Cloud computing: Is ITIL still relevant?

1 ©2010 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice

Cloud computing: Is ITIL still relevant? Randy SteinbergITIL and IT Service Management Specialist Leader, Deloitte ConsultingNicholas ClarkeSenior Consultant, Deloitte Consulting

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Table of contents

Cloud Computing Impact On IT Delivery 4

Cloud Computing and ITIL Relevancy 5

Two Case Studies 12

Service Strategy Considerations 13

Service Design Considerations 19

Service Transition Considerations 24

Service Operation Considerations 30

Continual Service Improvement Considerations 35

Takeaways and Questions 39

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Cloud computing represents a major shift in information technology architecture, altering the way services are sourced and delivered

Software and information are provided to computers and other devices on-demand, like a public utility

Services accessed via single point of access

Consumption billed on a utility or subscription basis with little or no upfront cost creating a low barrier to entry

Reduces upfront capital expenditures but may pay more for operating expenses

Some argue that the cloud is a paradigm shift, similar to the displacement of electricity generators by electricity grids early in the 20th century

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Operating Platform

Application

Network Security

Storage

Database

Infrastructure

EmailOther

Cloud computing represents a growing evolution in IT in which core IT services are getting sliced and diced across many providers

Organizations can now rent what they were earlier forced to make or own

This translates into collaborative relationships with service providers who provide access to capabilities and resources otherwise not available

IT is devolving into services that are delivered through patterns of collaborative exchanges

IT is rapidly becoming a service provider operating as a value chain network of services

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A capability to abstract this value chain in the form of services is critical to the future success of IT and its mission of delivering business value

Service Strateg

y

ITIL and IT Service Management are well

positioned for this

The Service Lifecycle can be leveraged to build this

value chain

Lack of a service approach will expose end users and the business to further complexities with no accountability for the

end services being delivered

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ITIL can be seen as supporting the Service Management layer within the HP Cloud Assure architecture, where its processes cover the entire value chain

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HP Cloud Assure Reference Architecture

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Operating as bundles of technologies and capabilities could pose serious risks for any IT organization migrating to cloud solutions

Overall loss of control as services are managed and controlled elsewhere

Operating complexity as external providers change platforms, services and versions of software based on their schedules and priorities – not yours

Security exposures for services working with sensitive data across the cloud

Poor user/customer satisfaction related to confusion over how to handle service outages and finger pointing between suppliers

Key service features that get dropped or fall through the cracks between providers

Risks of getting locked into poor supplier arrangements – over paying for services or under providing for actual business demand

Legal exposures and regulatory compliance risks with suppliers that use differing sets of controls

Locked into arrangements with suppliers that can’t deliver needed performance or meet business demand volumes

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Core IT management disciplines have not changed – just shifted from the IT organization to the cloud service provider

ITIL for the Cloud VendorITIL for the IT Organization

Architect service solutions by piecing together Cloud service providers and their service offerings

Focus on integrating and securing services from suppliers

Manage and control a complex mix of releases / changes across a wide range of suppliers’ varying schedules and priorities

Ensure expected value is being delivered, and service disruptions responses are coordinated across suppliers

Provide the needed transparency of results and coordinated improvement efforts across many providers

Identify services provided, their value and costs; demand management is key for providing on-demand services

Bundle service packages for consumption – capacity management key to disruption-free, on-demand delivery

Provide customers with easy, smooth and safe ways to transition and access provided services

Ensure that expected value is being delivered and that services are not disrupted

Provide a means for staying ahead of competition and gauging customer satisfaction or business will be lost

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The ITIL v3 Library Lifecycle Books

ITIL is well positioned help – nearly all the ITIL disciplines are used when pulling services delivered via the cloud together

