ITIL Foundation Plus Cloud Instructor Guide

ITpreneurs™ Service Management

ITIL® FOUNDATION PLUS CLOUD INTRODUCTION

INSTRUCTOR GUIDERelease 1.0.0

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www.ITpreneurs.com

Copyright © 2012 ITpreneurs. All rights reserved

Copyright Copyright and Trademark Information for Partners/Stakeholders. ITIL® is a registered trademark of the Cabinet Office. IT Infrastructure Library® is a registered trade mark of the Cabinet Office The Swirl logo™ is a trade mark of the Cabinet Office. All contents in italics and quotes is from the ITIL® Service Lifecycle Suite © Crown copyright 2011 Reproduced under licence from the Cabinet Office. All other text is based on Cabinet Office ITIL® material. Reproduced under licence from the Cabinet Office Cloud Essentials is Trademark of CompTIA Cloud Essentials Course is a Trademark of ITpreneurs

Copyright © 2012 ITpreneurs. All rights reserved. Please note that the information contained in this material is subject to change without notice. Furthermore, this material contains proprietary information that is protected by copyright. No part of this material may be photocopied, reproduced, or translated to another language without the prior consent of ITpreneurs Nederland B.V. The language used in this course is US English. Our sources of reference for grammar, syntax, and mechanics are from The Chicago Manual of Style, The American Heritage Dictionary, and the Microsoft Manual of Style for Technical Publications.

ITIL Foundation Plus Cloud Introduction, Classroom course, release 1.0.0

More on: http://www.itil-officialsite.com/IntellectualPropertyRights/TrademarkLicensing.aspx

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Copyright © 2012, ITpreneurs Nederland B.V. All rights reserved. i

CONTENTSLIST OF ICONS

FOLLOW US

ITIL® FIRST AID KIT INFORMATION

ACKNOWLEDGEMENTS

UNIT 1: COURSE INTRODUCTION 11.1 Student and Instructor Introductions 21.2 ITIL® Foundation Course 31.3 Course Learning Objectives 41.4 Course Agenda 51.5 ITIL Qualifi cation Scheme 71.6 Exercise — The Arora Family 8

UNIT 2: SERVICE MANAGEMENT AS A PRACTICE 112.1 Best Practices in the Public Domain 122.2 ITIL as a Good Practice 152.3 Concept of Service 172.4 Concept of Service Management 232.5 Processes and Functions 292.6 The RACI Model 352.7 Roles and Responsibilities 362.8 Exercise — The Lost Laundry 392.9 Module Summary 412.10 Test Questions for Service Management as a Practice 42

UNIT 3: SERVICE LIFECYCLE 433.1 The Service Lifecycle 443.2 Basic Concepts of Service Strategy 463.3 Basic Concepts of Service Design 513.4 Basic Concepts of Service Transition 553.5 Basic Concepts of Service Operation 603.6 Basic Concepts of Continual Service Improvement 653.7 Exercise — The New Swimming Pool 703.8 Module Summary 72

UNIT 4: SERVICE STRATEGY 734.1 Basic Concepts of Service Strategy 754.2 Principles and Models of Service Strategy 854.3 Processes of Service Strategy 894.3.1 Service Portfolio Management 904.3.2 Financial Management for IT Services 964.3.3 Business Relationship Management 994.4 Module Summary 1024.5 Test Questions for Service Strategy 1034.6 Case Study Exercise: The Cloud Solution 1054.7 Cloud Introduction 1074.8 Exercise – The Cloud Solution 120

UNIT 5: SERVICE DESIGN 1215.1 Basic Concept of Service Design 1235.2 Principles and Models of Service Design 1245.2.1 Service Solutions for New or Changed Services 1265.2.2 Management Information Systems and Tools 1275.2.3 Technology Architectures and Management Architectures 1285.2.4 Processes Required 1315.2.5 Measurement Methods and Metrics 1325.3 Processes of Service Design 1355.3.1 Design Coordination 136

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Copyright © 2012, ITpreneurs Nederland B.V. All rights reserved.ii

5.3.2 Service Level Management 1395.3.3 Service Catalogue Management 1525.3.4 Availability Management 1595.3.5 Information Security Management 1655.3.6 Supplier Management 1695.3.7 Capacity Management 1735.3.8 IT Service Continuity Management 1795.4 Exercise — Crossword 1835.5 Module Summary 1855.6 Test Questions for Service Design 186

UNIT 6: SERVICE TRANSITION 1916.1 Change Management 1936.2 Service Asset and Confi guration Management 2086.3 Release and Deployment Management 2146.4 Transition Planning and Support 2186.5 Knowledge Management 2216.6 Exercise – Crossword 2266.7 Module Summary 2286.8 Test Questions for Service Transition 229

UNIT 7: SERVICE OPERATION 2337.1 Event Management 2357.2 Incident Management 2397.3 Request Fulfi lment 2487.4 Problem Management 2517.5 Access Management 2607.6 Service Operations Functions 2637.6.1The Service Desk Function 2647.6.2 The Technical Management Function 2697.6.3 The Application Management Function 2717.6.4 The IT Operation Management Function 2737.7 Exercise – Complaint Handling and Service Recovery 2767.8 Module Summary 2777.9 Test Questions for Service Operation 278

UNIT 8: CONTINUAL SERVICE IMPROVEMENT 2818.1 Basic Concepts of CSI 2848.2 Principles and Models of CSI 2868.3 CSI Process 2908.4 Exercise – Crossword 2948.5 Module Summary 2958.6 Test Questions for Continual Service Improvement 296

UNIT 9: TECHNOLOGY AND ARCHITECTURE 2979.1 Service Automation 2989.2 Competence and Skills for Service Management 3019.3 Competence and Skills Framework 3049.4 Training 3059.5 Module Summary 306

UNIT 10: EXAM PREPARATION 307

MOCK EXAM 315

APPENDIX A: CASE STUDY 327

APPENDIX B: GLOSSARY 341

APPENDIX C: ANSWERS 435

APPENDIX D: APM GROUP SYLLABUS 457

APPENDIX E: ADDITIONAL INFORMATION 469

APPENDIX F: KEPNER-TREGOE® METHODOLOGY 479

APPENDIX G: RELEASE NOTES 481

FEEDBACK 483

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Copyright © 2012, ITpreneurs Nederland B.V. All rights reserved. iii

LIST OF ICONS

Refers to content that is meant for the instructor to lecture in class

Refers to content that is meant for the student to read on his/her own in class or at home

Refers to information items that are not covered by the instructor in class but help the student understand a particular topic in detail

Refers to a Scenario-Based Activity that the student must do in class or as homework after the completion of a topic or in between a topic

Refers to items or contents that are given in a step-by-step-instruction or checklist format

Refers to an important snippet of information that the instructors should remember to touch upon while conducting an activity or during a lecture

Refers to the simplifi cation of content that was previously diffi cult to understand or confusing

Refers to an extra piece of information that is not very important but still good to know

Refers to light, conversational snippets of information or that the instructor can use in class to break the monotony of a serious and tedious lecture

Refers to general-knowledge-based information that the instructor can use to provide relief to students during a serious or tedious classroom lecture

Refers to space for the students to take notes

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www.ITpreneurs.com

Copyright © 2012 ITpreneurs. All rights reserved

Follow us

Before you start the course, please take a moment to:

“Like us” on Facebook http://www.facebook.com/ITpreneurs

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"Add us in your circle" on Google Plus http://gplus.to/ITpreneurs

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Free ITIL® First Aid Kit The ITIL First Aid Kit (retail value $50) is an essential toolkit for effective

utilization of an IT Infrastructure Library® (ITIL) for any organisation. It

provides guidelines for areas to pay particular attention to and possible

strategies to include in your program approach.

“Essential Information for professionals and organisations using ITIL”

Please scan the QR code below to download your free ITIL First Aid Kit.

itilfakpromo.itpreneurs.com

ITIL® and IT Infrastructure Library® are registered trade marks of the Cabinet Office.

itil fak.indd 3 11-10-12 14:04

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Copyright © 2012, ITpreneurs Nederland B.V. All rights reserved. xi

We would like to sincerely thank the experts who have contributed to the shaped ITpreneurs ITIL Foundation.

