ITSM-2022-23.Aulas.02.Service Management Key Concepts

Information Technology
Infrastructure Library
A fundamental understanding
of ITIL 4
 Service Management: Key

Concepts
 The Guiding Principles
 The Four Dimensions of Service
Management
 Service Value System
 Continual Improvement
 The ITIL Practices
HOW IT WORKS
WORK
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CONTRIBUTE ENGAGE
Service Management: Key
Concepts
START TOGETHER
INTERACT
CAPTURE
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GIVE STUDY
PARTICIPATE
Summary
 ITIL
– History
– ITIL 4 Key Concepts
 Service Management as a Practice

– Business and IT
– Definition of Service Management
– Stakeholders in Service Management
– What is IT?
– The IT Organization
– Definition of Service
– Service Offering and Service Relationships
– Output, Outcome, Cost, and Risk
– Service Value = Utility and Warranty
– Practice
– Process Model
– Characteristics of Processes
Module 2: Service Management: Key Concepts Rui Soares 2022 - IT Service Management – ITIL® 4 Foundation | NOVA IMS
 ITIL
– History
ITIL History
 ITIL = IT Infrastructure Library

 History:
 Emerged in 1980’s
 ITIL v2 in 2001
 ITIL v3 in 2007
 ITIL 2011 Edition in 2011
 ITIL 2016 Practitioner course
 ITIL 4 in 2019
 ITIL is non-proprietary
 Based on best-practice in industry
 itSMF international User group
ITIL® is a Registered Trade Mark of AXELOS Limited
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Concepts Rui Soares 2022 - IT Service Management – ITIL® 4 Foundation | NOVA IMS
ITIL History
ITIL is an acronym for the IT Infrastructure Library and provides a source of good practice in IT
Service Management. ITIL is used worldwide by organizations to establish and improve
capabilities in Service Management. In the same area, ISO/IEC20000 provides a formal and
universal standard for organizations seeking to have their Service Management capabilities
audited and certified. While ISO/IEC20000 is a standard to be achieved and maintained, ITIL
offers a body of knowledge useful for achieving the standard. It is important to note that
organizations CANNOT become ITIL certified, only people can.
ITIL emerged in the 1980s while the UK Government’s Central Computer and
Telecommunications Agency (CCTA, which is now known as the Office of Government
Commerce) gathered practices from users, suppliers and consultants. The amount of
publications comprising the ITIL library grew to more than 30 books, but was not widely
embraced by the industry until the mid 1990s. To make ITIL more accessible, ITIL v2 focused on
reducing the amount of books, of which two (Service Support and Service Delivery) became the
most used.
ITIL Service Management practices are not based on any particular technology platform or
industry type.
ITIL History
 ITIL = IT Infrastructure Library

 History:
 Emerged in 1980’s
 ITIL v2 in 2001
 ITIL v3 in 2007
 ITIL 2011 Edition in 2011
 ITIL 2016 Practitioner course
 ITIL 4 in 2019
 ITIL is non-proprietary
 Based on best-practice in industry
 itSMF international User group
ITIL® is a Registered Trade Mark of AXELOS Limited
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
ITIL History
In 2005, the OGC began an effort to further improve the ITIL Library. A major refresh project
began and authors from throughout the industry were appointed to develop ITIL v3, which now
consists of five books.
In July 2011, the 2011 edition of ITIL was published, providing an update to the version published in
2007. The OGC is no longer listed as the owner of ITIL, following the consolidation of OGC into the
Cabinet Office.
The current ITIL 4 introduces the Service Value System for better business integration.
Since July 2013, ITIL has been owned by AXELOS, a new joint venture company, created by the Cabinet
Office on behalf of Her Majesty's Government (HMG) in the United Kingdom and Capita plc to run the
Best Management Practice portfolio, including the ITIL® and PRINCE2® professional standards. .
The IT Service Management Forum (itSMF) is the largest user group formed around IT Service
Management. The itSMF publishes books on IT Service Management, ITIL and related subjects,
and organizes conferences and meetings. Many countries, states, provinces and even some
cities have their own chapters. Its website, www.itSMF.org, contains valuable information and
offers opportunities to connect and share experiences and tips with peers.
AXELOS is a new joint venture company, created by the Cabinet Office on behalf of Her
Majesty's Government (HMG) in the United Kingdom and Capita plc to run the Best
Management Practice portfolio, including the ITIL® and PRINCE2® professional standards.
AXELOS goal: to nurture best practice communities, both in the UK and on a truly
worldwide scale, establishing an innovative and high quality, continuous learning and
development destination that is co-designed by and co-created for those who use it.
Intellectual Property Rights
Acknowledgement: The intellectual property (copyright and trade marks) of the AXELOS
portfolio is owned by AXELOS Limited.
ITIL 4 Key Concepts
Four dimensions model:
– Organizations & people
– Information & technology
– Partners & suppliers
– Value stream and processes
ITIL service value system

(SVS):
– Guiding principles
– Governance
– The service value chain (SVC)
– ITIL 4 practices
– Continual improvement
ITIL 4 Key Concepts
The following are the ITIL 4 key concepts we will go through our class.
Four dimensions model:

• Organizations & people
• Information & technology
• Partners & suppliers
• Value stream and processes
ITIL service value system (SVS):