IT organizations must clearly understand:The services they operate with (Service Portfolio Mgmt, Service Catalog Mgmt)How services are networked and bundled to deliver value (Configuration Mgmt, Knowledge Mgmt, Service Level Mgmt, Supplier Mgmt)Service costs (IT Financial Mgmt)Service Demand (Demand Mgmt, Capacity Mgmt)How services will be put on the cloud operating model (Service Strategy, Capacity Mgmt, Availability Mgmt, Information Security Mgmt, IT Service Continuity Mgmt)Managing transitions as service providers (or their offerings) move in and out of the network (Change Mgmt, Release and Deployment Mgmt, Configuration Mgmt, Service Testing, Evaluation)Delivering services on the cloud operating model (Incident Mgmt, Problem Mgmt, Access Mgmt, Event Mgmt, Request Fulfillment)

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The current set of HP IT Service Management Tools can support your cloud services program when looking at either vendor, internal or hybrid solutions

Demand Mgt.HP PPM

BusinessOutcomes(desired /realized)

Value

Users

StrategyMgt.

Service Strategy

Financial MgtHP PPM

HP Asset Mgr

Service PortfolioMgt.

HP PPM

AccessMgt.

Request Fulfillment

HP Svc Mgr

Incident MgtHP Svc Mgr

Event Mgt. HP Ops Mgr

HP BACHP NNM

OperationalActivities

Problem Mgt.

HP Svc Mgr

ServiceEvaluation

Release & Deployment.

HP DCA CenterHP Client AutomationRelease Control (RC)

Validation & TestingHP QC/PC

HP Application Security Center

TransitionPlanning&Support

HP Svc MgruCMDB

Asset/Config. MgtHP uCMDB/DDMaeHP Asset Mgr/DDMi

(Federated)

Knowledge Mgt.HP Svc Mgr

Change Mgt.HP Svc Mgr

Bus. Impact Anal.IT Perf. Analytics

SupplierMgt

HP Asset Mgr

AvailabilityMgt.

CapacityMgt.

IT Service Continuity

Mgt.

InformationSecurity

Mgt.

ServiceLevel Mgt.

HP Svc Mgr

Svc Catalog Mgt

HP Svc Mgr

ServiceMeasurement

ServiceReporting

ServiceImprovement

Service Transition

Service Operation

Continual Service Improvement

Service DesignCustomer/ Business

Projects

Business IT

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Case #1Large Healthcare Company

Case #2Applications Management Provider

Unsuccessful Cloud Experience Successful Cloud Experience

Needed social networking site to support M&A integration activities

Circumvented IT group to launch it leveraging Cloud services

Handed off to IT when done

User volume brought the site down

Site was cut off – bad press and embarrassment for company senior executives

Set strategy to leverage Cloud delivery as a way to lower development costs, increase delivery speed and gain competitive advantage

Underpinned current service offerings with Cloud-based delivery services

Was able to slash delivery costs by almost 90%

Was able to provision infrastructure in days versus weeks

No Service Management Service Management Considered From The Start

Two cloud computing case studies demonstrate the sharp difference between using a service management approach versus not

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Process Purpose

Strategy Generation

Identify the IT services, investments, partners and delivery channels to meet customer needs and outcomes

Service Portfolio Management

Manage the investment portfolio of all the services available to customers and users

Demand Management

Identify patterns of business activity that consume services and manage activities to influence demand

IT Financial Management

Manage the provider’s budgeting, accounting and chargeback for IT services

Service Strategy – considerations for Cloud Delivery Solutions

Key Questions To Be Answered

What Cloud Operating Model(s) will be used?

What elements of services will be placed in the Cloud?

Which service partners will we utilize?

Who are my customers and what are their needs?

What services will need to be provided?

How will business demand consume services?

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Cloud computing will not change the strategic objectives or the market spaces of a service, it provides new avenues to reach those objectives

Strategic Asset

Drive Business Value

Cloud Services

Input Output

Strategic Objectives

Additional Enterprise

Stakeholders

Service Strategy

Closely evaluating the strategy generation process, and verifying its alignment with the needs of your organization is a critical step.

