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Transforming IT into an App Store
Service Catalog Part I: Why Should I care?
Who are we?
Jason Rosenfeld
2
© 2011 – Cask, LLC | Strategy. Solutions. Success.
Shaun Ericson» ITSM Practice Lead at Cask, LLC
» 15+ years ITSM and IT Operations
experience with HP, US Navy, US Marine
Corps, American Airlines, US Airways,
Merck and LPL Financial
» Certified ITIL® Expert, LSS Black Belt and
ISO/IEC 20000, ISO/IEC 27002
» Author, speaker for HDI & itSMF events
» Solutions Consultant at Axios Systems
» 11+ years of ITSM consultative experience
with Axios, Peregrine, Remedy, LANDesk,
and Altiris
» ITIL v2, v3 Certified, ISO/IEC 20000
» Speaker at IAITAM, PINK and ITIL Events
» From San Diego and love to surf!
Cask provides expert IT Service Management advisory services including an agile approach to service design and process
development as well as cost and performance measurement
utilizing ITIL®, CobiT®, CMMI for Services and ISO/IEC
20000. Learn more at www.caskllc.com
Axios Systems is a leading provider of Best Practice-based ITSM solutions. The company’s customer-centric approach
combined with award-winning enterprise solutions enables customers
worldwide to align Service and Support organizations with their
overall business goals. Learn more at www.axiossystems.com
Summer Workshop Series3
» #1: Why should I care?» Defining the importance of IT services
» Determining the cost of IT
» How to “upstream” IT
» #2: How do I build it?» Learn where to start, important steps for defining services, developing service-based relationships
» #3: Why do customers care?» Understanding the “ideal” customer experience, how to win your customers over and to
communicate the benefits
Agenda: Why Should I Care?
» Something you may recognize
» Traditional IT vs. Service Oriented Departments
» Showing the value of IT
» Upstreaming
» Lack of Innovation
» Business Case
» Q&A
4
This is a Service Catalog?5
It tells customers about services:
� What they cost
� When they are available
� How long they can be used
� How to get them
� Who to call if you need support
� What they are like
� The warranty should they fail
� Even some photos!!
Traditional IT6
CIO
Operations
Service DeskData Center Operations
Infrastructure
Server Management
Database Administration
Applications
Application Support
Application Development
Service Orientated IT7
Co
mp
an
y
IT
Telecom
HR
Facilities
Finance
Customers
Str
ate
gy
Ma
na
ge
me
nt
De
ma
nd
Ma
na
ge
me
nt
Se
rvic
e P
ort
foli
o M
an
ag
em
en
t
CIO
Se
rvic
e C
ata
log
Ma
na
ge
me
nt
En
terp
rise
Re
po
rtin
g
Ca
pa
city
/ A
vail
ab
ilit
y M
an
ag
em
en
t
Pro
ble
m M
an
ag
em
en
t
Inci
de
nt
Ma
na
ge
me
nt
Se
rvic
e L
eve
l M
an
ag
em
en
t
IT S
erv
ice
Co
nti
nu
ity
Kn
ow
led
ge
Ma
na
ge
me
nt
Su
pp
lie
r M
an
ag
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en
t
Re
lea
se &
De
plo
ym
en
t M
an
ag
em
en
t
Se
rvic
e A
sse
t &
Co
nfi
gu
rati
on
Mg
mt
En
gin
ee
rin
g
Ch
an
ge
Ma
na
ge
me
nt
Ap
pli
cati
on
s
Fin
an
cia
l M
an
ag
em
en
t
Info
rma
tio
n S
ecu
rity
Ma
na
na
ge
me
nt
De
live
ry (
Se
rvic
e D
esk
, N
etw
ork
, D
esk
top
)
Poll Question
Do you think your organization has a good
understanding of what your customers expect from its
services?
» Yes
» No
8
© 2011 – Cask, LLC | Strategy. Solutions. Success.
Why does my mother care?9
Can a company survive without IT?10
Sales Force
AD
SAP
PeopleSoft
Oracle
Lawson
Service Desk
Mobile Phones
VPN
Instant Message
HR
Facilities
Intranet
Difficulty in Showing Value of IT
» Define the business services used
» Create Service Design Packages» Map business services to IT
services
» Negotiate Service Level Agreements with customer base
» Use existing data to determine IT service costs
» Aggregate IT service costs by mapped business service
» Associate revenue of business service
» Understand the customer experience
11
Business Services
Service Name and Description
SLA
Service Cost
Customer Experience
What should your customers expect?
Poll Question
What do you believe will be the biggest challenge in
setting up a Service Catalog?
