Introduction to Operation Support and Analysis Tutorial

1.1 Introduction to Operation Support and Analysis

Hello and Welcome to Simplilearn’s online course on ITIL 2011 intermediate OSA module preparation. In this session we will get introduced to OSA. This is Learning Unit 1 of the syllabus prescribed by the Cabinet office. In the last two introductory Learning Units we learnt about the exam format, ITIL certification path, OSA certification, Basics of ITIL and Service Management. Now let us proceed to learn about OSA and its objectives.

1.2 ITIL - The Library Constituents

ITIL – Library Constituents Prior proceeding to the objectives of OSA, in our previous introductory Learning Unit we had discussed about the six publications of Service life cycle. Now let us learn about the common structure across all core guidance publications. A common structure across all the core guidance publications helps easily to find references between volumes and where to look for similar guidance topics within each stage of the lifecycle: a. Practice fundamentals - This section of each core publication sets out the business case argument of the need for viewing service management in a lifecycle context and an overview of the practices in that stage of the lifecycle that contributes to it. b. Practice principles -Practice principles are the policies and governance aspects of that lifecycle stage that anchor the tactical processes and activities to achieving their objectives. c. Lifecycle processes and activities -The Service Lifecycle stages rely on processes to execute each element of the practice in a consistent, measurable, repeatable way. Each core publication identifies the processes it makes use of, how they integrate with the other stages of the lifecycle, and the activities needed to carry them out. d. Supporting organization structures and roles - Each publication identifies the organizational roles and responsibilities that should be considered to manage the Service Lifecycle. These roles are provided as a guideline and can be combined to fit into a variety of organization structures. e. Technology considerations - ITIL service management practices gain momentum when the right type of technical automation is applied. Each lifecycle publication makes recommendations on the areas to focus technology automation on, and the basic requirements a service provider will want to consider when choosing service management tools. f. Practice implementation - For organizations new to ITIL, or those wishing to improve their practice maturity and service capability, each publication outlines the best ways to implement the ITIL Service Lifecycle stage. g. Challenges, risks and critical success factors -These are always present in any organization. Each publication highlights the common challenges, risks and success factors that most organizations experience and how to overcome them. lets now learn about its purpose, scope, process and functions.

1.3 Service Operation - Purpose and Objectives

Service Operation – Purpose What is the purpose of Service Operation? The purpose of Service Operation is to coordinate and carry out the activities and processes required to deliver and manage services at agreed levels to business users and customers. Service Operation is also responsible for the ongoing management of the technology that is used to deliver and support services. Well-designed and implemented processes will be of little value if the day-to-day operation of those processes is not properly conducted, controlled and managed. Neither will service improvements be possible if day-to-day activities to monitor performance metrics and the collation of data are not systematically conducted during Service Operation. Service Operations staff should have in place processes and support tools to allow them to have an overall view of the operations, which in turn helps in detection of any threats or failures to the service quality. let us look into the Service Operation scope in the next slide.

1.4 Service Operation - Scope

Service Operation – Scope What is the scope of Service Operation? When we talk about the scope of Service operation then we need to consider the services, service management processes, technology and the people who actually drive them. Service Operation includes the execution of all ongoing activities required to deliver and support services. The scope of Services in Service Operation includes any activity that forms part of a service operation, whether it is performed by the Service Provider, an external supplier or the user or customer of the service. If we are talking about the scope of Service Management Processes in Service Operation then we need to consider the ongoing management and execution of any Service Management processes that is used throughout the Service Operations Lifecycle. The scope of Technology in Service Operation lies within all services require some form of technology to deliver them, managing this technology is not a separate issue, but an integral part of the management of the service in itself. Lastly, regardless of the service, processes and technology are managed, they are all about people. It is people who drive the demand for the organisation’s services and products and it is people who decide how this will be done. And that’s why we need to consider people involved in the operation lifecycle within the scope of Service Operation. We have studied the objectives of OSA and scope of Service Operations, In the next slide let us learn about the processes of Service operation.