Authors / Subject Matter Experts

y P J Corum - Quality Assurance Institute

y Cesar Augusto Monteiro - IT Partners, Brasil

y Sergio Rubinato Filho - CA (CA Education), Brasil

y Service Management Art, Calgary, Canada

y Brian Bourne - Compagnie Générale de Communication

y Cazzy Jordan - General Dynamics Information Technology

y Marcel Foederer - ITpreneurs

Review Board Members :

y Per Ivar Lillebråten - Ciber

y Fatih Celen - Impetus Consulting

y Michael D Costigan - CSC

y Lars Kristian Larsen - KMD

y Erik Bartholdy - KMD

y Bartosz Kozakiewicz - Conlea

y Jørgen Letager Hansen - Øberg

y Krzysztof Kozakiewicz - Conlea

Acknowledgements

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Copyright © 2012, ITpreneurs Nederland B.V. All rights reserved. 1

DURATION: 1 HOUR AND 15 MINUTES

Module1COURSE INTRODUCTION

INTRODUCECase Study

THE

ROYALCHAO PHRAYA

HOTEL

DISCUSSCourse Agenda

SHARE

Learning Objectives

OUTLINEITIL Qualifi cation Scheme

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Copyright © 2012, ITpreneurs Nederland B.V. All rights reserved.2

| COURSE INTRODUCTION | ITIL® FOUNDATION PLUS CLOUD INTRODUCTION | INSTRUCTOR |

1.1 STUDENT AND INSTRUCTOR INTRODUCTIONS

Course Introduction

2

ITIL® Foundation Course

Student and Instructor Introductions

We would like to hear about you. Please share with the class:Your name.

Your profession.

Your role.

Your background in IT.

Your familiarity with the IT Infrastructure Library (ITIL).

What you expect to learn over the next three days.

Just Concluded T R A N S I T I O N

1.2ITIL® Foundation Course

1.1 Student and Instructor Introductions

Coming Up

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| INSTRUCTOR | ITIL® FOUNDATION PLUS CLOUD INTRODUCTION | COURSE INTRODUCTION |

1.2 ITIL® FOUNDATION COURSE

Course Introduction

3


The Service Lifecycle

ITIL = Information Technology Infrastructure Library

ContinualService

Improvement Service Transition

ServiceStrategy

Service Operation

ServiceDesign

Adapted from The ITIL Service Lifecycle © Crown Copyright 2011 Reproduced under licence from Cabinet Office

The Service LifecycleThis course will guide the students in understanding the basic concepts of IT Service Management (ITSM), as described in the fi ve stages of the Service Lifecycle; that is, Service Strategy, Service Design, Service Transition, Service Operation, and Continual Service Improvement (CSI). These stages will be dealt with in detail in subsequent modules.


1.3Course Learning Objectives

1.2ITIL® Foundation Course

Coming Up

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1.3 COURSE LEARNING OBJECTIVES

Course Introduction

4


Course Learning Objectives

At the end of this course, you will gain the knowledge and skills to:Comprehend Service Management as a practice.

Understand the Service Lifecycle.

Know the generic concepts and definitions.

Understand the key principles and models used behind selected processes.

Identify the selected processes.

Understand the selected functions and roles.

Comprehend the technology and architecture of the Service Lifecycle.

Comprehend competence and training.


1.4Course Agenda

1.3Course Learning Objectives

Coming Up

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1.4 COURSE AGENDA

Course Introduction

5


Course Agenda

DAY 1 Start Time End Time

Unit 1: Course Introduction 08:30 09:30

Unit 2: Service Management as a Practice 09:30 11:00

Unit 3: Service Lifecycle 11:00 12:00

Lunch 12:00 01:00

Unit 4: Service Strategy 01:00 03:00

Cloud Computing 03:00 05:00

Homework – Study Material Evening

Course Introduction

6


Course Agenda (Contd.)


Unit 5: Service Design 08:30 12:00

Lunch 12:00 01:00

Unit 6: Service Transition 01:00 05:00

Homework – Study Material Evening

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Course Introduction

7


Course Agenda (Contd.)


Review Day 1 & 2 Content 08:30 09:30

Unit 7: Service Operation 09:30 11:00

Unit 8: Continual Service Improvement 11:00 12:00

Lunch 12:00 01:00

Unit 9: Technology and Architecture 01:00 02:00

Exam Preparation and Evaluation 02:00 03:15

Break 03:15 04:00

Exam 04:00 05:00

It is essential that the students of this course complete all units of the Foundation certifi cate in ITSM to be successful at the certifi cation exam. This entire course will be completed in three days, which includes a mock exam and a real exam at the end of the course.

1. Go through the course Agenda with the students.

2. Though review time for the previous day’s content has not been added at the beginning of Day 2 and Day 3, it is recommended that you take at least 30 mins at the start of each day’s session to review what was taught in the previous day.

3. It is not mandatory that you to begin and complete each module strictly as per the time duration given in the agenda. The duration given is only indicative and you can include your own “5 to 10 mins breaks” in between lectures as well as increase or decrease the lecture time for each module as per the class requirement.


1.5ITIL Qualifi cation Scheme

1.4Course Agenda

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1.5 ITIL QUALIFICATION SCHEME

Course Introduction

8


ITIL Qualification Scheme and Credit Assignment

Legend

SS Service Strategy

SD Service Design

ST Service Transition

SO Service Operation

CSI Continual Service Improvement

OSA Operational Support and Analysis

PPO Planning, Protection, and Optimization

RCV Release, Control, and Validation

SOA Service Offerings and Agreement

© Cabinet Office’s Official Accreditor – The APM Group Limited 2011

Qualifi cation SchemeThe purpose of the ITIL Foundation Certifi cate in ITSM is to certify students who have gained knowledge of the terminology, structure, basic concepts, and main principles of ITIL practices for Service Management. The ITIL Foundation Certifi cate in ITSM will guide the students to apply the ITIL practices for Service Management in the real world. After the students pass the certifi cation exam, they will gain credits of two points.


1.6Exercise — The Arora Family

1.5ITIL Qualifi cation Scheme

Coming Up

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1.6 EXERCISE — THE ARORA FAMILY

Course Introduction

9


The Royal Chao Phraya Hotel

We are pleased to introduce the Royal Chao Phraya Hotel case study.The case study will be used for various exercises throughout this course.

Please take the specified time to read through the case study.

The case study will be followed by our first exercise.

Learning FocusThis exercise is intended to introduce the students to some of the basic concepts of Service Management.

Learning MethodologyThe intent of this exercise is not to achieve a correct result at this stage, but to:

Introduce some of the basic concepts of Service Management.

Address the knowledge of some of those students who presume to know ITIL best practices based on their previous operational experience.

Review some of the key points below with the students at the close of the exercise:

There is no distinction between Request Fulfi llment, Incident Management, and the business.

Kit didn’t register the Incident or check whether other people had earlier reported the same Incident in that room or on that fl oor.

The receptionist didn’t check if the Incident was resolved.

There was inadequate reaction to early checkout. The lost revenue is much greater than $19.

There was no linking of the similar Incidents faced by both Mr. Brock and Mr. Arora.

There is a damage caused by inconsistent compensation for a similar event.

There has been no Change Management on maintenance work and its effects on services.

There is no Confi guration Management.

There is poor service-oriented communications.

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Instruct the students to read the exercise on their own. Ask them to underline or highlight the identifi ed errors that could be corrected through the application of Service Management practices.

Delivery Instructions

ExerciseThe Arora family arrived at the Royal Chao Phraya Hotel, enthusiastic about their upcoming stay. Mr. Arora checked in while his wife and two children, Ajay and Shalini, waited patiently in the lobby. It took some time to check the family in because the receptionist was fi rst dealing with a lengthy complaint from another guest about her shower not having hot water and then handling continual interruptions on the telephone from people calling to ask about the availability of rooms for the upcoming Songkraan festival.

After about 10 minutes, the Arora family was ready to go to their room, 1711. Their bellhop, Warit, led the way. When they reached the room, they found it stifl ing hot and musty. They turned on the air-conditioning, but it seemed ineffective. Mrs. Arora was quite upset and instructed her husband to get another room immediately. They had not escaped the heat of Mumbai to stay in an oven in Bangkok!

Mr. Arora returned to the reception and again waited in line while people were checked in. He spoke to the front-desk agent, Kit, and informed her of the situation. Kit was very nice and explained, “As the room hasn’t been used for a few days, it takes some time for the air-conditioning to take effect. I suggest that you close the curtains, take some refreshments at the Sugar Reef bar, and return in 20 minutes. Here is a beverage coupon for $20 as compensation for the inconvenience.”

