Service Strategy Flashcards
account manager
(ITIL Service Strategy) A role that is very similar to that of the business relationship manager, but includes more commercial aspects. Most commonly used by Type III service providers when dealing with external customers.
accounting
(ITIL Service Strategy) The process responsible for identifying the actual costs of delivering IT services, comparing these with budgeted costs, and managing variance from the budget.
accounting period
(ITIL Service Strategy) A period of time (usually one year) for which budgets, charges, depreciation and other financial calculations are made. See also financial year.
analytical modeling
(ITIL Continual Service Improvement) (ITIL Service Design) (ITIL Service Strategy) A technique that uses mathematical models to predict the behavior of IT services or other configuration items. Analytical models are commonly used in capacity management and availability management. See also modeling; simulation modeling.
asset
(ITIL Service Strategy) Any resource or capability. The assets of a service provider include anything that could contribute to the delivery of a service. Assets can be one of the following types: management, organization, process, knowledge, people, information, applications, infrastructure or financial capital. See also customer asset; service asset; strategic asset.
asset specificity
(ITIL Service Strategy) One or more attributes of an asset that make it particularly useful for a given purpose. Asset specificity may limit the use of the asset for other purposes.
billing
(ITIL Service Strategy) Part of the charging process. Billing is the activity responsible for producing an invoice or a bill and recovering the money from customers. See also pricing.
business
(ITIL Service Strategy) An overall corporate entity or organization formed of a number of business units. In the context of ITSM, the term includes public sector and not-for-profit organizations, as well as companies. An IT service provider provides IT services to a customer within a business. The IT service provider may be part of the same business as its customer (internal service provider), or part of another business (external service provider).
business case
(ITIL Service Strategy) Justification for a significant item of expenditure. The business case includes information about costs, benefits, options, issues, risks and possible problems. See also cost benefit analysis.
business customer
(ITIL Service Strategy) A recipient of a product or a service from the business. For example, if the business is a car manufacturer, then the business customer is someone who buys a car.
business impact analysis (BIA)
(ITIL Service Strategy) Business impact analysis is the activity in business continuity management that identifies vital business functions and their dependencies. These dependencies may include suppliers, people, other business processes, IT services etc. Business impact analysis defines the recovery requirements for IT services. These requirements include recovery time objectives, recovery point objectives and minimum service level targets for each IT service.
business objective
(ITIL Service Strategy) The objective of a business process, or of the business as a whole. Business objectives support the business vision, provide guidance for the IT strategy, and are often supported by IT services.
business operations
(ITIL Service Strategy) The day-to-day execution, monitoring and management of business processes.
business relationship management
(ITIL Service Strategy) The process responsible for maintaining a positive relationship with customers. Business relationship management identifies customer needs and ensures that the service provider is able to meet these needs with an appropriate catalogue of services. This process has strong links with service level management.
business relationship manager (BRM)
(ITIL Service Strategy) A role responsible for maintaining the relationship with one or more customers. This role is often combined with the service level manager role.
business unit
(ITIL Service Strategy) A segment of the business that has its own plans, metrics, income and costs. Each business unit owns assets and uses these to create value for customers in the form of goods and services.
capability
(ITIL Service Strategy) The ability of an organization, person, process, application, IT service or other configuration item to carry out an activity. Capabilities are intangible assets of an organization. See also resource.
capital budgeting
(ITIL Service Strategy) The present commitment of funds in order to receive a return in the future in the form of additional cash inflows or reduced cash outflows.
capital cost
(ITIL Service Strategy) The cost of purchasing something that will become a financial asset – for example, computer equipment and buildings. The value of the asset depreciates over multiple accounting periods. See also operational cost.
capitalization
(ITIL Service Strategy) Identifying major cost as capital, even though no asset is purchased. This is done to spread the impact of the cost over multiple accounting periods. The most common example of this is software development, or purchase of a software license.
change proposal
(ITIL Service Strategy) (ITIL Service Transition) A document that includes a high level description of a potential service introduction or significant change, along with a corresponding business case and an expected implementation schedule. Change proposals are normally created by the service portfolio management process and are passed to change management for authorization. Change management will review the potential impact on other services, on shared resources, and on the overall change schedule. Once the change proposal has been authorized, service portfolio management will charter the service.
chargeable item
(ITIL Service Strategy) A deliverable of an IT service that is used in calculating charges to customers (for example, number of transactions, number of desktop PCs).
