Can the adoption of an IT service management (ITSM) approach 'historically re-wire' an enterprise's IT systems in a time of economic turmoil? We talk to Deloitte Consulting Southeast Asia's newly-appointed financial service team director Axel Winter. How important is ITSM in the current economic downturn?
Deloitte believes that during an economic downturn, IT service management becomes even more important. There is no time for ongoing firefighting, for deep IT skills to focus on day and night issue resolution, or bug fixing, or doing redundant work in systems which are largely similar, but segregated.
The focus of IT operations now must be to remove root causes for IT failures indefinitely, to create system stability, remove process inefficiencies, simplify and make IT operations 'lean', to refocus resources to deliver additional value, for example in faster processing times of customer requests or the development of new company products.
IT service management and the ITIL framework (information technology infrastructure library, a best practice IT operations framework), give significant guidance on how to systematically improve IT operations, without actually requiring major additional investments.
What track record does ITSM have in making major enterprises more efficient and agile?
The key aim of ITSM is to align the current and future needs of the business, improving the quality of the IT services delivered and reducing the long-term cost of service provision.
While there may seem to be a risk of over-engineering the IT operations, the opposite is true.
Most larger IT departments follow just one of these approaches:
- The pure process focus: approvals, reviews, extensive documentation and a multitude of layers even for small changes, preventing any agility.
- The people-only focus: an approach that cannot be repeated, is dependent on the availability of team members, often lacks tools and technology, but is fast in execution.
- The technology-centric approach: this discards time-to-market and automates inefficient processes, but lacks focus on the proper use of people.
The key is to align all three components and to correctly implement the processes within the ITSM and ITIL framework, adding the proper tools, organisation, and technology.
This will result in effective teams servicing the business and IT needs, eventually creating a 'shared service' approach.
What are the top three reasons why enterprises should adopt an ITSM approach?
All best-in-class organisations, in collaboration with an experienced partner, generally see significant improvements in their IT operations.
This improvement leads to cost reductions, meaning significantly reduced down times and system issues (avoiding loss of business) and a reduction in operating expenses.
It means better servicing of the business departments' requirements and daily needs: leading to reduced cycle times for help desk and general operations.
The efficiency of capital investment increases significantly, leading to less capital expenditure in the medium term.
What case studies are available to support the adoption of ITSM?
A leading regional financial services organisation faced the following situation in IT operations:
- System stability challenges within the infrastructure and application space;
- Business applications with similar technologies hosted in different environments;
- Different teams between these environments, with different configurations, monitoring, backup and services standards;
- A service desk only forwarding tickets to experts, who are also focusing solely on issue resolution;
- Many manual interventions daily;
- Business and IT meetings focused on production issues.
The implementation of ITSM had two objectives: to implement a better process framework, with proper organisation and tools, and to optimise the infrastructure setup in the data centres.
The first steps to generate quick results, ensuring the overall initiative addressed the requirements of the business users, finance and management, included:
- The introduction of an ITSM relationship manager, as a single point of contact for all high- severity system issues for business users, partners and across IT. This manager was evaluated based on time reduced to address such production issues. Within four weeks, this time was reduced by 30 per cent.
- Service desk improvement: Providing better reporting, training and knowledge management tools for service desk staff, to improve the first call resolution rate. First call resolution improved by 20 per cent in the first six weeks. The service desk evolved to be a trusted and single point of contact, for all business users and partners.
- The next quick measurement was to invest in task automation, which involved tools and changes in the business application to ensure automation. (This was reduced by 20 per cent in the first three weeks and within a year, all tasks were automated).
These 'quick wins' enabled the subject matter experts and also IT service managers, to refocus their attention on driving systematic changes versus just quick fixes.
Key processes for incident and problem management, change management, configuration management, release management, availability management, and also service-level management have been implemented in the first wave. The initial focus was on incident, problem and change management to manage the external day-to-day relationships better. Toll gates with specific documentation requests, including templates, and workflow tools to digitise the processes, helped bridge the views of the different stakeholders and provided significant optimisations.
The technical team focused on implementing tools for IT monitoring and alerting for all systems and components in production. This included tools, who can report on the 'health' of applications and components and allowing IT operations to take preventive actions to avoid production issues in the first place.
The platform simplifications was another step, enabling centralised platforms to host business applications with standardised support, backup, monitoring, configurations and service levels. At the same time, the mix of open-source enterprise grade products versus commercial products have been improved. Both activities lead to significant operating expense reductions and improved the utilisation of existing assets, leading to a massive reduction of capital investments for the next budget.
These changes made the differences between business applications and also business units insignificant, leading to the company actually providing an Asian shared services approach out of Thailand.
What advice does Deloitte give to senior enterprise executives relating to adopting the ITSM approach?
Based on Deloitte's expertise, ITSM is a means to fundamentally change IT and to resolve the often inter-woven issues. Many IT change initiatives just address symptoms, but ITSM offers the -sometimes historic-opportunity to almost naturally 'rewire' how IT works, resolving many of the symptoms almost automatically.
It is crucial to engage in an ITSM exercise before other larger IT initiatives, such as core system replacements, outsourcing, and so on, to ensure the main issues have been resolved and proper IT operating procedures have been implemented, significantly reducing pain points in larger change programmes.
Deloitte recommends that enterprises should engage in a planning exercise, encompassing assessment, development of an end state target, identification of pain points for a gap analysis, and that they should develop a transformational road map, to drive the execution phase.
The upside to IT service management and optimisation of IT operations is that the initial capital expenses are very low. Engaging in a true ITSM exercise will seriously reduce operating and capital expenses.
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