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June 1, 2005

A Business Relationship Management Framework for IT Service Provision

The organizational structure of a business creates "organs" which have functions vital to the business. The IT organization created by the business will make the most sense as a component of the overall business system. Since business organizations at any time are different amongst businesses, and are different for any given business from one time to the next, the subject at hand is not so much what the ideal IT organization looks like but instead how to be an optimal IT organization for the particular business.

I. The organizational mission

Cows and people both have hearts, but one heart won't substitute for the other.

All businesses are enabled by IT. Seen as a functional business organ, the IT organization has both a primary responsibility and a primary objective.

The IT organization's objective is to manage enablement of ongoing business fulfillment of customers' (and other stakeholders') demand.

This enablement is executed within business preferences and tolerances -- targets set for both the types and levels of the enablement effort's performance, value, quality and risk.

Meanwhile, enabling business fulfillment is not solely accomplished through IT. For assuring the desired enablement, the IT organization's special responsibility is to succeed in managing information technology (IT) in three dimensions:
1. Requirements (representing business needs)
2. Changes (representing the business environment)
3. Assets (representing business investments)

Of the three dimensions, Change is the most directly challenging to manage.

All three dimensions feature difficulties stemming from complications (such as incompatibilities amongst many separate factors) that accumulate over time. But relative to the other two dimensions, changes involve much more direct struggle with complexity (such as interdependencies and their uncertainty).

To optimize the business cost/benefit of change against complexity and uncertainty, the basic job of managing IT systems must be executed within policy constraints that are nothing less than how the business explicitly prioritizes and accounts for its dependency on IT.

Meanwhile, because business-change is the rule rather than the exception in the life of the business, IT Management is naturally responsible for maximizing it's ability to manage changes to the "business-enabling" IT.

In that scenario, IT Change management is the central and most critical issue in the IT organization's mission. To tackle this, there needs to be a good picture of what the business impact scope of IT Change includes, along with a corresponding picture of the scope of both business management and IT management practices to be applied.

II. The architecture of enablement

IT's execution on enabling business's fulfillment is conducted on three levels of competency above and beyond hardware and software systems:
1. Processes - which are measurably composed, objective-driven activities.
2. An operation - which is a resource-managed integration of processes.
3. A "service" - which is an operation that is policy-based and customer-driven.

This scope of activities must be woven together in both IT and business practices. With change being the crucial issue in the reliabiity of the business dependency on IT, current business priorities always set the legitimate terms for alignment of IT's practices with the business's.

In this alignment, the overall arc of business expectations is as follows. Typically, business activities subscribe and leverage assets, consuming them on at least a temporary basis. Business assets include things, money, information, time, skills,and processes. From the business perspective, services convert these assets into on-demand resources and so are an essential link allowing the business to use its assets to meet its requirements. Therefore, managing services is an essential business competency, and managing changes in business finds the management of services to be a critical success factor.

"Performance" in IT's enablement of business fulfillment therefore refers mainly to a level of success achieved in providing appropriate services, on demand but also across continual change. From this perspective, the provision must be affordable and reliable. Business value comes from that performance tightly tracking with business priorities. And business perceives quality in the IT effort mainly through the consistency with which the effort delivers value through the current level and structure of management. Finally, the business sees risk in the effort according to the evident likelihood that the quality can be effectively leveraged for the requirements of the business-level priorities.

All of these business perspectives identify the IT organization's handling of assets, changes and requirements on business terms -- regardless of how the information technology is designed and deployed. As the famous saying goes, although a drill makes a hole, customers aren't paying for drills, they're paying for holes. In the form of IT services, the IT organization makes the drills, but the reason for doing that is to deliver business services -- the holes.

III. Re-aligning ITIL

The defacto standard for IT Service management is ITIL, which identifies a comprehensive approach for defining and managing services as products such that IT organizations can maximize the cost/quality ratio of the services for the business.

But taking another step in this consideration, the IT organization must acknowledge that no product actually delivers value except through the way that it is used. To more directly address that, the following framework describes and relates management processes of the IT organization as they are dedicated to the business utilization of IT services.

While incorporating the management process distinctions now standardized in the ITIL vocabulary, this Archestra framework positions the processes such that their different roles are quickly targeted from a perspective more sensitive to business drivers that generate demands on IT -- such as needs, investments, and the business operating environment. Each of those drivers significantly influences the business's perception of its relationship with the IT organization as opposed to just with the services.

The framework offers a very symmetrical assignment of management concerns. The symmetry more explicity recognizes the major business issues of the IT environment (not just of the current IT infrastructure); and it readily refers to the enterprise operation as extended to third parties beyond the corporate campus.

A key benefit of this reframing is to stage better predictive power and "normalized" tactical comparisons between legacy vs. evolving (or otherwise heterogeneous) enterprise architectures. The framework makes the point that change management is the nexus for all key business issues addressed by IT architecture and must strategically integrate them. Furthermore, the framework decodes the exciting buzzwords agility, integrity, reliability, and of course alignment by explaining where and why they should enter the conversation. For example, agility is spotted as a demand-driven crossing zone or balance point between support and delivery, reflecting IT service value.

The other significant specific difference between this framework and the ITIL publications framework is that "Continuity" is associated here with Support instead of with Delivery. The reasoning for this is that aside from the contingency planning (i.e., the design) aspect, Continuity is primarily and essentially an issue of problem management and recovery. Meanwhile, the more important aspect of its classification is that it falls on the side of enterprise risk management.

For a discussion on how the framework generates and tracks ITSM process integration, email me.

Posted by Malcolm Ryder at June 1, 2005 2:10 PM

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