charging
(ITIL Service Strategy) Requiring payment for IT services. Charging for IT services is optional, and many organizations choose to treat their IT service provider as a cost center. See also charging process; charging policy.
charging policy
(ITIL Service Strategy) A policy specifying the objective of the charging process and the way in which charges will be calculated. See also cost.
charging process
(ITIL Service Strategy) The process responsible for deciding how much customers should pay (pricing) and recovering money from them (billing). This process is not described in detail within the core ITIL publications.
charter
(ITIL Service Strategy) A document that contains details of a new service, a significant change or other significant project. Charters are typically authorized by service portfolio management or by a project management office. The term charter is also used to describe the act of authorizing the work required to complete the service change or project. See also change proposal; service charter; project portfolio.
control perspective
(ITIL Service Strategy) An approach to the management of IT services, processes, functions, assets etc. There can be several different control perspectives on the same IT service, process etc., allowing different individuals or teams to focus on what is important and relevant to their specific role. Examples of control perspective include reactive and proactive management within IT operations, or a lifecycle view for an application project team.
core service
(ITIL Service Strategy) A service that delivers the basic outcomes desired by one or more customers. A core service provides a specific level of utility and warranty. Customers may be offered a choice of utility and warranty through one or more service options. See also enabling service; enhancing service; IT service; service package.
cost center
(ITIL Service Strategy) A business unit or project to which costs are assigned. A cost center does not charge for services provided. An IT service provider can be run as a cost center or a profit center.
cost element
(ITIL Service Strategy) The middle level of category to which costs are assigned in budgeting and accounting. The highest-level category is cost type. For example, a cost type of ‘people’ could have cost elements of payroll, staff benefits, expenses, training, overtime etc. Cost elements can be further broken down to give cost units. For example, the cost element ‘expenses’ could include cost units of hotels, transport, meals etc.
cost management
(ITIL Service Strategy) A general term that is used to refer to budgeting and accounting, and is sometimes used as a synonym for financial management.
cost model
(ITIL Service Strategy) A framework used in budgeting and accounting in which all known costs can be recorded, categorized and allocated to specific customers, business units or projects. See also cost type; cost element; cost unit.
cost type
(ITIL Service Strategy) The highest level of category to which costs are assigned in budgeting and accounting – for example, hardware, software, people, accommodation, external and transfer. See also cost element; cost unit.
cost unit
(ITIL Service Strategy) The lowest level of category to which costs are assigned, cost units are usually things that can be easily counted (e.g. staff numbers, software licenses) or things easily measured (e.g. CPU usage, electricity consumed). Cost units are included within cost elements. For example, a cost element of ‘expenses’ could include cost units of hotels, transport, meals etc. See also cost type.
customer agreement portfolio
(ITIL Service Strategy) A database or structured document used to manage service contracts or agreements between an IT service provider and its customers. Each IT service delivered to a customer should have a contract or other agreement that is listed in the customer agreement portfolio. See also customer-facing service; service catalogue; service portfolio.
customer portfolio
(ITIL Service Strategy) A database or structured document used to record all customers of the IT service provider. The customer portfolio is the business relationship manager’s view of the customers who receive services from the IT service provider. See also customer agreement portfolio; service catalogue; service portfolio.
depreciation
(ITIL Service Strategy) A measure of the reduction in value of an asset over its life. This is based on wearing out, consumption or other reduction in the useful economic value.
direct cost
(ITIL Service Strategy) The cost of providing an IT service which can be allocated in full to a specific customer, cost center, project etc. For example, the cost of providing non-shared servers or software licenses. See also indirect cost.
economies of scale
(ITIL Service Strategy) The reduction in average cost that is possible from increasing the usage of an IT service or asset. See also economies of scope.
economies of scope
(ITIL Service Strategy) The reduction in cost that is allocated to an IT service by using an existing asset for an additional purpose. For example, delivering a new IT service from an existing IT infrastructure. See also economies of scale.
enabling service
(ITIL Service Strategy) A service that is needed in order to deliver a core service. Enabling services may or may not be visible to the customer, but they are not offered to customers in their own right. See also enhancing service.
enhancing service
(ITIL Service Strategy) A service that is added to a core service to make it more attractive to the customer. Enhancing services are not essential to the delivery of a core service but are used to encourage customers to use the core services or to differentiate the service provider from its competitors. See also enabling service; excitement factor.