• Guiding principles
• Governance
• The service value chain (SVC)
• ITIL 4 practices (used to be processes)
• Continual improvement
The Four Dimensions
 Holistic ITSM approach to the value of
products/services for customers/stakeholders
 Relevant to the whole SVS, the service value chain
and all ITIL practices
 Constrained to - influenced by - external factors
beyond control of the SVS.
The Four Dimensions
To support a holistic approach to service management, ITIL defines four dimensions that
collectively are critical to the effective and efficient facilitation of value for customers and other
stakeholders in the form of products and services. These are:
• Organizations and people
• Information and technology
• Partners and suppliers
• Value streams and processes
Not addressing all four dimensions can result in services becoming undeliverable, not meeting
expectations of quality or efficiency.
The four dimensions represent a holistic approach to service management, and organizations
should ensure that there is a balance of focus between each dimension. The impact of external
factors on the four dimensions should also be considered. All four dimensions and the external
factors that affect them should be addressed as they evolve, considering emerging trends and
opportunities. It is essential that an organization’s SVS is considered from all four dimensions, as
the failure to adequately address or account for one dimension, or an external factor, can lead
to sub-optimal products and services.
The Service Value System (SVS)
 The ITIL Service Value System (SVS) describes how all

components and activities of the organization work
together as a system to enable value creation
• The ITIL Service Value System (SVS) operates across the four dimensions.
• Components, activities, resources can be (re)configured flexibly to suit the situation.
• This requires integration/coordination of activities/practices across the value chain.
The Service Value System (SVS)
The ITIL SVS represents how various components and activities work together to facilitate value
creation through IT-enabled services.
These can be combined in a flexible way, which requires integration and coordination to keep
the organization consistent.
The ITIL SVS facilitates this integration and coordination and provides a strong, unified, value-
focused direction for the organization.
The Service Value System (SVS) – Guiding
principles
The Service Value System (SVS) – Guiding principles
The guiding principles embody the core messages of ITIL, supporting successful actions and
good decisions of all types and at all levels. They can be used to guide organizations in their
work as they adopt a service management approach and adapt ITIL guidance to their own
specific needs and circumstances. The guiding principles encourage and support organizations in
continual improvement at all levels.
These principles are reflected in many other frameworks, methods such as Lean, Agile, DevOps,
and COBIT. This allows organizations to effectively integrate the use of multiple methods into an
overall approach to service management.
The guiding principles are universally applicable to any initiative and all relationships with
stakeholder groups. For example, the first principle, focus on value, can be applied to service
consumers, all relevant stakeholders and their respective definitions of value
Governance
Corporate Governance:
‘The ethical behavior by directors or
others in the creation and
Corporate preservation of wealth for all
Governance
stakeholders.’
(IT Governance Institute)
IT Finance
Governance Governance
Other
Governance
IT Governance:
“An integral part of corporate
governance that ensures that the
organization’s IT sustains and
extends the organization’s strategies
and objectives”.
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Governance
In general, governance ensures that policies and strategies are implemented, and that required
processes are correctly followed. Governance includes defining roles and responsibilities,
measuring, reporting and taking actions to resolve any identified issues. It is important to
distinguish between governance and management, as they are often used within the wrong
context. Governance is about maintaining proper policy and procedures to ensure that IT is
“doing the right things.” Management is about “doing things right.”
An highly-visible example of a renewed emphasis on corporate governance is the Sarbanes-

Oxley Act (SOX) of 2002 in the United States.
IT is increasingly being called upon to “do more with less” and create additional value while
maximizing the use of existing resources. However, in terms of IT governance, IT must now
comply with new rules and legislation and continually demonstrate its compliance through
successful independent audits by external organizations.
These increasing pressures dovetail perfectly with the basic premise of ITIL: IT is a service
business.
Existing internal IT organizations must transform themselves into effective and efficient IT
service providers or they will cease to be relevant to the business. This continual and unending
drive toward greater business value with greater internal efficiency is at the heart of Continual
Improvement, one of the modules covered in this course.
The Service Value Chain (SVC)
 The six value chain activities are:

– Plan
– Improve
– Engage
– Design & transition
– Obtain/build
– Deliver & support
The Activities:
 Manage services through the lifecycle
 Are executed by a service team
 Use the ITIL 4 practices for guidance
The Service Value Chain
These activities represent the steps an organization takes in the creation of value. Each activity
contributes to the value chain by transforming specific inputs into outputs. These inputs could
be demand from outside the value chain or outputs of other activities. In this way the activities
are connected to, and interact with, one another, with each activity receiving and providing
triggers for further actions to be taken.
The ITIL 4 Practices
General Management Practices Service Management Practices Technical Management Practices
Architecture Management Availability management Deployment management
Continual Improvement Business analysis Infrastructure & platform management
Information security management Capacity & performance management Software development and management
Knowledge management Change enablement
Measurement and reporting Incident management

A practice is a set of
Organizational change management IT asset management
organizational resources
Portfolio management Monitoring & event management
designed for performing
Project management Problem management
work or accomplishing an
Relationship management Release management objective
Risk management Service catalogue management
Service Financial management Service configuration management Practices are used as

Strategy management Service continuity management plug-ins for activities in
Supplier management Service Design
the value chain
Workforce & talent management Service Desk
Service level management
Service request management
Serice validation & testing
The ITIL 4 Practices
A management practice is a set of organizational resources designed for performing work or

accomplishing an objective.
Now more general, they are called practices in ITIL.
Practices are used as plug-ins for activities in the value chain.

