IT Asset Management

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FTFINANCIAL TIMES

Prentice Hall

IT Asset Management

How to manage your IT equipment

ALEX SEFKE

An imprint of Pearson Education

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FTFINANCIAL TIMES

PrenticeHallIT BRIEFINGS SERIES EDITOR: SEBASTIAN NOKES

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First published in Great Britain in 2003

Pearson Education Limited 2003

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vAbout the author

Alex Sefke moved into IT business about 15 years ago from a career in financial

and commercial management. Having initially concentrated on network design

and hardware distribution, he refocused his company to IT consultancy and

software development in the early 1990s.

As a senior consultant, Alex specialized in service management, working for

international companies such as GE, Lufthansa Systems, Deutsche Bank and

Mannesmann. Within the field of service management he gained particular

recognition in the area of service centres and help desks, including the application

and design of workflow and customer relationship management systems. Among

the numerous service centre projects Alex has designed and implemented have

been multilingual helpdesks operated 24 hours a day, seven days a week and

which are seamlessly integrated into the service and production supply chains.

Over the past three years Alex has held directorships in operational and strategic

roles within SITA, a global telecommunications and network provider focused on the

air transport community. These roles included the service and process design,

implementation and operation of major airlines outsourced global managed services.

Currently leading the Programme Office, Alex presently focuses on strategic and

tactical operations such as the design and subsequent implementation of operational

services models for desktop-related IT products in the airport. His role in senior

management covers not only the more theoretical design of service processes but

also the practical proof of such concepts in implementation and operation.

Meanwhile, at the Newcastle University, Alex is also conducting research within

the field of technology management, where his work has specialized in IT asset

management and its impact on financial performance and competitive advantage.

Alex may be contacted via Alex@Sefke.de or Alex.Sefke@SITA.aero

vii

About the series editor

Sebastian Nokes is Series Editor for the IT Management series within the Financial

Times Prentice Hall Executive Briefings and has written and co-written several works

on the subject. These Briefings are designed to provide concise, focused knowledge,

concerning critical IT issues facing managers today. They deliver the information and

insight needed to evaluate situations and make informed decisions.

Sebastian is a partner at Kimbell Evaluation Ltd, a leading consulting and

analytical firm. Kimbell Evaluation was co-founded by Sebastian and helps clients

measure and manage value added by information technology, both in stable

organizations and in business or divisional turnarounds. His consulting clients

include international financial institutions and commercial corporations.

Sebastian began his career in the IT and investment banking industries, and has

been an employee of Credit Suisse First Boston and IBM. He was educated at

London University, served in the 2nd KEO Goorkhas, and holds finance and

engineering qualifications.

Sebastian may be contacted via Nokes@ITVA.Net

ix

Contents

List of definitions xi

List of figures xii

List of tables xiii

Preface xv

Introduction 1Terminology 3IT asset management programmes 5IT asset management and traditional asset management 7

Management context 9The need for IT asset management 11Supply chain management 14IT asset life cycle 16Service and support strategy 19IT strategy 20IT asset strategy 23

IT asset management services 29IT asset management services model 31Inventory management 33Configuration management 43Change management 56Order processing 60Contract management 64

Financial aspects 69Property accounting 71Budget and cost control 72Potential cost savings 73

1

2

3

4

xContents

Reporting 77Definition and outline 79Data sources 81Data analysis 84Report production 84Sample report 85

Organizational structure 91Impact of ITAM 93Roles and responsibilities 94

Technology 105Management approaches 107Layers of information 109Asset tags 111Tool requirements 113Solutions 115

Implementation plan 119Due diligence 121Implementation plan 123

Appendix: ITAM data table 135

Bibliography 149

6

7

8

5

xi

Definitions

1 IT asset management 3

2 ITAM programme 3

3 Assets 4

4 Configurations 4

5 Inventory 4

6 Change 5

7 IT asset life cycle 16

8 Inventory management 33

9 Configuration management 43

10 Change management 56

11 Order processing 60

12 Contract management 64

13 Reporting 79

xii

2.1 Integrated supply chain 14

2.2 Components of customer service 16

2.3 IT asset life cycle 17

2.4 Managed life cycle 18

2.5 Derivation of strategy 21

2.6 Generic strategies 21

2.7 Development of strategies 22

2.8 Design IT asset strategy 25

3.1 IT asset management services model 32

3.2 Factors impacting inventory 36

3.3 Recursive configuration data structure 46

3.4 Sample structure 47

3.5 Development of new configurations 49

3.6 Integration of new software or component 50

3.7 Dependencies of purpose, objective and scope 52

3.8 Contract management 66

5.1 Report implementation 81

5.2 Data links 83

5.3 Data analysis matrix 84

5.4 Report generation overview 86

6.1 ITAM organizational structure 93

7.1 Push and pull approach 107

7.2 Layers of information 110

7.3 eTag General information 112

7.4 eTag Help information 113

7.5 Push and pull management 115

Figures

xiii

Tables

1.1 Maturity of ITAM programmes 6

2.1 Management advantages linked to ITAM 13

3.1 Service deliverables for asset administration 38

3.2 Service deliverables for asset record updating 40

3.3 Service deliverables for software licence management 41

3.4 Service deliverables for quality assurance 42

3.5 Service deliverables for reporting 43

3.6 Sample configuration 51

3.7 Purpose, objective and scope dependency examples 53

3.8 Service deliverables for configuration management 54

3.9 Service deliverables for change management 59

3.10 Service deliverables for order management 61

3.11 Service deliverables for logistics 64

3.12 Service deliverables for contract management 67

4.1 Controlling IT costs 73

4.2 Cost impact of ITAM 75

7.1 Push and pull limitations and advantages 108

7.2 Checklist for tracking system customization 117

8.1 Service deliverables for wall-to-wall inventory 122

8.2 Preliminary service deliverables for ITAM implementation 123

8.3 ITAM programme implementation checklist 125

8.4 ITAM programme compliance checklist 132

A1 ITAM data table 136

xv

Preface

During the course of positions held in senior management, both in IT operations

and projects, I came across an absence of common terminology and general

understanding of IT asset management. Despite an individual, detailed knowledge

of underlying issues and requirements, conceptualization and communication

were hampered through this lack of a common view of IT asset management

services which is capable of being shared.

This book attempts to outline a terminology and a set of definitions for IT asset

management, using a framework of five main components. It is not intended to

override existing different definitions, but to provide a baseline for a corporate

understanding of IT asset management and the services involved.

I would like to express my thanks to my colleagues at SITA London, Montreal and

Frankfurt, who have supported me with their invaluable feedback and input, and in

particular to Darrell Frith of SITA for his professional contribution and support.

1Introduction

Terminology 3

IT asset management programmes 5

IT asset management and traditional asset management 7

1

Introduction

TERMINOLOGY

IT asset management is often referred to as configuration or inventory management.

In particular in the UK, asset management is often understood as an accounting

discipline rather than as a managed set of services.

However, within a holistic approach, configuration and inventory management

are like property accounting services or applications within the context of the

management of IT assets. IT asset management hence marks a wider scope and is

intended to integrate processes and procedures on a corporate level or provide

information to other disciplines via access to data repositories.

