the rise of slm in itil v3

7/28/2019 The Rise of Slm in Itil v3

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The Rise of Service LevelManagement in ITIL V3

April 2008

Oblicore, Inc.


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Table of Contents

The Move From Version 2 To Version 3 . . . . . . . . . . . . . . . . . . . 3

Whats New In V3? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3Service Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Service Design . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Service Transition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Service Operation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Continual Service Improvement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Service Level Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Service Level Management Objectives. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Process Activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Service Strategy & SLM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Service Design & SLM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8Service Transition & SLM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Service Operation & SLM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Continual Service Improvement & SLM. . . . . . . . . . . . . . . . . . . . 9

7-Step Improvement Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Steps 1 & 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Step 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Step 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Step 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Step 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Step 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Where To Start . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Service Catalog Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

The Business Service Catalog . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

The Technical Service Catalog . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Conclusion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

The Rise of Service Level Management in ITIL V3 2


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The Move From Version 2 To Version 3

ITIL Version 2 brought us many best practice books. The books included theService Management set of Service Support and Service Delivery as well as

Application Management, Security Management, Planning to Implement, TheBusiness Perspective and ICT Infrastructure Management. However, mostorganizations focused on only two of the books, Service Support and ServiceDelivery. Service Support contained process details on Incident, Problem,Change Configuration and Release Management. Service Delivery providedprocess content on Service Level, Availability, Capacity, IT Service Continuityand Financial Management.

ITIL V2 was process-based, while V3 has moved to a true lifecycle approach.Each core book within ITIL V3 is responsible for documenting a completeprocess, but the key with a lifecycle approach is that the process activities canbe performed across multiple stages of the lifecycle.

Welcome to ITIL V3. One of the first things you will discover in V3 is that it isall about the business. How does IT, in the offering of IT services, enable abusiness outcome and provide the value to the business? No matter what bookor process you look at, they all are focused on enabling business outcomes.

There have been many improvements in V3 to support this business view. Thereare more processes, enhanced processes new functions and two new focusesaround Service Strategy and Continual Service Improvement. However, onething remains constant from V2 to V3 and that is the importance Service LevelManagement plays throughout the entire Service Lifecycle. In fact, V3 hasactually expanded the need for IT and the Business to not only be aligned but

to move toward IT and Business integration. In todays world it is hard to definewhere a business process starts and stops; where the IT process starts andstops; as well as the Business service and the IT service.

Service Level Management plays a key role in the Service Lifecycle with aspecial emphasis on its interaction with Continual Service Improvement, one ofthe new core books. If you find it difficult to gain order and be proactive inmapping service to business needs, the adoption of ITIL V3 may be the answer

your organization needs to transform.

Whats New In V3?

ITIL V3s move from a process-centric view to a more strategic view using aService Lifecycle approach allows certain process activities to flow across thedifferent phases of the Service Lifecycle.

ITIL is no longer an IT only referencethe business will need to understandthe Service Lifecycle and be actively involved in setting service strategy forsuccessful business-IT integration and creation of business value.



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Additional functions important to Service Level Management (SLM) have calledout in V3 to include the Service Desk, Technical Management, ApplicationManagement as well as IT Operations Management.

These roles are critical for SLM as they will actually perform many of theactivities around monitoring and reporting on services, as well as providingtrending and analysis around the trends. This is all required input for SLM to beable to conduct service review meetings both internally with IT as well as withthe Business.

The five core books in V3 are as follows:

Service Strategy

This core book provides guidance on how to design, develop and implementService Management, not only as an organizational capability but also as a

strategic asset. One of the keys to do this is to ensure that IT is integrated withthe service strategy of the business.

Service Design

The Service Design book provides guidance for the design and development ofservices and Service Management processes. It begins with a set of new orchanged business requirements and ends with a solution designed to meet thedocumented needs of the business. The SLM process is fully described in thisbook; however, there are touch points to SLM within the rest of the core books.

Service Transition

The Service Transition book provides guidance for the development andimprovement of capabilities for transitioning new and changed servicesinto operations.