– Business and IT
– What is IT?
– Service Offerings and Service Relationships
– Practice
– Process Model
Business and Information Technology
 Information has become a value in itself
 IT aids existing Businesses by increasing

efficiency and effectiveness
 IT enables new types of Business
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Business and Information Technology
The current era is often referred to as the Information Age. From the 1980’s onward, IT has
become more and more important.
Information technologies (IT) enable, enhance, and are embedded in a growing number of
goods and Services. They are connecting consumers and producers of Services in ways
previously not feasible, while contributing to the productivity of numerous sectors of the
Services industry such as financial Services, communications, insurance, and retail Services.
Tremendous Change and growth is taking place in information-based Services. Information,

previously a supporting element, has become the basis for value by itself. Recent years have
seen significant increases in valuation for Businesses that simply facilitate interactions or the ex
Change of information.
This rapid development of IT aids existing Businesses by increasing their efficiency and
effectiveness, but also makes room for new types of Businesses. New types of companies have
formed, whose Business model is focused solely on using and processing information. Think of
companies like Google, which derives its profit completely from intangible assets.
The concept of effectiveness and efficiency are seen throughout the Service Lifecycle.
• Effectiveness can be viewed as “doing the right things”
• Efficiency can be viewed as “doing things right”
The World is Changing
 Speed of Business increases
 Globalization and lower transaction costs

redefine Business
 Business models are redefined
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
The World is Changing

The world is changing at a faster pace than ever before. Markets are created almost
spontaneously with innovative business models and value propositions. The digitization of
commercial activities, social interactions and government has meant fewer physical
constraints on new business models, strategies and relationships. Knowledge and productive
capacity are more dispersed than ever before.
Business executives everywhere appreciate the value of speed and agility. An enterprise that
can act swiftly on routine transactions (speed), and that can also modify its processes
quickly in response to changing conditions (agility), will have a competitive advantage.
Business models are redefined and new strategies are developed. Integration of different
technologies now leave different industries competing with each other. For example,
traditional photo-camera companies are now competing with telephone manufacturers, as
integrated cameras continue to improve.
Business/IT Alignment
 Customer of IT (the Business) requires IT

Services that continuously support their
Business needs
 IT should be aware of rapid Changes in

Business
 Internal providers face possible outsourcing

and must run their IT as a Business
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Business/IT Alignment
The frequently cited objective of “alignment with the business” characterizes a common
problem faced by the leadership of IT organizations in general and Chief Information Officers
(CIOs) in particular. Those who succeed in meeting this objective are those who understand the
need to be business-minded. When an IT organization has an internal focus on the technology
being delivered and supported, they lose sight of the actual purpose and benefits that their
efforts deliver to the business.
The increasing popularity of managed services and outsourcing places tremendous pressures on
internal providers to adopt the structure and behavior of a professionally managed business. A
well-managed IT organization can act like a business-within-a-business and deliver value that
meets or exceeds the value proposition of commercial alternatives.
Why is ITIL successful? (1/2)
ITIL embraces a practical approach to service by adapting

a common framework of practices that unite all areas of IT
service provision towards a single aim – that of delivering
value to the business;
 Vendor-neutral ITIL service management practices are

applicable in any IT organization because they are not
based on any particular technology platform or industry
type.
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Why is ITIL successful?
A multi-disciplinary approach is required to answer such questions. Technical knowledge of IT is

necessary but not sufficient. The guidance is pollinated with knowledge from the disciplines
such as operations management, marketing, finance, information systems, organizational
development, systems dynamics, and industrial engineering. The result is a body of knowledge
robust enough to be effective across a wide range of business environments. Some
organizations are putting in place the foundational elements of service management. Others are
further up the adoption curve, ready to tackle challenges and opportunities with higher levels of
complexity and uncertainty.
Why is ITIL successful? (2/2)
 Non-prescriptive ITIL offers robust, mature and time-

tested practices that have applicability to all types of
service organizations. It continues to be useful and
relevant in public and private sectors, internal and
external service providers, small, medium and large
enterprises, and within any technical environment
 Best practice ITIL represents the learning experiences

and thought leadership of the worlds best-in-class
service providers
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Adoption of a Good Practice
Business Dynamic Sourcing

Requirements Environment Strategy
“Practice fit for

organization”
IT Service Provider
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Adoption of a Practice that is fit for your Organization
Organizations operate within dynamic environments with the need to learn and adapt—to
improve performance while managing trade-offs. Under similar pressure, customers seek
advantage from Service Providers. They pursue sourcing strategies that best serve their own
business interest.
This puts additional pressure on Service Providers to maintain a competitive advantage with
respect to the alternatives that customers may have. The increase in outsourcing has
particularly exposed internal Service Providers to unusual competition.
To cope with the pressure, organizations benchmark themselves against peers and seek to close
gaps in capabilities. One way to close such a gap is the adoption of good practices in wide
industry use.
Many organizations are similar, therefore, best practice guidance can be used to improve the
ability to deliver quality services.
ITIL defines Best Practice as: “Proven activities or processes that have been successfully used by
multiple organizations.”
ITIL is the most widely recognized and trusted source of best-practice guidance in the area of
ITSM.
Service Management Practice
ITIL
Standards Employees
Enablers
Sources Industry Practices Customers
Academic Research Suppliers
Training & Education Consultants
Internal Experience Technologies
Scenarios
Substitutes Competition
Drivers
Regulators Compliance
Customers Commitments
Service Management Practice fit

for organization
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Service Management Practice
There is no single, best Service Management practice available that fits every company.
However, there are several sources for a Service Management practice that is fit for the
business objectives, fit for the context of the business and fit for purpose.
These sources include:

