Service Strategy
Service Portfolio Management
Purpose
Service Portfolio Management (SPM) prioritizes
investments and improves the allocation of resources.
The purpose of service portfolio management
is to ensure that the service provider has the right mix of services to balance the investment
in IT with the ability to
meet
business outcomes.
The Service Portfolio represents the commitments and investments made by
a
Service Provider across all customers and marketplaces.
The Service Portfolio aims to answer the following questions:
• Why should a customer buy these services?
• Why should they buy these services from our IT organization?
• What is the pricing and chargeback model?
• How should the IT organization’s resources and capabilities be allocated?
Objectives
The objectives of service portfolio management are to:
• To investigate and decide on which services to provide, based on an analysis of the potential
return and acceptable level of risk.
• To maintain
the definitive portfolio
of services provided.
• To evaluate how services achieve their strategy, and to respond to changes.
• To control
which services are offered,
under what conditions and at what level of investment.
• To track the investment in services throughout their lifecycle.
• To analyze which services are no longer viable and when they should be retired.
Scope
The scope of service portfolio management is all services a
service provider plans to deliver, those currently
delivered and those that have been withdrawn
from service.
The primary concern of service portfolio management is whether the service provider is able to generate value from the services.
Service portfolio
management evaluates the value of services throughout their lifecycles, and must be able to
compare what newer services have offered over the retired services they have replaced.
External service
providers
tend to evaluate
value
more
directly,
as
each service
needs to
be able to generate revenue directly, or support revenue-generating
services.
Internal service providers will need to work with the business
units in the organization to link each service
to the business outcomes before they can compare investment
with returns.
Service Portfolio
The Service Portfolio Management approach helps
prioritize investments and improve the allocation of resources.
Service Portfolio is divided into 3 sections:
• Service pipeline is a part of Service Portfolio that consists of the services under development or under consideration for development.
• Service catalog is a part of Service
Portfolio that consists of services active in the Service Operation
phase
and
is
visible
to
the
customers. It mainly represents the present capabilities of the IT organization.
• Retired services are a part of Service
Portfolio that consist of services that are no longer in use.
The portfolio should
have a proper
mix of services
in the pipeline
and catalog
to secure the financial viability of the Service Provider.
Outcomes in the present can be supported
by services in the Service Catalog or may be supported by services in the Service Pipeline in the future.
Process
The activities in the Service Portfolio Management process
are:
• Define is a phase that deals with collecting information from all existing service
as well as proposed services. Service Strategy
applies in this activity because it underlines the framework, as a whole.
• Analyze is a phase
that
revises
the information collected during
the
Define phase, to maximize the portfolio value, align, prioritize and balance supply and demand.
• Approve is a phase that authorizes or rejects proposals/plans of future state or development path of services
proposed.
For
existing services,
the following steps apply:
o Retain – Services that are largely
self-contained, with well-defined asset, process, and system boundaries.
o Replace – Services that have unclear and overlapping business functionality.
o Rationalize
– Services that
are composed of multiple releases of the same operating system, multiple versions of the same software and or multiple versions of system platforms providing similar
functions.
o Refactor – Services that meet the technical and functional criteria of the organization but have fuzzy processes or system boundaries.
o Renew – Services that meet functional fitness
criteria but fail technical fitness.
o Retire – Services
that
do not meet minimum
levels
of technical
and functional fitness.
• Charter is a phase that begins with a list of decisions and actions. This list is then correlated to the financial plan and
budget. The outcome
of
the mentioned process will build into financial forecasts and resource plans.
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