Mr. Arora begrudgingly agreed and took his family for a refreshing drink at the Sugar Reef bar. The front desk heard no more from him until he came to check out the next day. “Oh, you are leaving a day early, Mr. Arora?”

“Yes,” he replied, “the room was too hot for my wife and even though conditions improved slightly during the course of the evening, my wife really wants to move to the Mandarin Oriental today.”

“Oh, I am sorry to hear that! I do hope that you will return and that next time, your experience will be much better. As a token of our apologies, I have removed from your bill the $19 charged for the video game you ordered.”

Mr. Arora thanked her for the token of goodwill and headed for the front of the lobby to wait for his car to be pulled up from the garage. While waiting, Mr. Arora heard another guest talking to Sonny Singh, the Concierge. “I’ve been coming here for years, Sonny; I am so upset that this stay was ruined by the stifl ing heat in my room.”

“Did you complain about it to Mr. Van Rijn, Mr. Brock?” Sonny asked. “No,” answered Mr. Brock, “Dimitri is away for the day.”

“But at least they gave you some compensation, sir?”

“Yes Sonny, they gave me the room free, but that didn’t solve the problem, did it?”

“Well, I guess saving $250 is some consolation, Mr. Brock.” “Maybe Sonny… maybe.”

Mr. Arora was astonished to hear this and felt quite discouraged. He was just glad that his wife had not heard this story. Maybe he hadn’t complained enough! The hotel certainly hadn’t offered him any such compensation. Now he knew that the move to a new hotel was the right step.

Meanwhile, Sonny wandered back to the front desk and found the receptionist, Apple, chatting with Pap.

“Apple, I just heard that there is a problem with the air-conditioning on the 17th fl oor. Is someone working on that?”

“Oh, you must have spoken to Mr. Arora. He was a bit upset, but I think I satisfi ed him by compensating his bill.”

“No, it wasn’t Mr. Arora, it was Mr. Brock and he is still upset.”

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“That’s strange,” said Pap, “I had told Kit yesterday that we were doing maintenance on the 17th fl oor and that we might lose some suction power on the air-conditioning units.”

“Did you tell her to block the rooms, Pap?” asked Sonny. “No, but I thought that would have been obvious, wouldn’t it?”

Meanwhile, the Aroras drove away in their chauffeured car.

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Module 4SERVICE STRATEGY

DURATION: 2 HOURS 30 MINUTES

IDENTIFY STEPSService Strategy

IDENTIFY STEPSObjectives and Concepts in

Financial Management

Service Portfolio Management

Business Relationship Management

SHARELearning Objectives

DEFINEUtility and Warranty

Resources and Capabilities Value Through Services

Service Portfolio

Service Catalogue

Governance

The Service Portfolio

Business Case

DEFINERisk

Ways to Manage Risk

SERVICE STRATEGYRole in Lifecycle Model Purpose

LINK TO

LINK TO

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| SERVICE STRATEGY | ITIL® FOUNDATION PLUS CLOUD INTRODUCTION | INSTRUCTOR |

Service Strategy

2

Module Introduction

Learning Objectives

At the end of this module, you will be able to: Understand the key concepts of Service Strategy.

Comprehend and account for the key principles and models of Service Strategy.

Understand how Service Strategy processes contribute to the Service Lifecycle.

Explain the high-level objectives of the Service Strategy processes:Service Portfolio Management

Financial Management for IT Services


Service Strategy

3

Module Introduction

Service Strategy in the Lifecycle

The Service Strategy volume:Provides guidance on how to design, develop and implement Service Management, not only as an organizational capability but as a Strategic Asset.

Provides direction to ensure that organizations are in a position to handle the costs and risks associated with their Service Portfolios for achieving operational effectiveness and distinction in performance.

Encourages readers to think about whysomething is to be done before thinking of how.

ServiceStrategy

Continual Service

Improvement

Service Design

Service Transition

Service Operation

Adapted from The ITIL Core © Crown Copyright 2011 Reproduced under licence from Cabinet Office

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SERVICE STRATEGY || INSTRUCTOR | ITIL® FOUNDATION PLUS CLOUD INTRODUCTION |

4.1 BASIC CONCEPTS OF SERVICE STRATEGY

Service Strategy

4

General Concepts and Definitions

Service Strategy – Purpose

The purpose of Service Strategy is:To operate and grow successfully in the long term.

To transform Service Management into a strategic asset.

To see the relationships between various Services, systems, or processes that are managed and the business models, strategies, or objectives they support.

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Service Strategy

5


Service Strategy – Objectives

Some objectives of Service Strategy include:

Having Objectives and policies defined for IT Service Management.

An understanding of what strategy is.

A clear identification of the definition of services and the customers who use them.

The ability to define how value is created and delivered.

Objectives of Service Strategy“The objectives of Service Strategy include providing:

An understanding of what strategy is.

A clear identification of the definition of Services and the customers who use them

The ability to define how value is created and delivered.

A means to identify opportunities to provide Services and how to exploit them.

A clear Service provision model, that articulates how Services will be delivered and funded, and to whom they will be delivered and for what purpose

The means to understand the organizational capability required to deliver the strategy.

Documentation and coordination of how service assets are used to deliver Services, and how to optimize their performance.

Processes that define the strategy of the organization, which Services will achieve the strategy, what level of investment will be required, at what levels of demand, and the means to ensure a working relationship exists between the customer and Service Provider.”

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Service Strategy

6


Utility and Warranty

The concepts of Utility and Warranty are key to understand the customer’s perspective of value:

WarrantyFit for Use – a promise or guarantee that availability, capacity, continuity, and security are all meeting customer expectations

UtilityFit for Purpose – the functionality offered by a product or Service to meet a particular need

Adapted from Combined effects of Utility and Warranty on Customer Assets© Crown Copyright 2011 Reproduced under licence from Cabinet Office

Low impact onbusiness outcomes but

with high certainty(unbalanced value)

High impact onbusiness outcomes

but with low certainty(unbalanced value)

High

Low

Low HighUtility

War

rant

ly

Utility is what the customer gets and Warranty is how it is delivered.

Service Strategy

7


Service Assets

Service Assets are the capabilities or resources of a Service Provider.

Organizations use resource and capability assets to create value in the form of goods and Services.

Capabilities refer to the ability of an organization, person, process, application, Configuration Item (CI), or IT Service to carry out an activity. Capabilities are intangible assets and cannot produce value by themselves, without adequate and appropriate resources.

Resources include IT infrastructure, people, money, or anything else that might help deliver an IT Service. Typically, resources are tangible assets and are relatively easier to acquire than capabilities.

Adapted from Examples of Capabilities and Resources © Crown Copyright 2011 Reproduced under licence from Cabinet Office

Management

Organization

Processes

Knowledge

People (experience, skills and relationships)

Financial Capital

Infrastructure

Applications

Information

People (number of employees)

Capabilities Resources

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Service Strategy

8


Governance

“Ensures that policies and strategy are actually implemented, and that required processes are correctly followed. Governance includes defining roles and responsibilities, measuring and reporting, and taking actions to resolve any issues identified.”(Source: Service Strategy book)

Evaluate

MonitorDirect

Adapted from Governance activities © Crown Copyright 2011 Reproduced under licence from Cabinet Office

GovernanceGovernance is the single overarching area that binds the IT and business together and Services ensure that an organization has executed that governance. Governance defi nes the collective directions, policies, and rules that the business and IT use to conduct their business. Governance should evaluate, direct, and monitor the strategy, policies, and plans of an organization.

Generally, many IT Service Management (ITSM) strategies fail because they do not work with the structure of governance that is in place but try to build a structure or processes according to how they would like the organization to work. Governance is applicable to a constantly managed approach at all organizational levels. It begins with setting a clear strategy, followed by policy defi nition to achieve the strategy or what is not part of the organization’s operations.

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Service Strategy

9


Business Case

A Business Case:Is justification for a significant item of expenditure.

Includes information about costs, benefits, options, issues, Risks, and possible Problems.

Is a means to identify the business imperatives that depend on Service Management.

Is a decision support and planning tool that projects the probable consequences of a business action – a financial analysis is frequently central to a good business case.

Is a detailed analysis of business impact or benefits. Business impact is, in turn, linked to business objectives.

Focuses on financial analysis and nonfinancial impacts.