• Standards such as ISO9000, ISO/IEC20000, and ISO/IEC27001 are a set of criteria that help
validate a practice. These standards may be based upon existing industry practices or originate
from (academic) research.
• Industry practices (ITIL ® , CobiT ® , CMMI ® , eSCM-SP, PRINCE2™, PMBOK ® , M_o_R ® ,

eTOM ® , Six Sigma) are a set of guidelines that are used throughout the industry and have
proven their usefulness.
• Academic research
• Training and education
• Internal experience, also called proprietary knowledge
The other side of the graphic depicts the enablers that define how these sources may be used.
These enablers play an important role in determining the practice that is fit for purpose. The
employees (related to corporate culture) will play an important role in the organization, and the
use of technology may also facilitate much within Service Management.
The enablers and sources alone do not form the practice that fits the organization;
several drivers and scenarios influence the employment of a Service Management
practice. Laws such as Sarbanes-Oxley (SOX) have a major influence on the way business
operates, and customers will usually desire that an organization’s way of working is
aligned with its own. Competition may further shape the way of business, as the
organization must stay competitive to stay alive.
Ignoring public frameworks and standards can needlessly place an organization at a

disadvantage.
Organizations should cultivate their own proprietary knowledge on top of a body of

knowledge based on public frameworks and standards. Collaboration and coordination
across organizations become easier on the basis of shared practices and standards.
IT Service Management
 Service Management: A set of specialized organizational

capabilities for enabling value to customers in the form of
services
 Service provider: A role performed by an organization in a

service relationship to provide services to consumers
 IT service management (ITSM): The implementation and

management of quality IT services that meet the needs of
the business.
 IT service management is performed by IT service providers
through an appropriate mix of people, process and information
technology
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
IT Service Management
Service Management is a set of specialized organizational capabilities for enabling value to

customers in the form of services.
Service provider is a role performed by an organization in a service relationship to provide

services to consumers.
ITSM must be carried out effectively and efficiently. Managing IT from the business perspective
enables organizational high performance and value creation. A good relationship between a
service provider and its customers relies on the customer receiving an IT service that meets its
needs, at an acceptable level of performance and at a cost that the customer can afford.
The service provider needs to work out how to achieve a balance between these three areas,
and communicate with the customer if there is anything which prevents it from being able to
deliver the required IT service at the agreed level of performance or price.
A service level agreement (SLA) is used to document agreements between an IT service provider
and a customer. The SLA describes the IT service, documents service level targets, and specifies
the responsibilities of the IT service provider and the customer. A single agreement may cover
multiple IT services or multiple customers.
Benefits of Service Management
 Improved quality Service provision

 Cost justifiable Service quality
 Services that meet Business, Customer and User
demands
 Everyone knows their role and knows their responsibilities

in Service provision
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Benefits
Does an organization need Service Management? The following questions can serve as a guide
to answer this question.
• Do the IT Services align with Business requirements?
• Are the Customers satisfied with the IT Services?
• Are the Customers provided with IT Services that match THEIR needs and not the
needs of the IT department?
• Is there any risk that the Customers will shop elsewhere?
• Are there appropriate levels of security?
• How would the IT department fare in an audit?
• What would happen to the IT Services in a contingency situation?
• Is the IT department proactive or reactive?
• Are Changes requested by the Business side of your organization able to be
accommodated?
Service Management assists organizations to align IT with the Business side of the organization.
This will improve IT’s ability to deliver consistently reliable Services that meet Customer needs.
The benefits of applying Service Management practices vary depending on the needs of each
organization, however there are many benefits that organizations can gain by introducing
Service Management practice.
Service Management
Challenges
 Intangible nature of the output
 Demand is tightly-coupled with Customer’s assets
 High-level of contact for producers and consumers of

Services
 The perishable nature of Service output and capacity
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Challenges
Organizational capabilities are shaped by the challenges they are expected to overcome.
Service Management capabilities are similarly influenced by the following challenges that
distinguish Services from other systems of value-creation such as manufacturing, mining and
agriculture:
• Intangible nature of the output and intermediate products of Service processes: Difficult to
measure, control, and validate (or prove)
• Demand is tightly-coupled with Customer’s assets: Users and other Customer assets such as
processes, applications, documents, and transactions arrive with demand and stimulate
Service production
• High-level of contact for producers and consumers of Services: Little or no buffer between
the Customer, the front-office and back-office
• The perishable nature of Service output and Service capacity: There is value for the
Customer from assurance on the continued supply of consistent quality. Providers need to
secure a steady supply of demand from Customers
Stakeholders in service management
 Stakeholders have an interest in an organization, project

or service etc. and may be interested in the activities,
targets, resources or deliverables from service
management
 Within the service provider organization there are many

different stakeholders including the functions, groups and
teams that deliver the services
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Stakeholders in service management (1/2)
Stakeholders have an interest in an organization, project or service etc. and may be interested in
the activities, targets, resources or deliverables from service management. Examples include
organizations, service providers, customers, consumers, users, partners, employees,
shareholders, owners and suppliers. The term ‘organization’ is used to define a company, legal
entity or other institution. It is also used to refer to any entity that has people, resources and
budgets – for example, a project or business.
Within the service provider organization there are many different stakeholders including the
functions, groups and teams that deliver the services.
Service Consumer Roles (external stakeholders)
 Customer – A person who defines requirements for services and takes responsibility for
outcomes from service consumption
 User – A person who uses services

