the demand. Consumption influences on demand and
production consumes demand. Services due to their Item Category/ Number or Percent of Respondents
immateriality cannot be manufactured and stocked in an Small Medium
Firm size 151 23
inventory. Therefore the capacity and the demand are tight 87.0 13.0
together, and their efficient management leads to improved Owner Top management Service manager
quality of services delivered and limits the growth of the 34.0 21.0 6.0
service. The demand management use the business activity
patterns (PBA), that define dynamics of a business and include Respondent’s Operational Project Quality/process
interactions with customers, suppliers, partners and other position in manager manager improvement manager
organization 3.0 3.0 1.0
stakeholders [3, p.214]. PBA together with users profiles are a
useful tool for demand management. The service provider Analyst Consultant Other
possess an adequate information on types of service, service 3.0 5.0 24.0
Source: own collaboration.
levels and service assets in relation to the demand changes.
E. Business Relationship Management V. RESULTS
Business relationship Management process purpose is to The respondents were polled regarding the level of
establish the relationship between the service provider and adoption of chosen ITSM frameworks. The respondents were
customer around understanding and meeting business asked to rank the level implementation of the ITIL, ISO/IEC
requirements [3]. This process focuses on customer 20000, ISO 27001 and CobiT framework from 1 to 5. The
satisfaction. BRM drives he organization focus not only on results are presented in the Table III. Majority of the polled
building the relationship but also on driving discussion on enterprises do not adopt neither the ISO/IEC 20000 (N=167;
service levels of provided business services. BRM is the N=96%) nor ITIL (N-162; N=93%). 5 respondents reported
process that ensures both achieving outcomes and fulfilling full implementation of ITIL. Majority of polled enterprises
strategic requirement as it’s collaborated to service level declared the lowest level of process implementation “no plan of
management process, change management process and its adoption” regarding all ITSM frameworks. ISO 27001 is
primary focus is on customer satisfaction. adopted by 12 respondents. Medium sized enterprises report
the highest level of ISO 27001 adoption “fully adopted”. Most
IV. METHODOLOGY OF THE RESEARCH of the respondents to not plan to implement CobiT, only 1
The objective of this research is to identify the level of small enterprises reported on full implementation of CobiT.
adoption of ITIL Service Strategy processes within small and
medium sized enterprises in Poland. The object of the research TABLE III. ADOPTION OF CHOSEN ITSM FRAMEWORKS
is to identify the level of adoption of the chosen ITSM ITSM Firm’s Level of Process Adoption / Number
frameworks and processes: strategic management for IT, Framework size of Enterprises
service portfolio management, financial management, demand 1 2 3 4 5
management and business relationship management. The ISO/IEC 20000 small 148 1 2 0 0
medium 18 1 0 2 1
object of the research have been reflected in the questionnaire.
ITIL small 143 5 0 0 3
At the beginning the questionnaire consists of basic questions medium 19 1 0 1 2
to identify the respondents by enterprise’s size and position of ISO 27001 small 139 6 3 1 2
the respondent in the organization. Next the respondents were medium 15 2 0 0 6
polled regarding the chosen ITSM frameworks: ITIL, ISO/IEC CobiT small 147 3 0 0 1
20000, ISO/IEC 27001 and CobiT adoption; and level of medium 23 0 0 0 0
Source: own collaboration.
Service Strategy process adoption. The measurement scale is
developed on the basis of Cater-Steel and Tan [5] 5-point Next, respondents were asked to rank their attitude toward
Likert type scale, ranging from 1 – no plans of adoption to 5 – ITIL service strategy processes implementation. The results of
fully adopted. The target population is small and medium sized the research are presented in the Table IV. Majority of small
enterprises from division 62 of PKD 2007, that is computer enterprises (N=56%) adopted the service management process,
programming, consultancy and related activities in Poland. The among which 45% of respondents point full process adoption.
