The failure of IT to show the value to the organization and its role in the achievement of business outcomes may leave IT vulnerable in the sense that it is seen as not being as strategically important to the organisation as other business processes and functions.  If IT fails to provide quality services that are required by the organization, or even fails to cope with changing demands, IT may be viewed as a less important strategic asset in the organization. This could lead to the possibility of areas within IT, or IT itself, being downsized or even outsourced.

Show the value of IT
For IT to be fully successful, IT needs to be strategically aligned to the business and positioned as a key enabler in achieving successful outcomes for the organization. It is not enough for IT alone to consider itself successful at what it does. IT needs to provide real value to the organization that directly achieves business outcomes that the organization wants to achieve and should be able to deal with the ever changing needs and demands of the organizations and their customers. IT should also be capable of demonstrating how it provides business value to the organization to ensure that IT is positioned within the organization as a core strategic asset.

How does IT achieve this? First of all, IT should provide services that are required. Secondly, IT should deliver services that are perceived by users and customers as providing value. Also, IT should actively retire services that do not, or no longer, provide value. It is important that IT needs to be able to show the organization the services that are provided in a way that is understood by the organization.  

A service catalog is no simple menu
Imagine a restaurant with no menu. How is the customer to know what can be ordered? How does the chef know what to make with the raw ingredients that are available? How does one restaurant differentiate itself from another? How can the restaurant be profitable if customers do not know what is on offer and management cannot understand the cost of providing their services? Unlike the traditional restaurant menu, the service catalog offers much more to the organization than just a menu of available services. The service catalog provides IT with the capability to showcase the services that IT provides, as well as the business process and customers services that are supported and provided by IT. The service catalog provides users and customers with the means of understanding what services they can actually use. Different views of the service catalog can provide service details and information in a format that is understood by the relevant audience.

The service catalog is the only part of the overall service portfolio that can recover costs or earn profits. The relative cost of services can be identified easier if services can be broken down into reusable components. IT services that can be shared by multiple customers can be identified and economies of scale can lead to potential savings for the organization and lower costs to customers. Using the supplier catalog alone, consolidation of multiple suppliers providing the same services can be achieved, thus reducing the overall cost to the organization. The service catalog provides the platform for IT to charge the organization for their use of services provided in a fair and equitable manner.

The service catalog plays a key role
ITIL is now based around the service lifecycle. Central to this lifecycle are services. The service catalog plays a key role in the documenting and management of services. Actionable service catalogs provide the ability to reduce the cost of IT support and decrease manual intervention via automated workflow that support business processes. Customer actionable catalogs allow organizations to reach new markets at reduced costs.

The above is an excerpt from my forthcoming book “The Service Catalog” that is due to be published by Van Haren as part of the ITSM library in early 2010.

Over future columns I will be taking a look at the different views of the Service Catalog, its benefits to the organisation and some of the issues and pitfalls that can be experienced and will provide some of my own views on the elusive service catalog. Stay tuned.

This article is taken from my ITSM Portal column