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The nature of cloud computing may require changes in how services are charged, and how IT organizations allocate cloud services costs

Pay Per Use Provider

Input Output

Service Portfolio

Service Cost

Examine Demand Factors

Develop Meaningful Unit Charge

Apply Charge Based on Usage

Financial management in ITIL terms requires you to identify the bundles of services being delivered, the delivery costs for each

service, and how demand consumes those services.

Allocations

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Input Output

Existing Service Portfolio

Provider Service

Offerings

Examine Services

Bundle Services

Integrate Into Existing Delivery Chain

Updated Service Portfolio

Cloud computing forces IT to take a hard look at the services they deliver, and how these are bundled to add value for varying stakeholders

A service portfolio must be augmented to include Cloud services being provided, what level of investment is being made in these services, how they are being sourced, bundled, and providing value to the business.

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Service Strategy – case summary

Case #2 - Successful

Cloud was seen as a strategic choice matched to business goals for lower costs, faster delivery and competitive advantage

IT saw a distinct advantage in quickly embracing Cloud technologies to gain competitive advantage

Distinct Cloud delivery solutions put into place for specific customer sets (demos, development, research, etc.)

Strategic choices in partners set from the start to handle ongoing management and support of the solution

Case #1 - Unsuccessful

Cloud was used as a way to bypass the IT organization

IT was reacting to current capabilities versus considering what the business was looking for

No consideration for the demand of business volumes that needed to be supported

Little consideration for partners to provide ongoing support and management of the solution post deployment

Service Strategy Not In Place Service Strategy In Place

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Project & Portfolio Management (PPM) Center [fka Kintana & Mercury ITG]

Resource Management

Demand Management

Deployment Management

Time Management

Universal CMDB (UCMDB) and Discovery & Dependency Mapping ae (DDMae)

HP Project & Portfolio Management (PPM) Software Solution Suite

Software-as-a-Service

Portfolio Management

Program Management

Project Management

Financial Management

PPM –

ITILv3 Service StrategyDemand, Portfolio, and Financial Management Processes

Once an effective process is defined to support your cloud computing program, select ITSM tools to realize the capabilities and processes

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Process PurposeService Catalog Management

Publish , manage and communicate which services are available to customers and users

Service Level Management

Negotiate, monitor, report and measure SLAs and OLAs

Availability Management

Define, measure, analyze and improve the availability of services

Capacity Management

Ensure appropriate infrastructure capacity in place to meet service demand volumes

Information Security Management

Protect the confidentiality, integrity and availability of services

IT Service Continuity Management

Ensure services can be recovered in the event of a major business disruption

Supplier Management

Ensure suppliers support the needs of the business and meet their contractual obligations

Service Design - considerations for Cloud Delivery Solutions

Key Cloud Questions To Be AnsweredHow will services be bundled and packaged for consumption?

What SLAs and OLAs will be needed to meet business objectives?

How will we ensure availability of services in the event of a major business disruption?

How will we secure our services and data across the Cloud?

What supplier agreements and contracts need to be in place?

How will we communicate available services to the business?

What capacity needs to be in place to meet business demand?

How will services integrate and sit on the Cloud Operating Model?

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Design the cloud computing solution to provide maximum benefits to business instead of treating it solely as technology innovationService catalog management, service level management, and capacity management processes are necessary to achieve an integrated Cloud computing solution to complement business needs

Business RequirementsTechnical Requirements

Business Needs

Cloud Solution

Effective coordinated execution of these customer-facing processes will help to define design requirements to build the stable Cloud solution that

will benefit the business in the long term.