enterprise financial management
(ITIL Service Strategy) The function and processes responsible for managing the overall organization’s budgeting, accounting and charging requirements. Enterprise financial management is sometimes referred to as the ‘corporate’ financial department. See also financial management for IT services.
eSourcing Capability Model for Client Organizations (eSCM-CL)
(ITIL Service Strategy) A framework to help organizations in their analysis and decision-making on service sourcing models and strategies. It was developed by Carnegie Mellon University in the US. See also eSourcing Capability Model for Service Providers.
eSourcing Capability Model for Service Providers (eSCM- SP)
(ITIL Service Strategy) A framework to help IT service providers develop their IT service management capabilities from a service sourcing perspective. It was developed by Carnegie Mellon University in the US. See also eSourcing Capability Model for Client Organizations.
excitement factor
(ITIL Service Strategy) An attribute added to something to make it more attractive or more exciting to the customer. For example, a restaurant may provide a free drink with every meal. See also enhancing service.
external service provider
(ITIL Service Strategy) An IT service provider that is part of a different organization from its customer. An IT service provider may have both internal and external customers. See also outsourcing; Type III service provider.
financial management
(ITIL Service Strategy) A generic term used to describe the function and processes responsible for managing an organization’s budgeting, accounting and charging requirements. Enterprise financial management is the specific term used to describe the function and processes from the perspective of the overall organization. Financial management for IT services is the specific term used to describe the function and processes from the perspective of the IT service provider.
financial management for IT services
(ITIL Service Strategy) The function and processes responsible for managing an IT service provider’s budgeting, accounting and charging requirements. Financial management for IT services secures an appropriate level of funding to design, develop and deliver services that meet the strategy of the organization in a cost-effective manner. See also enterprise financial management.
financial year
(ITIL Service Strategy) An accounting period covering 12 consecutive months. A financial year may start on any date (for example, 1 April to 31 March).
fit for purpose
(ITIL Service Strategy) The ability to meet an agreed level of utility. Fit for purpose is also used informally to describe a process, configuration item, IT service etc. that is capable of meeting its objectives or service levels. Being fit for purpose requires suitable design, implementation, control and maintenance.
fit for use
(ITIL Service Strategy) The ability to meet an agreed level of warranty. Being fit for use requires suitable design, implementation, control and maintenance.
fixed cost
(ITIL Service Strategy) A cost that does not vary with IT service usage – for example, the cost of server hardware. See also variable cost.
indirect cost
(ITIL Service Strategy) The cost of providing an IT service which cannot be allocated in full to a specific customer – for example, the cost of providing shared servers or software licenses. Also known as overhead. See also direct cost.
insourcing
(ITIL Service Strategy) Using an internal service provider to manage IT services. The term insourcing is also used to describe the act of transferring the provision of an IT service from an external service provider to an internal service provider. See also service sourcing.
internal rate of return (IRR)
(ITIL Service Strategy) A technique used to help make decisions about capital expenditure. It calculates a figure that allows two or more alternative investments to be compared. A larger internal rate of return indicates a better investment. See also net present value; return on investment.
internal service provider
(ITIL Service Strategy) An IT service provider that is part of the same organization as its customer. An IT service provider may have both internal and external customers. See also insourcing; Type I service provider; Type II service provider.
IT service provider
(ITIL Service Strategy) A service provider that provides IT services to internal or external customers.
Kano model
(ITIL Service Strategy) A model developed by Noriaki Kano that is used to help understand customer preferences. The Kano model considers attributes of an IT service grouped into areas such as basic factors, excitement factors, performance factors etc.
line of service (LOS)
(ITIL Service Strategy) A core service or service package that has multiple service options. A line of service is managed by a service owner and each service option is designed to support a particular market segment.
market space
(ITIL Service Strategy) Opportunities that an IT service provider could exploit to meet the business needs of customers. Market spaces identify the possible IT services that an IT service provider may wish to consider delivering.
near-shore
(ITIL Service Strategy) Provision of services from a country near the country where the customer is based. This can be the provision of an IT service, or of supporting functions such as a service desk. See also offshore; onshore.
net present value (NPV)
(ITIL Service Strategy) A technique used to help make decisions about capital expenditure. It compares cash inflows with cash outflows. Positive net present value indicates that an investment is worthwhile. See also internal rate of return; return on investment.