1.5 Service Operation - Processes

Service Operation – Processes What are the processes of Service Operation? In the Service Operation phase the processes are divided into five phases. They are Event Management, Incident Management, Problem Management, Access Management and Request Fulfillment. Here is the short description of each phase as we will be learning about them in detail in the coming sessions. • Event management monitors all events that occur throughout the IT infrastructure; it monitors normal operations, detects and escalates any exception results. • Incident Management concentrates on restoring degraded disrupted services to users as quickly as possible, in order to minimize business impact. • Problem Management uses root cause analysis to determine and resolve the cause of Incidents and proactive activities to detect and prevent future problems or incidents. • Request Fulfillment is the process for dealing with Service Requests (a generic term for varying types of user demands on IT departments). Many of these Service requests are actually small changes which are risk, frequently occurring and low cost. • Access Management is the process of granting authorized users the right to use a service, while restricting access to non-authorized users. Moving ahead let’s look into the functions of Service operation.

1.6 Service Operation - Functions

Service Operation – Functions What are the functions of Service Operation? Function is a logical concept of group, people, role, division or department who actually perform the activities defined in a process. There are in total four functions defined in the ITIL Lifecycle. They are Service Desk, Technical Management, IT Operation and Application Management. • Service Desk is the primary point of contact for users on a day-by-day basis, handling all Incidents, requests and queries associated to IT. • Technical Management provides the technical skills and resources needed to support the ongoing operation of the IT infrastructure. • IT Operations Management executes the daily operational activates needed to manage the IT infrastructure. It contains two functions namely IT Operation Control and Facilities Management. IT Operations Control supports the daily routine operational tasks and Facilities Management and manages the physical IT environment. • Application Management is responsible for managing, supporting and maintaining applications throughout their lifecycle. So far, we have learnt about the purpose, processes and functions of Service Operation. Now let us go back to ITIL and learn how ITIL Service lifecycle adds value to the business?

1.7 Value to the Business of OSA Activities

Selecting and adopting the best practices for the OSA processes will assist organizations in delivering significant benefits. Adopting and implementing standard and consistent approaches for service operation will: • Reduce unplanned labour and costs for both the business and IT through optimized handling of service outages and identification of their root causes. • Reduce the duration and frequency of service outages which will allow the business to take full advantage of the value created by the services they are receiving. • Provide operational results and data that can be used by other ITIL processes to improve services continually and provide justification for investing in on-going service improvement activities and supporting technologies. • Meet the goals and objectives of the organization’s security policy by ensuring that IT services will be accessed only by those authorized to use them. • Provide quick and effective access to standard services which business staff can use to improve their productivity or the quality of business services and products. • Provide a basis for automated operations, thus increasing efficiencies and allowing expensive human resources to be used for more innovative work, such as designing new or improved functionality or defining new ways in which the business can exploit technology for increased competitive advantage.

1.8 Optimization of Service Operational Performance

Optimization of Service Operational Performance Service Operation is optimized in two ways: — Long-term incremental improvement. This is based on evaluating the performance and output of all Service Operation processes, functions and outputs over time. The reports are analysed and a decision made about whether improvement is needed and, if so, how best to implement it through Service Design and Transition. Examples include the deployment of a new set of tools, changes to process designs, reconfiguration of the infrastructure, etc. — Short-term ongoing improvement of working practices within the Service Operation processes, functions and technology itself. These are generally smaller improvements that are implemented without any change to the fundamental nature of a process or technology. Examples include tuning, workload balancing, personnel redeployment and training, etc. In the next slide we will look at the definition of IT Service Management.

1.9 IT Service Management

IT Service Management we have already learnt about the definition of Service Management. Now, let us see what is IT Service Management? As we know, Service Management is defined as “a set of specialized organizational capabilities for providing value to customers in the form of services.” The capabilities take the form of functions and processes for managing services over a lifecycle, with specializations in strategy, design, transition, operation, and continual improvement. The capabilities represent a service organisation’s capacity, competency, and confidence for action. The act of transforming resources into valuable services is at the core of Service Management. Without these capabilities, a service organisation is merely a bundle of resources that by itself has relatively low intrinsic value for customers. The origins of Service Management are in traditional service businesses such as airlines, banks, hotels, and phone companies. Its practice has grown with the adoption by IT organizations of a service-oriented approach to managing IT applications, infrastructure, and processes. Solutions to business problems and support for business models, strategies, and operations are increasingly in the form of services. The popularity of shared services and outsourcing has contributed to the increase in the number of organizations who are service providers, including internal organizational units. This, in turn, has strengthened the practice of Service Management and at the same time imposed greater challenges upon it. Thus IT Service Management is more related to the services provided by the IT industry. I am sure there is a clear distinction made between service and service management. As we are aware that service is a process that adds value to the business, let us see how service and value work together?