Despite other terminologies in use, the term IT asset management is widely

used within the context of IT service management.

From here on within this book IT asset management is referred to as ITAM.

Definition 1: IT asset management

IT asset management (ITAM) is understood as a set of services, which may be

utilized internally or provided to customers. ITAM services are built on processes

in order to track technical, commercial and financial data associated with IT

assets. ITAM focuses on all assets which are available to an organization as means

for internal processes or as part of contracted services. ITAM covers the entire life

cycle of assets.

Within a corporate environment ITAM is usually understood as a set of services,

supported by technology, which help IT organizations to accurately take

inventory of assets and configurations. ITAM allows for the management of these

assets through the various stages of their time in service, i.e. their life cycles.

From the point of view of organizational structure, ITAM may also be referred to

as a set of policies, roles and responsibilities which are adhered to and carried out

by individuals and hence determine an organizational function or role. Increasingly

organizations include ITAM functions in their organizational structure.

All of the above are encompassed by an ITAM programme, which is designed prior

to the implementation of ITAM services and is maintained after implementation as

an ITAM policy. The maintenance of the ITAM programme is a managerial function,

which depending on the impact of ITAM on an organizations business and its size

will be integrated into the organizations structure. This integration can be achieved

through the design of dedicated roles and responsibilities or through the integration

of ITAM functions into existing roles and responsibilities.

Definition 2: ITAM programme

An ITAM programme encompasses processes and policies, which are delivered

through procedures, carried out through roles and responsibilities, supported by

3

4IT Asset Management

a technology. An ITAM programme incorporates the commercially relevant life

cycle management, e.g. from purchase to disposal on a corporate/global basis.

Definition 3: Assets

IT assets are all valuable items, irrespective of material evaluation and ownership,

which physically or in the form of licences and rights are at an organizations

disposal for purposes of information technology. Assets may be assigned to other

assets or contain other assets. Assets are grouped into categories, types and items,

whereby items mark unique, physically identifiable assets.

Ownership and evaluation of assets may be relevant for organizational entities to

determine the level of management required. However, all assets which are in use or

are available to use have to be considered from a management perspective, that is in

terms of handling, maintaining and support for these assets during their life cycles.

Definition 4: Configurations

Configurations are combinations of assets which form a functional unit, offering

a defined functionality and integration within parameters which allow an

understanding of the relationships and dependencies among components.

Configurations may be valid for a number of assets, an asset type may be valid for

numerous configurations, but a single, uniquely identified asset may have only

one configuration at any point in time.

Assets are set up for a particular purpose through configurations. All assets in use

within an organization have a specific configuration. Configurations may vary,

for example following new or altered requirements or technical changes, and

hence may exist in a number of different versions.

Definition 5: Inventory

The inventory lists all IT assets available to an organization, be they installed, in

stock or shipped. All parts of the inventory are associated with physical, contractual

and financial data, which uniquely identify equipment and establish an

organizational context. Inventory comprises physical assets, rights and licences.

The inventory lists all assets, possibly grouped on a department, contract or customer

basis, which are available for internal use or for service provision to customers. Not

restricted to owned assets, this inventory goes far beyond property accounting, as it

will contain all equipment which is at an organizations disposal for IT purposes.

The inventory provides information about what equipment is where and what

its status is with respect to the life cycle. Physical inventory data is frequently

linked to demographic data to achieve this.

Introduction

Organizations as a whole have to respond to changes in their environment,

which will also be reflected in their inventories.

Definition 6: Change

Change is the implementation of new processes, sub-processes, procedures or

technologies to an existing organizational context in order to let the organization

respond to changing environments.

Change needs to take place in order to allow an organization to become flexible

with respect to changes in the business environment such as customer requirements

and demands. Standardized and predefined changes are described as IMACs, i.e.

installations, moves, additions and changes.

IT ASSET MANAGEMENT PROGRAMMES

IT asset management (ITAM) is an ongoing operational effort and its

implementation an iterative process. ITAM goes beyond the one-time efforts of

projects, focusing on tools and processes and their implementation. ITAM needs

to be established as part of the organization responding to its size and business

with dedicated resources and integration into operations and administration

procedures. Efforts to maintain data accuracy are likely to exceed efforts for

programme implementation.

ITAM services are either provided by internal entities to internal customers or

outsourced as part of service contracts with service providers. Organizations

which provide ITAM services to their customers have to implement a wider set of

services and processes which need to be highly adaptable in order to serve the

various customers requirements.

An ITAM programme within this business context needs to contain the full

range of ITAM services if it is to operate as a pick and mix toolkit, from which

those services in the programme may be chosen which are relevant for internal

purposes and to fulfil contractual obligations.

Effective ITAM programmes need to encompass four basic components:

an IT asset strategy based on the customers and business needs;

Quick wins which deliver immediate impact and high visibility;

the negotiation of contracts, where applicable;

performance measurement.

In order to be implemented, the programme needs to focus on a business area of

high visibility which provides an appropriate opportunity to succeed within set

timelines and budgets. The implementation needs to demonstrate financial impact

5

6IT Asset Management

beyond the one off, and needs to build on designed processes and procedures to

allow for adaptation and replication in other areas.

An ITAM programme typically includes team members from those parts of the

organization which are involved in the different aspects of ITAM, i.e. those which

have a business interest in the programme and its outcome. For example, team

members will be representatives from:

business units;

finance;

legal;

IT organizations.

The overall maturity of an ITAM programme and its implementation can be

determined through parameters such as:

process;

tools;

information;

integration.

Table 1.1 shows these parameters for five levels of ITAM, Level I being the lowest

and Level V the highest.

Table 1.1 Maturity of ITAM programmes

Level I Level II Level III Level IV Level V

Process Low Reactive Proactive Measurements Seamless maturity state life cycle and SLAs in integration

management place

Tools No tool for Tool for Tool Tool Integration inventory inventory integration integration with corporate scanning counts with service with ERP systemsavailable management (see text)

systems

Information Limited Inventories Inventory Standard Inventory availability and IMAC linked with reporting on transparency,

run on finance and inventory and usage based project basis contract opportunity re-charge and

management billing

Integration None Through ITAM Dedicated Seamless project teams implementation ITAM team organizational

with senior integrationmanagement attention

Introduction

Particularly with businesses which provide process integration to customers, but

also with internal service provision, the provision of ITAM services will be

expected between Level III and Level V. Customers are also likely to expect their

vendors and suppliers to provide these levels of process excellence in order to

benefit from cost advantages.

IT ASSET MANAGEMENT AND TRADITIONAL

ASSET MANAGEMENT

What are the differences between IT asset management and traditional asset

management?

First of all, all practices applicable and relevant to overall asset management

should also apply to IT asset management. However, this does not always seem to

be the case. Core business processes, which are supported or enabled by technology,

expose organizations to a certain level of dependency on assets and technology. This

level of dependency will vary with the level of integration of technology and may be

observed not just with IT assets.

However, productivity gains are often achieved through a higher involvement of

IT in core business processes, e.g. Enterprise Resources Planning systems (ERP).

The increased dependency on IT systems and their availability means that IT

assets become of vital importance to organizations, which may make these assets

different from many others.

