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 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. ...

The New Four Ps of Service Management

By Donna Knapp For years, people , process , and technology (PPT) was a widely recognized framework for balancing and integrating the components needed to achieve optimal performance and outcomes. In the ITIL v3 Service Design publication, this framework was expanded to the four Ps: people , processes , products , and partners . ITIL 4 has further expanded and evolved this framework to the four dimensions of service management. These four dimensions are collectively critical to the effective and efficient facilitation of value for customers and other stakeholders in the form of products and services. The four dimensions of service management are: Organizations and people Information and technology Partners and suppliers Value streams and processes. These four dimensions represent perspectives which are relevant to the whole service value system (SVS), including the entirety of the service value chain and all ITIL practices. Each ITIL practice is a set of organizational resources base...

Search