1.10 Concept of Service and Value - Definition of a Service

Concept of Service and Value – Definition of Service How does Service and Value work hand in hand? Let us look into the details: Service is a means of delivering value to customers by facilitating outcomes customers want to achieve without the ownership of specific costs and risks. Outcomes are possible from the performance of tasks and are limited by the presence of certain constraints. Broadly speaking, services facilitate outcomes by enhancing the performance and by reducing the grip of constraints. The result is an increase in the possibility of desired outcomes. Some examples of services include the Service Desk, e-mail, break/fix, video conferencing etc. Each of these services should create value for stakeholders and customers through proper utility and warranty. From the customer’s perspective, value consists of two primary elements: utility or fitness for purpose and warranty or fitness for use. Utility is perceived by the customer from the attributes of the service that have a positive effect on the performance of tasks associated with desired outcomes. Removal or relaxation of constraints on performance is also perceived as a positive effect. Warranty is derived from the positive effect being available when needed, in sufficient capacity or magnitude, and dependably in terms of continuity and security. Utility is what the customer gets, and warranty is how it is delivered. Customers cannot benefit from something that is fit for purpose but not fit for use, and vice versa. It is useful to separate the logic of utility from the logic of warranty for the purpose of design, development and improvement. Considering all the separate controllable inputs allows for a wider range of solutions to the problem of creating, maintaining and increasing value. The diagram on the slide depicts the utility and warranty working in parallel to create value outcome. Let us now learn about the value of service in financial terms in the next slide.

1.11 Economic Value of a Service

Economic Value of a Service All processes /service are considered as value to the business only when it can show returns in the form of financial revenue. But it is always not possible to calculate in terms of revenue. Let us look at what is the economic value of a service? Calculating the economic value of a service can sometimes be straightforward in financial terms. In other instances, however, it is harder to quantify the value although it may still be possible to quality it. Value is defined not only strictly in terms of the customer’s business outcomes: it is also highly dependent on the customer’s perceptions. The value of a service takes on many forms, and customers have preferences influenced by their perceptions. Definition and differentiation of value is in the customer’s mind. The more intangible the value, the more important the definitions and differentiation become. Customers are reluctant to buy when there is ambiguity in the cause-and-effect relationship between the utilization of a service and the realization of benefits. It is incumbent on providers to demonstrate value, influence perceptions, and respond to preferences. Perceptions of value are influenced by expectations. Customers have reference values on which they base their perceptions of added value from a service. The reference value may be vaguely defined or based on hard facts. An example of reference value is the baseline that customers maintain on the cost of in-house functions or services. What matters is that it is important for the service provider to understand and get a sense of what this reference value is. This may be obtained through extensive dialogue with the customer, prior experience with the same or a similar customer, or through research and analysis available in the market. The economic value of the service is the sum of this reference value and the net difference in value the customer associates with the offered service (see image above). Positive difference comes from the utility and warranty of the service . Negative difference comes from losses suffered by the customer from utilizing the service due to poor quality or hidden costs. As stated earlier, value is defined strictly in the context of business outcomes. Focus on business outcomes over everything else is a critical advance in outlook for many service providers. It represents a shift of emphasis from efficient utilization of resources to the effective realization of outcomes. Customers do not buy services; they buy the fulfillment of particular needs. This distinction explains the frequent disconnection between IT organizations and the businesses they serve. What the customer values is frequently different from what the IT organization believes it provides. We have looked at service and value, economic value of service and we introduced the terms utility and warranty. Further to this we will learn about their combined effect in the next slide.