IT asset management is different with regard to life cycles, which may be perceived

as being shorter in comparison to other assets with a similar level of investment and

maintenance, e.g. machinery for production. And life cycles are constantly getting

shorter due to increasing requirements, e.g. for computing power, memory and

storage as well as integrational capabilities such as networking.

The IT industry itself seems to drive the shortening of life cycles through

enhanced or new functionalities and usability. These enhancements do not

necessarily result in a similar increase in productivity. To follow the latest

developments sometimes even fads is perceived as strategic. Furthermore, the

companys image and culture to remain at the forefront of developments and

industry practices may force an organization to further cut down the time IT

assets spend in service, i.e. their life cycle.

A large proportion of IT costs is associated with maintenance, which frequently

exceeds the original purchasing cost. The effort to get these costs under management

control seems to be a major difference to traditional asset management, where

these problems are likely to have already been solved some time ago.

The reason for IT asset management not being as far advanced in

standardization as traditional asset management and property accounting can be

7

8IT Asset Management

seen in its relatively short history. There is a need to develop further these

management capabilities, processes and procedures. This seems to be the case for

WINTEL (Windows/Intel) dominated environments in particular, although in

host-based environments a number of these requirements have already been

satisfied for some time, e.g. the re-charging of IT cost on a usage basis.

A third difference is derived from the nature of IT assets: they are manageable

through technology. The decentralization of computing power in PC networks has

had a significant effect on the need for on-site maintenance for anything other

than peripheral equipment.

While some active network components such as routers, switches and gateways

have been remotely manageable by default, other components such as PCs and

printers are only now becoming available for remote management.

Supported by a continuous reduction in the size and weight of equipment but

ever more increased functionality the need to have skilled personnel on-site is

decreasing. Support strategies utilize remote management and logistic services to

replace the entire piece of equipment if it cannot be repaired remotely.

Support strategies also go beyond financial management of IT assets. Not only

assets which are owned but all assets which are at an organizations disposal

require technical and/or physical management. Thus the inventory of IT equipment

may include leased or rented equipment.

Organizations may be obliged to keep track of IT assets not only through legal

regulations but also through contracts with their suppliers. Typical supplier

contracts will, for example, oblige organizations to maintain inventory lists of leased

equipment and be in a position to report on the number of software licences in use.

2Management context

The need for IT asset management 11

Supply chain management 14

IT asset life cycle 16

Service and support strategy 19

IT strategy 20

IT asset strategy 23

9

Management context

THE NEED FOR IT ASSET MANAGEMENT

The implementation and operation of leading-edge information technology is often

hampered by the high risk and failure rates of projects. The failure of IT systems

which support core business processes thus creating an organization dependent

on technology reflects deficiencies in the management of IT. Successful IT

management requires accurate information about the installed asset base.

Dependencies and interactions within this inventory need to be considered for

changes to be made to installations and configurations.

Legal obligations require organizations to operate a system of asset

management for internally owned assets. These obligations are determined by

local accounting regulations and by organizational policies. Despite being within

legal regulations, organizational policies may be far-reaching, and are generally

set up to support economic objectives such as leveraging economic performance.

Obligations also include licence agreements, for example with software vendors

which require software assets to be tracked and reported on. Under the terms of

their contracts with software vendors clients in volume agreements are required

to prove how many and what types of licences are utilized. An accurate inventory

may help to save cost by avoiding over-licensing. In many cases the purchase of

software, such as operating systems and office applications, is automated with

every new PC. An inventory allows purchases to be optimized by identifying

options for upgrades or re-use of existing licences.

Through the keeping of accurate numbers the purchasing department will be

able to negotiate volume agreements or discounts on certain products. Also, an

inventory will make sure that no breach of a licence agreement occurs by buying

the correct amount of licences.

In order to provide internal or outsourced services, organizations are required

to have a reasonably accurate overview of:

what assets are available internally and for service delivery to customers;

where assets are located;

who uses assets;

how assets are moved;

how assets change.

Within the outsourcing business these requirements are extended through

contracts and possibly further legal obligations. ITAM provides the basic

information to operate asset-related outsourced managed services, including

change and the ability to control technology streams. Being able to pass on

accurate asset information, for example to field service technicians, will allow the

time for fault diagnosis and response time to be significantly reduced.

11

12

IT Asset Management

Although organizations tend to invest a significant portion of corporate capital

in IT, an increasing dissatisfaction with IT and related services is evident. The lack

of services is perceived to be due to a lack of efficiency in internal IT organizations,

including re-charging mechanisms. Dissatisfaction is further nurtured through

rising costs, though these are often justified by increases in capacity and

performance through technological developments. These increases will have led in

some cases to unwanted overcapacity. ITAM programmes can help to utilize this

overcapacity and hence increase the return on investment.

Organizations seek to achieve service improvements and IT cost reductions

through economies of scale and improved cost control. Consequently organizations

are looking to outsource IT functions to gain improved transparency, unless

internally provided services are competitive, i.e. at world-class level. However,

outsourcing may also expose the organization to a number of risks, such as:

loss of flexibility due to long-term contracts and relationships;

irreversibility of contracted outsourced services;

high cost and constraints to in-source where and when necessary.

The indications show that in general business is expected to benefit from IT

through improved information availability, while the area of accounting expects

to benefit through improvements in the services offered and the performance of

services provided. However, these benefits may be hampered by:

systems which are not fully functioning;

systems which are not fully implemented;

changes in power relevant to system implementation.

There is also a need for corporate integration of ITAM in order to gain process

competence, competitive advantage and differentiation of service products, e.g. in

the areas of supply chain management, logistics and marketing effectiveness.

Common drivers for the initiation of an ITAM programme include:

help desk support;

maintenance and repair cost;

software distribution;

property and lease management;

licence compliance;

budgeting;

IT procurement;

planning, e.g. for capacity and life cycles;

technology migration;

Management context

disaster recovery;

mergers and acquisitions;

mobile device management.

Integration of IT brings to organizations management advantages. Possible

advantages supported by ITAM are shown in Table 2.1: the right-hand column

links these potential management advantages to ITAM and hence demonstrates

the corporate importance of ITAM functions and services.

Table 2.1 Management advantages linked to ITAM

Management advantages Link to ITAM

Increased speed of communication of Availability of accurate and timely more accurate data asset-related data for planning and

support purposes

Better quality of communication Direct links between systems, e.g.accounting, enable higher transparency ofasset data

Speeding up of the business cycle Support through accurate asset information

Increase business flexibility Exact information on installed base,configurations and asset status enablesplanning and change management

Improved decision making, gaining Provision of core data for decision making, competitive advantage e.g. availability, capacity and usage

Headcount savings Efficiency gains through clearly definedprocesses, supported by technology

Increased direct control Accurate and timely asset information allowsimproved cost and usage control

Awareness of outstanding duties to be Life cycle management, preventative completed measures, licence management and control

of leasing contracts

The link between inventory data delivered by wall-to-wall inventories and

through frequent inventory scans under contract and demographic data allows for

the efficient management of IT assets. Efficient management leads to contract

efficiency with regard, for example, to leasing and software licences and helps to

avoid legal or contractual exposure.

