ITIL Service Portfolio Management

ITIL Service Portfolio Management

What is Service Portfolio?

The Service Portfolio represents a complete list of the services managed by a service provider; some of these services are visible to the customers, while others are not. It contains present contractual commitments, new service development, and ongoing service improvement plans initiated by Continual Service Improvement. It also includes third-party services which are an integral part of service offerings to customers 

 

What is Service Portfolio Management?

Service Portfolio Management, as described in ITIL V3, is responsible for analyzing and optimizing the investment IT makes in Services across the Services’ entire lifecycles. It does this by understanding business value, with which IT needs to become better integrated.

IT will generally talk in value terms it can instrument and measure, such as availability, response times, utilization, etc. The business talks in value terms such as revenue, ROI, increased market share, increased customers, decrease in lost business, etc.

Service portfolio management consists of four major steps (as seen in Figure 1):

Define. Collect information and inventories of existing services. Establish the requirements for the requested service, and establish the business case for implementing

the service.

Analyze. Review the long-term business goals, and determine what services are required to meet those goals. Then analyze the requested service for financial viability, operational capability, and technical feasibility to determine how the organization is going to get there. (You may decide to obtain the service from an outsourcer rather than develop it internally.)

Approve. Make a decision to retain, replace, renew, or retire the services.

Charter. Communicate action items to the organization to implement approved service, and allocate budget and resources.

Benefits of Service portfolio management

• Ability to establish the criteria for ’fact-based’ decision-making and effectively deliver only those Services that actually provide value and strategic advantage to the business
• Maximize value of investment decisions and rapidly re-evaluate those decisions when events and governing assumptions change
• Optimize the build phase of a Service to ensure it is delivered in the most cost-effective manner and as quickly as possible, providing the performance required to meet business needs
• Deliver quality Services that provide the required quality/functionality and the supporting eco-system to sustain them as a consumed Service
• Provide strategic advantage to businesses by giving them early indications when a Service is decreasing in value, allowing them to decide whether to improve, retire or replace the Service if necessary.

Service portfolio management has three phases (as seen in Figure A): 

 

1) Service Pipeline

Services that are planned or in development but not yet available to service consumers

2) Service Catalog

Services that are currently released and deployed or ready for deployment

3)Retired Services

Services that are no longer active

Service Pipeline

The service pipeline represents the strategic outlook that you, the service provider, should take. Services begin their lifecycle in the service pipeline, starting with the strategic assessment of the marketplace and/or customers to be served. The pipeline includes the services that have been requested and are currently being evaluated. Here, you identify the requirements of the requested services. You then define and analyze the services based on a number of factors, including cost, risk, and expected business value.

Based on the analysis, you either approve or reject requested services. Approved services proceed from the service pipeline to the service catalog.

Service Catalog

The service catalog is the subset of the service portfolio that is visible to customers. The service catalog includes all services that have been approved and are either in development or currently deployed. Services include outsourced, co-sourced, and managed services. ITIL V3 defines several attributes to be maintained by the service catalog for each service, such as the following:

• Service description
• Policies
• SLAs
• Ordering and request procedures
• Support terms and conditions
• Pricing and chargeback

Here, you assess the feasibility of the services that come into the service catalog from the service pipeline, and either charter or reject them. Chartered services move to the design and development phases. Developed services are then built, tested, released, and deployed. At this point, services become operational, and you engage resources to support them.

The service catalog is used to develop requestable services that customers can purchase and consume. A mature service catalog is a very powerful tool for decision making. By analyzing the demand and fulfillment capabilities a service provides, a service portfolio management approach can assist you in making decisions to expand a service or the marketplace to serve to meet future demands.

Service Catalog has two aspects (as seen in picture B):

Business Service Catalog provides the service consumer view. It contains details of the services available to consumers and shows the relationships of the services to business units and business processes.

Technical Service Catalog underpins the business service catalog and provides the IT view. It shows the makeup of the services, including the relationships of the services to the enterprise infrastructure elements that support them.

Benefits of Service Catalog

• Creating a service driven culture elevating the perception of the IT organization to a Service Provider
• Providing a source of reliable information to manage investments
• Increasing customer satisfaction allowing to choose the correct level of IT service for their needs
• Setting the stage for a formal Service Level Management process
• Building the foundation to manage Service Requests

Retired Services

It is necessary to review the service portfolio periodically to determine whether any services should be retired. Services targeted for retirement may include those that are no longer needed by the business, those that have been superseded by other services, and those that are no longer cost-effective.

Retire these services and identify them as “retired” in the service portfolio.