1.12 Combined Effects of Utility and Warranty

Combined Effect of Utility and Warranty Let us look at the combined effect of utility and warranty. Value creation is the combined effect of utility and warranty. Value for customers can be increased by either of the two factors. Both are necessary: neither is sufficient by itself. Each should be considered as a separate factor of value creation. The ability to deliver a certain level of warranty to customers by itself is a basis of competitive advantage for service providers. This is particularly true where services are commoditized or standardized. In such cases, it is hard to differentiate value largely in terms of utility for customers. When customers have a choice between service providers whose services provide more or less the same utility but different levels of warranty, then they prefer the greater certainty in the support of business outcomes. The guidance provided in the Service Design, Service Transition, and Service Operation processes is useful in this strategic context. Service Design processes provide new and improved designs delivering better utility or better warranty. Service Transition processes ensure design improvements are directed into Service Operation while minimizing costs and risks. Service Operation processes inject the new value propositions into the customer’s business by delivering higher levels of utility and warranty. The processes of Continual Service Improvement coordinate the flow of knowledge between the processes and provide feedback throughout the lifecycle. To understand better, study the picture on the slide depicting the combined effect of utility and warranty. It is very essential to always keep a check on the functions of services/processes for its smooth functioning. Therefore in the next slide we will look at the monitor and measure phase in service operations.

1.13 Value to the Business - Monitor and Measure

Value to the Business-Monitor and Measure Service Operation is the phase of the Service Delivery lifecycle where the actual delivery of service happens. The four basic reasons to monitor and measure lead to three key questions: “Why are we monitoring and measuring?” “When do we stop?” and “Is anyone using the data?” To answer these questions, it is important to identify which of the above reasons is driving the measurement effort. Too often, we continue to measure long after the need has passed. Every time you produce a report you should ask: “do we still need this?” It will be important to sift through large amounts of raw data before synthesizing the right information. This information must then be analyzed and studied, but against what? This is where the different layers of management come in: strategic, tactical and operational, each with their own goals, objectives, critical success factors (CSFs)(pronounced as C-S-Fs) and KPIs(pronounced as K-P-Is) – all of which must be aligned and supportive of each other but , more importantly, aligned with the goals and objectives of the business. The ability to derive any meaningful information from the data collected depends not only on the maturity of the processes but also on the level of maturity of the services provided by IT. That’s why it provides by itself the value to the business by validating previous decisions. It helps to set direction for activities in order to meet set targets which are the most prevalent reason for monitoring and measuring. Service Operation as a phase helps to justify, with factual evidence or proof, that a course of action is required In this slide we have learnt the importance of monitor and measure. In the next slide we will learn about process.

1.14 Process

What is a Process? We have been hearing this word all through the session, I am sure we do have an idea about the word, “Process”. However let us learn about it in detail. A process can be defined as a structured set of activities designed to accomplish a specific objective. A process takes one or more inputs and turns them into defined output. A process includes all of the roles, responsibilities, tools and management controls required to reliably deliver the outputs. A process may also define or revise policies, standards, guidelines, activities, processes, procedures and work instructions if they are needed. The diagram above shows the generic process diagram, with process inputs on the left, the process itself in the center and the process outputs on the right. Every process requires process enablers and is regulated by a control mechanism. So, what are these enablers and what is process control? Process enablers are assets of the process; they include Process Resources and Process Capabilities. Process control can be defined as: The activity of planning and regulating a process, with the objective of performing a process in an efficient and consistent manner. Processes, once defined, should be documented and controlled; once under control, they can be repeated and become manageable. Degrees of control over processes can define, and then process measurement and metrics can be built- in to the process to control and improve the process as illustrated. Process control includes Process Policy, Process Owner, Process Documentation, Process Objective and Process Feedback The generic process elements show that data enters the process, is processed, is output and the outcome is measured and reviewed. A process is always organized around a set of objectives. The main outputs from the process should be drive by the objectives and should always include process measurements (metrics), reports and process improvement. Each process should be owned by a process owner who is responsible for the process, its improvement, and for ensuring that the process meets its objectives. The objectives of any IT process should be defined in measurable terms and should be expressed in terms of business benefits and underpinning business strategy and goals. The output produced by a process has to conform to operational norms that are derived from business objectives. If products conform to the set norm, the process can be considered effective (because it can be repeated, measured and managed). If the activities are carried out with a minimum use of resources, the process can also be considered efficient. Process analysis, results and metrics should be incorporated in regular management reports and process improvements. Now, let’s look into the IT Service Management – Process definition.