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Input Output

Supplier Management is the critical process necessary to strengthen relationships between the business and vendor Cloud computing

service providers

Cloud Vendors

Valued Business Partner

Provide Understanding

of Business Needs

Measure and Compare Supplier

Performance

Align Contracts with Business

Needs

Maximize Return On Investment (ROI) By Selecting the Right Provider Partner

100+ Cloud Computing Vendors

Cloud computing requires a renewed effort in supplier management processes to ensure meeting terms, conditions, and target of agreements

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Service Design – case summary


Capacity is built into the solutions as they are offered and tailored for customers

Offerings described in a Service Catalog that also sets operating levels to be delivered – each service in the catalog has a Service Owner accountable for the successful delivery of that service

Cloud operating model was part of a comprehensive delivery architecture that supported the Service Catalog

Recovery considerations for major failures were a strategic part of the design and agreements with key suppliers


Solution not scaled for capacity to handle business volumes

No agreements in place for levels of service, operating roles and responsibilities

Cloud operating model was considered only for the specific solution being deployed

Little or no consideration for recovery in the event of major failures

Service Design Not In Place Service Design In Place

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Business Availability Center (BAC) [fka Mercury]²

Operations Center [fka Openview]¹

Network Management Center [fka Openview]¹

HP Business Service Management (BSM) Software Solution Suite

BAC Dashboard Diagnostics¹ SiteScope¹

Operations Manager (OM) OMi Smart Plugins (SPI)

Network Node Manager (NNMi) Smart Plugins (SPI)

Real User Monitor (RUM) Business Process Monitor (BPM) TransactionVision

Performance Manager/Agent² Reporter² GlancePlus Pak²


ITILv3 Service Operation¹ ITILv3 Service Design² Event, Problem Management Processes Availability, Capacity Mgmt Processes

Selecting the correct tools to support a well-defined Service Design program can dramatically improve the maturity level of your cloud services capability

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Process PurposeTransition Planning and Support

Plan and coordinate activities for transitioning services to the live production environment

Change Management

Protect services while changes are being made

Release and Deployment Management

Manage releases and their deployment to live production

Service Asset & Configuration Management

Maintain information about configuration items used to support services and their relationships

Service Validation and Testing

Validate that new services and changes will match design and business objectives

Knowledge Management

Gather, analyze, store and share knowledge to reduce the need for rediscovery of information

Evaluation Ensure a service will meet intended business objectives when it is transitioned

Service Transition – considerations for Cloud Delivery Solutions


How will services be transitioned to a live production state?

How will changes be managed across providers?

How will releases and deployments be coordinated across providers?

How will we test services across providers?

What operating information should we retain across providers?

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Transition Planning And Support Activities

Deployment Plan

Input Output

Planned Changes

Cloud Services

Since a vendor Cloud is a shared responsibility environment, having an inclusive, structured Transition Planning and Support process and a

responsible Project Planer is a critical success factor

Initiate

Plan

ExecuteControl

Clos

e

Project ManagementMethodology Project Documentation

Project Planner

Transition planning and support processes plan and coordinate resources to deploy a cloud service within predicted cost, time, and quality estimates

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Change Management Activities

R = Responsible

A = Accountable

C = Consulted

I = Informed

Cloud Vendor Organization

Change management support R A, C

Request for Change (RFC)logging and preevaluation A R

RFC classification C R

Assessment of urgent RFC by the Enterprise Change Advisory Board (ECAB) I R

Change assessment by the change manager C R

Change assessment by the CAB I R

Change scheduling R C

Change evaluation A R

Planned Changes

Input Output

Change Requests

Cloud Services

To achieve successful change management in a vendor Cloud services environment, the organization and Cloud computing provider must agree on

roles and responsibilities as they both participate in major changes.