Service Operation

Service Operation is concerned with the daily business-as-usual activitiesand supporting the services deployed into the production environment. Thebook provides guidance on achieving effectiveness and efficiency in thedelivery and support of services so as to ensure value for the customer andservice provider.

Continual Service Improvement

Continual Service Improvement (CSI) is the proactive practice that identifiesand implements improvement initiatives to improve service provision, ServiceManagement processes and also the Service Lifecycle itself. CSI is animportant aspect in order to achieve the overall goal of the SLM process aswell as successfully pulling off the CSI practice.



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Service Level Management

Service Level Management can generally be described in four words: buildingand managing relationships. That is building relations with IT customers,

building relationships between functional groups within IT, and buildingrelationships with the vendor community who provide services to IT. Manyorganizations focus on Service Level Agreements only and lose sight of thevalue perception of SLM.

Service Level Agreements (SLAs) and Operational Level Agreements (OLAs) areoutputs of the SLM process and are needed, but should not be the only focus ofimplementing SLM. The goal of SLM is to ensure that an agreed level of ITservice is provided for all current IT services, and that future services aredesigned and delivered to agreed targets. With SLM there is a constant sourceof communication with the business and IT groups to meet the changing needsof a customer, thus creating a higher perception of value.

Service Level Management Objectives

Define, document, agree to, monitor, measure, report, and reviewthe level of IT services provided

Provide and improve relationship and communication with thebusinessand customers

Ensure that specific and measurable targets are developed for allIT services

Monitor and improve customer satisfaction with the quality ofservice delivered

Ensure that IT and the customers have a clear expectation of the levelof service to be delivered

Ensure that proactive measures to improve the levels of servicedelivered are implemented wherever it is cost-justifiable to do so

Process Activities

Determine, negotiate, document and agree requirements for new orchanged services in Service Level Requirements (SLRs), and manage andreview them through the Service Lifecycle into SLAs for operational services

Monitor and measure service performance and compare actual targetsagainstagreed to targets

Produce service reports and provide management information to helpimprove performance and demonstrate service achievement

Measure and improve customer satisfaction

Conduct internal and external service reviews

Working with CSI, instigate improvements within an overall ServiceImprovement Plan (SIP)



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Review and revise SLAs, OLAs, contracts and other underpinningdocuments

Develop and maintain standard SLM documentation templates

SLM is responsible for executing the SLA with the business and OLAs with ITand non-IT functional groups. Many SLAs will require an UnderpinningContract (UC) with some of the organizations vendors/suppliers. Therefore, asthe diagram below shows, it is important that SLM is in agreement with thebusiness on the levels of service, quality of service and cost of service. SLMalso needs to check with the internal IT functions to ensure that IT has thecapability to meet the service requirements.


Even if an organization is not going to negotiate and sign an SLA with acustomer, the IT organization will internally set service targets or objectives.These targets will require OLAs and Supplier Contracts to ensure the internalcapability to meet defined service targets.

One of the more critical activities is the ability to monitor and report on ServiceLevel Achievements. There are three types of metrics: Technology, Service andProcess metrics. IT organizations typically do a good job of monitoring andreporting on technology metrics such as a server, an application or themainframe; however, IT usually does a poor job of being able to roll all thetechnology/component metrics into a service metric that provides a true pictureof the service as experienced by the end user.


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Service Level Management needs to work with the business to understand thebusiness requirements for monitoring and reporting. Then, SLM will work withthe different IT functions to ensure that proper monitoring and reportingprocedures and tools are implemented. The technology owners as well asAvailability, Capacity and SLM Process Owners are responsible for ensuringthe monitoring is done. SLM will then need to take the component metrics androll them into a Service Metric.

Process metrics help an organization understand the health of its SLM process.These metrics are often defined in the form of Key Performance Indicators (KPI)and can provide the following information:

Value Is SLM providing value to the business and IT?

QualityAre we executing the process activities well?

