Calculating ROI on IT Service Management

One of the questions I am often asked is, "How do we calculate the Return on Investment (ROI) of our ITIL Implementation".

This week, a new case study was introduced covering:

ROI Calculator
Case Study Synopsis

Traditionally, ROI and TCO are touted by software companies as a means to sell software. Many of us have become hardened to these calculations, as experience has show they were grossly over-inflated. To help combat this, in 2006, ITSM Academy shared a realistic, un-biased ROI calculator which enables users to estimate potential costs savings of:

Incident Management
Availability Management
Unplanned Work

Existing calculations can be easily tailored to produce similar process area calculations.

Case Study Synopsis

The case study also includes a collection of 25 published ROI statements and stories, broken out by industry type. The following is one of the quotes:

"An ITIL program at Capital One resulted in a 30% reduction in system crashes and software-distribution errors, and in a 92% reduction in critical Incidents within 2 years. After the ROI analysis, the implementation of ITIL was estimated to save 10 percent to 20 percent in technology support costs over a five-year period."
~ Computerworld, CIO.com

Download Whitepaper and Case Study - for the whitepaper, choose Check/Money Order - it's complimentary through itsmbookstore.com.

Comments

Four Service Characteristics

Recently I came across several articles by researchers and experts that laid out definitions and characteristics of services. ITIL provides us with a definition that can help drive the creation of value-laden services: A means of delivering value to customers by facilitating outcomes customers want to achieve without the ownership of specific costs and risks. An area that ITIL is not so clear is in terms of service characteristics. Several researchers and experts put forth that services have four basic characteristics (IHIP): Intangibility—Services are the results of actions not things. They have no physical presence and represent a logical set of elements. One way to think of service is “work done for others.” Heterogeneity—Also known as “variability”; services are unique items because of the mechanisms used to deliver services, which is people. Because the people element adds variability, the service is variable. This holds true, especially for the value proposition—not eve...

What is the difference between Process Owner, Process Manager and Process Practitioner?

This article was originally published in 2015. With the Introduction of ITIL 4, some of the concepts have changed in ways that are described below. ITIL 4 has also introduced new roles, as explained in our blog ITIL 4 and the Evolving Role of Roles . Before we dive into the difference between these roles, let’s first look at a key update in ITIL 4 – the shift from processes to practices. ITIL 4 has evolved to focus on holistic practices vs. isolated processes. By definition, a practice is a set of organizational resources designed for performing work or accomplishing an objective. For example, the purpose of the incident management practice is to minimize the negative impact of incidents by restoring normal service operation as quickly as possible. All organizations recognize the need to allocate resources to the management of incidents and mature their capabilities in that area. In ITIL 4, each practice includes resources based on the four ...

What Is A Service Offering?

The ITIL 4 Best Practice Guidance defines a “Service Offering” as a description of one or more services designed to address the needs of a target customer or group. As a service provider, we can’t stop there! We must know what the contracts of our service offering are and be able to put them into context as required by the customer. Let’s explore the three elements that comprise a Service Offering. A “Service Offering” may include: Goods, Access to Resources, and Service Actions 1. Goods – When we think of “Goods” within a service offering these are the items where ownership is transferred to the consumer and the consumer takes responsibility for the future use of these goods. Example of goods that are being provided in the offering – If this is a hotel service then toiletries or chocolates are yours to take with you. You the consumer own these and they are yours to take with you. ...

Search