Business CaseA business case is a tool that supports decision and planning that shows the possible costs of a business action. The cost of business action can be qualitative and quantitative. An example of a good business case is a fi nancial analysis. However, there is a business case that relies on nonfi nancial business impacts as well. Organizations can identify a nonfi nancial business impact by understanding how the achievement of one or more business objectives affects the other objectives. For example, to track individual customer transactions and reports on purchasing trends for each customer, an organization should change its sales order service. When the organization defi nes the nonfi nancial impacts, the fi nancial impact for the business will become clear. As a result, the business case should include both the fi nancial and nonfi nancial impacts of the proposed project or Service.

The structure of a business case differs from one organization to another but all business cases have a detailed analysis of business impacts or benefi ts. This business impact is linked to the business objectives. Organizations consider the Service Management initiative by looking at the business objective, which should begin in a broad way.

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Service Strategy

10


Business Case Structure

Sample business case structure

A. Introduction Introduces the business objectives directed by the service.

B. Methods and assumptionsOutlines the boundaries of the business case, pertaining to the time period, costs and benefits.

C. Business impactsThe expected financial and non-financial results for the Service or Service Management initiative.

D. Risks and contingencies The possibility that unusual results will arise.

E. Recommendations Particular actions recommended.

Sample business case structure

“A. Introduction Presents the business objectives addressed by the service.B. Methods and assumptions Defines the boundaries of the business case, such as time period, and which

organizational context is being used to define costs and benefits.C. Business impacts The financial and non-financial results anticipated for the Service or Service

management initiative. Please bear in mind that many non-financial results can also be expressed in financial terms. For example, an increase in staff morale can result in lower staff turnover, and therefore less expenditure on hiring and training.

D. Risks and contingencies The probability that alternative results will emerge.E. Recommendations Specific actions recommended.”

(Source: Service Strategy book)

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Service Strategy

11


Risk Management

The two distinct stages in a Risk framework are:Risk analysis

Risk Management

A Risk is defined as an uncertainty of either an outcome, a negative threat, or a positive opportunity.

Organizations can measure a Risk by the probability of a threat, asset vulnerability to a threat, and the impact of the threat if it occurs.

Management of Risk (M_o_R®) is an example of a public framework for Risk Management.

Adapted from The M_o_R framework © Crown Copyright 2011 Reproduced under licence from Cabinet Offi ce

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Risk ManagementOrganizations may need a separate plan to deal with identifi ed Risks, depending on the implementation strategy of the scope and complexity of Service Management. This plan will become part of any overall project plan, which will assign an individual to monitor and manage the project Risks.

To identify a Risk, it is not essential to explain or quantify a Risk but understand what can threaten the success of a project or strategy. To identify a Risk, Service Providers should engage in brainstorming so that the Risks that are not obvious in the fi rst instance come to the forefront. After a Risk is identifi ed, organizations should quantify the Impact and probability of the Risk.

The approaches to Risk Management use both qualitative and quantitative descriptions of Risks identifi ed and analyzed. The approach usually describes the consequences and Impacts of Risks and then associates a numeric value to the Risk. The Risk ranks are calculated using the numbers, and how to deal with the Risks is defi ned using the quantitative description.

Organizations should review their Risk Management plan on a daily basis so that correct actions are taken and Services are working. Any Risk can change the status of a project and, as a result, it is essential that organizations monitor the Changes and build Risk control mechanisms into the normal project.

The Project Manager ensures that Risks are identifi ed and measures are put in place to mitigate the Risks. The project team identifi es and documents the Risks, the potential Impacts, and the probability of recurring Risks along with the project manager.

A Risk with a 100 % probability is a certainty and, as a result, becomes an issue, which should be taken off the Risk plan and dealt with. On the other hand, a Risk with a 0 % probability should be deleted from the plan.

Service Strategy

12


Service Provider

Service Provider

Type I Internal Service Provider

Shared Services Unit Type II

External Service Provider Type III

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Service ProviderThe three types of Service Providers are:

“Type I – internal Service provider: An internal Service Provider that is embedded within a business unit. There may be several Type I Service providers within an organization.

Type II – shared services unit: An internal Service Provider that provides shared IT Services to more than one business unit.

Type III – external Service provider: A Service Provider that provides IT Services to external customers.”


The three types of Service Providers are applicable to most Service Management aspects, but a Service Provider can be of a specifi c type for others aspects, such as customers, contracts, competition, market spaces, revenue, and strategy. Service Strategy gives guidance on how IT organizations should interact with external users of online Services and the owners and managers of users and Services.

ITSM concepts are usually described in the context of only one Service Provider type. But in most organizations, there are combinations of IT Service Providers. For example, some IT units may be dedicated to one Business Unit or provided as shared Services, outsourced Services, or as Services dependent on external Service Providers.

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Service Strategy

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Patterns of Business Activity

Organizations should document the following things in the PBA:Classification

Attributes

Requirements

Service Asset Requirements

Patterns of Business Activity (PBA) represent the dynamics of the business and include interactions with customers, suppliers, partners, and other stakeholders.

Service Providers design Services to help business activities, which in turn helps achieve business results. As a result, everytime, a Service Provider performs a business activity, it generates demand for Services. People, processes, and applications, which are customer assets, perform business activities and the organizations of these assets or the tasks these assets are completing help the business activity to be performed in patterns. These Patterns of Business Activity (PBA) represent the dynamics of the business and include interactions with customers, suppliers, partners, and other stakeholders.

PBAs are dynamic because they operate in a dynamic environment. Usually, Services provide support to one or more PBA. As PBA achieve business results, organizations should understand PBAs properly and aligned them to Services. As a result, PBAs should be properly defi ned and documented, and the Changes should be properly controlled.

After a PBA has been identifi ed, organizations should draw up a PBA profi le and details about the PBA should be documented. Organizations should document the following things in the PBA:

Classifi cation: Shows the type of PBA and can refer to where it originates (user or automated), the type and Impact of outcomes supported, and the type of workload supported.

Attributes: Refers to frequency, volume, location, and duration.

Requirements: Refers to performance, security, availability, privacy, latency, or tolerance for delays.

Service Asset needs: Service Design teams should draft a utilization profi le for each PBA in terms of what resources it uses, when, and how much of each resource. If the resource quantity and the pattern of utilization is known, Capacity Management will be able to make sure that resources are available to meet the demand.

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4.2Principles and Models of Service Strategy

4.1Basic Concepts of Service Strategy

Coming Up

4.2 PRINCIPLES AND MODELS OF SERVICE STRATEGY

Service Strategy

14

Principles and Models of Service Strategy

The Service Triangle

Functionality (utility)

Adapted from The Service Triangle © Crown Copyright 2011 Reproduced under licence from Cabinet Office

Value is defi ned in terms of the customer’s business outcomes and on the perceptions of the customer. Value consists of two components: Utility or fi t for purpose and Warranty or fi t for use. Customers do not buy Services; they buy the fulfi llment of particular needs. As a result, it is incumbent on Service Providers to demonstrate value, infl uence perceptions, and respond to preferences.

The diagram on the slide shows how Services are based on a balance between price, functionality, and performance. Customers desiring to improve performance or functionality should be willing to pay more or sacrifi ce either performance or functionality, or both. Each customer has to maintain a different balance in the three areas.

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Service Strategy

15


Characteristics of Value

Value It is an affordable mix of features.

It is the achievement of objectives.

It changes over time and circumstance.

It is defined by customers.

Service Strategy

16


Understanding the Value of IT Services

Organizations should ask the following three questions to understand the value of IT:What Service(s) did IT provide?

What did the Service(s) achieve?

How much did the Service(s) cost or what is the price of the Service(s)?

Services provide value to an organization when the perceived value of the Service is higher than the cost of procuring the Service.

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Service Strategy

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Components of Value

Adapted from Components of value © Crown Copyright 2011 Reproduced under licence from Cabinet Office

Value can be defined in regards to three main aspects; the business outcome achieved, the customer’s preferences and the customer’s perceptions.

Preferences Perceptions

Value

Businessoutcomes

Components of ValueThe diagram on the slide shows how value needs to be defi ned in terms of the following three areas:

The business outcomes that are achieved

The preferences of the customers

The perception of the customer of what was delivered

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Service Strategy

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Customer Perception of Value

Adapted from Economic value of a Service © Crown Copyright 2011 Reproduced under licence from Cabinet Office

Customer Perception of ValueService Providers cannot decide the value of a Service, but they can infl uence how the customer perceives the value of the Service. The diagram shows how customers perceive value. In this diagram, the initial point for customer perception is the reference value, which can be based on what the customer has heard about the Service or how the customer is presently using that Service or has used that Service or a similar Service.


