Service Level Management Financial Management for IT services Capacity Management IT Service Continuity Management Availability Management

GOALS GOALS GOALS GOALS GOALS

To maintain and gradually improve IT service quality

trough a constant cycle of agreeing monitoring and

reporting upon IT service achievement and

instigation of actions to eradicate poor service

To provide cost-effective stewardship of the IT assets

and resources used in providing IT Services

To ensure that cost-justifiable IT capacity always

exist and that it is matched to the current and future

identified business needs

or

Having the appropriate IT capacity and making best

use of it

The goal for ITSCM is to support the overall

Business Continuity Management process by

ensuring that the required IT technical and services

facilities can be recovered within required, and

agreed, business timescales

Satisfy Business objectives

Achieve sustained level of availability

Ensure cost effectiveness

Optimize the capability of services and components

OBJECTIVES OBJECTIVES OBJECTIVES OBJECTIVES OBJECTIVES

High quality, cost effective, value-adding IT services

that underpin the organization’s business needs

Play a key role in ascertaining the business

requirements

SLA is written agreement between the customer and

the IT service provider, defining key targets and

responsibilities on both sides

To manage the financial aspects of IT assets and

resources cost-effectively

To account fully for the total spend on the provision

of IT Services and to attribute the cost to the services

delivered

To advise management on IT investment matters by

providing detailed business cases

PROCESS PROCESS PROCESS – sub-processes PROCESS PROCESS

Established Function

Initial Planning activities and Implementation

Implement SLAs

Compile a service catalogue

Establish SLA structure

Establish overview of Service Level Requirements

(SLRs)

Plan UCs and OLAs

Draft and agree SLAs

Manage The Ongoing Process

Monitor and report SLA achievements

Review SLA achievements

Identify Service improvements (SIP)

Periodic Reviews

Review and update SLAs, UCs and OLAs

Review SLM process for efficiency and effectiveness

Budgeting

Setting the budget

IT Accounting

Building a Cost Model

Charging

Setting the Price

Pricing methods

Differential Charging

Billing

Business Capacity Management

Service Capacity Management

Resource Capacity Management

ACTIVITIES

Monitoring

Analysis

Tuning

Implementation

Storage of Capacity Management data – the CDB

Demand Management

Modeling

Application sizing

Producing of the capacity Plan

Stage 1- Initiation

Initiate BCM

Stage2 – Requirements and Strategy

Business impact analysis

Risk assessment

Business Continuity Strategy

Stage3 - implementation

Organizational and implementation planning

Implement stand-by arrangements

Develop Recovery Plans

Implement Risk reduction Measures

Develop Procedures

Initial testing

Stage4 – Operational Management

Education and awareness

Review and audit

Testing

Change Management

Training

Assurance

ACTIVITIES

determining the Availability requirements from the business for

a new or enhanced IT Service and formulating the Availability

and recovery design criteria for the IT Infrastructure

in conjunction with ITSCM determining the vital business

functions and impact arising from IT component failure

defining the targets for Availability, reliability and

maintainability for the IT Infrastructure components

establishing measures and reporting of Availability, Reliability

and Maintainability that reflects the business, User and IT

support organisation perspectives

monitoring and trend analysis of the Availability, Reliability

and Maintainability of IT components

reviewing IT Service and component Availability and

identifying unacceptable levels

investigating the underlying reasons for unacceptable

Availability

producing and maintaining an Availability Plan which prioritises

and plans IT Availability improvements.

DEFS DEFS INPUTS Recovery Types INPUTS

Service Catalog: defines services with default levels

and options. Gives a profile of IT service provider to

org. and overview of services provided to users.

SLR-Service Level Requirements: list of clients reqs.

OLA-Operational Level Agreements: Between 2

intern IT departments

UC-Underpinning Contract: With an external

supplier.

