Why Is ITSM Important For Your Business?

Posted by on August 16, 2019

Importance of ITSM

IT service management (ITSM) is "the set of processes and activities that IT organizations implement to manage IT services throughout their life cycle"—but this practical definition tells us little about the high-level strategic importance of ITSM. In fact, the paradigm of ITSM contributes just as much to the business as the processes and activities of ITSM themselves:

  • ITSM organizes the activities of the IT organization around service delivery, ensuring that the business has access to the services that it needs to function effectively

  • ITSM aligns the goals and activities of the IT organization with those of the business

  • ITSM drives down IT expenses, helping organizations maximize their return on IT investments and extract the most out of annual budgets

  • ITSM institutes a systematized approach to IT that promotes transparency and accountability between IT and the business

Why Do More IT Organizations Adopt ITSM?

When we look at the broad strategic aims of ITSM, it is easy to see why businesses choose to adopt ITSM instead of the more technology-focused alternative methods of managing information technology, such as IT systems management or network/server management. 

ITSM offers a structured and process-oriented approach to IT management that focuses on delivering value to the business through the establishment and maintenance of IT services that support and enable the business functions that drive profit. The focus on services rather than technology is a clear reason why the ITSM model generates higher rates of customer satisfaction.

Organizations that adopt ITSM also benefit from 30 years of documented development of ITSM best practices through what is known as the ITIL® framework. Developed by the British government and first published in the late 1980s, ITIL offers a complete set of best practices that businesses can follow for implementing ITSM. The ITIL framework is updated and revised on an ongoing basis to reflect changes in technology and update methodologies for ITSM process management. ITIL is a strong source of guidance for organizations who wish to improve their IT service delivery with ITSM.

Why Is ITSM Important? 

Before the creation of the ITSM paradigm and ITIL best practices framework, there was a disconnect between the processes and activities of IT organizations and the needs of the private and public entities that relied on IT for support. 

Without close alignment between the business and IT organization, the same problems were all too common within IT organizations:

  • A reactive, break-fix model where organizations spent most of their time addressing incidents and performing manual operational tasks

  • IT expenses were poorly justified

  • IT organizations lacked transparency and focused on maintaining static systems or infrastructure with little or no emphasis on service delivery

ITSM addressed these issues through a process-oriented approach that helped IT organizations play a more proactive role, align their service objectives and spending with business priorities, and focus their resources on maintaining service level agreements that enable the business to function.

Breaking Down ITSM: 5 Critical Areas to Consider

When we break down the key components of ITSM, there are five critical areas to consider. IT organizations that are interested in adopting ITSM should be familiar with:

  1. The end users of ITSM and how the IT organization should interact with its customers

  2. The most important services offered by the IT organization and how they can be managed more effectively with ITSM

  3. The quality of ITSM, including how it helps IT organizations address common IT problems more efficiently and effectively

  4. The cost reduction aspect of ITSM

  5. The unique capacity of ITSM processes to enable business and drive digital transformation

Let's take a look at each of these five areas to understand more about the role that ITSM plays in today’s IT organizations. 

1. The End Users of ITSM 

The ITSM paradigm redefines the relationship between the business and the IT organization. In ITSM, the IT organization is conceptualized as a service delivery organization with the business as its customers or users. The purpose of the IT organization, therefore, is to ensure that end users have consistent access to the services that they need to perform key business functions. 

If you're an IT manager, operator, or analyst, you should try to put yourselves in the shoes of your customer and ask, "What can the IT organization do to better meet my needs?" Even better, you could adopt a formalized process for developing service strategy and actively collaborate with customers to define their service needs and develop capabilities that satisfy those requirements.

End users of IT services benefit significantly from the implementation of ITSM and the associated processes, including the following:

  • Streamlined communication with the IT organization and IT operators through a service desk that is established as a single point of contact (SPOC) between the business and IT organization

  • Consistent, standardized incident response service through a tracked ticketing system that ensures queries are addressed according to agreed service levels

  • Clearly defined processes for service acquisition and request fulfillment via a structured service catalog

  • Self-service options for basic service requests that enable users to resolve their own IT issues without involving technical support staff

  • Enhanced service availability and better adherence to service-level agreements, along with fewer unplanned business interruptions

In addition to these benefits, the ITSM framework mandates that IT organizations align their activities with the goals of the business. This alignment gives users more input and control over what services are offered by IT, and tells the IT organization what services it should deliver to best meet the strategic needs of the business. 

2. The Services of ITSM 

ITSM is all about managing services, but what exactly are the services that IT organizations provide? ITIL v3 offers a definition of these services that says, "A service is a means of delivering value to customers by facilitating outcomes customers want to achieve, but without the ownership of specific costs and risks."

There's a lot going on in that definition, so let's break it down. 

Delivering value means that a service has to result in benefits to the business that outweigh the costs. A service might deliver value by enabling the business to deliver a new capability or by streamlining certain important business functions. To deliver value, IT organizations need to understand something about the outcomes that customers want to achieve. That's why we have processes like ITIL Service Strategy that encourage IT organizations to actively evaluate user needs for services and act on them. 

The other components of ITSM service delivery are cost and risk. Business organizations want to outsource the risks and costs of IT service delivery onto the IT organization, such that they can take advantage of IT services without having to shoulder the costs. The IT organization also takes responsibility for risk management, implementing operational processes like data back-ups and ITSM processes like change management to protect business-critical services.