ITAM is affected by technological and economic trends, including shifting

requirements and increasing complexity. Centralization and globalization lead to

increased compatibility and communication requirements. Technology developments

lead to diversification of requirements and continuously shortened life cycles.

13

14

IT Asset Management

SUPPLY CHAIN MANAGEMENT

Logistics and supply chain management focus on purchasing, procurement and

delivery of organizational demands, including assets, consumables, supplies for

production processes and traded goods. They may be in place to support the

organizations or the customers business.

A tendency towards integrated supply chains has led away from vertical

integration and towards virtual integration of core processes, as illustrated in

Figure 2.1.

Fig. 2.1 Integrated supply chain

Virtual integration requires seamless, streamlined and effective service processes,

which need to be supported by similar effective and efficient ITAM processes,

leading to closer customer relationships and also to maximized ROIs.

Within supply chain management services are expected to become a key

differentiator, given the fact that a growing commoditization of products can be

observed with prices remaining a competitive denominator. Supply chain

management has a strong impact on cost and customer service. Successors in a

competitive environment can be expected either to have gained cost advantages

over their competitors or to have differentiated themselves through their products

and services.

Services and their likely association with products play an increasing role in

differentiation in competitive environments where customers tend to buy services

rather than products. In a commodity environment products are largely

interchangeable with respect to the value expected and/or perceived by the customers

buying them. Consequently, buying decisions are widely based on price. Services

associated with products allow organizations to differentiate from their competitors

by adding further criteria to the decision making. Customers willingness to switch

products may possibly decrease and help to build long-term customer relationships.

The differentiation through service relies on an effective strategy for supply chain

and logistics management. ITAM supports both logistics and supply chain

CustomersSuppliers Internalsupply chain

Management context

management through accurate and timely information which will lead, for example,

to reduction in lead times. The impact of ITAM is even more evident in vendor-

managed inventories, where customer demands are managed through shared

information between customer and vendor. Based on information shared, a vendor

takes responsibility for agreed services affecting the customers inventory.

Services initiate, support or utilize supply chain and logistics management to

increase customer satisfaction. Processes and technology support supply chain and

logistics management to improve service capabilities and provide cost advantages.

Customer relations are impacted through quality of service, process excellence

and process integration, using services as a differentiator. The absence of ITAM

may also add to the cost pressure put on an organization by customers, as they

would expect an increase in efficiency based on industry standard processes such

as ITAM to have an impact on their cost base also.

Customers will expect services beyond volume pricing, such as suppliers

becoming involved in life cycle management and optimization of the customer and

vendor relationships. Joint life cycle management is part of virtual integration, i.e.

process integration between customers and vendors.

Customers of service products expect cost advantages through buying service

rather than providing these internally. Services bought externally need to integrate

seamlessly with internal and other outsourced services to provide overall added

value and competitive advantage for customers.

In service environments, e.g. where supply chain and logistics are the products

or part of managed services sold to customers, differentiation and competitive

advantage can be achieved through process excellence. The expected or perceived

process excellence of a service provider is similar to the properties of products and

is also subject to commoditization, with buying decisions, for example in

outsourcing contracts, being made based on price and process excellence.

To a certain extent ITAM programmes and efforts are driven by the complexity

involved in purchasing and delivering IT assets. The complexity is caused through

the diversity and variety of products available and suppliers operating globally.

Order processing strives to manage the first stages of life cycle management by

offering a framework of standardized processes to deliver installations, moves,

adds and changes (IMAC). This framework may be understood as a basic part of

an ITAM programme.

Offering services related to products and process excellence in performing services

are effective ways to add value and gain efficiencies. Value adds may include:

service delivery;

service excellence;

financial packages;

technical support.

15

16

IT Asset Management

Efficiencies gained and value added lead to competitive advantage by performing

strategically important activities both at a lower cost and offering higher value.

Cost leadership strategies have been focusing on economies of scale. Logistics

are very likely to offer a powerful alternative to deliver cost advantages with the

speed and effectiveness of logistics processes becoming performance indicators.

ITAM allows the consolidation of purchasing and maintenance processes based on

inventory information. The improved technology and business planning provided by

ITAM will lead to shortened procurement cycles.

Service differentiation, process integration and improved customer relationships

make ITAM a vital and central function in customer service, as illustrated in Figure

2.2. Based on the transaction related components of customer service, ITAM

components and services are found in all three sectors, e.g. stock availability, order,

delivery, substitution and service parts availability.

Fig. 2.2 Components of customer service

Models for inventory calculation require accurate and current data. Through the

determination of annual demands and availability curves per system, ITAM delivers

a vital part of the data baseline to calculate stock levels, hence ITAM is becoming

an important part of the equation for optimal inventories and spares levels.

IT ASSET LIFE CYCLE

Definition 7: IT asset life cycle

An IT assets life cycle encompasses the different stages the asset will undergo during

its time in service and which are commercially or technically relevant, from purchase

to disposal. These different stages are identified through a status which will allow

Pre-transaction Transaction Post-transaction

Stock availability Target delivery dates Response time to queries

Order fill rate On-time delivery Back-orders by age Shipment delays Product substitutions

First call fix rate Customer complaints Returns/claims Invoice errors Service parts availability

Management context

detailed tracking, supported by technology. IT asset life cycle management aims at

cost management, cost reduction and continuous performance improvements.

Life cycle management has to be understood as an interdisciplinary, corporate

effort, facilitated by IS organizations to establish standards for the use of IT

equipment. Ageing equipment, warranties, lease contracts and labour costs have to

be tracked closely in order to reduce costs. Life cycles for IT equipment need to be

planned to reduce complexity and take maximum advantage of future developments

in technology.

On a wider scope, activities and phases also have to be included which make

assets available to an organization in the first place, e.g. gathering of requirements,

procurement and approval.

Management of equipment has to allow for overlaps while preceding product

generations are phased out and new product generations are phased in.

During a life cycle, the intensity of service requirements may vary, as illustrated in

the bath tub curve shown in Figure 2.3 which shows increased service requirements

during the deployment and disposal phases. Hence life cycle management has to be

envisioned as an overlapping process, which is directly linked to the service efforts

and hence service costs.

Fig. 2.3 IT asset life cycle

17

Generation of current assets

Num

ber o

f fai

lure

s/in

terv

entio

ns

Strategy Plan Management

Pro

duct

inves

tigat

ion

Req

uire

men

ts g

athe

ring

Bus

ines

s ap

pro

val

Pro

cure

men

t

Tech

nolo

gy p

lann

ing

and

depl

oym

ent Support strategies andphysical management

Ret

irem

ent a

nd d

ispo

sal s

trat

egie

s

Earlier generation of assets Following generationof assets

Assets time in service

Phase in/Phase out

Phase inPhase out

Transition

18

IT Asset Management

The pace of life cycles may be accelerated, e.g. through new software platforms

which also require enhanced hardware. ITAM allows for the management of

changes and the optimization of the use of IT assets, while taking control of

developments in technology (see Figure 2.4).

Fig. 2.4 Managed life cycle

The technological life cycle of a PC is an average of three-and-a-half years for

desktops and below three years for laptops. The economic life cycle, however, is

calculated at three years. Due to technological developments in hardware in recent

years, an overcapacity will have been built in many organizations. Overcapacity

which does not correspond to increased user requirements can be employed to

extend the economic life cycle to four years and hence reduce annual depreciation.