commonly used definition is the European Union definition of The results differ among medium sized enterprises. Majority of
SME. According to it SME is the category of micro, small and medium sized enterprises (N=61%) do not adopt the process,
medium-sized enterprises which employ fewer than 250 however among those which adopted the process 22% declared

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 The 4th International Virtual Conference on Advanced Scientific Results
June, 6. - 10. 2016, www.scieconf.com

its full adoption. The service portfolio management process ITSM maturity at the one hand and limited knowledge on
have been implemented by 54% small and 48% medium sized ITSM frameworks on the other hand. Polled SMEs in Poland
enterprises. Among all polled enterprises 28% (N=49) have are more technology rather that business oriented and the shift
fully adopted service portfolio management process. Among toward the recognition of customer’s business needs is
small enterprises the process is adopted by 82 enterprises, half recommended. It is crucial to small and medium sized
of which report full adoption status. Financial management is enterprises to develop the service strategy. This is the first and
adopted by 55% respondents. 38 small and 8 medium sized the most important step to take. Polish SMEs need innovation
enterprises declare full adoption of the process. The opinion to become competitive on the European or global market [8, 9,
regarding application of the strategic management for IT 10] Small and medium sized enterprises in Poland from ICT
services (Mdn=2; IQR=4), service portfolio management sector must think about process innovation in order to provide
(Mdn=1; IQR=3) and financial management (Mdn=2; IQR=3) the supply for increasing demand for ICT tools and techniques
process is polarized. Most of the respondents do not plan to arise on the Polish market [11]. The shift toward modern
implement the demand management in their organizations business oriented IT organization in Polish SMEs is still not
(N=56%) however 17% of small enterprises fully adopt the developed. According to obtained results more than half but
process. 63% of medium enterprises do not adopt demand less than 60% of polled SMEs report on adoption of ITIL
management process while 13% of them have fully adopted the Service Strategy processes. Near half of polled SMEs do not
process. The business relationship process is adopted by implement any of these processes and do not even plan to
majority of small enterprises (N=58%) and medium sized adopt any of the ITSM frameworks. Hence, this results suggest
enterprises (N=52%). 26% of small enterprises and 30% of limited ITSM maturity of polled enterprises that is in
medium enterprises have fully adopted BRM process. accordance to [12].
Presented results show that ITIL Service Strategy processes are
implemented by majority of polled small and medium sized According to the obtained results majority of polled SMEs
enterprises. The strategic management for IT services process in Poland are implementing the Service Strategy processes
is adopted by 56% of polled SMEs in Poland. Service portfolio (except the demand management) in their organizations. The
management process is adopted by 52% of polled SMEs in actions toward full implementations of further mentioned
Poland. The financial management process is adopted by 55% processes characterize those polled SMEs, that have already
of polled SMEs in Poland. The demand process is not adopted adopted one of the processes. However, it must be noticed that
by the majority (57%) of polled SMEs in Poland and the respondents have put some confusions to the researcher. Most
business relationship management process is adopted by 57% of the polled SMEs declared the application of financial
of polled SMEs in Poland. management of the IT services while scientific literature [13,
14] suggest the opposite: low or lack of financial management
TABLE IV. ADOPTION OF ITIL SERVICE STRATEGY PROCESSES of IT services. Is it possible that respondents confused the
financial management to financial management of IT services?
ITIL Service Firm’s Level of Process Adoption / This issue is the potential object of the further investigation.
Strategy size Number of Enterprises
process More than half of polled enterprises declared the Service
1 2 3 4 5 portfolio management process adoption. This suggests that
Strategic small 58 5 7 13 68 service catalog in these companies have been developed as it is
management the crucial item of the service portfolio. Therefore, the question
for IT medium 13 1 2 2 5 arises: Do SMEs of ICT market associated to programming
services (Division 62 of PKD) introduce also service catalog
Service small 65 4 11 30 41 management? The service catalog management process is
Portfolio essential to obtain benefits that development of service catalog
management medium 11 1 2 1 8
offers. This issue is an interesting field of study for the future
Financial small 60 7 12 34 38 research.
Management
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VI. CONCLUSIONS London: TCO, 2011.
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