The key attributes of an IT service are:

  1. The customer derives value from the service

  2. Service offerings are aligned with desired customer outcomes

  3. The IT organization owns the costs and risk associated with delivering the service

As far as what services can be offered by the IT organization, the list is essentially endless. The IT organization may host and support business-critical applications and systems, provide data storage, processing and visualization that drives business decision-making, conduct data analysis, manage knowledge and APIs, and more. 

Read More: ITSM Tools: 6 Important Facts Every Business Needs to Know

3. The Quality of ITSM

The ITSM paradigm, and in particular the ITIL framework of ITSM best practices, does an excellent job of solving some of the most common IT problems that businesses face. Let's take a look at a couple of the most common problems and how they can be addressed through ITSM and ITIL best practices. 

Problem: IT assets and infrastructure are managed departmentally, with a lack of insight into what resources are available.

ITSM Solution: The ITIL process known as Service Asset and Configuration Management (SACM) aims to maintain a database of information about Configuration Items (CIs) that are required to deliver an IT service. The database, known as a CMDB, contains information about all IT assets that the IT organization controls and incorporates inventory and accounting functions to create an extra layer of transparency around IT resources.

Problem: Network security is poor and the organization is potentially vulnerable to data breaches or other cyber attacks.

ITSM Solution: The ITIL process known as Information Security Management requires IT organizations to design security controls, them regularly, routinely review the security plan, and actively manage security incidents to maintain the security posture of the organization. ITIL defines roles and responsibilities for an information security manager, applications analysts, technical analysts, and IT operators in maintaining the IT organization's security system.

Problem: There is no oversight of software license agreements, leaving the company exposed to legal action in the event of a software audit.

ITSM Solution: The SACM process we identified earlier is also used to maintain oversight of software asset deployment on the company network and to ensure that the organization complies with its software licensing agreements. Software tools such as Cherwell Asset Management can be implemented to automatically detect instances of software on the network, monitor software license inventory and usage, and reconcile procurement data with inventoried software assets.

Read More: IT Asset Management 101: How to Get Started & Best Practices

4. The Cost of ITSM

As IT organizations grow in size, they face ongoing pressure to identify ways to cut costs while maintaining the same service level agreements with the business. This challenge is almost insurmountable for IT organizations that have not adopted ITSM, simply because they lack the service focus and existing process framework to drive the systemic changes needed for genuine cost control.

Cutting costs in business isn't always easy without reducing service levels, but IT organizations with ITSM may find it simpler than expected t for three reasons: automated workflows, enhanced self-service, and improved asset management.

IT organizations can adopt software tools like Cherwell IT Service Management that automate workflows for key ITIL processes and reduce the manual workload of IT operators. The establishment of a service catalog with self-service capabilities enables customers to address their own IT issues and fulfill basic service requests, leading to greater customer satisfaction and reduced cost-of-resolution for IT incidents. Improvements to the asset management process yield several opportunities for cost reduction, including:

  • Reduced exposure to risk associated with failed software vendor audits through better maintenance of software usage and compliance with SLAs

  • More efficient deployment of IT assets and infrastructure, including better ROI and more intelligent procurement based on real-time inventory counts

  • The ability to identify opportunities for bulk purchases of IT assets when discounts are available

With the right processes in place, IT organizations can achieve the cost reductions they desire while maintaining and even improving on the service levels required by the business.

Read More: ITSM vs ITIL: What's the Difference, and How Do They Complement Each Other?

5. The Business Benefits of ITSM 

The IT organization should act as an enabler for the business, helping it achieve its operational and financial goals and ensuring that it can access the services that it needs to function.

The "magic" of ITSM's focus on services is that it aligns perfectly with what businesses really need from their IT organizations: a service-oriented partner who enables them to execute on key business capabilities that drive profit.

To that end, organizations are not required to adopt every element of ITSM right away. Businesses can focus on implementing and optimizing only the ITSM or ITIL best practices that suit their business needs, and either address the rest later or forego it altogether. There is no all-or-nothing approach to ITSM, and organizations are free to adapt any or all parts of the framework and methodology that are required to support their business objectives.

How to Implement ITSM Within Your IT Organization

When it comes to implementing ITSM for your organization, there's no need to be overwhelmed. You can start by implementing one or two ITSM processes that are most important for your business (many choose incident management and request fulfillment) and work on optimizing those according to the ITIL and ITSM best practices before taking on additional processes.

Every organization is different, so there are no set ITSM implementation steps to follow—it all depends on which processes you choose to adopt that will best meet your business needs. 

Choosing an ITSM software tool that you can depend on is a critical aspect of ITSM adoption. Cherwell's IT Service Management software solution is compliant out-of-the-box with 11 of ITIL's most important processes, making it the ideal choice for low- and medium-maturity IT organizations that wish to adopt and master a few key ITSM processes before fully transforming their IT organization through ITSM. The Cherwell Service Platform also supports additional service functions, such as HR Service Management and Facilities Management—making it easy for shared service centers to manage their activities through a single platform.

If you're ready to revolutionize your business with ITSM, attend our demo webinar and see how Cherwell's award-winning platform can support your ITSM implementation. 

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