An asset life cycle is embedded in a set of organizational service-relevant

strategies which allow life cycles to be managed according to organizational needs.

These strategies and their impact are shown in Figure 2.4. The managed life cycle

integrates planning, procurement and purchasing into the cycle.

Life Cycle

Disposal

Technologyplanning

Deployment

Procurement

Purchasing

Physicalmanagement

Supportstrategy

Retirement/disposalstrategy

IT and IT assetstrategy

AssetidentificatonInventory

tracking

Technology

Servicesdelivery

Assetmanagement

services

Management context

The efficiency of IT resources will be focused by organizations due to rising

economic pressure. The 1990s saw a deployment of overcapacity within the IT

infrastructure, probably supported by falling hardware prices. Obtaining exact

information about the installed base and its capacity will allow organizations to

cut costs by eliminating overcapacity without reducing services and quality. The

extension of services to new business requirements may be made without further

investments in IT.

Using the option to upgrade PC hardware rather than replace the entire PC will

also lead to the extension of life cycles.

While reductions in depreciation may lead to a decrease in internal cost re-charges,

an increase in taxes on assets may occur consequently.

ITAM will allow both internally and in the context of service contracts

reporting on green issues within the inventory, such as compliance with recycling

and disposal policies, so that what needs to be disposed of in the future is

recognized and understood.

Aspects of the green management of assets are becoming more and more

important on a regional level, for example in Europe, but also for global or

international organizations and hence add to an organizations competitive

advantage. In fact, through the policies of global European organizations for

example, standards for environmental friendliness may become relevant

worldwide, even in emerging countries.

Using ITAM, data managers are in a position to report accurately on the

environmental friendliness of inventories. Furthermore, disposal policies can build

and plan on ITAM data related to the expected life cycles of equipment, including

options and plans for recycling certain parts and components.

SERVICE AND SUPPORT STRATEGY

Industry standard service and support strategies frequently encompass three levels

of services, typically provided through a centralized unit such as a help desk or

service centre which takes ownership for the life cycle of a request. Also referred to

as consolidated service desks these entities are directly reliant upon the availability

and accuracy of asset-related data to be able to provide the required services.

Furthermore, requests raised may include the need to trigger change processes,

which may have an impact on assets. Also, problems occurring through changes

will be reported into this service structure. To provide these services, accurate and

timely inventory and configuration data is required.

In order to ensure adequate engineering and documentation of IT systems,

organization and control is provided through configuration management. Rigid

19

20

IT Asset Management

processes are introduced to prevent loss of information with respect to

configurations. The extent of configuration management can be an indicator of

the organizations level of process maturity.

ITAM data can provide the statistical evidence to identify faulty products and

take appropriate actions to avoid future negative impact on IT availability and

reliability. Minimizing the impact of faulty products, such as downtime or

logistics and maintenance costs, is an efficient strategy to improve effectiveness

and cost reduction.

IT STRATEGY

Concepts for business strategy are also applicable for IT strategy and planning. IT

is understood as a set of processes, policies and technologies that allow data

storage, processing and transmission. IT has the capability to link entities within

the organization and beyond through the standardization and extension of

linkages. IT potentially reduces cost by adding efficiency to transactions.

IT offers integrational capabilities which allow services to become available

across the board, as is evident from systems which integrate corporate processes,

e.g. ERP systems. Due to the central role of IT, dependency on IT in terms of

availability, reliability and usability increases. The level of integration of IT in core

processes determines the level of dependency on IT.

IT has strategic importance as it may offer new or enhanced business and

management opportunities, for example:

competitive advantage gains;

productivity and performance improvements;

as an enabler for new ways of managing and organizing;

new business development.

Clearly identified, defined and communicated objectives supported by adequately

defined structures are also prerequisites for a successful IT implementation.

Strategies can be described as focused measures which are derived from the

organizations visions, missions and objectives, as illustrated in Figure 2.5. Strategies

support the achievement of organizational objectives and their formulation is hence

dependent on these objectives. Defining a strategy prior to identifying objectives is

impossible.

Figure 2.5 also indicates that strategies are at the end of a process which

provides direction to the organization in general. Changes to the vision and its

derived mission will inevitably lead also to changed objectives, which are likely to

lead to changed strategies in order to be achieved.

Management context

Fig. 2.5 Derivation of strategy

A lack of clarity within the vision and the mission statement, or in their

communication, will almost inevitably lead to less clearly defined objectives and

strategies. A clear and strong mission statement will hence contribute to the overall

success of an organization.

An organizations position within the market is determined through its

competitive advantage over its competitors. Objectives and strategies are defined

with respect to the market position. When operating in international environments,

these factors may be multiplied through the influence of regional markets and

production conditions.

In relation to an organizations mission and market position a number of generic

strategies can be identified, as illustrated in Figure 2.6.

Fig. 2.6 Generic strategies

21

Vision

Mission

Objectives

Strategy

Productdifferentiation

Cost ProductCompetitive advantage

Broaddifferentiation

Costfocus

Costleadership

Focu

sN

arro

wBr

oad

22

IT Asset Management

Following this approach, organizations gain competitive advantage either through

their products being innovative or new, or through cost and price optimized

production. The focus determines whether an organization strives for leadership

or follows existing leaders. Use of technology and readiness for investment and

technical innovation is determined by such self-assessment by an organization.

IT capabilities and capacities which are hard to imitate contribute to an

organizations competitive advantage and hence are an integral part of its resource

base. As a consequence, the alignment of IT and overall business strategy will

increase competitive advantage. However, it is the management of IT, rather than the

technology itself, which is primarily contributing to this competitive advantage.

Overall corporate strategies will determine the strategies for products, functions

and departments in order to make sure that the organizations strategy is followed

in the relevant corporate areas, as shown in Figure 2.7.

Fig. 2.7 Development of strategies

ITAM services are likely to be sold bundled with other services, which allows

vendors offering ITAM to gain competitive advantage within the outsourcing

business and/or be more successful in winning business internally.

Three categories of overlap between the use of IT and strategy can be identified:

IT used to help in the formulation of business strategy;

IT used in the implementation of business strategy;

strategic planning within IT functional units.

e.g. overallorganizational

objectives

e.g. product andmarketing strategies

e.g. product objectives

Corporatestrategy

Business unitstrategy

Departmentstrategy

Management context

These categories point towards a corporate importance of IT which goes beyond

organizational departments. Consequently issues of control arise which lead to

the tendency to see the IT department as a corporate or federal function.

Technology management has focused on strategic issues such as integration with

corporate and business strategies. The effective implementation of IT strategies

requires operational process management. ITAM provides a framework which

allows an understanding the technology management issues and incorporates

tools and technologies for strategy implementation.

The integration and application of IT within an organizations core processes

lead to competitive advantage through, for example:

production process excellence;

support process excellence;

order and logistic process excellence;

resource management;

level of process integration with customer;

organizational responsiveness and flexibility;

level of integration with business strategy.

To gain competitive advantage, organizations need to identify their critical success

factors and review their current ways of operating in order to find cost savings.

