ITIL Version 3 is All Business

By Drew Robb

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Shrek III was better. So were Rocky III and Mission Impossible III. But while ITIL III is no blockbuster, it is getting decent ratings from the IT community overall. In particular, it is earning kudos for attempting to bridge the chasm between IT and the various business units within organizations.

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IT Infrastructure Library (ITIL) made its debut in 1989 and since then has become the de facto standard for IT service management best-practices. Since the release of v2 at the start of the millennium, there have been new business regulations and mandates, technology advancements, and general shifts in how IT is valued.

In light of this, the UK’s Office of Government and Commerce (OGC) has been working with industry leaders to update ITIL for the third time in two decades even as many organizations are in varying stages of ITIL adoption. With the release of ITIL v3 come many questions from IT managers and CIOs. Most common among them: “What’s the difference between v2 and v3?” and “Should I wait to start my ITIL project?” and, “What does this have to do with the data center?”

“For those worried about a brand new ITIL, instead of thinking of it as a big bang, think more of it being another step on a evolutionary pathway designed to help you better deliver what you are already trying to do,” said Martin Atherton, principal analyst at consulting firm Freeform Dynamics in the UK. “Practitioners will be pleased to know that all their ITIL efforts thus far will not be any less relevant or become redundant with the new version of ITIL.”

ITIL Adoption Climbs

The commercial world is embracing ITIL in a big way. According to Forrester Research, over 40% of billion dollar corporations have already adopted ITIL. That figure will rise to 80% by the end of 2008.

Why are adoption rates so high? As well as greater efficiency Gartner states that an organization can achieve up to a 48% reduction in total cost of ownership (TCO) by fully implementing ITIL. It’s no wonder that the first ever international standard (ISO 20000) covering how organizations are to manage IT services is built around ITIL.

Most organizations currently involved in ITIL are working on ITIL v2, which introduces more formal processes. The goal was to promote better business-IT working relationships, eliminate redundant processes, improve levels of services and reduce operating costs.

“ITIL v2 was clearly a big success and the number of organizations implementing it is testament to that fact,” said Ron Potter, manager of best practices at TeamQuest Corp. “The most common benefits reported by users are better service improvement and reduced costs.”

But ITIL v2 was far from the finished article. Thus several years of review and consultation have gone into further ITIL refinements. In 2007, the third version of ITIL was released.

v2 vs. v3

So what’s new? The core of ITIL will stay much the same. Atherton reports the introduction of the Service Management Knowledge System will addresses the incorporation of certain knowledge management principles into ITIL. The labels, though, have changed slightly. ITIL v3’s core practices are now: Service Strategy; Service Design; Service Transition; Service Operation; and Continuous Service Improvement.

“Probably the best way to describe the difference is to look upon ITIL v2 as being process-oriented whereas v3 is much more service-oriented,” said Potter. “In other words, v2 is more about linear process flow from business to infrastructure where v3 is a hub-and-spoke structure that adds flexibility and addresses the unique challenges of the Web.”

The new version is also more customizable so may be able to better meet the individual organization’s needs. Although most of the v2 processes continue to exist, this ITIL refresh is designed to be less complicated to comprehend. This should make it much easier to sell ITIL-based programs to senior management.

v3 also adds flexibility by providing structure to incorporate complimentary best-practices such as Six Sigma. It has separate component to address unique challenges of the Web, though Service Delivery and Service Support remain central elements in v3 as they were in v2.

Another benefit of the latest ITIL iteration is it makes team effort between IT and business crucial to success. The previous version left too many opportunities for IT to go it alone so ultimately the business never really understood the value of IT.“v3 closes the gaps,” said Potter. “That, however, may prove to be a two-edged sword as the companies that can’t or don’t care to involve the business will not do v3 for very reason that business must be involved.”

What To Do?

So what should users do that are in the midst of an ITIL v2 project? Potter suggests it is probably best to stay the course with in-flight ITIL implementations as they already have senior management buy-in. Once ITIL is in place, the project team should have an after-action taskforce review the differences between the two versions, see if there’s anything that brings additional value to the organization and only then commission work to tweak the processes.

On the other hand, some organizations are struggling to commence ITIL because they failed to achieve a common point of understanding among their various stakeholders. In a case like this, Potter said it may be best to switch to v3 as it will probably facilitate better understanding. ITIL v3’s changed viewpoint does a good job of communicating the business value of ITIL.

Using the service perspective of v3 will permit senior managers to better understand the advantages IT brings to the organization, both from a service quality and a cost perspective. Since it is more customizable, ITIL will meet the organizations needs more closely than with the older method which made use of generic process views. As a result, the odds of success improve because the solution is designed just for that organization and described in terms that both senior IT and business management will understand.

Products Proliferate

Vendors, of course, are quick to come out with products that facilitate the move towards ITIL and incorporate the v3 changes. TeamQuest Performance Software v10.1, for example, includes the concept of IT Resources which aligns closely with ITIL methodology. Additionally, TeamQuest IT Service Analyzer permits quicker identification of performance-related issues. Capacity managers can drill down to isolate affected services and users, and determine the exact reason for bottlenecks before they snowball into major problems. This facilitates the accomplishment of many of the capacity management goals of ITIL v3.

CA for example, has just released Unicenter Server Catalog that enables IT services to be defined, delivered and consumed in business terms. It provides a centralized source of information for all services. By keeping IT informed about who is requesting and consuming resources as well as the frequency with which they’re doing so. It also aids in demands in demand planning and allocation.

“Organizations need to ensure their IT spend is directed where it will do the most good and deliver the best returns,” said David Hurwitz, vice president of product marketing at CA. “Unicenter Service Catalog enables the business and IT staff to work cooperatively and implement best practices that optimize IT spending.”

But ITIL isn’t the answer to everything. While v3 encourages business and IT to coordinate, it takes real live communication between CIOs and line of business heads to relate ITIL to their own environment. And from there, they need to align it closely to ongoing programs and strategies.

“ITIL is high-level and focuses on what should be done, but doesn't describe at a detailed level how to do it,” said Gartner research director Ed Holub. “It is important that IT and business executives work together to understand what specific business problems they are trying to resolve, and how ITIL can be an enabler to solving them.”