4.3Processes of Service Strategy

4.2Principles and Models of Service Strategy

Coming Up

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4.3 PROCESSES OF SERVICE STRATEGY

Service Strategy

19

Service Strategy Processes

Processes in Service Strategy

The Service Strategy Processes

Business Relationship Management Strategy Management for IT Services (not covered in this course)

Service Portfolio Management (SPM)

Demand Management (not covered in this course)


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4.3.1 SERVICE PORTFOLIO MANAGEMENTService Strategy

20

Purpose

Objectives

Basic Concepts

The purpose of Service Portfolio Management includes:Ensuring that the Service Provider has the accurate Services.

Tracking the investment in Services.

Defining and linking the Services to the achievements of business outcomes.

Service Portfolio Management Business Relationship ManagementFinancial Management for IT Services


Service Portfolio Management – Purpose

The purpose of Service Portfolio Management is:

To make sure that the Service Provider has the right Services mix to balance the investment in IT with the ability to meet the business outcomes.

To track the investment in Services throughout their Lifecycle and work with other Service Management processes to ensure the achievement of the right returns.

To make sure that organizations defi ne the Services clearly and link the Services to the achievement of business outcomes. This ensures that all activities of design, transition, and operation are aligned with the value of the Services.

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Service Portfolio Management – Objectives

Purpose

Objectives

Basic Concepts


The objectives of Service Portfolio Management include:


Enabling an organization to examine and decide on which Service to provide.

Maintaining a conclusive portfolio of services provided.

Facilitating a mechanism for the organization to assess the Service support to achieve its strategy.

Controlling the Services offered.

Analyzing the viability of the Services.

Tracking the investment in Services.

Objectives of Service Portfolio Management“The objectives of Service Portfolio Management are:

Provide a process and mechanisms to enable an organization to investigate and decide on which Services to provide, based on an analysis of the potential return and acceptable level of risk.

Maintain the definitive portfolio of Services provided, articulating the business needs each Service meets and the business outcomes it supports.

Provide a mechanism for the organization to evaluate how Services enable them to achieve their strategy, and to respond to changes in their internal or external environments.

Control which Services are offered, under what conditions and at what level of investment.

Track the investment in Services throughout their lifecycle, thus enabling the organization to evaluate its strategy, as well as its ability to execute against that strategy.

Analyze which services are no longer viable and when they should be retired.”

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Service Portfolio Management – Basic Concepts

Purpose

Objectives

Basic Concepts

Service Portfolio

Adapted from The Service Portfolio and its Contents © Crown Copyright 2011 Reproduced under licence from Cabinet Office

Service knowledge management system

Service portfolio

Servicepipeline

Servicecatalogue

Retired services

Service lifecycle

Service statusRequirementsDefinitionAnalysisApprovedCharteredDesignDevelopmentBuildTestReleaseOperational/liveRetiringRetired

Customer/supportteam viewablesection of theservice portfolio(the servicecatalogue, withselected fieldsviewable)


The Service PortfolioThe Service Portfolio is the complete set of Services that is managed by a Service Provider. It acts as the basis of a decision framework because it allows the management to compare and contrast various ideas so that the most viable and valuable can be further developed as a Service. It also represents present contractual commitments, new development of Services, and continual Service improvement plans that are initiated by Continual Service Improvement (CSI) and includes third-party Services. In other words, the Service Portfolio manages the entire Service Lifecycle and helps the managers prioritize investments and improve resources allocation.

The Service Portfolio includes three categories, which are:

Service Pipeline (proposed or in development)

Service Catalogue (live or available for deployment)

Retired Services

The Service Portfolio should have the right mix of Services in the Service Pipeline and Service Catalogue to make sure that the Service Provider is fi nancially viable.

The Service Portfolio tells you the status of all Services within the Service Lifecycle. The Service Portfolio consists of the Service Pipeline, Service Catalogue, and Retired Services.

The Service Portfolio should include:

“Service name

Service description

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Service status

Service classification and criticality

Applications used

Data and/or data schema used

Business processes supported

Business owners

Business users

IT owners

Service warranty level, SLA and SLR references

Supporting services

Supporting resources

Dependent services

Supporting OLAs, contracts and agreements

Service costs

Service charges (if applicable)

Service revenue (if applicable)

Service metrics.”

(Source: Service Design book)

Let us now understand the Service Pipeline, Service Catalogue, and Retired Services.

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Purpose

Objectives

Basic Concepts

Management Information Systems and Tools

The Service Pipeline contains details of business needs, such as Services that have yet to be released into the live environment.

Service Pipeline

The Service Catalogue contains details of all Services that are visible to the customer. Service Catalogue

Retired services are those Services that are no longer available or are in use.Retired Services


Service Pipeline, Service Catalogue, and Retired ServicesThe Service Portfolio has a subset called the Service Pipeline, which contains details of business needs, such as Services that have yet to be released into the live environment.

The Service Catalogue contains details of all Services that are visible to the customer. You must ensure that only those Services whose status is between “chartered” and “operational” are accessible to customers.

Retired services are those Services that are no longer available or are in use.

Service Design and Service Strategy staff should have access to all the records in the Service Portfolio and other important areas, such as Service Management. The rest of the staff members must have access to only the permitted subset of records. The Service Design staff design the Service Portfolio but the Service Strategy staff manage it.

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Purpose

Objectives

Basic Concepts

Adapted from The Service Portfolio © Crown Copyright 2011 Reproduced under licence from Cabinet Office

Servicepipeline Service catalogue

Configuration management system

CMDB

Service portfolio

Retiredservices

Customerportfolio

Applicationportfolio

Supplier and contractmanagement

information system

Customeragreement

portfolioProjectportfolio



Service Portfolio ManagementThe Service Portfolio contains all Services that a Service Provider plans to deliver, Services that are recently delivered, and retired Services. SPM is concerned with whether the Service Provider is able to generate value from the Services. As a result, SPM tracks investments in Services and compares them to the desired business outcomes. SPM evaluates the value of the Services throughout their Lifecycles and compares what new Services are offering in place of the retired Services.

Internal Service Providers will need to work with the Business Units in the organization to link each Service to the business outcomes before they can compare investment with returns. External Service Providers tend to evaluate value more directly because each Service needs to be able to generate revenue directly or support revenue-generating Services. The generation of revenue in an effi cient manner will, in turn, facilitate profi tability.

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4.3.2 FINANCIAL MANAGEMENT FOR IT SERVICES

Service Strategy

25


Financial Management for IT Services – Purpose

Purpose

Objectives

The purpose of Financial Management for IT Services includes:To secure the correct level of funding to design, develop, and deliver Services that meet organizational strategy.

To ensure that the Service Provider does not commit to Services that cannot be provided.

To identify the balance between the Service cost and Service quality.

To maintain the balance of supply and demand between the Service Provider and customers.


Basic Concepts

Service Strategy

26


Financial Management for IT Services – Objectives

Purpose

Objectives

Basic Concepts

The objectives of Financial Management for IT Services include:


Defining and maintaining a framework.

Evaluating the financial impact of Service Provider.

Securing funds to manage the provision of Services.

Facilitating good management of Services.

Managing and reporting expenditure on Service provision.

Understanding the association between expenses and income.

Accounting for money spent on Services.

Executing the financial policies and practices.

Recovering the costs of Service provision.

Predicting the financial requirements.Sample

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Objectives of Financial Management for IT Services“The objectives of Financial Management for IT Services include:

Defining and maintaining a framework to identify, manage, and communicate the cost of providing services.

Evaluating the financial impact of new or changed strategies on the Service Provider.

Securing funding to manage the provision of Services.

Facilitating good stewardship of Service and customer assets to ensure the organization meets its objectives. This should be done together with Service asset and configuration management and knowledge management.

Understanding the relationship between expenses and income and ensuring that the two are balanced according to the organization’s financial policies.

Managing and reporting expenditure on Service provision on behalf of the organization’s stakeholders.

Executing the financial policies and practices in the provision of Services.

Accounting for money spent on the creation, delivery, and support of Services.

Forecasting the financial requirements for the organization to be able to meet its Service commitments to its customers, and compliance with regulatory and legislative requirements.

Where appropriate, defining a framework to recover the costs of Service provision from the customer.”