Coordination between IT and cloud vendors is critical to ensure that beneficial changes can be made minimum disruption to IT services

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Cloud vendors need to be integrated with release/deployment processes to protect the integrity of the live environment when releasing components

Service Management Activities

Change Release

Input Output

Deployment Plan

Cloud Services

Collaboration between the Cloud computing services vendor and the organization is key to successful release management during

deployments to an operating environment

Agreed Maintenance WindowsJoint Release Planning

Release Documentation

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Service Transition – case summary


Cloud solutions were carefully planned and transitioned with IT staff handling ongoing operations

Change and release management procedures were agreed and contracted for between IT and suppliers

Consistent testing and pilots conducted prior to releasing Cloud solutions to clients


Cloud solution was “tossed over the wall” to the IT organization for ongoing support

Little or no consideration for handling changes and releases between IT and the Cloud Vendor

Little or no consideration for testing the Cloud solution to ensure it was operationally ready

Service Transition Not In Place Service Transition In Place

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HP IT Service Management (ITSM) Software Solution Suite


Service Management Center [fka Peregrine & Openview]

Asset Manager 5.x³ Discovery & Dependency Mapping Inventory (DDMi) IT Financial Management (ITFM) Contract Management Chargeback Procurement Software Asset Management (SAM) Portfolio Management Connect-it¹,²,³ DecisionCenter¹,²,³ Business Impact Analytics IT Performance Analytics Optimization Module Planning and Analysis Module

Service Manager 7.1xServiceDesk¹Incident Management (OGC Gold)¹Problem Management (OGC Gold)¹Change Management (OGC Gold)³Asset/Configuration Mgmt (OGC Gold)³Knowledge Management (OGC Gold)³Service Catalog (OGC Gold)²Service Level Management (OGC Gold)²Request (Fulfillment) Mgmt (OGC Gold)¹Service Portfolio Management (OGC Gold)2

Universal CMDB (UCMDB) and Discovery & Dependency Mapping ae (DDMae)³

ITILv3 Service Operation¹ ITILv3 Service Design² ITIlv3 Service Transition³ Incident, Problem, Request SLM, Service Catalog Change, Asset/Config, KM Management Processes Processes Management Processes

Tools can provide the capabilities required to support the core ITIL processes to support your transition to operating a unified cloud computing program

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Process Purpose

Incident Management

Restore an IT service to normal state operations as quickly as possible

Problem Management

Prevent incidents from happening or minimize their impacts by identifying their root causes

Event Management

Manage operational events and communicate them to appropriate parties for further action

Access Management

Ensure only authorized users are allowed access to services

Request Fulfillment

Manage the lifecycle of all service requests

Service Operation – considerations for Cloud Delivery Solutions


How will incidents and problems be managed across providers?

What events need to be generated and visible across and between providers?

How do we ensure only authorized users have access to services?

How will we prioritize and coordinate user service requests that may need provider involvement?

How will we coordinate operational control activities across providers?

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Monitoring for security compliance, privacy and access, reliability, and availability of IT services and components pose increased challenges

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Internal IT Cloud Vendor

Service Desk • Visibility of the components • Impact assessment• Provider failure awareness

• Define scope of Cloud Vendor support

• Provide access to visibility tools

Technical Management

• Increased focus on areas of technical responsibility

• Accountability and handoffs between the provider and IT

• Oversee the management of hardware and network assets

• Own infrastructure and operations staff

Application Management

• Accurate application portfolio • Managing application changes• Monitoring performance • Managing application suppliers

• Multiple application servers• Collections of virtual machines • Multiple nodes • Multiple locations

IT Operations Management

• Certain operational activities may need to remain within IT

• Holistic services thinking view• Adherence to service levels • No visibility at component level

• Execute and monitor operational activities

• Manage physical environment• No linkages back to business

services affected by Cloud services

Service Operations Cloud computing delivery traits from an Internal IT and Cloud Vendor perspective

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Sharing the high number of nodes in vendor clouds sees failed configuration components as the norm rather than the exception

Internal IT Cloud Vendor

Incident / Problem Management

• Must leverage new problem diagnosis and testing tools

• New contract details, such as scope and support are required

• Defines scope of Cloud Vendor support

• Provides access to visibility tools

Event Management • Creative monitoring solutions, such as use of synthetic transaction

• Escalates events that have meaning for IT management

Request Fulfillment

• Communications and understanding between organizations

• Consistent internal process

• Clearly defined roles and responsibilities

Access Management

• Access control schemes will have to accommodate global user bases by securing service access methods throughout the Cloud