notional charging
(ITIL Service Strategy) An approach to charging for IT services. Charges to customers are calculated and customers are informed of the charge, but no money is actually transferred. Notional charging is sometimes introduced to ensure that customers are aware of the costs they incur, or as a stage during the introduction of real charging.
offshore
(ITIL Service Strategy) Provision of services from a location outside the country where the customer is based, often in a different continent. This can be the provision of an IT service, or of supporting functions such as a service desk. See also near-shore; onshore.
onshore
(ITIL Service Strategy) Provision of services from a location within the country where the customer is based. See also near-shore; offshore.
opportunity cost
(ITIL Service Strategy) A cost that is used in deciding between investment choices. Opportunity cost represents the revenue that would have been generated by using the resources in a different way. For example, the opportunity cost of purchasing a new server may include not carrying out a service improvement activity that the money could have been spent on. Opportunity cost analysis is used as part of a decision-making process, but opportunity cost is not treated as an actual cost in any financial statement.
outsourcing
(ITIL Service Strategy) Using an external service provider to manage IT services. See also service sourcing.
pattern of business activity (PBA)
(ITIL Service Strategy) A workload profile of one or more business activities. Patterns of business activity are used to help the IT service provider understand and plan for different levels of business activity. See also user profile.
pricing
(ITIL Service Strategy) Pricing is the activity for establishing how much customers will be charged.
profit center
(ITIL Service Strategy) A business unit that charges for services provided. A profit center can be created with the objective of making a profit, recovering costs, or running at a loss. An IT service provider can be run as a cost center or a profit center.
real charging
(ITIL Service Strategy) A charging policy where actual money is transferred from the customer to the IT service provider in payment for the delivery of IT services. See also notional charging.
resource
(ITIL Service Strategy) A generic term that includes IT infrastructure, people, money or anything else that might help to deliver an IT service. Resources are considered to be assets of an organization. See also capability; service asset.
return on assets (ROA)
(ITIL Service Strategy) A measurement of the profitability of a business unit or organization. Return on assets is calculated by dividing the annual net income by the total value of assets. See also return on investment.
service analytics
(ITIL Service Strategy) A technique used in the assessment of the business impact of incidents. Service analytics models the dependencies between configuration items, and the dependencies of IT services on configuration items.
service contract
(ITIL Service Strategy) A contract to deliver one or more IT services. The term is also used to mean any agreement to deliver IT services, whether this is a legal contract or a service level agreement. See also customer agreement portfolio.
service model
(ITIL Service Strategy) A model that shows how service assets interact with customer assets to create value. Service models describe the structure of a service (how the configuration items fit together) and the dynamics of the service (activities, flow of resources and interactions). A service model can be used as a template or blueprint for multiple services.
service owner
(ITIL Service Strategy) A role responsible for managing one or more services throughout their entire lifecycle. Service owners are instrumental in the development of service strategy and are responsible for the content of the service portfolio. See also business relationship management.
service package
(ITIL Service Strategy) Two or more services that have been combined to offer a solution to a specific type of customer need or to underpin specific business outcomes. A service package can consist of a combination of core services, enabling services and enhancing services. A service package provides a specific level of utility and warranty. Customers may be offered a choice of utility and warranty through one or more service options. See also IT service.
service pipeline
(ITIL Service Strategy) A database or structured document listing all IT services that are under consideration or development, but are not yet available to customers. The service pipeline provides a business view of possible future IT services and is part of the service portfolio that is not normally published to customers.
service portfolio
(ITIL Service Strategy) The complete set of services that is managed by a service provider. The service portfolio is used to manage the entire lifecycle of all services, and includes three categories: service pipeline (proposed or in development), service catalogue (live or available for deployment), and retired services. See also customer agreement portfolio; service portfolio management.
service portfolio management (SPM)
(ITIL Service Strategy) The process responsible for managing the service portfolio. Service portfolio management ensures that the service provider has the right mix of services to meet required business outcomes at an appropriate level of investment. Service portfolio management considers services in terms of the business value that they provide.
service potential
(ITIL Service Strategy) The total possible value of the overall capabilities and resources of the IT service provider.
service provider
(ITIL Service Strategy) An organization supplying services to one or more internal customers or external customers. Service provider is often used as an abbreviation for IT service provider. See also Type I service provider; Type II service provider; Type III service provider.