The technology currently in place and expected changes in systems which are

involved in the business value chain need to be evaluated in order to define a

strategy with respect to the organizations vision and targeted market position in

terms of, for example, cost leadership or differentiation.

Competitive advantage may be gained by the use of IT in products and services,

distribution and supply. ITAM is linked to all these applications, providing base-

line information for distribution through data gathered earlier.

IT ASSET STRATEGY

Overview

IT systems, including hardware and software, need to be identified through a technical

framework such as ITAM in order to meet business needs, maximize opportunities,

establish a data structure and provide an evolution plan of current systems.

Successful ITAM programmes will respond to the organizational, environmental,

financial and technological environment of the organization. Hence, ITAM strategies

encompass critical success factors such as:

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IT Asset Management

responsiveness to business requirements;

involvement of corporate entities;

identification of potential cost savings and commitment to achieve;

linkage of business and IT objectives;

senior management support;

funding;

adequate resource assignment;

iterative approach for implementation.

IT asset strategies need to reflect the fact that ITAM is an ongoing effort which,

despite the underlying complexity, needs to remain understandable and

straightforward. ITAM services focus on strategic areas within the corporate context,

where accurate and timely asset data is key to decision making. These areas include:

IT budgeting;

licence management;

infrastructure planning and management;

procurement;

standardization;

decision support;

contract management.

The ITAM process design builds on the IT asset strategy, in particular when some

policies and processes are already in place which need to be integrated. Process

integration needs to cover the ITAM requirements gathered from the parties

involved and hence a re-engineering component is likely to be included.

Any decision on technology and tools which are brought in to support ITAM

needs to be based on the IT asset strategy and the requirements included in it. The

requirements of and management policies included in the IT asset strategy

determine the need for, scope and level of customization required to meet ITAM

expectations. Figure 2.8 provides an overview of the preliminary steps in designing

an IT asset strategy.

The IT asset strategy should be reviewed frequently to make sure that changes

in the business environment and requirements are reflected. Change processes

need to be implemented to maintain the strategy and provide business flexibility.

Scope of ITAM

As a preliminary step, the scope of ITAM services within the context of the

organization has to be determined. The scope is expected to vary according to

environmental factors such as:

Management context

business environment;

type of business;

level of competitiveness;

role of IT and ITAM for the business;

and internal factors such as:

size of organization;

level of process integration with IT;

service management.

The scope outlines the organizational requirements for ITAM on a high level and

in relation to the business and the organization. Based on this framework, the

requirements and objectives for an ITAM implementation are further described in

the IT asset strategy.

Fig. 2.8 Design IT asset strategy

ITAM requirements

Requirements for ITAM services come from a number of different sources, e.g. legal

and contractual obligations as mentioned earlier, business strategies and customer

requirements.

These requirements actually form the basis for any IT asset strategy and

subsequent ITAM implementation. Any shortfall in meeting requirements will

likely have an impact on an organizations business and financial performance,

while exceeding requirements frequently means overspending and impacting

negatively on the organizations margins.

To gather requirements, the stakeholders in ITAM services have to be identified

and allowed to provide their input in order to make the picture as complete and

valid as possible. Stakeholders are likely to include both internal and external

25

Design andmaintainIT assetstrategy

Design andmaintaininventory

managementpolicy

Identify andcollect

requirementsfor ITAM

Consolidateexisting ITAMstrategies and

policies

Determinedata set

forinventorytracking

Identify anddocumentscope of

ITAM

26

IT Asset Management

entities, which will have specific requirements for their individual involvement in

ITAM, and possibly include a potential for improvement which is usually expected

to be addressed simultaneously.

Nevertheless, these requirements need to fit into the overall scope of ITAM as

earlier identified. The expectations of stakeholders and involved parties need to

be managed accordingly to maintain support and buy-in.

Existing ITAM strategies and policies

Although an overall IT asset strategy and ITAM services implementation may be

missing, organizations will likely have implemented parts and subsets of ITAM

within departments and operations in order to respond to existing needs. An IT asset

strategy needs to evaluate the existing processes and procedures, and possibly the

tools and technologies, in place and incorporate them where and when appropriate.

In particular these will include existing agreements with service providers which

are in place to operate the base already installed. Although the IT asset strategy

will provide overall guidance to the management of service providers and the type

of agreement required in support, a general renegotiation of all existing contracts

may not be feasible.

Besides building on existing pre-work and hence saving investments and returns,

subprocesses in place will also provide a good insight into the requirements of and

options for implementation. Likewise, invaluable experience may come from the

processes and policies being operated, which should be captured for the overall

strategy.

Furthermore, integrating the existing expertise in staff and inherent in current

strategies and policies will certainly increase the level of support and commitment

for the implementation of corporate ITAM programmes.

Inventory management policy

Based on requirements and existing processes, strategies and policies, a corporate

inventory management policy needs to be defined. This policy will describe overall

management approaches to utilizing technologies and manual processes such as:

data collection;

updating processes;

asset tagging;

audits and site surveys;

links to demographic data;

links to other systems.

Management context

Within the policy, the information to be collected per asset and how it is to be

organized and later maintained will be outlined, for example:

categorization of assets;

level of detail maintained per asset;

asset status with respect of life cycle.

The inventory management policy will outline the linkages with other internal or

external entities such as customers, departments and service providers. Other

corporate policies, such as purchasing and procurement, are likely to be impacted

by the inventory management policy. The principles of virtual integration and

shared inventories need to be applied in these areas.

ITAM services are based on a plan for wall-to-wall inventories, both initially

and through frequent reiterations. All changes to the inventory in place (IMACs)

need to be captured and monitored in a similar way in order to keep the inventory

current. The accuracy of data collection and ongoing inventories can be seen as a

major challenge in ITAM. Hence process and interface definition to and from

ITAM is vital.

Data set for inventory tracking

Based on the IT asset management policy outlined, the requirement for a

supporting data set can be derived. Although the data set should already point very

much in the direction of technology and tools, it is vital to have the data set derived

from the organizational requirements rather than, for example, a particular tools

capabilities and architecture.

The data set will also outline an overall structure for the data based on the

categories of information required. For all assets to fall within the scope of the IT

asset strategy ideally all IT assets available to the organization a mandatory

data set will be defined which depicts the core information which has to be

collected and maintained in order to provide basic ITAM services.

Design of IT asset strategy

The IT asset strategy links the concepts of ITAM and the services it comprises to

the organizational context, based on the requirements and preliminary steps

described above. The strategy is documented and communicated to all involved

parties; subsets of the internal strategy document may be distributed to external

customers and service providers, where applicable.

The framework outlined for the development, documentation and communication

of an IT asset strategy is also applicable for software and licences. Increased

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IT Asset Management

complexity may make a split of licence management from inventory management

for hardware necessary.

An IT asset strategy document will frequently contain the following sections:

purpose of the document;

communication and distribution;

business requirements;

ITAM scope;

inventory management policy;

inventory data requirements;

linkages with organization and supply chain;

contract management (where applicable);

implementation;

change management.