Performance This is the throughput of the process to ensure that there are

no process bottlenecks Compliance Is the organization following the standards of the process?

Service Strategy & SLM

The Service Strategy core book introduces us to the concept of Utility andWarranty and how this impacts the quality of services perceived by customersand users.

Service as we know it is the delivery of value while removing cost and risk. Froma customers perspective, value consists of two primary elements: Utility (or fit for

purpose) and Warranty (or fit for use). SLM will be involved in both aspects, asUtility is what the customer wants, and Warranty is how it is delivered.

The warranty is where SLAs and the monitoring of the agreements come intoplay. It addresses issues such as:

Enough Availability and Capacity?

Continuous and secure enough?

Even though these concepts are discussed in the Service Strategy book, SLMwill play an important role, ensuring that both the business requirements andthe IT Capabilities are fully understood and that appropriate SLAs, OLAs, and

UCs can be negotiated and agreed to.Service quality can be defined in many ways such as level of excellence, valuefor money, conformance to specifications, or meeting or exceeding expectations.Senior leadership needs to define the meaning of service quality for theirorganization. Whatever is decided will have a direct impact on Service LevelManagement, as this will influence how services are measured and controlled.



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Service Design & SLM

The Service Design book is where SLM is fully documented. Service Design istaking the strategy that has been defined, capturing business requirements, and

creating a blueprint for the service to be built and implemented.

It is responsible for the design of IT services to include architecture, processes,policies and documentation required to meet current and future agreedbusiness requirements, functionality and quality. It is also critical here to includethe negotiating of SLAs, OLAs and any UCs that will be required to meet theSLAs.

Service Design also considers all aspects and impact of the service, includingfunctional management and operational requirements such as designing,monitoring and reporting requirements, which of course Service LevelManagement will play a key role in. The key output of Service Design is the

Service Design Package that details all aspects of the service and itsrequirements through all of the subsequent stages of its lifecycle.

Key processes of SLM that will interact within the Service Design phase areService Catalog, Availability, Capacity, IT Service Continuity, Supplier andInformation Security Management

Service Transition & SLM

Service Transition is where the new or modified service is built, tested andimplemented. Key activities that SLM will play a part in will be the implementingof monitoring requirements and implementing of performance standards, i.e.:Management reporting, etc. Again, SLM plays a key part through this cycle toensure that what is delivered meets what has been agreed to.

Other areas that SLM will be paying close attention to are:

Reducing variations between the predicted and actual performanceof the transitioned service

Reducing Known Errors and risks associated with the transitionof the service

Ensuring that the service meets the service requirements

Increasing proper use of the services

Providing clear and comprehensive plans that enable alignmentbetween the business change project and the service transition plans

Key processes SLM will interact with in the Service Transition Phase are Change,Release and Deployment Management and Service Validation and Testing.



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Service Operation & SLM

Service Operation is the phase where the value is realized. The day-to-dayoperations are where many tasks, such as monitoring and reporting, take

place that are of great importance to SLM. This provides input into the servicereview meetings that will take place within IT and with the business. Incidentand Problem Management provide input in the delivery of services just likeAvailability and Capacity Management do. SLM will also define levels ofservice associated with request fulfillment.

Key processes SLM will interact with in the Service Operation phase will beIncident, Problem and Request Fulfillment.

Continual Service Improvement & SLM

SLM is a cornerstone of Continual Service Improvement (CSI). Changes to

business requirements, regulatory requirements or bringing on new serviceswill involve the participation of both SLM and CSI. SLM and CSI take proactivemeasures to seek and implement any agreed to improvements that are requiredto meet new business or regulatory requirements. It is important that all ITservices and their performance are measured in a consistent mannerthroughout the IT organization, and meet the needs of the business, customersand IT by defining any gaps and discovering the best approach to manageand close these gaps.