 Sponsor – A person who authorizes the budget for service consumption
Suppliers - A stakeholder responsible for providing services that are used by an

organization.
 Suppliers are internal or third parties, responsible for supplying goods or services that
are required to deliver IT services
 Examples of suppliers include: commodity hardware and software vendors, network and
telecom providers, and outsourcing organizations
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Service Consumer Roles (external stakeholders)
Customer – A person who defines requirements for services and takes responsibility for
outcomes from service consumption
User – A person who uses services
Sponsor – A person who authorizes the budget for service consumption
Suppliers - A stakeholder responsible for providing services that are used by an organization.
Suppliers are internal or third parties, responsible for supplying goods or services that are
required to deliver IT services.
Examples of suppliers include commodity hardware and software vendors, network and
telecom providers, and outsourcing organizations

What is Information Technology (IT)?
IT changes meaning with context:
 IT as an “Organization”
 IT as a “Component”
 IT as a “ Service”
 IT as an “Asset”
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
What is Information Technology (IT)?
Information Technology (IT) is a commonly used term that changes its meaning with context.
• IT as an Organization: As an internal unit or function of the enterprise or commercial service

provider, IT is an organization with its own set of capabilities and resources. IT organizations can
be of various types such as business functions, shared services units and enterprise-level core
units.
• IT as a Component: As components of systems and processes, IT systems, applications and

infrastructure are components or sub-assemblies of a larger product. They enable or are
embedded in processes and services.
• IT as a Service: IT may be a shared category of services utilized by business or by business

units. These services are typically IT applications and infrastructure that are packaged and
offered by internal IT organizations or by external service providers. IT costs are treated as
business expenses.
• IT as an Asset: As capabilities and resources that provide a dependable stream of benefit, IT is

a category of business assets that provide a stream of benefits for their owners, including, but
not limited to, revenue, income, and profit. IT costs are treated as investments.
It is important to be clear on what the term means in a given context. It is often used with
different meanings in the same sentence or paragraph, often creating confusion. Read carefully!
Service Provider
IT as an Organization
Customers can get Services from three types of

Service Providers
Corporate
Company External
Service
Provider
Business Business Shared 3
Unit A Unit B Services Unit
2
Internal Internal
Service Service
Provider A 1 Provider B
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
A Customer is defined as “someone who buys goods or Services”, for IT, the Customer wants to
buy IT Services. A typical large company often has multiple Business units or departments,
which have a different need for IT Services. In this case, there are multiple Customers that
are looking for Services.
Services can be acquired from a Service Provider, and a Service Provider can provide any type of
Service. Within ITIL, the definition of a Service Provider is: “An organization supplying
Services to one or more internal or external Customers". This definition is not IT specific; for
example, other Services can be Human Resource Management or Finance. The important
part is that a Service provider provides Services, which differ significantly from the more
traditional (tangible) goods.
Three types of Service Providers can be identified:

1. Internal Service Provider – An Internal Service Provider is established close to the Business
and is defined as “A Service Provider that is part of the same Organization as its Customer”.
As shown in the image above with (1), the Internal Service Provider A and B are both
examples of Internal Service Providers that provide their Services to a Business unit, in this
case, each Business unit has its own IT Service Provider.
2. Shared Services Unit – As many Services like Finance, IT and Human Resources are not part
of the core Business of many organizations, these are often consolidated into an autonomous
special unit, which is called the Shared Services Unit (SSU). This structure helps spreading of
costs and risks and allows a more Business like approach for the Service Provider. For small
organizations, a Shared Services Unit is not an option, as it is the same as an Internal Service
Provider.
3. External Service Provider – Defined as “A Service Provider that is part of a different
Organization as its Customer”, is often referred to as an external supplier. External
Service Providers usually serve to more organizations and Customers and are often
dedicated to supplying IT Services.
A Service Provider that delivers IT Services can be called an IT Service Provider. Or, when
the IT Service Provider is internal for a company, they are often referred to as “the IT
Organization". This can be both the Internal IT Service Provider and/or the IT within a
Shared Services Unit.
Service
Services
IT as a Service
Definition: Service
“ Services are a means of enabling value co-creation by

facilitating outcomes that customers want to achieve without
the customer having to manage specific costs and risks".
“People want a quarter inch hole, not a quarter inch drill".

- Prof T. Levitt, Harvard Business School
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Services – IT as a Service
Services are a means of enabling value co-creation by facilitating outcomes that customers
want to achieve without the customer having to manage specific costs and risks.
Outcomes are possible from the performance of tasks and are limited by the presence of
certain constraints. Broadly speaking, Services facilitate outcomes by enhancing the
performance and by reducing the grip of constraints.
The often repeated quote by professor Theodore Levitt shows the intangible nature of Services:
“People want a quarter inch hole, not a quarter inch drill”.
This is also applicable to IT, the Customer wants a specific Service, like e-mail, which supports
the outcome of cheap, reliable and fast written communication. A Customer does not want to
be bothered by running hardware, maintaining software and ensuring there is sufficient capacity
in the network.
Services
Service Offerings
Definition: Service Offering