• Visibility into security and access policies

• Audit these policies

Service Operations Cloud computing delivery traits from an Internal IT and Cloud Vendor perspective

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HP Business Service Automation (BSA) Software Solution Suite


Data Center Automation Center [fka Opsware]² Operations Orchestrations (OO) Runbook Automation¹,² Server Automation (SA) Network Automation (NA) Storage Essentials (SE/SRM)

Client Automation Center [fka Novadigm Radia]²


Services Automation Visualization (SAV) Services Automation Reporter (SAR) BSA Essentials (fka Live Network) Release Control (RC)

Client Automation Enterprise (CAE)

ITILv3 Service Operation¹ ITIlv3 Service Transition² Incident, Problem, Event Mgmt Processes Release/Deploy, Asset/Configuration Mgmt Processes

As you refine your and integrate cloud delivery with your overall service management capability, look to improve operations through automation

Service Management Center [fka Peregrine & Openview] Asset Manager 5.x³ Service Manager 7.1x

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Service Operation – case summary


Incidents occur from time to time but minimally impact ongoing operations

No occurrence of incidents related to how services are used and consumed

Clear ownership over operational control of services and who is responsible


Multiple incidents occurred that shut down operation of the site

IT blindsided by incidents related to business volumes

Unclear responsibilities and finger pointing when outages occurred

Service Operation Not In Place Service Operation In Place

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Process Purpose

7-Step Improvement Process

Measure services to proactively identify opportunities for improvement

Service Reporting Produce and communicate reports for achievements and trends against service levels

Service Measurement

Put appropriate metrics into place that provide information for proactive decision making

Continual Service Improvement - considerations for Cloud Solutions


What key measurements will be needed to ensure services are working across the Cloud?

What measurements should be taken by suppliers to ensure service objectives will be met?

What information and reports will we require from our providers?

How do we ensure that our providers implement key improvements on a timely basis in line with our business needs?

How will we work with our providers to proactively improve services?

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The melding of cloud centric approaches with CSI by IT can dramatically speed up realignment and improvement processes

• IT more dynamic and responsive to the needs of the business

• Cutting edge applications are rolled out and adopted by the end user at a much higher rate

• Additional users and teams will find applications that better meet their requirements

Traditional CSI outputs

• Introduce new service offerings

• Improve existing offerings

• Connects IT with customers

• Improvement space restricted by rigid systems

Cloud and CSI outputs

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The nature of cloud computing may lead to challenges for CSI such as misalignment between business needs and technical solution

Public, Private, and Hybrid Clouds

User Requirements

Outspoken change advocates

Limited product influence

Delegation of content

Existing AlignmentCloud Vendor

Business Needs

Provider Policies

Establishing KPIs and SLAs with Cloud Vendors helps communicate the expectation that change requests will be acted upon in an

acceptable manner and time frame

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Continual Service Improvement – Case Summary


Key measurements for availability and customer satisfaction are in place and monitored over time

Service offerings and number of clients using those services are continuing to expand

Senior management is receiving accolades for the successful solution

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No provision for CSI activities was in place and IT was reacting to events versus controlling them

Management made the determination that reasonable improvements could not be made and the site was shut down

Senior management was embarrassed by the failed solution

CSI Not In Place CSI In Place

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IT is devolving into a network of services that can be provided from anywhere – aided and abetted by advancements in Cloud computing technology

The service mindset that ITIL brings is key to operating in a Cloud world – the disciplines still exist but may have shifted emphasis from the IT Organization to the Cloud Vendor

Continuing to operate as bundles of technologies and capabilities might lead to serious operational risk

Key takeaways

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The ITIL Service Lifecycle and HP software supporting its processes can be leveraged as a design, build, deploy and operate vehicle for

constructing Cloud-based solutions!

Q&A

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Documents

Cloud computing: Is ITIL still relevant?