There are many external and internal drivers that impact IT and create the needfor continual improvement. CSI is tasked with the following objectives:

Review, analyze and make recommendations on improvementopportunities in each lifecycle phase: Service Strategy, Service Design,Service Transition and Service Operation

Review and analyze Service Level Achievement results

Identify and implement individual activities to improve IT service qualityand improve the efficiency and effectiveness of enabling ITSM processes

Improve the cost effectiveness of delivering IT services without sacrificingcustomer satisfaction

SLM defines and gets agreements through formal SLAs and OLAs. CSI reviewshow IT has delivered the services against the SLAs and identifies improvement

opportunities.

The key process within CSI that SLM will interact with is the 7-Step ImprovementProcess. This is expanded on the following pages.



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Steps 1 & 2

Steps 1 and 2 are a direct relationship with Service Level Management.Business requirements are defined for not only the level of service, but also forwhat needs to be monitored and reported on. Monitoring and reporting are

key steps in Knowledge Management, which is key for CSI.

Step 3

Data defined by SLM is gathered in Step 3 and is usually completed by thefunctions called out in V3, such as technical management, IT operationsmanagement and application management. In addition to defining businessrequirements, it should be known if IT is capable of achieving those requirements.Internal or external monitoring of agreements is often performed as part ofAvailability and Capacity Management activities.

Step 4

Step 4 is processing the data and SLM can help drive how often the data isprocessed and checked for accuracy. SLM supports the CSI processing dataactivity in the following manner:

Defining requirements to support any default levels of service that aredescribed in the Service Catalog

Ensuring that the SLAs only incorporate measurements that truly canbe measured and reported on


7-Step Improvement Process


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Negotiating and document OLAs and UCs that define therequired measurements

Reviewing the results of the processed data from an

end-to-end approach

Step 5

Step 5 is probably the step that most IT organizations ignore, justifying why itis so important that CSI became a key part of V3.

It is not enough to gather the data, but the data needs to be trended as well asanalyzed. The analysis is looking to see if we have met our commitments eitherdocumented in a SLA or as internal targets. Analysis looks to define if trendsare good or bad trends and to identify improvement opportunities to putactionable initiatives in place.

Step 6

Step 6 of presenting the data is where internal and external service reviewsare presented, discussing information and achievements of the business for thecurrent time period in addition to any longer trends that were identified. Thesediscussions should also include information about what led to the results andany incremental or fine-tuning actions required. During the customer reviewmeetings new business requirements or services will be identified and takeninto consideration for existing SLAs or perhaps for the negotiating andagreeing of new ones.

From a reporting perspective there are usually three distinct groups that we

should be reporting to: The Business/Customers, Senior IT Management andother IT Managers and Process Owners. Each report should support the abilityto make a strategic, tactical or operational decision. This information needs tobe taken into consideration when determining what to monitor and gather dataon. Improving what data to gather and how to gather the data will oftenbecome one of the first improvement activities.

Step 7

Step 7 is where the Service Improvement Program (SIP) is implemented as partof CSI. A SIP is a formal plan of improvements to a process or IT service and ismanaged as part of the CSI practice. The SLM process is one of the triggers fora SIP and can be the result of the service review activity.

Where To Start

Where does one start? Whether your ITIL journey is using V2 or V3, theanswer is still pretty much the same. Most organizations have operation painpoints and a lack of control, so Incident and Change Management arenormally the first ITIL processes that are implemented.



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We must consider the importance that Service Level Management bringsto the table. SLM can help strengthen both processes by understanding theimportance of holding external review meetings with the business even beforea SLA agreement is signed. SLM can play a key role in support of CatalogManagement. Identifying your services up front also strengthens multipleprocesses that rely upon the knowledge of what services IT provides tothe business.

However, SLM is a customer-facing process and thus there are many activitiesthat can and should be implemented early on. This doesnt mean the entireprocess has to be developed, but there are many activities within SLM thatprovides immediate value to the business and IT.

One of the critical steps for Incident Management is to define and document apriority model and SLM plays a key role in this step.

SLM also often represents the business at the Change Management AdvisoryBoard and becomes the voice for the customer.