SLA

SIP-Service Improvement Program: SLM with PM

and AM starts a formal project focusing on user

satisfaction

Cost Model: by service, location, customer (for

charging)

Cost Types: HW, SW, People, Accommodation,

External services, Transfer costs

Cost Elements: Sub elements of Cost Types, like HW =

NW, Server, Office

Cost Category

Capital or Operational

Direct/Indirect

Absorbed/Unabsorbed Indirect

Fixed/Variable

Technology

SLA, SLR and Service Catalogue

Business plans and strategy

IS/IT plans and strategy

Operational schedules

Deployment and development plans and programs

Forward schedule of change

Incidents and problems

Service reviews

SLA breaches

Budget

Do nothing - Few, if any, organisations can function

effectively without IT Services. Even if there is a

requirement for stand-alone PC processing, there is

still a need for recovery to be supported.

Manual Work-arounds - manual Work-arounds can

be an effective interim measure until the IT Service is

resumed wherever they are practical and possible.

Reciprocal arrangements - Entering into an

agreement with another organisation using similar

technology. Benefits can exist, in maintaining some

reciprocal arrangements, for example, in the off-site

storage of backups and other critical information.

Gradual Recovery (cold standby) - up to 72 hours,

without a re-establishment of full IT facilities.

Accommodation fully equipped with power and local

network cabling Infrastructure, telecom connections.

Fixed or portable facility.

When opting for a gradual recovery, consideration

must be given to highly customised items of

hardware or equipment that will be difficult, if not

impossible, to replace.

Intermediate Recovery (warm standby) 24 to 72 hour

period. It is usually far away (logistics) and shared

with 20 to 30 other companies. Use 6-12 weeks. Can

be portable, in a trailer.

Immediate Recovery (hot standby) provides for

immediate restoration. Application systems and

communications already available and data mirrored

from the operational servers. In the event of a system

failure, the Customers can immediately switch to the

backup facility with little or no loss of service.

System can be used as backup and reporting resource.

Business availability requirements

Business impact assessment

Availability, Maintainability and Reliability requirements

Impact assessment for Vital Business Functions

Incident and problem data

Configuration and monitoring targets

Service Level Targets

Service Catalog Contents CHARGING OUTPUTS OUTPUTS

Version number, date created, date amended; TOC;

Foreword from CIO; IT Service provider profile; Service

times and accessibility of IT Service Provider; Overview

of services and products; Customer focused

service/product description; Specs; Deliverables; Service

times; Maintenance times; Support times; Delivery

times; Quality targets (availability, usability, reliability,

priority); Requirements; Request & Change procedure;

Contigency policy; Pricing & Charging; Index &

Definitions

Notional (Invoiced, not payed), Communication of Info

(customer informed of charges to be aware), Pricing

Flexibility (Rates charged annually)

Pricing Method/Policy

Cost Plus – cost + profit rate

Going Rate – comparable to other dept services

Market Price – match external supplier price

Negotiated Contract Price

Capacity plan

CDB

Baselines and profiles

Thresholds and alarms

Capacity reports (regular, at hock and Exception)

SLA and SLR recommendations

Costing and Charging recommendations

Proactive changes and service improvements

Revised operational schedule

Effectiveness reviews

Audit reports

Availability and recovery design criteria

Agreed targets of availability, rel., maintainability

Reports on achieved A.R.M

Availability monitoring

Availability improvements plans

Service Level Management Financial Management for IT services Capacity Management IT Service Continuity Management Availability Management

BENEFITS BENEFITS BENEFITS BENEFITS BENEFITS

Customer and IT service provider have a clearer

view of requirements and responsibilities

Commitment on both sides

Specific targets to aim for

Week areas will be identified

Supports supplier management (internal and

external)