3IT asset management services

IT asset management services model 31

Inventory management 33

Configuration management 43

Change management 56

Order processing 60

Contract management 64

29

IT asset management services

IT ASSET MANAGEMENT SERVICES MODEL

The key business drivers for ITAM, which have been outlined earlier, are directly

related to an organizations business objectives and IT strategy. These drivers are

reflected in operational strategy, planning and management, such as:

capacity and integration planning;

support strategies;

physical management.

To support these operational requirements, five key components of ITAM can be

identified, which are illustrated in the ITAM services model (Figure 3.1). The

following chapters define these five main components of ITAM in detail and also

provide tables which contain the service deliverables for each component.

Many of the service deliverables are linked or dependent on each other. Any

selection from these deliverable to form a tailored ITAM service hence needs careful

consideration of these dependencies. Some deliverables have to be understood as

enablers for other services and deliverables.

The tables attempt to reflect this matter by grouping the service deliverables in

three distinct levels:

Mandatory service deliverables are prerequisites for services and other

deliverables.

Standard form a standard ITAM service or programme, building and relying on

mandatory service deliverables.

Extended mark services beyond the standard, which build on the standard

service deliverables and can be provided as optional extras, usually subject to

additional cost.

Figure 3.1 also shows the links of ITAM into service management and finance,

which both make use of the data and information made available through ITAM.

Service management is dependent on the accuracy and timeliness of ITAM data

for all asset-related requests, e.g. problems and changes. Often the entitlement to

service is validated through ITAM data, where services and support may be denied

when the asset referred to is not contained in the asset inventory.

ITAM also provides core data to finance, which is used for property accounting

and cost re-charging and billing purposes. ITAM data may be reconciled with data

from other repositories to complement the information, e.g. with purchasing data.

In cases where cost re-charge or revenue is based on a per asset (per seat) basis,

accurate and timely asset information is vital.

31

Inven

tory

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IT asset management services

Depending on the business and market an organization is in, the complexity of

ITAM components and services may increase. This is particularly the case when

ITAM services are not only provided internally, but are also supporting the

organizations business or even are products sold on externally to customers. In

these cases ITAM services need to be productized, which means that ITAM

service products are designed making use of standard service deliverables.

To provide different ITAM service products to customers and respond to

changing demands and market situations usually requires the capability to cover

the entire portfolio of ITAM services.

Focused on ITAM, Figure 3.1 indicates in passing only the very important links

through data and processes to finance and service management. Within this

model, finance would be expected to use the data provided by ITAM to derive the

financial information required such as depreciation, ownership, etc.

The link through data and processes to service management indicates a strong

bilateral dependency, where both disciplines, service management and ITAM, are

interacting with each other, e.g. through the involvement of a service centre

change and configuration management.

The services model is neither a functional nor organizational view, but illustrates

the links between objectives and strategies which lead to the provision of

integrated ITAM services.

Transposed into an organizational structure, the main components of ITAM

may be found in different areas of the organization or be outsourced to external

service providers. The components may also be part of a wider functionality

through which among others ITAM services are provided.

INVENTORY MANAGEMENT

Definition and outline

Definition 8: Inventory management

Inventory management tracks information on where, what and who in respect

of available equipment, with levels of detail determined by configuration

management. Information tracking may be done manually, through technology or

by a combination of both. Information is stored in a repository database and

updated through corporate processes and procedures.

Inventory management aims to identify and count available equipment within an

organization. Equipment within the inventory is identified by the physical and

demographic data on the assets which are linked within the repository to

contractual and financial data.

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IT Asset Management

Legal obligations require organizations to operate asset management for assets

owned internally. These legal obligations also include licence agreements with

software vendors, which require software assets to be tracked and reported on.

Based on outsourcing, organizations providing lease and rental contracts may also

be obliged to keep track of equipment owned by third parties. Hence ITAM

focuses on overall IT equipment irrespective of ownership.

The level of detail maintained for the inventory is determined by organizational

requirements. These requirements may reflect, for example, an organizations core

processes depending on the IT and the level of specialization of the IT supporting

these processes. Typically, finance departments will determine the level of detail

required to maintain property accounting or support the obligations arising from

renting or leasing contracts. Support functions need to be provided with IT asset

information to deliver contracted services.

In some cases a mere count of equipment may be satisfactory, such as where

pieces of equipment or components are dealt with in bulk. This may be the case

for equipment representing comparatively little value such as standard keyboards

or pointing devices.

Also, components build in such as RAM chips, network interface cards or CD

ROM drives are often tracked by number or capacity rather than through unique

identification such as a serial number.

In order to maintain a high accuracy of inventory data, the overall requirements

should be reduced wherever possible. Who is responsible for the inventory

repository needs to be clarified and assigned responsibilities. Changes which occur

as a result of field services intervening during repair or maintenance need to be

reflected within the inventory immediately, such as by a service centre which has

been set up to coordinate and manage the services provided.

Due to the non-physical properties of software, licence management is a specific

form of inventory management. Licence management maintains an inventory of

licences, rights and patents, i.e. immaterial assets. Within the context of ITAM,

software licences are of particular interest.

Volume software licence agreements at the corporate level are negotiated on the

basis of exact information on licences which are available and in use. ITAM delivers

this data and allows the use of licences to be analysed so that the most cost-effective

options for the re-use and upgrading of existing licences may be identified.

Organizations may be obliged through contractual regulations, such as licence

or volume agreements, as well as through legislation to maintain a schedule of

existing licences. When purchasing a software licence, usually only the right to use

but not ownership of the software as such is acquired. This right is appropriated

and limited based on the licence agreement. Limitations may be imposed through

a prohibition to copy and re-sell, but may also be imposed on the use, e.g. in

named licences.

IT asset management services

In order to ensure compliance with licence agreements and to maximize the

return on investment, an accurate schedule of licences in use and available is

required. Without inventory management on software, organizations are in

danger of being in breech of contract or over-licensed, both positions likely to give

rise to costs. Over-licensing as a result of over-purchasing, under-utilizing existing

licences, under-utilizing upgrade options or not re-using in cases of replacement

may amount to as much as 10 per cent of overall software licence costs.

Through the evolution of the inventory database into a service database,

historical service data, e.g. on changes and repairs, becomes available which may

be used for preventative or trend analysis purposes. Inventory data available

through the service database provides basic information required by service

management functions, such as helpdesks, IMAC teams and field services.

Inventory management has a significant impact on:

control of asset utilization;

cost control;

asset related re-charge and revenue;

service management;

finance and billing.

Inventory management supports the optimization of IT asset costs through, for

example:

life cycle management;

capacity planning;

asset utilization control;

optimized licence utilization;

avoiding outages;

preventative maintenance;

planned repair and maintenance.

Change

Inventories of fixed assets are subject to numerous changes and in the case of IT

ever more frequently. The factors impacting on an inventory are illustrated in

Figure 3.2. The diagram shows the inventory surrounded, i.e. protected, by

standard configurations and acceptance procedures. The application of standards,

e.g. the execution of acceptance procedures, allows changes to the inventory to be

processed in a planned and controlled manner.

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IT Asset Management

Fig. 3.2 Factors impacting inventory

Installations of additional equipment, changes, maintenance and new equipment

have to comply with existing configurations or otherwise have to undergo agreed

change processes prior to being accepted within the inventory.