Description of one or more services, designed to address
the needs of a target consumer group.
Service offerings may include goods, access to resources, and service actions:
Goods Access to Resources Service Actions
Ownership is transferred Ownership is not Performed by the
to the consumer transferred to the provider to address a
consumer consumer need
Consumer takes Access is granted/ Performed according to
responsibility for future licensed under agreed agreement with
use terms or conditions consumer
A mobile phone Access to the mobile User support
A physical server network, or to network Replacement of a piece
storage of equipment
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Services Offerings
Services are offered to target consumer groups, and those groups may be either internal or
external to the service provider organization.
Different offerings can be created based on the same product, which allows it to be used in
multiple ways to address the needs of different consumer groups.
For example, a software service can be offered as a limited free version, or as a comprehensive
paid-for version, based on one product of the service provider.
A Service offering is a description of one or more services, designed to address the needs of a
target consumer group.
A service offering may include goods, access to resources, and service actions.
Goods
• Ownership is transferred to the consumer
• Consumer takes responsibility for future use
Access to Resources
• Ownership is not transferred to the consumer
• Access is granted/ licensed under agreed terms or conditions
Service Actions
• Performed by the provider to address a consumer need
• Performed according to agreement with consumer
Services
Service Relationships
Definition: Service Relationship
A cooperation between a service provider and service
consumer.
Service relationships include service provision, service consumption and
service relationship management.
Service provision Service consumption
• Management of provider resources
• Management of the consumer
configured to deliver the service
resources needed to consume the
• Provision of access to resources for
service
users
• Utilization of the provider’s
• Fulfillment of the agreed service
resources
actions
• Requesting service actions to be
• Service performance management
fulfilled
and continual improvement
joint activities performed by a service provider and a service consumer to ensure
continual value co-creation based on agreed and available service offerings
Service relationship management
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Service Relationships
A service relationship is a cooperation between a service provider and service consumer.
The service relationships seek value co-creation between service providers and service
consumers.
A service relationships includes: service provision, service consumption, and service relationship
management.
• Service provision consists of activities performed by an organization to provide services.
• Service consumption consist of activities performed by a service consumer to consume
services.
• Service relationship management consists of joint activities performed by a service provider
and a service consumer to ensure continual value co-creation based on agreed and available
service offerings.
When services are delivered by the provider, they create new resources for service consumers,
or modify their existing ones. For example:
• A car-hire service enables the consumer’s staff to visit clients
• A software development service creates a new application for the service consumer.
The service consumer can use its new or modified resources to create its own products to
address the needs of another target consumer group, thus becoming a service provider.
Services
IT as a Service– Output and Outcome
Customers seek outcomes but do not wish to

Business Service A
manage all the associated specific costs and
risks
Output
• A tangible or intangible deliverable of an activity
Outcome
• A result for a stakeholder enabled by one or more outputs
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Services – IT as a Service – Output and Outcome
Lets go through the latter part of the ITIL service definition: “…Customers seek outcomes but do
not wish to manage all the associated specific costs and risks”
Definition: Output
A tangible or intangible deliverable of an activity.
Definition: Outcome
A result for a stakeholder enabled by one or more outputs.
An outcome-based definition of service moves IT organizations beyond business–IT alignment

towards business–IT integration. Internal dialogue and discussion on the meaning of services is
an elementary step towards alignment and integration with a customer’s business. Customer
outcomes become the ultimate concern of business relationship managers instead of the
gathering of requirements, which is necessary but not sufficient. Requirements are generated
for internal coordination and control only after customer outcomes are well understood.
Services
IT as a Service – Cost and Risk
Cost
The amount of money spent on a specific activity or resource:
• Costs removed from customer (part of value)
• Costs imposed on customer (costs of consumption)
Risk
Possible event that could cause harm or hinder achievement of objectives.
(Another definition: uncertainty of outcome.)
Can be seen as:

