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Next Practices in Business Service Management

 

 

Where can I turn to in a Recession?
by Ken Turbitt

ITIL

This time last year, all appeared to be well with the world, businesses were trading as normal, unemployment was low, profits were high, lending was good, and interest rates were steady, inflation rising a little. The outlook was confident. Then came September and October and the financial Armageddon began. The Financial bubble (just like the IT one before it) burst on a massive scale and at breakneck speed around the globe.

“The rising defaults on subprime mortgages in the US triggered a global crisis for the money markets. Many of the world’s leading investment banks have collapsed as a result and the US government has proposed a massive bail-out.

The crisis has become one of the most radical reshapings of the global banking sector, as governments and the private sector battle to shore up the financial system following the disappearance of Lehman and Merrill as independent entities and the $85bn government rescue of AIG.” Source FT.com

It’s unbelievable if you simply list the headlines: US downturn, Lehman Brothers, Bradford and Bingley, Icelandic Banks and economy, Russia’s financial fallout, Regulating short selling, Freddie Mac and Fannie Mae, Central Banks cut interest rates to the lowest in Banking history, UK house prices tumble, UBS, Bear Stearns, Northern Rock, Woolworths, MFI, US and UK borrow Billions and billions, the list goes on and is frightening.

So how can you keep a steady hand on the tiller? How to you focus on cashflow, keeping afloat when borrowing is limited or impossible (unless you get the Government to bail you out, like RBS and GM) and still serve your clients in a quality, professional and cost effective manner? Your business systems and processes have always been your mechanism of performing business, be they creating and delivering a service or a product. This is your Intellectual Property (IP) your means of trading, so focus on it, understand it, protect it, streamline it, improve it and above all use it.

Until very recently effective technology or services are those that grow the business, increase profitability and add competitive edge. These are still valid and you need to ensure your IT is effective in these areas. However in the climate of the here and now, we need to be effective, to manage our capability, to remove excess costs out of the business, reduce expenditure on IT and the business, and provide clearer visibility into the business performance and outlook. Fortunately there is a guidance to help you, something that has been around for over 20 years and been proven in the early ‘90s downturn. Yes, it’s ITIL. ITIL is there to help you address all of the above. The central core, the driver of this is Business Service Management (BSM). BSM seeks to define IT resources in terms that not only make functional sense to the business, but which relate directly to business metrics and concepts. BSM needs to become the core of your business to enable that clear visibility into business performance and add competitive edge. Now more than at any time in the last 20years is the critical period to review your processes in line with ITIL to improve and automate, understand where you can remove costs without impacting your customers, and keep your business running. To succeed and survive you need to be flexible and respond quickly to the changing requirements and demands being made, and do this whilst protecting and enhancing the business, your products and services and your business processes. Get this right and you’ll be able to respond to your client’s needs and demands and survive. This is why you need to turn to ITIL now. It’s not a luxury; it’s a necessity for survival. ITSM is already helping IT organizations serve their business divisions in an unprecedented fashion, enabling BSM to become mainstream.

In a survey carried out by Information Age (Jan 2009) covering 355 CIO’s detailing the most adopted strategies for effective IT in 2009, ITIL and its disciplines are found to be highly successful approaches. The proportion of respondents that had adopted Asset Management and Helpdesk automation tools – both techniques for improving the customer service that IT departments can deliver to the business - increased 2008 to 2009.

• Asset Management and Helpdesk automation tools (63.9% have adopted, 74% say is effective)
• deploying automated systems management tools (54.1% have adoped,71.8 say is effective),
• ITIL itself (45.1% have adopted, and 64% say is effective or very effective),
• appointing an IT/business alignment manager (39.2% adopted).

Whilst the least effective were:
• Outsourcing the IT department
• offshoring development/business process outsourcing
• Reducing IT staffing costs.

This proves that we need to focus where the most effective business benefit areas, not the traditional cost reduction areas, we need to look at long term savings

The “Credit Crunch” will also prompt many more regulatory requirements than ever before, not just for the finance sector, but across the board to try and prevent any other industry or business sector crisis. We recall the knee jerk reaction to the fall of Enron and Worldcom with the creation in the US of the Sarbanes Oxley legislation (SOX, E-SOX, J-SOX), but we also had Basel II and the SEC’s regulation AB in place before the current Financial crisis hit. Therefore these regulatory requirements forcing the reporting and disclosure of risk and asset-based securities data failed. The effect now will be even tighter controls to be put in place, and automation of these will be critical. Therefore, yet again, another 2009 reason to improve the effectiveness and efficiency of the IT automation of key business processes through BSM and start implementing other controls like COBIT, in preparedness for the new enforced regulatory requirements that will start to hit your industry within the next 12-18months.

Fortunately now, more than at any other time in IT’s history, it’s easier than ever to become ITIL aligned and in a phased, non-disruptive, automotive way. Many vendors have invested heavily in automating ITIL within their business supporting products, and often taken as a whole enables BSM to become a reality. Even the contributors, owners and custodians of ITIL have made it easier for both your IT staff and that of the vendors and consultancies you engage to gain access online to both the ITIL core and the complimentary elements.

Two new OGC approved areas that are cost effective and will speed your ITIL alignment and deployments are detailed below.

ITIL Live is a service launched in late 2008. ITIL Live gives you ready made templates to lift and use when reviewing or implementing or enhancing your IT services to the business. Things like Service Level Agreements, ensuring you’re not exposed by suppliers when committing to delivering a service to your customers. You get this wrong and your customers instantly feel the pain and leave for a competitor who has it right. Accessing ITIL Live will save on consultancy fees, by providing many of the templates, documents and guidance submitted by consultants for your use. Ultimately it will allow you to connect with experts in the field to ask questions and seek advice and assistance on-line. It’s simply another facility to enable you to reduce those costs, improve the business and understand business performance facilitating the addition of competitive edge.

We’ve been able to qualify our IT people in ITIL and we’ve also able to obtain an ISO standard for the delivery of our IT services, but the elements that bring people and service together, the tools, could not be ITIL accredited, until now. To ensure you invest in the vendor tools most in compliance with the ITIL guidelines a new service has been brought to market by Service Management Consultancy (SMCG) with the approval of the OGC, the copyright owners of ITIL. This is the first time that products can be assessed and if compliant with ITIL receive a grading and award, together with the use of an “ITIL Compliant Process” trademark. Seeking a vendor that has invested in automating ITIL and obtained official recognition will provide confidence to the buying market that the tool does automate ITIL, and that the documentation and processes are in alignment. All of which saves time and money when carrying out your procurement due diligence and implementations.

At a time when companies in many industries offer similar products and use similar technology, distinctive business processes count among the last remaining points of differentiation. Many previous bases for competition – such as geographical advantage or protective regulation – have been eroded by globalisation. Proprietary technologies are rapidly copied, and breakthrough innovations in products or services are increasingly difficult to achieve. That leaves three things as a basis for competition: efficient and effective execution, smart decision making, and the ability to wring every last drop of value from business processes – all of which can be gained through sophisticated use of Best Practices, automation and analytics. ITIL provides the guidance necessary to succeed.

 

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