1.15 Organizing IT Service Management - Process Definition

IT Service Management-Process Definition What is the definition of process as per the IT Service Management? A process is a set of coordinated activities combining and implementing resources and capabilities in order to produce an outcome, which, directly or indirectly, creates value for an external customer or stakeholder. Processes that provide transformation towards a goal, and utilize feedback for self-reinforcing and self-corrective action function as closed-loop systems. It is important to consider the entire process or how one process fits into another. We know that process always results an outcome, but is that outcome a value add to the business? To answer this, we need to understand the characteristics of a Process.

1.16 Characteristics of a Process

Characteristics of a Process What are its characteristics? Every Process should have characteristics. Let’s look at them: • Every process should be measurable. This characteristic actually helps us to understand the quality of the process. •Every process should deliver specific results. The reason a process exists is to deliver a specific result. The result must be individually identifiable and countable. While we can count changes, it is impossible to count how many service desks were completed. •Every process delivers its primary results to a customer or stakeholder. They may be internal or external to the organization but the process must meet their expectations. •Lastly every process should respond to a specific event. While a process may be ongoing or iterative, it should be traceable to a specific trigger. So far, we have learnt about services, its value, utility, warranty, the combined effect of them, process and its characteristics. Let proceed to understand the IT Service Management organisation structure.

1.17 Organizing IT Service Management - Organization Structure

IT Service Management-Organisation Structure Is the Organisation structure of IT service management different from a company’s organisation structure? In an organisation’s structure, it is important to align all contributors to the use of common terms with the same meaning. ITIL, therefore, defines concepts of Function, Roles, Groups, Team, Department and Division when it comes to an organisation’s structure. First that comes in this picture is Function. A function is a logical concept that refers to the people and automated measures that execute a defined process, an activity or a combination of processes or activities. In larger organizations a function may be broken out and performed by several departments, teams and groups, or it may be embodied within a single organisational unit (e.g,(pronounced as example) Service Desk). Next is Role. A role refers to a set of connected behaviors or actions that are performed by a person, team or group in a specific context. For example, a technical management department can perform the role of Problem Management when diagnosing the root cause of Incidents. This same department could also be expected to play several other roles at different times, e.g, (pronounced as example) they may assess the impact of changes (Change Management role), manage the performance of devices under their control (Capacity Management role), etc. The scope of their role and what triggers them to play that role are defined by the relevant process. A group is a number of people who are similar in some way. In this book, groups refer to people who perform similar activities, even though they may work on different technology or report into different organizational structures or even in different companies. Group are usually not formal organizational structures, but are very useful in defining common processes across the organization –e.g; ensuring that all people who resolve incidents complete the Incident Record (“close the ticket’) in the same way. A team is a more formal type of group. These are people who work together to achieve a common objective, but not necessarily in the same organizational structure. Teams are useful for collaboration, or for dealing with a situation of a temporary or transitional nature. Examples of teams include project teams, application development teams (often consisting of people from several different business units), and Incident or Problem resolution teams. Departments are formal organizational structures which exist to perform a specific set of defined activities on as ongoing basis. Departments have a hierarchical reporting structure with managers who are usually responsible for the execution of the activities, and also for day-to-day management of the staff in the department. A division refers to a number of departments that have been grouped together, often by geography or product line. A division is normally self-contained and is able to plan and execute all activities in a supply chain. From the explanation given it is clear that the IT service management organization structure is pertaining to the IT department and is similar to any company organisation structure. We have come to the end of this module, let us quickly summarize.

1.18 Summary

Summary Before you proceed to take up the quiz, let us quickly recap on the module content that we have covered in Module 1. To summarize, we have learnt about the basic introduction to OSA, Service management, service lifecycle as value to business, functions, processes and value creation through service management. Meet you in Module 2, Thankyou!

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