• Risks removed from the customer(part of value)
• Risks imposed on customer (risks of consumption)
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Services – IT as a Service – Cost and Risk
From consumer’s perspective, there are two types of cost in service relationships:
• costs removed from the consumer by the service (a part of the value proposition). This may
include costs of staff, technology, and other resources, which the consumer does not need to
provide
• costs imposed on the consumer by the service (the costs of service consumption). The total
cost of consuming a service includes the price charged by the service provider (if applicable),
plus other costs such as staff training, costs of network utilization, procurement, etc. Some
consumers describe this as what they have to ‘invest’ to consume the service.
Both types of cost are considered when the consumer assesses the value which they expect the
service to create. To ensure that the correct decisions are made about the service relationship,
it is important that both types of cost are fully understood.
It is the duty of the provider to manage the detailed level of risk on behalf of the consumer
There are two types of risk that are of concern to service consumers:
• risks removed from a consumer by the service (part of the value proposition). May include
failure of the consumer’s server hardware or lack of staff availability. In some cases, a service
may only reduce a consumer’s risks, but the consumer may determine that this reduction is
sufficient to support the value proposition
• risks imposed on a consumer by the service (risks of service consumption).An example of this
would be a service provider ceasing to trade, or
experiencing a security breach.
Service Value Definition
Service Value = Utility + Warranty
Performance supported?
Fit for purpose?
Utility
Constraints removed?
Value
Available enough?
Capacity enough?
Warranty
Continuous enough? Fit for use?
Secure enough?
Service Value = Warranty + Utility
Both utility and warranty are essential for a service to facilitate its desired outcomes and
therefore help create value.
Utility defines the functionality of an IT Service from the Customer’s perspective (i.e.: what the
Service does) and in terms of the increase in possible gains from the performance of the
Customers assets. It is perceived by the Customer from the attributes of the Service that have a
positive effect on the performance of tasks associated with desired Business outcomes. This
means that the Service is fit for purpose.
Warranty for a Service provides the customer a level of assurance that product or service will
meet agreed requirements. It is the decrease in possible losses for the Customer from variations
in performance. Example attributes: availability, capacity, continuity, security etc. It is derived
from the positive effect being available when needed in sufficient capacity, and being
dependable in terms of continuity and security. This means that the Service is fit for use.
It is normal for Customers to be skeptical about the potential value to be realized from Services
when there is uncertainty surrounding the Service output. This is remedied by backing up the
utility of a Service with a warranty.
If there is little or no difference regarding the warranty on the market, then IT organization
should use the utility criteria to differentiate itself. Utility is necessary but not sufficient: Utility
is backed up by warranty so that Customers do not worry about possible losses due to poor
performance or performance variations.
Internal and External Customers and Services
 Just as there are internal and external customers, there are internal
and external services
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Internal and External Customers and Services
There is a difference between customers who work in the same organization as the IT service
provider, and customers who work for other organizations. They are distinguished as follows:
Internal customers - These are customers who work for the same business as the IT service
provider. For example, the marketing department is an internal customer of the IT
organization because it uses IT services. The head of marketing and the chief information
officer both report to the chief executive officer. If IT charges for its services, the money paid
is an internal transaction in the organization’s accounting system, not real revenue.
External customers - These are customers who work for a different business from the IT
service provider. External customers typically purchase services from the service provider by
means of a legally binding contract or agreement.
Many IT organizations who traditionally provide services to internal customers find that they are
dealing directly with external customers because of the online services that they provide.
Organizing IT Service Management
Practice Definition
“A set of organizational resources designed for

performing work or accomplishing an objective."
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Practice
A practice is a set of organizational resources designed for performing work or accomplishing an

objective.
Process Definition
“A set of interrelated or interacting activities that transform

inputs into outputs. A process takes one or more defined
inputs and turns them into defined outputs. Processes define
the sequence of actions and their dependencies."
 Processes are strategic assets when they create

competitive advantage or market differentiation.
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Process
A process is a a set of interrelated or interacting activities that transform inputs into outputs. A
process takes one or more defined inputs and turns them into defined outputs. Processes
define the sequence of actions and their dependencies. Processes that provide transformation
towards a goal, and utilize feedback for self-reinforcing and self-corrective action function as
closed-loop systems. It is important to consider the entire process or how one process fits into
another.
Process Owner is responsible for ensuring that their process is being performed according to
the agreed and documented process and is meeting the aims of the process definition. This
includes such tasks as:
• Ensuring that the process is fit for the desired purpose

• Defining the Key Performance Indicators (KPIs) to evaluate the effectiveness and
efficiency of the process
• Responsibility for the process design
• Improving the effectiveness and efficiency of the process
• Ensuring that all relevant staff has the required training in the process and are aware of
its role in the process
• Interfacing with line management to ensure that the process receives the needed staff
resources
Process Diagram
Process
Owner
Control
Input Process Output
Process
Manager Enablers
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Organizing IT Service Management – Process Diagram
A process can be defined as a structured set of activities designed to accomplish a specific

objective. A process takes one or more inputs and turns them into defined outputs. A process
includes all of the roles, responsibilities, tools, metrics (measurements) and management
controls required to reliably deliver the outputs.
The diagram above shows the generic process diagram, with Process Inputs on the left, the
process itself in the center and the Process Outputs on the right. Every process requires Process
Enablers and is regulated by a control mechanism. It also shows the two major roles in the
process: Process Owner and Process Manager.
Each process should be owned by a process owner who is responsible for the process, its
improvement, and for ensuring that the process meets its objectives. The objectives of any IT
process should be defined in measurable terms and should be expressed in terms of Business
benefits and underpinning Business strategy and goals. The output produced by a process has to
conform to operational norms that are derived from Business objectives. If products conform to
the set norm, the process can be considered effective (because it can be repeated, measured
and managed). If the activities are carried out with a minimum use of resources, the process can
also be considered efficient. Process analysis, results and metrics should be incorporated in
regular management reports and process improvements.
Process Diagram
Metrics, roles, Activities