Financial Management for IT ServicesThe Financial Management for IT Services process is responsible for managing an IT Service Provider’s budgeting, accounting, and charging requirements. It ensures correct funding for the delivery and consumption of Services. In general, organizations have professional accountants who manage a dedicated fi nance department, where fi nancial policies, budgeting procedures, fi nancial reporting standards, accounting practices, and revenue generation or cost recovery rules are set. The table on the slide shows an example of a business case from the Financial Management for IT Services view point.

On the other hand, Financial Management for IT Services is a specialized area that requires an understanding of the fi nance world, the business world, and the technology world. Financial Management for IT Services needs accountants who have good understanding of cost accounting, which is a discipline often found in manufacturing environments. As a result, it is essential that organizations specify the correct skills when hiring a person to manage IT fi nances.

Organizations should ensure that the fi nancial policies and practices within IT are consistent with the overall organizational policies and practices so that better communication and reporting between IT and other Business Units is facilitated.

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Service Strategy

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Financial Management for IT Services – Basic Concepts

Purpose

Objectives

Basic Concepts

Processes of Financial Management for IT ServicesThe three main processes of Financial Management for IT Services are:

Budgeting: Is the process of predicting and regulating the income and expenditure of an organization.

Accounting: Is the process that allows the IT organization to justify the way its money is spent.

Charging: Is the process to raise the bill to the customers for the services provided.

Service Portfolio Management aBusiness Relationship ManagementFinancial Management for IT Services

Financial Management for IT Services consists of three main processes:

“Budgeting: This is the process of predicting and controlling the income and expenditure of money within the organization. Budgeting consists of a periodic negotiation cycle to set budgets (usually annual) and the monthly monitoring of the current budgets.

Accounting: This is the process that enables the IT organization to account fully for the way its money is spent (particularly the ability to identify costs by customer, by Service and by activity). It usually involves accounting systems, including ledgers, charts of accounts, journals etc. and should be overseen by someone trained in accountancy.

Charging: This is the process required to bill customers for the Services supplied to them. This requires sound IT accounting practices and systems.”


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4.3.3 BUSINESS RELATIONSHIP MANAGEMENT

Service Strategy

28


Business Relationship Management – Purpose

Purpose

Objectives

The purpose of the Business Relationship Management process is two-fold:To form and uphold the Service Provider and the customer business relationship

To identify customer requirements and make certain that the Service Provider meets the requirements


The purpose of the Business Relationship Management process is two-fold:

To form and uphold the Service Provider and the customer business relationship based on understanding the customer and its business requirements.

To identify customer requirements and make sure that the Service Provider meets the requirements because business requirements change over time and according to circumstances. Business Relationship Management ensures that the Service Provider is aware of changing business needs and helps the business in expressing the value of a Service. In other words, Business Relationship Management makes sure that the expectations of customers do not exceed their wants and that the Service Provider meets the expectations of the customers before agreeing to deliver the Service.

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Service Strategy

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Business Relationship Management – Objectives

Purpose

Objectives

The objectives of Business Relationship Management include:


Confirming that the Service Provider comprehends the customer’s viewpoint.

Assuring customer satisfaction.

Establishing and preserving a beneficial relationship between the Service Provider and the customer.

Recognizing changes to the customer background.

Articulating business requirements.

Identifying technology trends.

Assuring that Services and Service levels deliver value.

Ensuring that the Service Provider meets the prerequisites of the customer.

Establishing complaints and growth processes for the customer.

Interceding when there are conflicts for services.

Objectives of Business Relationship ManagementThe objectives of Business Relationship Management include:

“Ensure that the Service Provider understands the customer’s perspective of Service, and is therefore able to prioritize its services and Service assets appropriately

Ensure high levels of customer satisfaction, indicating that the Service Provider is meeting the customer’s requirements

Establish and maintain a constructive relationship between the Service Provider and the customer based on understanding the customer and its business drivers

Identify changes to the customer environment that could potentially impact the type, level, or utilization of services provided

Identify technology trends that could potentially impact the type, level, or utilization of Services provided

Establish and articulate business requirements for new services or changes to existing Services

Ensure that the Service Provider is meeting the business needs of the customer

Work with customers to ensure that services and Service levels are able to deliver value

Mediate in cases where there are conflicting requirements for services from different business units

Establish formal complaints and escalation processes for the customer.”


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Business Relationship Management is the process that enables the Business Relationship Managers (or BRMs) to provide the connection between the Service Provider and the customers at the strategic and tactical levels. This connection ensures that the Service Provider understands the business needs of the customer and is able to provide Services that meet these requirements (customer satisfaction level).

The focus of Business Relationship Management is to understand how Services meet the needs of the customer. Business Relationship Management depends on other Service Management processes, and functions and organizations should ensure that there is a clear identifi cation of relationships between Business Relationship Management and other Service Management processes.

The focus of Business Relationship Management is on the real relationship between the Service Provider and its customers and the levels of customer satisfaction while the focus of other processes is on the Services themselves and the extent to which the Services meet stated needs.


4.4Module Summary

4.3Processes of Service Strategy

Coming Up

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4.4 MODULE SUMMARY The main points to summarize this module are:

General Concepts:

Utility and Warranty: Utility = The functionality offered by a product or Service to meet a particular need. Utility is often summarized as “what it does.” Warranty = A promise or guarantee that a product or Service will meet its agreed requirements.

Resources and Capabilities: Resource = A generic term that includes IT infrastructure, people, money, or anything else that might help deliver an IT Service. Resources are considered the tangible assets of an organization. Capabilities = The ability of an organization, person, process, application, Confi guration Item (CI), or IT Service to carry out an activity. Capabilities are the intangible assets of an organization.

Service Assets: The basis for value creation.

Service Portfolio: The complete set of Services that are managed by a Service Provider. The Service Portfolio is used to manage the entire Lifecycle of all Services and includes three categories: Service Pipeline (proposed or in development), Service Catalogue (live or available for deployment), and Retired Services.

Service Catalogue: A database or structured document with information on all live IT Services, including those available for deployment. It includes information about deliverables, prices, contact points, and the ordering and request processes. There is a Business Service Catalogue and a Technical Service Catalogue.

Business Case: The justifi cation for a signifi cant item of expenditure. It includes information about costs, benefi ts, options, issues, Risks, and possible Problems.

Risk: A possible Event that could cause harm or loss or affect the ability to achieve objectives.

Processes:





4.5Test Questions for Service Strategy

4.4Module Summary

Coming Up

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4.5 TEST QUESTIONS FOR SERVICE STRATEGY © Offi cial ITIL ® Accreditor 2011. This document is not to be reproduced or re-sold without express permission from the APM Group Ltd. This information is part of the offi cial ITIL sample examination paper.Version 5.1 (Live) Owner – Chief ExaminerNote: The students can fi nd the answers in Appendix C.

Q1. Which one of the following is NOT a stage of the Service Lifecycle?

a) Service Optimization

b) Service Transition

c) Service Design

d) Service Strategy

Correct Answer: a

Rationale: Service Optimization is the correct answer

Q2. Which of the following are characteristics of every process?

1. It is measurable

2. It delivers a specifi c result

3. It delivers its primary results to a customer or stakeholder

a) 1 and 3 only

b) 1 and 2 only

c) 2 and 3 only

d) All of the above

Correct Answer: d

Rationale: Measurability, delivery of specifi c results, and delivery of results to a customer or stakeholder are all characteristics of a process.

Q3. Which statement about value creation through services is CORRECT?

a) The customer’s perception of the service is an important factor in value creation

b) The value of a service can only ever be measured in fi nancial terms

c) Delivering service provider outcomes is important in the value of a service

d) Service provider preferences drive the value perception of a service

Correct Answer: a

Rationale: D is incorrect; customer preferences drive value perception. C is incorrect; delivering on customer outcomes is vital. B is incorrect; the value of a Service can be fi nancial but other factors are also relevant. A is correct; customer perception is a vital element in defi ning how much a customer values a Service.

The Swirl logo™ is a trade mark of the Cabinet Offi ceITIL® is a registered trade mark of the Cabinet Offi ce

ITIL Foundation Examination SampleA v5.1This document must not be reproduced without express permission from The Accreditor.