The drivers for changes to the inventory are either usage and ageing of the

equipment or changes within the environment which an organization has to react

to. The requirement for continuous change in response to changing business

environments derives from the need to gain and maintain competitive advantage.

Following an initial wall-to-wall inventory, the repository needs frequent updates

which can be provided through:

technology and tools, i.e. inventory scanning;

process integration, e.g. IMAC;

manual inventories.

The required accuracy and timeliness of the data in a repository can be achieved

by merging these sources into a coherent set of processes supported by technology

and tools.

Inventory

Installations

Repair and maintenance

Life

cyc

le

Changes

Configurations

Acceptance

Wear and tear, consumption

Changing environment

IT asset management services

The inventory may be understood as the product determined by the following

factors:

initial installation;

moves;

additions;

changes;

deletions.

Standardized changes, i.e. defined and agreed procedures for changes, are utilized

by IMAC operations, while change management takes care of those changes for

which standardized procedures are not available.

Spare management

Spares need to be available to IT operations in order to bridge shortages and to

maintain service availability. Spares can be either parts for replacement or

complete products which will be used for replacement of a faulty unit or which

may be stripped and cannibalized when a specific part is needed.

The IT strategy has significant impact on the spares policy through the

determination of the required level of service and product used. The levels of

spares are calculated based on experience and manufacturer data, such as mean

time between failure (MTBF). Obviously levels of spares are affected by the

number of different products and their individual reliability and life cycle.

Spares represent a non-productive portion of inventory, which has a negative

impact on asset utilization. Consequently organizations in charge of providing

services tend to keep spares levels to an absolute minimum. Calculations of spares

levels hence need to be as accurate as possible.

The level of spares available reflects the importance of the availability of IT

systems to the organization expressed in terms of how much downtime may be

tolerated. Depending on the geography, vendor contracts may make spare

inventories partially redundant; however, expected lead times and product

availability need to be considered for spare levels.

Spare equipment will not usually be online and hence will not be captured

through inventory scanning tools.

Status

Equipment status identifies what state a piece of equipment is in with respect to

its life cycle. All technical, commercial or financial states within the life cycle are

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IT Asset Management

reflected by the status of an asset which may also vary with respect to its specifics.

Typical life cycle states will include:

ordered;

shipped;

in stock;

productive;

spare;

shipped for refurbishment;

broken;

out of use.

The status determines the relevance of an asset for reporting, for example where

non-productive assets will be excluded from performance and SLA reporting. The

analysis of status also allows an understanding of the reliability of certain types

of equipment and their need for repair.

The status also determines which equipment is included in inventory scans and

hence what to expect from such a scan.

Service deliverables

Asset administration

Table 3.1 shows the service deliverables for asset administration, that is for adding

asset data to the repository using manual and automated methods.

Table 3.1 Service deliverables for asset administration

Service deliverable Level

Notification on missing data

Add data for assets that were missed during due diligence

Notification to add asset data from IMAC process

Add asset data from the IMAC process

Notification to add asset data from change management process

Add asset data from the change management process

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Table 3.1 continued

Service deliverable Level

Notification to add asset data from end users request

Add asset data from end users request

Notification to add new asset data from inventory scan

Add new asset data from inventory scan

Notification to add asset data other than minimum

Maintain asset history

Maintain schedule for preventative maintenance

Asset life cycle management

Create new data from electronic source: coordination of data mapping development of custom data load and data cleansing procedures

Scheduling and loading of data for transfer and synchronization between data sources

Analyse and cost development of custom data load and interfaces

Add asset data and data from the interface with acquisition processes

Add asset data and data from interface with financial management and lease management

Add asset data manually or carry out manually data load

Maintaining mandatory data tables for data standardization and normalization

Developing and running scripts necessary to ensure data validity and quality

Provide billing data

Provide reference and values for accounting systems

Prepare for financial tracking of assets

Asset data update

Table 3.2 shows the service deliverables for asset data updates, that is for updating

data in the repository using manual and automated methods.

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Table 3.2 Service deliverables for asset record updating

Service deliverable Level

Notification on mandatory update standard on, for example, IMAC, repair, maintenance or infrastructure change

Update asset data standard on IMAC: updated demographic data initiate inventory scan

Update demographic data via mass update resulting from: company reorganization (i.e. changes to department, cost

centre, etc.) location changes (e.g. building or floor changes) change in asset ownership (e.g. manager or equipment

coordinator changes

Update asset data from the repair activities that require removing a broken asset and replacing it with one from stock (an asset that already is in the data standard)

Update server (or infrastructure device) data from the change management process

Update asset data and data from electronic sources (e.g. spreadsheet, edit feed or delimited text file) or online (web) access

Update asset data manually entering data in the data standard or manually loading it from an alternative source such as a spreadsheet or data standard provided by a customer

Update asset data and data from the interface with financial management and lease management

Update asset data and data from network electronic scan or from user-initiated scan via online (web) access

Run the data through a loader or filter or activities associated with running recurring scripts or tools that automatically scrub and load data

Load the acceptable data into the data repository through use of automated tools

Manually load the acceptable data into the data repository

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Software licence management

Table 3.3 shows the service deliverables for software licence management, that is

the processes to effectively and efficiently gather, track and distribute software

licences.

Table 3.3 Service deliverables for software licence management

Service deliverable Level

Verify software licence and maintenance agreements

Identify software keys, expiration dates and entitlement data

Software metering

Maintain utilization information: procure additional licences as needed address daily operational issues

Control software licences: execute control requests gather and analyse software requirements develop/maintain software licence management strategy

and infrastructure

Establish software licence repository

Review existing software: collect and capture standard software licence data, attributes

and deployment develop re-use plan for standard applications review software upgrade policies review existing licence, maintenance and support agreements

Administer licence, maintenance and support agreements: react to licence expiration track, allocate, authorize, monitor and audit software use maintain software utilization data procure additional licences perform vendor agreement negotiation address daily operational issues resolution or escalation of issues

Provide information on software products installed to initiate compliance analysis and identify corrective actions

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Quality assurance

Table 3.4 shows service deliverables related to quality assurance and inventory

management.

Table 3.4 Service deliverables for quality assurance

Service deliverable Level

Provide reports of data rejected during the load or cleansing processes

Reconcile data

Analyse data standard

Determine correct data

Update data standard with correct data

Revalidate data

Implement quality controls to identify data and/or process discrepancies: identify problem determine variances analyse detail reports for completeness of data audit sample of IMAC activity to determine asset information

accuracyreconciliation to correct discrepancies

Determine root cause: develop corrective actions execute corrective actions

Generate reports that identify last inventory date for software

Perform regular automated audits on software licence information accuracy

Perform regular manual audits on software licence information accuracy

Reporting

Table 3.5 shows the service deliverables for reporting within inventory management.

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Table 3.5 Service deliverables for reporting

Service deliverable Level

Provide scheduled standard reporting

Developing and generate ad hoc reports or additional recurring custom reports

Developing and running reports necessary to conduct quality control tasks

CONFIGURATION MANAGEMENT

Definition and outline

Definition 9: Configuration management

Based on a logical model of the infrastructure, configurati