Demonstrable performance indicators

Gradual improvements in service quality

Better forward planning / both customers and IT

Will show where customer/user actions are causing

difficulty and identify where working practice need

to be improved

IT service will be defined to meet Service Level

Requirements

SLAs can be used as a basis for charging

Improved communication between IT and customers

Better value for money

Increased Confidence in budgets

Accurate information supplied for investment and

TCO purposes

Increased professionalism and efficiency

Warning over or under usage of service

Sound business method of balancing IT service

provision with business requirements

The cost of doing or not doing a Change

Minimize risk of failing to meet SLAs and SLRs

More confident forecasting

Value to the applications lifecycle

Increased efficiency

Cost savings and cost avoidance

Timely enhancements and upgrades

The annual spend on ITSM can be controlled

Cost justifiable risk reduction measures can be

implemented

The ability to recover in a controlled manner

All staff aware of their role relating to ITSCM

Potential lower insurance premiums

Meetings regulatory requirements

Better business relationships

Positive marketing of contingency capabilities

Organizational credibility

Competitive advantage

A single point of accountability for availability is established

within the organization

IT Services are designed to meet the IT Availability

requirements of the business

the levels of IT Availability provided are cost justified

the levels of Availability required are agreed, measured and

monitored to fully support Service Level Management

shortfalls in the provision of the required levels of Availability

are recognised and appropriate corrective actions identified and

implemented

a business and User perspective of IT Service Availability is

taken to ensure optimal usage and performance of the IT

Infrastructure is achieved to deliver maximum benefit

the frequency and duration of IT Service failures is reduced

over time

IT support organisation mindset moves from error correction to

service enhancement; from reactive to proactive attitude

the IT support organisation is seen to 'add value' to the

business.

PROBLEMS PROBLEMS PROBLEMS Contingency Plan PROBLEMS

ensuring targets are achievable (use existing

achievements if known)

verifying targets prior to agreement (prior

monitoring, pilot SLAs)

Monitoring of actual achievement (only agree what

can be monitored)

Inadequate resources and time (process must be

properly staffed and resourced

Lack of understanding (educations)

Differences in perceptions within the customer

community (need to agree relevant targets at all

levels)

Not enough seniority (give Service Level Manager

the appropriate authority)

SLA may not be supported by adequate underpinning

agreements/contracts (review OLAs and contracts)

Lack of understanding leading to inefficient, overlay

expensive or over-complex systems

Monitoring tools inaccurate or too expensive

Delay in obtaining, or inaccurate, information

Difficulty in recruiting staff with accountancy and IT

skills

Unable to respond to changes quickly enough

Lack of management understanding and support

Unrealistic expectations

Vendor influence

Lack of accurate information

- business data

- technical data

Distributed environments

Level of monitoring to be implemented

IT infrastructure, comprising the replacement system,

plus contracts/agreements necessary for recovery

IT Infrastructure Management and operating

agreements/procedures during a disaster

Personnel - details of those needed at contingency

site plus accommodation required

Security instructions, emergency contacts and items

for home site

Contingency site: location, people, facilities, security

and transport arrangements

Return to normal - dependencies affecting the return

Defining availability levels that are meaningful to the business

Managing internal and external providers is made difficult by

lack of agreed availability targets

Assessing achievable and cost-effective levels of IT service

availability

New services are implemented without full consideration of

availability requirements

Loss of business and reputation due to unstable IT services

Lack of accountability

KEY PERFORMANCE INDICATORS KEY PERFORMANCE INDICATORS KEY PERFORMANCE INDICATORS KEY PERFORMANCE INDICATORS DEFINITIONS

what number or percentage of Services are covered

by SLAs

are Underpinning contracts and OLAs in place for all

SLAs and for what percentage?

are SLAs being monitored and are regular reports

being produced?

are review meetings being held on time and correctly

minuted?

is there documentary evidence that issues raised at

reviews are being followed up and resolved (e.g. via

an SIP)

what number or percentage of Service targets are

being met and what is the number and severity of

service breaches?

are service breaches being followed up effectively?

are service level achievements improving

are Customer perception statistics improving?

are IT costs decreasing for services with stable

(acceptable but not improving) service level

achievements?

are SLAs, OLAs and underpinning contracts current

and what percentage are in need of review and

update?