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Q4. Which one of the following statements about internal and external customers is MOST correct?

a) External customers should receive better customer Service because they pay for their IT Services

b) Internal customers should receive better customer Service because they pay employee salaries

c) The best customer Service should be given to the customer that pays the most money

d) Internal and external customers should receive the level of customer Service that has been agreed

Correct Answer: d

Rationale: D is the correct response. Both internal and external customers should be provided with the agreed level of Service, and with the same level of customer Service.

Q5. Which one of the following should IT Services deliver to customers?

a) Capabilities

b) Cost

c) Risk

d) Value

Correct Answer: d

Rationale: A Service is a means of delivering value to customers. IT needs capabilities to deliver Services. Cost and risk are what IT helps to manage.

Q6. What does “Warranty of a Service” mean?

a) The Service is fi t for purpose

b) There will be no failures in applications and infrastructure associated with the Service

c) All Service-related problems are fi xed free of charge for a certain period of time

d) Customers are assured of certain levels of availability, capacity, continuity, and security

Correct Answer: d

Rationale: A is part of the defi nition of utility. B is unrealistic. C could be feasible as a warranty statement from another industry but is not the defi nition of warranty as used by ITIL. D is a good summary of warranty as defi ned by ITIL.

The Swirl logo™ is a trade mark of the Cabinet Offi ceITIL® is a registered trade mark of the Cabinet Offi ce

ITIL Foundation Examination SampleA v5.1This document must not be reproduced without express permission from The Accreditor.

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4.6 CASE STUDY EXERCISE: THE CLOUD SOLUTION

2

ITpreneurs Cloud Essentials Courseware

We are pleased to introduce the Cloud Solution for the Royal Chao Phraya Hotel case study.

• Please take the specified time to read through the case study.

To help handle increased guest traffi c and improve the guest experience, the Royal installed computerized kiosks throughout the hotel to provide guests with self-service capability. The kiosks enable guests to book services at the spa, book a scuba lesson in the pool, get printed information such as maps and coupons to local restaurants, and so on.

The kiosks make use of the guest card key for authentication and data management. Each guest is authenticated and authorized to use the kiosk by swiping the card key. The card key is also capable of storing data, written to it by the kiosk. This data storage capability facilitates and helped to modernize the Royal’s guest loyalty program. The loyalty program rewards repeat guests with discounts on services at the hotel’s various facilities like the spa, pool, restaurant, or bar.

The kiosk program has been very successful. The devices have been to be a hit with guests and staff. Self-service has helped reduce errors, free staff to deal with other critical matters, and improve overall customer satisfaction with the Royal. However, the kiosks are proving inadequate to keep up with the growth of the Royal and an increase in the number of technology savvy guests.

Cloud ComputingDURATION: 2 HOURS

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| CLOUD COMPUTING | ITIL® FOUNDATION PLUS CLOUD INTRODUCTION | INSTRUCTOR |

Recently, there have been complaints about the dated look and feel of the kiosks. There are a limited number of kiosks and only in certain locations throughout the facility. Guests don’t like waiting in line to use kiosks. They want more functionality like self-check-out, bill pay, room service orders, weather reports, Internet access, ticket orders for local events, and even networked gaming. Also, guests would like to use their own devices like smart phones and tablets to access those same hotel services directly.

Perhaps the most signifi cant complaint is that guests must be currently checked-in and have a room key to use the kiosks and accrue credits within the loyalty program. As a city hotel, the Royal is a venue of choice for many locals for dining, meetings, or a night in the town. Therefore, the Royal’s management would like to expand the reach of the loyalty program to include guests who are making use of hotel facilities a la carte.

Management also wants to expand the kiosk program by adding more terminals and increased functionality. But there is great concern over the costs and the potential for disruption to the hotel infrastructure as well as the guest experience. The hotel cannot afford to reduce operations to facilitate any new construction. Also, the current kiosks are reaching their end-of life and will not accommodate many of the new features guests want.

Your manager has read that other businesses are using cloud computing to overcome IT challenges, reduce costs, and improve business operations. He is eager to learn more about cloud computing and discover whether it may be a viable solution for the Royal. Your manager has asked you to prepare a briefi ng for the senior management team on how cloud computing can be applied to replace or enhance the use of kiosks in the Royal.

You are an IT professional with little knowledge and no direct experience with cloud computing. After doing some research, you discover a world class IT training organization called ITpreneurs. You contact one of the sales executives and learn that the organization has created the industry’s premier foundation-level certifi cation in cloud computing, Cloud Essentials®. The executive sends you a digest of the curriculum to help you prepare for your briefi ng.

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| INSTRUCTOR | ITIL® FOUNDATION PLUS CLOUD INTRODUCTION | CLOUD COMPUTING |

4.7 CLOUD INTRODUCTION

Cloud Computing Defi ned

3


Cloud computing brings some new terms:

Cloud Servicesinclude the delivery of:

Cloud Service Provider is responsible for:

Cloud is a set of :

HardwareNetworksStorageServicesInterfaces

SoftwareInfrastructureStorage

AssetsMaintenance

According to the offi cial defi nition by the US National Institute of Standards and Technology (NIST), cloud computing is a model for enabling ubiquitous, convenient, on-demand network access to a shared pool of confi gurable computing resources (example: networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction.

The cloud model identifi es fi ve essential characteristics: on-demand self-service, broad network access, resource pooling, rapid elasticity, and measured service. It has three service models: software, platform, and infrastructure. In addition, there are four deployment models: private, community, public, and hybrid.

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Cloud Computing Defi ned (Contd.)

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It’s very likely you’re already a user of cloud computing. Do you use Gmail, Flickr, or Salesforce? Think about Gmail as a mail server. You send and store your email without thinking about servers, upgrades, or storage.

All your emails are saved in the cloud, which is a data center located somewhere on the planet. While you don’t know where your mail is as they might be stored in multiple locations, you trust Gmail to keep your email safe. In this way, you can access your email from anywhere in the world, and you don’t have to worry about your computer crashing.

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Cloud Computing Defi ned (Contd.)

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Software

Storage

Applications

Cloud Service Providers:

In cloud computing, the cloud service provider will provide access to the software, take care of hosting and storage, and also help developers rapidly create applications. Where the provider keeps the hardware is their business. It might be in a dedicated data center, in multiple data centers, or shifted between data centers. Because we don’t know the exact location, we call it cloud computing.

Cloud computing makes use of existing technologies, like virtualization. Although some of the underlying technology is old, the emergence of cloud providers and the Internet has created new possibilities for IT and business units. That’s why cloud computing is more a business model than a technology.

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Characteristics of Cloud Computing

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On-demand self-service

Broad network access

Resource pooling

Rapid elasticity

Measured service

Five essential characteristics of

cloud computing are:

According to the US NIST (National Institute of Standards and Technology), fi ve essential characteristics of cloud computing services are:

On-demand self-service

Broad network access

Resource pooling

Rapid elasticity

Measured service

Quoting from the source (NIST):

On-demand self-service: A consumer can unilaterally provision computing capabilities, such as server time and network storage, as needed automatically without requiring human interaction with each service provider.

Broad network access: Capabilities are available over the network and accessed through standard mechanisms that promote use by heterogeneous thin or thick client platforms. For example, mobile phones, tablets, laptops, and workstations.

Resource pooling: The provider’s computing resources are pooled to serve multiple consumers using a multi-tenant model, with different physical and virtual resources dynamically assigned and reassigned according to consumer demand. There is a sense of location independence in that the customer generally has no knowledge about or control over the exact location of the provided resources but may be able to specify location at a higher level of abstraction,

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such as country, state, or data center. Some examples of resources include storage, processing, memory, and network bandwidth.

Rapid elasticity: Capabilities can be elastically provisioned and released, in some cases automatically, to scale rapidly outward and inward commensurate with demand. To the consumer, the capabilities available for provisioning often appear to be unlimited and can be appropriated in any quantity at any time.

Measured service: Cloud systems automatically control and optimize resource use by leveraging a metering capability at some level of abstraction appropriate to the type of service, such as storage, processing, bandwidth, and active user accounts. Resource usage can be monitored, controlled, and reported, providing transparency for both the provider and consumer of the utilized service.

Note to instructor: According to the offi cial NIST defi nition, “cloud computing is a model for enabling ubiquitous, convenient, on-demand network access to a shared pool of confi gurable computing resources (e.g., networks, servers, storage, applications and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction.”

Industry has united under the leadership of NIST to standardize cloud defi nitions and remove market confusion.