Policy, Process Process
/procedures/work
Owner, Owner
instructions
Documentation,
Control
Objectives and
Feedback
Input Process Output
Process + Metrics,
Manager Enablers Reports,
Resources
Improvements!
and
capabilities
Introduction:
Module 2: Service
Overview
Management:
of the ITILKey
4 library
Organizing IT Service Management – Process Diagram (cont.)
Each process can also have a process manager who is responsible for the operational
management of a process. There may be several managers for the one process and they report
to the process owner.
For each part of this diagram, we may identify some typical elements. For the Process these
include the Process Activities, Process Metrics, Process Roles, Process Procedures, Process Work
Instructions and Process Improvements.
Process Enablers are the process assets, the Resources and Capabilities.
Process control can be defined as: The activity of planning and regulating a process, with the
objective of performing a process in an effective, efficient and consistent manner. Processes,
once defined, should be documented and controlled; once under control, they can be repeated
and become manageable. Degrees of control over processes can be defined, and then process
measurement and metrics can be built in to the process to control and improve the process as
illustrated. It includes, amongst others: Process Policy, Process Owner, Process Documentation,
Process Objectives and Process Feedback.
The generic process elements show that data enters the process, is processed, is output and the
outcome is measured and reviewed. A process is always organized around a set of objectives.
The main outputs from the process should be driven by the objectives and should always
include process measurements (metrics), reports and process improvement.
Process Characteristics
 Measurable
 Specific Results
 Delivers to Customers
 Responds to a Specific Event
Organizing IT Service Management – Process Characteristics
A process should have these four characteristics:
Measurable: We are able to measure the process in a relevant manner. It is performance driven.
Managers want to measure cost, quality and other variables, while practitioners are
concerned with duration and productivity.
Specific Results: The reason a process exists is to deliver a specific result. This result must be
individually identifiable and countable. While we can count Changes, it is impossible to count
how many Service Desks were completed.
Delivers to Customers: Every process delivers its primary results to a Customer or stakeholder.
They may be internal or external to the organization but the process must meet their
expectations.
Responds to a Specific Event: While a process may be ongoing or iterative, it should be

traceable to a specific trigger.
RACI model
Process Incident
Owner 1st Line 2nd Line
Manager
Incident Mgt
Process Design A R I I
Staff Training A R I I
Incident
A R I
Identification
Incident A R I
Logging
Incident
Classification A R I
Incident
Investigation & A R C/I
Diagnosis
Organizing IT Service Management – RACI Model
For Service Management to be successful it is essential to define the roles and responsibilities
within the organization for various activities.
When managing a Service or a process it imperative that all the roles are clearly defined. A
trademark of high performing organizations is the ability to make the right decisions quickly and
execute them effectively. Whether the decision involves a strategic choice or a critical
operation, being clear on who has input, who decides, and who takes action will enable the
company to move forward rapidly.
The RACI model will be beneficial in enabling decisions to be made with pace and confidence.
RACI is an acronym for the four main roles of:
• Responsible - The person or people responsible for getting the job done
• Accountable - Only one person can be accountable for each task
• Consulted - The people who are consulted and whose opinions are sought
• Informed - The people that are kept up-to-date on progress
The RACI chart in the above table shows the structure and power of RACI modeling with an
example of process activities down the left-hand side including the actions that need to be
taken and decisions that must be made. Across the top, the chart lists the functional roles
responsible for carrying out the initiative or playing a part in decision making.
Note: Only one “A’’ per row is allowed and at least one “R” is needed per row (this ensures that
someone actually does the work).
Whether RACI or some other tool or model is used, the important point is to not just
leave the assignment of responsibilities to chance or leave it until the last minute to
decide. Conflicts can be avoided and decisions can be made quickly if the roles are
determined in advance.
Review
 ITIL
– History

– Business and IT
– What is IT?
– Service Offering and Service Relationships
– Practice
– Process Model

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Information Technology

 Service Management: Key

THINK STAY FOCUSED LEARN

 Service Management as a Practice

 ITIL = IT Infrastructure Library

 ITIL = IT Infrastructure Library

Intellectual Property Rights

ITIL service value system

ITIL 4 Key Concepts

Four dimensions model:

ITIL service value system (SVS):

The Four Dimensions

 The ITIL Service Value System (SVS) describes how all

The Service Value System (SVS)

The Service Value System (SVS) – Guiding principles

An highly-visible example of a renewed emphasis on corporate governance is the Sarbanes-

 The six value chain activities are:

The Service Value Chain

Architecture Management Availability management Deployment management

Continual Improvement Business analysis Infrastructure & platform management

Knowledge management Change enablement

Measurement and reporting Incident management

Service Financial management Service configuration management Practices are used as

Service level management

Service request management

Serice validation & testing

The ITIL 4 Practices

A management practice is a set of organizational resources designed for performing work or

Now more general, they are called practices in ITIL.

Practices are used as plug-ins for activities in the value chain.

 Information has become a value in itself

 IT aids existing Businesses by increasing

 IT enables new types of Business

Business and Information Technology

Tremendous Change and growth is taking place in information-based Services. Information,

 Speed of Business increases

 Globalization and lower transaction costs

 Business models are redefined

The World is Changing

 Customer of IT (the Business) requires IT

 IT should be aware of rapid Changes in

 Internal providers face possible outsourcing

ITIL embraces a practical approach to service by adapting

 Vendor-neutral ITIL service management practices are

Why is ITIL successful?

A multi-disciplinary approach is required to answer such questions. Technical knowledge of IT is

 Non-prescriptive ITIL offers robust, mature and time-

 Best practice ITIL represents the learning experiences

Business Dynamic Sourcing

“Practice fit for

Adoption of a Practice that is fit for your Organization

Service Management Practice fit

Service Management Practice

These sources include:

• Industry practices (ITIL ® , CobiT ® , CMMI ® , eSCM-SP, PRINCE2™, PMBOK ® , M_o_R ® ,

• Training and education

• Internal experience, also called proprietary knowledge

Ignoring public frameworks and standards can needlessly place an organization at a

Organizations should cultivate their own proprietary knowledge on top of a body of

 Service Management: A set of specialized organizational

 Service provider: A role performed by an organization in a

 IT service management (ITSM): The implementation and

Service Management is a set of specialized organizational capabilities for enabling value to

Service provider is a role performed by an organization in a service relationship to provide