Overall cost of delivery per customer

Percentage of IT costs not accounted for

Dollar value of budget variances/adjustments

Percentage of IT financial objectives met

IT Service Headcount

Resource forecasts

- timely production of forecasts

- accurate forecasts if trends in resource util.

- incorporation of business plans into cap. plan

Technology

- ability to monitor perf and troughput

- impl. Of new tech. in line with business

requirements (time cost functionality)

- use of old technology does not result in breached

SLa due to problems

Cost effectiveness

- a reduction in panic buying

- not significant over-capacity

- accurate forecasts of planned expenditure

Plan and implement the appropriate IT capacity to

match business needs

- reduction in lost reduction in the incidents due to

poor performance

- reduction in lost business due to inadequate

capacity

- new services are implemented which match SLR

-recommendation made by capacity mgt. are acted

upon

Percentage of Vital Business Functions covered by IT

Service Continuity Plans

Percentage of Vital Business Functions covered by

annual IT Continuity tests

Number of annual IT Service Continuity Plan testing

failures

Number of 3rd party recovery support contracts not

agreed

Number of audits performed on IT Service

Continuity Plan

Number of business issues logged against IT Service

Continuity.

Availability – Ability of an IT Service or CI to perform its

required function at a stated instant or over a stated period of time

Reliability – freedom from operational failure. Rel. of an IT

service is determined by rel. of each component delivering the

service.

Maintainability – ability of a CI to be kept in, or to be restored to

an operational state.

Serviceability – describes contractual arrangements made with 3rd

party IT service providers to assure Avail., Rel. and

Maintainability. of IT services and their CIs.

Resilience – capacity of an IT service to allow continued operation

of IT despite the failure of one or more sub-systems.

Vital Business Function – business critical element of business

process.

Security – deals with confidentiality, integrity and availability of

data.

AMDB – record & store info reqd. for support of key activities:

reporting, analysis and availability forecasting...

Service Window – period in which maintenance can be completed

on a service

CRITICAL SUCCESS FACTORS CRITICAL SUCCESS FACTORS CRITICAL SUCCESS FACTORS CRITICAL SUCCESS FACTORS CRITICAL SUCCESS FACTORS

Meeting Customer Needs And Priorities

Adherence To Service Levels

Providing Services Cost Effectively

Controlling Service Delivery

Maintaining Recognized Industry Acceptance For IT

Quality

Maintaining An IT Service Culture

Effective stewardship over IT finances Accurate business forecasts

knowledge of IT strategy and plans, and that the

plans are accurate

an understanding of current and future technologies

an ability to demonstrate cost effectiveness

interaction with other effective Service Management

processes

an ability to plan and implement the appropriate IT

Capacity to match business need

Ensuring IT Service Recovery Within Agreed

Timescales

Establishing Process

Planning

Implementation

Operational

Managing change

Managing variances

Service Level Management Financial Management for IT services Capacity Management IT Service Continuity Management Availability Management

RESPONSIBILITIES SLMgr RESPONSIBILITIES RESPONSIBILITIES RESPONSIBILITIES ITSC Manager RESPONSIBILITIES (A. Manager)

creates and maintains a catalogue of existing

Services

formulates, agrees and maintains an appropriate SLM

structure (SLA, OLA, Contracts, accommodating

service improvement plan within SLM)

negotiates, agrees and maintains the Service Level

Agreements with the Customer

negotiates, agrees and maintains the Operational

Level Agreements with the IT provider

negotiates and agrees with both the Customer and IT

Provider any Service Level Requirements for any

proposed new/developing services

analyses and reviews service performance against the

SLAs and OLAs

produces regular reports on service performance and

achievement

organizes and maintains the regular Service Level

review process

initiates any actions required to maintain or improve

service levels

conducts annual (as appropriate) reviews of the entire

Service Level process and negotiates, agrees and

controls any amendments necessary

acts as co-ordination point for any temporary

Changes to service levels required

Budgeting:

manage the IT organisation budget

prepare budget forecasts and assist Customers in

preparing IT elements of their budgets

report regularly to IT managers and Customers on

conformance to budgets

Accounting:

select suitable tools and processes for gathering Cost

data

develop suitable cost models

agree suitable IT Accounting policies, e.g.