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Virtualization and Cloud Computing Characteristics

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Organizations might benefit from virtualization and cloud computing if:

• Business is changing rapidly like growing or shrinking on a seasonal basis.

• Capital is scarce or expensive.• Technology or business is

immature.• Senior management is not ready

for long-term commitment.

There are several identifi able characteristics of organizations that indicate whether they might benefi t from virtualization and cloud computing. Some indicators of benefi t are:

The business is changing rapidly and grows or shrinks quickly, possibly on a seasonal basis.

When capital is scarce or expensive, cloud computing allows business to shift capital expense from servers owned to the operational expense of servers leased.

The business is immature and subject to change.

Senior management is not ready to make a long-term commitment.

Startup businesses typically have high borrowing costs, which makes cloud computing a relevant approach.

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Solution to Problems

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Virtualization and cloud computing overcome problems such as:

Running out of capacity

Cost of excess capacity

Much capital tied up in server

hardware

Virtualization and cloud computing overcome problems such as:

Running out of capacity.

Costly and excess capacity.

Much capital tied up in server hardware.

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Virtualization and Cloud Computing: Non-suitability

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Organizations might not benefit from virtualization and cloud computing if they have:

Steady andfixed workload.

Own large data centers.

High compliance standards.

High degree of operational assurance.

Not all organizations benefi t from virtualization and public cloud computing. These types of organizations would probably not benefi t because:

Steadily large and fi xed workloads can typically make optimal use of their hardware and do not need the scaling.

Organizations that own large data centers often have enough scale to be as fl exible and effi cient as cloud computing providers are. They will however typically benefi t from virtualizing their infrastructure.

Legal and security reasons, also termed compliance reasons, can require an organization to know more details about the location of its data and servers than a cloud computing provider can provide.

Organizations with systems requiring a high degree of operational assurance, such as military systems and systems responsible for health, safety, and emergency response, may be a poor fi t for the relatively weak guarantees offered by typical public cloud service providers today.

Note to instructor: Benefi ts of cloud computing are dependent on specifi c characteristics of the organization.

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Models of Cloud Computing

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Software as a Service (SaaS), applications which provide business value for

users

Platform as a Service (PaaS), applications which provides

specialized software components and programming

tools

Infrastructure as a Service (IaaS), applications which

provides computing infrastructure resources as

a service

Cloud computing is an umbrella concept for a number of service models. The given table outlines three different models of cloud computing: Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS).

Note to instructor: This subdivision, also known as the SPI classifi cation, is good because it shows the impact on the organization, rather than being based on technical characteristics. Although there can be confusion between the layers, in each layer there are obvious archetypes.

In the following table, we compare a traditional IT technical architecture with these cloud models.

Technology Layer ‘Traditional IT’ IaaS PaaS SaaS

Application Consumer Consumer Consumer Provider

OS/Middleware Consumer Provider Consumer Provider

Hardware Consumer Provider Provider Provider

Who is responsible for correct operation of a particular technology layer?

Note to instructor: ‘traditional IT’ could also be called half jokingly ‘Nothing as a Service’.

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Deployment Models

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In addition to the cloud service models, there are also a number of ways to deliver or roll out these cloud services. In some of these deployment models, the financial commitment lies with the organizations that use these clouds.

• Private Cloud• Community Cloud• Public Cloud• Hybrid Cloud

The following is based on the NIST defi nitions of deployment models.

These deployment models differ in where the control of data and security ultimately lies and where the fi nancial commitments are.

Private cloud: The cloud infrastructure is provisioned for exclusive use by a single organization comprising multiple consumers (e.g., business units). It may be owned, managed, and operated by the organization, a third party, or some combination of them, and it may exist on or off premises.

Community cloud: The cloud infrastructure is provisioned for exclusive use by a specifi c community of consumers from organizations that have shared concerns such as mission, security requirements, policy, and compliance considerations. It may be owned, managed, and operated by one or more of the organizations in the community, a third party, or some combination of them, and it may exist on or off premises.

Public cloud: The cloud infrastructure is provisioned for open use by the general public. It may be owned, managed, and operated by a business, academic, or government organization, or some combination of them. It exists on the premises of the cloud provider.

Hybrid cloud: The cloud infrastructure is a composition of two or more distinct cloud models like, private, community, or public. The models will remain unique entities but are bound together by standardized or proprietary technology that enables data and application portability. For example, cloud bursting for load balancing between clouds.

Examples of hybrid clouds: websites of which are partly served out of private data centers and partly out of public clouds, potentially even depending on the actual load (cloud bursting).

Examples of community clouds: SaaS offerings for closed user groups, various government clouds.

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Security and Risks

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IT risks are usually categorized as:• Availability: This informs you about the status of the services and data

available when required.• Confidentiality: This limits data access to the authorized people.• Integrity: This protects tampering of data and is data trustworthy.

Cloud computing changes the risk landscape. There are risks in any business, and every technology has its own risks. These risks originate in the technology itself, but also in the way we handle this technology. Although new technology invariably introduces new risks, at the same time it can introduce fresh ways to reduce existing risks. Consequently, cloud computing has a mixed impact on business risks. IT risks are usually categorized as:

Availability Your dependence on an external provider increases, but you have less control over its resources. In case of

shortages, you might not be able to secure enough resources for your business.

Your dependence on network connectivity might increase, but your Internet provider might not control the Internet connectivity. If this connectivity fails, your service will suffer.

Your dependence on your internal IT might decrease.

Your external provider might fi nd it a lot easier to provide redundancy and increase availability.

Confi dentiality You are handing over digital assets to an external provider whom you might or might not trust more than

your internal staff.

Compliance issues, such as industry or government regulations, might reduce your maneuvering space. They might force you to be in control of where your data is physically stored, which can limit the number of cloud services that you can employ. This issue will be discussed further in the module on governance.

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Integrity With cloud computing, a whole new category of people can potentially tamper with your data. These security

risks will be discussed in more detail in the governance module.

Cloud computing solutions might have more functionality to prevent an accidental loss or corruption of data or to recover afterwards, for example, moving from email as a way to share documents to a secure extranet.

User Experience

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IT applications have business value because they enable people to perform their work more easily and effectively. There are a number of areas where cloud computing can assist users.

• Web-based user interfaces• More recent versions of software• Access anywhere anytime• Easy to use and flexible capacity

Web-Based User InterfacesCloud applications have web-based user interfaces. In the past, these user interfaces would load one webpage after another and were not capable of the same rich interaction that PC-based user interfaces had. However, with the advent of more modern technological standards for the web, such as HTML 5 and AJAX and the browsers that implement them, web-based applications are often functionally superior to traditional PC-based applications. A good example is Google Maps with Street View.

UpdatesWeb applications are updated much more rapidly than packaged applications. For example, in the past, new versions of Microsoft’s Offi ce suite for PCs were released every two to three years, and it could take a long time after that for these releases to be deployed by the IT department. The cloud version of this software (Microsoft Offi ce 365) is updated monthly. Other web-based applications are updated with new functionality every few weeks, or even days. This release cycle can make the applications much more adaptive to evolving user needs.

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AccessCloud applications can be accessed from anywhere at any time. Employees working at remote or home locations, partners, and users across the world can all access these services from any Internet connection.

Easy to UseCloud computing applications are more fl exible in their resources, so they become easier to use. For example, cloud provider email servers have vastly larger email boxes than typical company email systems.

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4.8 EXERCISE – THE CLOUD SOLUTIONObjective: Prepare a business case for the Royal’s adoption of cloud computing to replace or enhance the current kiosks.

Instructions: Divide the class into pairs of teams. Each team in the pair should have no more than fi ve members. Each pair of team will work together. One team will play the role of the management steering committee. The other team will prepare and present a business case for the cloud computing solution to the management steering committee. The briefi ng team may choose whether or not to recommend the cloud computing solution, but the team must justify its position in the business case. The management steering committee will prepare questions and challenges for the briefi ng team.

The business case should address:

a) The Service Defi nition

b) Value of the Service

c) Impact on the Royal’s Core, Enabling, and Enhancing Services

d) Stakeholders

e) Challenges

f) Risk Management

g) Roles

h) Utility and Warranty

i) Service Assets

j) Governance

k) Patterns of Business Activity

l) Financial Management

Teams will have one hour to prepare their business case statements and challenge questions and then one hour to present and receive instructor and peer feedback.

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ITIL Foundation Plus Cloud Instructor Guide

Documents

Transcript of ITIL Foundation Plus Cloud Instructor Guide