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Article Blog General June 21, 2011

A phased approach for business value planning of IT Services – Part1

Business value planning of IT Services can be conducted in a phased approach. Depending on the organizational culture and IT maturity, the time for each phase may vary but the activities under each phase are more or less the same. We can broadly classify the planning into five phases.

  • Phase-I: Business-IT Alignment
  • Phase-II: IT Service Impact Planning
  • Phase-III: Planning the Effectiveness & Availability of IT Services
  • Phase-IV: Measuring the Value of IT
  • Phase-V: Outcomes

Let us see what can be accomplished in each phase.
Phase-I: Business-IT Alignment Phase
This is a basic handshake phase where each business service owner of a business unit agrees with the IT organization on what IT services are being utilized and planned for the business service. Based on historical organizational data, a preliminary mapping can be arrived at quickly. At the end of this phase a formal understanding of the dependencies of each business service on the IT services will be completed. This formalism will be the basis later for arriving at costing, budgets, asset procurements, projects, SLAs and CSATs.
Phase-II: IT Service Impact Planning
In this phase, business service owners and IT Service owners agree on what impact the specific IT Service has on the Business Service. Historical organizational data and intuition are the initial reference points to create the impact values. The impact values may be categorized into three values: HIGH, MEDIUM, LOW.  This phase is a contentious phase as both business and IT organizations may have a completely different view of impact. An as-is impact scenario and planned scenario may be a desirable way to get an agreement in this phase. The IT organizations have to ‘sell’ the value of each IT Service to the business from a variety of perspectives including unit cost, benchmark costs and value impact.
At the end of this phase, both IT and Business organizations will have a clear understanding of inter dependencies and impact values so that business value can be systematically measured and planned at a later stage.
I will explain the remaining phases in the next post.

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