Depreciation

assist in developing cost-benefit cases for IT

investments

advise senior management on the cost-effectiveness

of IT solutions

Charging:

identify methods of charging within the organisations

charging policy

provide justifications and comparisons for charges

prepare regular bills for Customers

prepare a price list of Services, if required

ensures that appropriate levels of monitoring of

resources and system performance are set, and that

the information recorded in a CBD is kept up-to-date

and used by all parts of the Capacity Management

process

produces Capacity Plans in line with the

organisation's business planning cycle, identifying

Capacity requirements early enough to take account

of procurement lead times

documents the need for any increase or reduction in

hardware based on SLRs and cost constraints

produces regular management reports which include

current usage of resources, trends and forecasts

sizes all proposed new systems to determine the

computer and network resources required, to

determine hardware utilisation, performance service

levels and cost implications

recommends resolutions to performance-related

Incidents and Problems

recommends to IT management when to employ

Demand Management, to dampen Customer

demands on systems

carries out ad-hoc performance and Capacity studies

on request from IT management

is represented on the CAB, assessing and authorising

Changes

ensures that regular and ad hoc audits are carried out

on the Capacity Management process

Develop and manage the ITSCM Plan to ensure that,

at all times, the recovery objectives of the business

can be achieved.

Ensure that all IT Service areas are prepared and able

to respond to an Invocation of the Continuity plans.

Maintain a comprehensive IT testing schedule.

Undertake quality reviews of all procedures and

ensure that these are incorporated into the testing

schedule.

Communicate and maintain awareness of ITSCM

objectives within the business areas supported and IT

Service areas.

Undertake regular reviews, at least annually, of the

Continuity plans with the business areas to ensure

that they accurately reflect the Business processing

Environment.

Negotiate and manage contracts with providers of

third party recovery services.

Manage the IT Service delivery during times of crisis

including:

o Co-ordination with the crisis control team

o Invocation of the appropriate recovery

facilities

o Resource management, direction and

arbitration

o Recovery site management.

to be accountable for the deployment of the AM process and

associated methods and techniques

to be responsible for ensuring the AM process is regularly

reviewed and audited, and that all of these are subject to cont.

improvement and remain fit for purpose

to be responsible for determining the Av. requirements from the

business for new or enhanced IT Services

to be responsible for the creation of A and recovery design

criteria to be applied to new or enhanced Infrastructure design

to be responsible for ensuring the levels of IT A. required are

cost justified

defining the targets of A. required for the IT Infrastructure and

its components that underpin a new or enhanced IT Service as

the basis for an SLA

establishment of measures and reporting that reflect business,

User and IT support org. requirements

responsible for the monitoring of actual IT A. achieved vs

targets and to ensure shortfalls are addressed

to be responsible for the production and maintenance of an A.

Plan which prioritises and plans IT A. improvements

to promote AM awareness and understanding within the IT

support organisation

to maintain an awareness of technology advancements and IT

best practice, e.g. ITIL.

SMART: Specific- Measurable- Achievable- Realistic -

Time based

INTERFACES INTERFACES INTERFACES INTERFACES

CfgM:

- manages assets and cost information

SLM :

- cost provision impacts service..;

- Supplied with cost of meeting current and new

requirements

CM, AM:

- Supplied with cost of meeting cap. and avail.

- some data shared – e.g. Machine data sharing

IM- scripts for diagnostics

- performance counters

PM- scripts for diagnostics

- performance counters

ChM- assist in CAB assessing business impact

- raise RFC if needed

RM- helps with distribution strategy (network

bandwidth,..)