Many organizations want to rush into signing SLAs and they often do this withlittle knowledge about the level of service currently being provided, the level ofservice required by the customers or understanding the ability, both internallyand through external partners, to deliver specific levels of service. Althoughsigning an SLA is an important part of SLM, and is an expected output, itshouldnt be the first thing an organization would plan to pursue. You may findthat you wont implement a full process in the beginning, but you will selectcertain activities that will enhance the relationship with the business as well as

internal groups. These early activities will also help prepare your organizationto negotiate formal SLAs.

Other early activities to focus on:

Work with the Service Catalog Management process to begin developingan IT Service Catalog. This is important input for the development of SLAsand OLAs

Think about and document a consistent set of templates that can be usedto establish SLAs and OLAs

Define what you are currently monitoring, measuring and reporting on.You may find that there are opportunities to improve these activities

If your organization has some defined service level targets or objectives,then it would be wise to begin negotiating internal OLAs to support thedefined service level targets

One of the biggest wins an organization can achieve is to meet with thecustomer to discuss the current level of service. As a customer-facingprocess, it is important that IT and the customer meet. This provides anopportunity to understand the customer concerns and issues, newrequirements as well as customer perceptions



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Service Catalog Management

The purpose of Service Catalog Management is to provide a single source ofconsistent information on all of the agreed services, and ensure that this single

source is available to those who are approved to access it. The ServiceCatalog must be produced and maintained to provide accurate information onall operational services and those being prepared to be run operationally.

The Service Catalog will provide two views:

The Business Service Catalog: Contains details of all the IT services, togetherwith the relationship to the business units and the business process that rely onthe IT services.

The Technical Service Catalog: Contains details of all the IT services deliveredto underpin the services detailed in the Business Service Catalog along with

relationships to the supporting services, shared services, components andConfiguration Items required to support the provision of the service to thebusiness. The customer does not access this view.

One of the components of the Service Catalog can be the default levels ofservice that everyone gets. This is an important concept because the ServiceCatalog can become the organizations Enterprise SLA or Master SLA thateveryone gets. SLAs will only need to be negotiated for those customers whorequire a higher level of service than the default level contained in the ServiceCatalog. This will help limit the number of true SLAs that need to be negotiated.

ConclusionNever lose sight of the importance that Service Level Management brings toboth the Business and IT. SLM is the liaison between the business and IT andprovides ongoing communication and updates as to how IT is deliveringservices to the business. SLM is also one of the first areas where animprovement initiative can be identified and where new business requirementscan be identified, as well as getting an initial indication if the customer is nothappy with the service currently being provided.

As one of the key ITIL processes defined in V3, Service Level Managementplays an important role in building and maintaining relationships. The initial

focus should not be on signing SLAs but on understanding the businessrequirements, IT capability and ensuring that OLAs are in place to support anyinternal targets before we start negotiating with the business. The ServiceCatalog is also critical and Service Level Management will play a critical rolein the development of the Service Catalog.



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Service Level Management activities such as monitoring and reporting willrequire close integration with Availability and Capacity Management as wellas Incident Management. It will also closely adopt the CSI practice in order toensure that services as well processes that enable IT services continually meetthe business requirements. Only then can an organization transform from beingsystem oriented to service-oriented, reactive to proactive and chaos to order.

Remember that the focus of IT is shifting. It is no longer about technology, but itis really about people and the products that IT provides, which are services. Bythe nature of the name Service Level Management this means that IT is sellingproducts/services to the business community to enable a business processwhich enables a business outcome. SLM plays a critical link in this supplychain.

Dont overlook the value that SLM can bring to IT. There are even pain points

that need to be addressed. Service Level Management can help minimize thepain points by continually working with the customer and IT.

No matter if you start with doing some basic monitoring, measuring andreporting, or begin holding meetings with IT and the Business or simply beginsupporting the development of a Service Catalog, these are all activities thatprovide value and strengthen the relationship between the business and IT.

Good luck on your ITIL journey and with your Service Level Managementimplementation.



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the rise of slm in itil v3

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