» Understanding customer requirements
» Gaining buy-in from the business
» Ability to demonstrate the ROI
» Defining and designing services
» Lack of appropriate technology/tool
13
© 2011 – Cask, LLC | Strategy. Solutions. Success.
Upstreaming14
NETWORK – DEVELOPMENT SUPPORT ($$$$)
DESKTOP SERVICES ($$$)
SERVICE DESK ($$)
SELF SERVICE ($)
Tier 3
Tier 2
Tier 1
Tier 0
» Shift higher % of
incidents and
requests upstream
» Lower service cost
» Reduce time to
deliver
» Service Catalog
promotes Self
Service
Lack of Innovation15
» Industry-wide 70% of IT service costs are support to keep the lights on; only 30% is spent on innovation and development
» Process improvement and automation enable a reduction in support and a shift of resources to address » Innovation
» Competitive advantage
» IT transformation example; Randy Mott –http://www.informationweek.com/news/global-cio/interviews/212200747
3 Steps for Building a Business Case
1. Understand the customers and business» Work with customers to understand their service expectations and priorities
» Define the business services with your customer(s)
» Use workshops for common understanding and develop vision
2. Define the IT service ‘value chain’ » Understand the current process for ordering services
» Review the efficiency and cost of key services
» Identify customer pain points and ways to improve
» Identify the benefits of implementing an automated Service Catalog
3. Realize the vision» Build an improvement plan with business objectives and costs
» Business case and ROI over 2/3 years should include hard savings, soft savings, tangible and intangible benefits
» Build a practical program to implement
» Get people on board
Business Case Example
1. Customer and Business Objectives addressed by a Service Catalog
a. Financial c. Strategic
b. Operational d. Industry
2. Current State and Vision
a. Operational efficiency baseline c. Service-based IT
b. Cost baseline
3. Business Impact Analysis
a. Hard cost savings and ROI c. Analysis of alternatives
b. Non-financial benefits
4. Risks and Mitigations
5. Recommendations
a. Improvement plan c. Practical program to implement
b. Identification of ownership d. Stakeholder support
Hard Cost Savings for ROI Report
Cost per request without workflow automation
Initial interaction time for customer:
No. of human interactions x average time per interaction x loaded
staff cost`
Cost of unproductive time:
No. of requests x unproductive time x average salary with fringe
Service Desk cost of handling requests
Service Desk cost:
No. of requests x Cost per Request Call
Things to look for:
• Requests for Information
• New Service Requests
• Status Requests
• MACs (Moves, Adds,
Changes)
Things to look for:
• Requests that can be
handled by Self Service
Catalog
Note: Make sure your units of measure are converted. We have used 2080 working hours in a year and 8 working hours in a day for our calculations. If applicable, when calculating costs use Net Present Value (NPV) to look at these savings over time.
Service Catalog Potential Savings
Things to look for:
• Back-and-forth between
customers and delivery
teams
• Status request calls
• Incorrect request routing
• Back and forth Lack of
information for
streamlined fulfillment
1000/month x $24/call =$24,000/month or
$288,000/year
500/month x 1 hour $85,000 / yearx
=$20,433/month or
$245,192/year
500/month x 15 min $85,000 / yearx
=$5,108/month or
$61,298/year
60% call reduction $14,400/month or
$172,800/year=
50% waste
reduction$10,216/month or
$122,596/year=
50% waste
reduction$2,554/month or
$30,649/year=
Potential Annual Savings = $326,045
Poll Question
What stage is your organization currently at with a
Service Catalog project?
» Not started
» Intend to start in next 6 months
» Intend to start in next 12 months
» Intend to start in next 24 months
» Do not plan to start
19
© 2011 – Cask, LLC | Strategy. Solutions. Success.
Non-financial Benefits
» Enables the “consumerization of IT”
» Improves the customer experience
» IT is able to its demonstrate value
» Improved cost-cutting decisions by understanding service costs
» Opportunity to resolve inter-departmental issues with better service based reporting
» Capability to re-use for non-IT processes
» Improved delivery time for requests
Analysis of Alternatives
» Do-nothing» IT unable to demonstrate
value
» Inability to determine cost of IT
» Confusion as to what services are available
» Customers look for alternatives ways of ordering services increasing redundancy and waste
» Service Catalog» Mechanism for IT to
market services 24x7
» Ability to view cost by business service and IT service
» Centralized location for all service ordering needs
» Improved process and reduction of redundancy and waste
» Upstream IT
Questions22
Thank You!
For a copy of the presentation or for more
Information please contact us:
Jason Rosenfeld
Shaun Ericson