service provider interface (SPI)
(ITIL Service Strategy) An interface between the IT service provider and a user, customer, business process or supplier. Analysis of service provider interfaces helps to coordinate end-to-end management of IT services.
service sourcing
(ITIL Service Strategy) The strategy and approach for deciding whether to provide a service internally, to outsource it to an external service provider, or to combine the two approaches. Service sourcing also means the execution of this strategy. See also insourcing; internal service provider; outsourcing.
service strategy
(ITIL Service Strategy) A stage in the lifecycle of a service. Service strategy defines the perspective, position, plans and patterns that a service provider needs to execute to meet an organization’s business outcomes. Service strategy includes the following processes: strategy management for IT services, service portfolio management, financial management for IT services, demand management, and business relationship management. Although these processes are associated with service strategy, most processes have activities that take place across multiple stages of the service lifecycle.
service valuation
(ITIL Service Strategy) A measurement of the total cost of delivering an IT service, and the total value to the business of that IT service. Service valuation is used to help the business and the IT service provider agree on the value of the IT service.
strategic
(ITIL Service Strategy) The highest of three levels of planning and delivery (strategic, tactical, operational). Strategic activities include objective setting and long-term planning to achieve the overall vision.
strategic asset
(ITIL Service Strategy) Any asset that provides the basis for core competence, distinctive performance or sustainable competitive advantage, or which allows a business unit to participate in business opportunities. Part of service strategy is to identify how IT can be viewed as a strategic asset rather than an internal administrative function.
strategy
(ITIL Service Strategy) A strategic plan designed to achieve defined objectives.
strategy management for IT services
(ITIL Service Strategy) The process responsible for defining and maintaining an organization’s perspective, position, plans and patterns with regard to its services and the management of those services. Once the strategy has been defined, strategy management for IT services is also responsible for ensuring that it achieves its intended business outcomes.
total cost of ownership (TCO)
(ITIL Service Strategy) A methodology used to help make investment decisions. It assesses the full lifecycle cost of owning a configuration item, not just the initial cost or purchase price. See also total cost of utilization.
total cost of utilization (TCU)
(ITIL Service Strategy) A methodology used to help make investment and service sourcing decisions. Total cost of utilization assesses the full lifecycle cost to the customer of using an IT service. See also total cost of ownership.
transfer cost
(ITIL Service Strategy) A cost type which records expenditure made on behalf of another part of the organization. For example, the IT service provider may pay for an external consultant to be used by the finance department and transfer the cost to them. The IT service provider would record this as a transfer cost.
Type I service provider
(ITIL Service Strategy) An internal service provider that is embedded within a business unit. There may be several Type I service providers within an organization.
Type II service provider
(ITIL Service Strategy) An internal service provider that provides shared IT services to more than one business unit. Type II service providers are also known as shared service units.
Type III service provider
(ITIL Service Strategy) A service provider that provides IT services to external customers.
unit cost
(ITIL Service Strategy) The cost to the IT service provider of providing a single component of an IT service. For example, the cost of a single desktop PC, or of a single transaction.
user profile (UP)
(ITIL Service Strategy) A pattern of user demand for IT services. Each user profile includes one or more patterns of business activity.
utility
(ITIL Service Strategy) The functionality offered by a product or service to meet a particular need. Utility can be summarized as ‘what the service does’, and can be used to determine whether a service is able to meet its required outcomes, or is ‘fit for purpose’. The business value of an IT service is created by the combination of utility and warranty. See also service validation and testing.
value chain
(ITIL Service Strategy) A sequence of processes that creates a product or service that is of value to a customer. Each step of the sequence builds on the previous steps and contributes to the overall product or service. See also value network.
value network
(ITIL Service Strategy) A complex set of relationships between two or more groups or organizations. Value is generated through exchange of knowledge, information, goods or services. See also partnership; value chain.
variable cost
(ITIL Service Strategy) A cost that depends on how much the IT service is used, how many products are produced, the number and type of users, or something else that cannot be fixed in advance.
warranty
(ITIL Service Strategy) Assurance that a product or service will meet agreed requirements. This may be a formal agreement such as a service level agreement or contract, or it may be a marketing message or brand image. Warranty refers to the ability of a service to be available when needed, to provide the required capacity, and to provide the required reliability in terms of continuity and security. Warranty can be summarized as ‘how the service is delivered’, and can be used to determine whether a service is ‘fit for use’. The business value of an IT service is created by the combination of utility and warranty. See also service validation and testing.