- after distribution capacity audits

CfgM- gets information about CIs

- stores capacity information in CMDB

SLM - Perf. And capacity targets

- assist SLM drafting OLAs

FM - cost summary as part of capacity plan

- resource utilization basis for charging

ITSCM - capacity needed for recovery options used

- maintain ITSCM capacity requirements in line with

production

AM - Share common goal slow performance is

effectively the same as unavailability

SD, IM, PM

- Provides historical data

- Customer liaison

ChM

- Ensures the on-going accuracy of continuity plans

-

CfgM

- Identifies the core infrastructure

SLM

- understands the obligations of IT service provision

FM

-

CM

- ensure business requirements are fully supported

trough the appropriate IT hardware resources

AM

- delivers risk reduction measures to maintain

business-as-usual

ChM

- Input from AM is details of the planed maintenance regime

- input to AM is schedule of planned maintenance activities

SLM

- provide information what is availability of the system for SLA

- SLR provide availability requirements

FM

- input to FM is cost of nonavailability

- output from FM cost associated with proposed upgrades to the

infrastructure

ITSCM

- output from ITSCM is business impact assessment

- Input from AM is the availability and design criteria tom

maintain “business as usual” by preventing or minimizing

impact of failure by use CFIA

CM

- input from AM is completed CFIA

- input from CM is capacity plan

SLA STRUCTURES

Customer Based – With a customer group

Service Based – For customers of a service (e-mail)

Multi-Level SLAs

Corporate Level – cover generic SLM issues

Customer Level

Service Level Meeting Customer Needs and Priorities: Customer

satisfaction score/rating ; Average time to implement

SLA requests ; Number of SLAs in renegotiation ;

Number of SLAs requiring changes (targets not

attainable, etc.) ; Number of SLA issues logged

Adherence To Service Levels: Number of SLA targets

missed ; Number of SLA targets threatened

Providing Services Cost Effectively: Current cost per

customer for delivery of services ; Percentage

improvement in delivery cost per customer

Controlling Service Delivery: Number of OLA issues

logged ; Number of Underpinning Contract issues

logged

Maintaining Recognized Industry Acceptance For IT

Quality: Number of ITs articles/white papers published ;

Percentage IT Operations staff in industry (i.e; itSMF)

programs ; Percentage progress towards industry

certification (i.e; ISO9000) ; Dollars spent on external

communications activities

Maintaining an IT Service Culture: Percentage of IT

Operations staff ITIL-aware ; Number of IT Operations

staff ITIL certified ; Number of IT Operations staff with

advanced ITIL certification ; Number Of Agreed SLAs

Not Supported By OLAs/UCs

Cost types: AM methods and techniques

Hardware, Software, Employment, Accommodation,

External services and Transfer

Cost Elements: Breakdown of cost types (HW/ server/ NT/ HR server…)

Redundancy and resilience

Component Failure Impact analysis (CFIA)

Fault tree Analysis (FTA)

CCTA Risk Analysis & Management Method (CRAMM)

Service Outage Analysis (SOA)

Technical Observation Post (TOP)

Incident Lifecycle Management

Continuous Improvements

http://itservicemngmt.blogspot.com/

SLA Content ELEMENTS of fin. management

General details

Service hours

Roles and responsibilities

Availability, Reliability, Maintainability &

Serviceability

Service Performance

Customer Support

Example incident targets

Printing

IT Service Continuity

Security

Change management Procedures

Charging

Quality / Customer perception

Administration (Reporting, service reviews,..)

Budgeting

Accounting

Charging

Fin Management Cycle

Planning annual:

Budgeting (agree overall expenditure)

IT Accounting (Establish standard unit cost for each

IT resource)

Charging (Establish Pricing policy, Publish price list)

Operational monthly:

Budgeting (take actions to manage budget

expectations or charged costs)

IT Accounting (Monitor Expenditure by cost-centre)

Charging (Compile and issue bills)