ITIL Service Level Management

What is it?

Service Level Management (SLM) is one of five components in the ITIL Service Delivery area. It is arguably the most important set of processes within the ITIL framework. SLM processes provide a framework by which services are defined, service levels required to support business processes are agreed upon, Service Level Agreements (SLAs) and Operational Level Agreements (OLAs) are developed to satisfy the agreements, and costs of services are developed.

Executing Service Level Management processes permits IT staff to more accurately and cost effectively provision identified levels of service to the business. The processes ensure business and IT understand their roles and responsibilities and empower the business units.

In the end, business units are justifying to senior management the levels of service needed to support business processes, not IT. And the built-in continuous improvement processes ensure that when business needs change, supporting IT services change with them.

Service Level Management activities include:

• Identifying business requirements by working with business units
• Establishing the scope of services, timeliness, hours of operation, recovery aspects, and service performance
• Translating business requirements into IT requirements
• Developing and maintaining a service catalog, including costs for different tiers of service performance
• Performing gap analysis between business requirements and available services.
• Determining the costs related to services such that service goals satisfy business needs at a price the business can afford
• Drafting, negotiating and refining SLAs with the business units, ensuring business requirements are met and agreement from all parties involved
• Implementing SLAs
• Measuring SLA performance, reporting results and adjusting as necessary

Why should I implement Service Level Management?

Immediate benefits to implementing SLM processes include:

• Enabling a better understanding between business units and IT
• Setting more accurate service quality expectations and effectively measuring, monitoring and reporting service quality
• Clearly delineating roles and responsibilities
• Providing the necessary flexibility for business to react quickly to market conditions
• Creating more accurate infrastructure sizing based on clearly defining service levels
• Avoiding or mitigating the costs of excess or insufficient capacity
• Providing discipline in supporting internal or external sourcing of IT services

Service Level Management teams have close ties to business processes and customer management, Financial Management for IT Services, and Capacity Management. Capacity Management provides performance data to the SLM team for SLA sizing. Service Level Management passes information about service gaps and interruptions back to Capacity Management for capacity assessment and implementation of required changes.

TeamQuest Addresses ITIL Service Level Management

TeamQuest directly supports ITIL Service Level Management processes by providing a practical approach for determining SLAs and helping identify the right balance of service and associated costs to provision it. TeamQuest Model allows you to run multiple scenarios to show business units the impact of various SLA decisions - helping to determine the optimal performance levels needed to meet business unit goals while ensuring that these metrics can be tracked and reported on an ongoing basis.

TeamQuest IT Service Analyzer and TeamQuest IT Service Reporter provide unique flexibility to run reports using performance data in whatever manner is necessary to document performance against SLA metrics. These products also provide a monthly analysis and capture historical data for trend reporting, which enables IT to proactively predict potential issues and address them before they become a problem.

TeamQuest tools support Service Level Management by:

• Gathering historical and real-time data on service performance
• Determining current levels of service to use as a starting point in SLA negotiations
• Providing the performance data required to make informed decisions regarding SLAs
• Allowing you to experiment with multiple scenarios to determine resources needed to meet business unit goals
• Determining whether SLAs are sustainable on current hardware or if upgrades are required
• Tracking and reporting service performance against SLAs on an ongoing basis
• Proactively alerting IT of impending bottlenecks so they can be resolved before impacting service performance

As with all major projects, proper planning is key. TeamQuest recommends following these steps for implementing ITIL Service Level Management:

1. Gather the data. Identify a SLM manager and form a team to spearhead the implementation. The team must perform several duties:  
• Assess current state. Discover where and to what extent CM work is being performed today and document current reports, distribution lists, policies and procedures.
• Inventory tools and software currently used for monitoring, capacity planning, performance management, and charge back, all of which support SLM processes.
• Collect budget details that pertain to capacity management work.
• Perform a gap analysis to reveal areas that require process improvements, training, or software.
• Develop a project plan to migrate to the new organization based on required changes you uncovered.
2. Build the plan. The implementation plan should:  
• Establish the three major components of capacity management - people, processes and tools.
• Outline the costs necessary to sustain the new organization and build a preliminary budget.
• Determine where the service level manager should be placed in the organization, ideally reporting directly to the CIO, IT Director or within the service management group.
• Describe workflow, including data inputs, information outputs, and work processes.
• Allocate sufficient time for training the people performing the work.
• Identify any necessary work to acquire, consolidate and/or implement capacity and performance tools.

Be sure to communicate the organization and its processes to the rest of the company, preferably through your internal corporate communications team.

Once the project plan and budget are complete, they should be submitted for approval.

3. Execute the plan. You will want to execute the project plan in a series of steps:  
• Assign the staff.
• Document and publish the processes. This is an important step that will likely take considerable time during initial implementation.
• Acquire and implement the tools. Ideally, a single tool would be used to provide the data and reporting necessary for accurate reporting of service performance.
• Inventory IT services and build a service catalog. Be sure service definitions meet Financial Management's requirements, such that utilization data can be obtained and associated to a particular service.
• Identify, develop, negotiate and implement SLAs and OLAs. Close work with business units is required. SLAs and OLAs should be a page or two in length and include:
• Parties involved
• Start, end and review dates
• Scope of the agreement
• Description of the services provided
• Roles and responsibilities of each party involved
• Hours of operation
• Service availability
• Service reliability
• Support
• Throughput, transaction times and/or response times
• Change turnaround targets
• Security requirements and considerations
• Service continuity
• Service costs and how they are charged
• Service reporting
• Service incentives and penalties
• Identify any required services not currently provided by IT and resolve any contradictions in service requirements vs contingency recovery time, for example.
• Define metrics to measure success. Be sure to tie your metrics to business value, not technical measures. Metrics should be few in number, yet succinct and to the point.
• Build training materials and execute the training plan. Develop the training materials based on the processes you drafted and test staff members to ensure retention.
• Implement reporting and exception processes and procedures. Two types of reporting are necessary. High-level reporting, used to keep management informed, often takes the form of a dashboard, using colors to depict service quality. Be sure to report both current status and how it is trending. The second type of reporting is more detailed for use by the SLM team to identify problematic service areas.
4. Initiate the ongoing work of SLM. Begin the reporting process. Include the ability to:  
• Automatically alert the SLM team when services are in danger of missing performance targets due to bottlenecks or sudden spikes in demand.
• Automatically alert the SLM team when trends show performance is approaching agreed-upon limits, so that corrective actions can be taken to prevent service outages or poor service performance.

Schedule monthly or quarterly review meetings to discuss service performance results. Initiate any changes required as a result of unforeseen business events or changes in business priorities.

5. Post implementation review. Document lessons learned and identify any changes that should be made to the process to facilitate future process migrations. Perform a post-implementation audit 6-12 months after completion to determine if the new processes are being adhered to and if you're getting expected results.