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Causality and IT Service Management

In reviewing the services offered by IT, management must be able to see the causal linkages between what IT is providing and what the business needs.
Mar 23, 2006
By

George Spafford





Noted economist Steven Levitt remarked in his book, Freakonomics, that the economics profession has the analysis tools but lacks interesting questions wherein to apply them.

The management of IT would seem to be somewhat similar. Business management, notably senior management, has the tools to govern the IT organization, but is thrown off by the technical jargon and thus tends to avoid determining the correct questions to ask.

This is very troubling as the information technology (IT) function in organizations is both the source of much promise and yet also much disdain by senior management. IT differs in regards to line of business functions because of it being an enabler of other functions but regardless, it is still a business function that must deliver. ITIL recognizes this and recommends that IT provision services in support of the organization and those services must be properly managed to ensure that the organization meets its goals.

Goals

Based upon Dr. Eliyahu Goldratt’s Theory of Constraints (TOC) we know that to properly manage resources and meet the expectations of investors, organizations must have goals. We must recognize that an organization is a system, which means it must be viewed as such and managed as a collection of units moving towards a common goal. By definition, unless there is a goal, there isn’t a system. Based upon that premise, management must then align the various functional units such that their objectives support the attainment of the overall entity’s goal to the maximum extent possible.

Causality

At this juncture we can use a variation of the time honored thought process developed by Kaoru Ishikawa. Quality groups have long used his fishbone-shaped cause and effect diagram to map an effect and then plot its causes in an effort to determine the root cause(s) of a problem. Rather than follow a reactive approach, we can invert the model to instead proactively drive what needs to be done in order to attain functional area objectives and the organization’s goal.

In the below diagram, we have a generic “organizational goal” listend. For businesses, this may be “to make money in a sustainable manner”. For other groups, this could read “to save lives” or “to reduce poverty”. The important part is the establishment and acknowledgement of the core reason why the entity exists. From that point, we radiate outward and identify the relevant functional areas and the objectives they each have that support attainment of the overall goal.

The next step is to then diagram how IT contributes services to the attainment of functional unit objectives and the goal of the organization. The services will be a mix of direct value added initiatives as well as controls expressly aimed at facilitating risk management. Through the recognition of IT providing services, we can leverage the teachings of ITIL to look at how IT provisions services in support of each objective.

In the above diagram, we might say that one of accounting’s objectives is to provide accurate and timely financial reporting to the business and that IT enables this through the provisioning of a corporate ERP system[1]. Rather than focus on the technology involved, we instead focus on the business and the service IT provides.

For example, the IT service could be entitled “IT in support of financial reporting.”[2] For each functional area, the objectives that support attainment of the goal are mapped and then the services that IT provisions should roll up to support those objectives and the overall goal. To do this effectively, IT must work with the business to understand requirements and not simply push technology. The establishment of services and their requirements should be managed in the context of an enterprise IT Service Management process as defined in ITIL.

Interesting issues begin to surface as we see IT not as a direct line of business unit but as an enabler, or force multiplier, of the business. In other words, if IT is allowed to function independently of the business units then alignment issues will happen. Instead, taking an IT Service Management perspective, we recognize that IT provides services that enable the business by working with the business – not around the business.

Summary

IT provides services to the various functional areas so they can attain their objectives in support of the organization’s goal. In reviewing the services offered by IT, management must be able to see the causal linkages between what IT is providing and what the business needs. The use of Ishikawa diagrams can serve to enable the visual illustration of those causal linkages.

Overall, the IT Service Management process espoused in ITIL provides a best practice reference for how IT can support the organization through service management. Like all parts of the enterprise system, IT must be managed for the benefit of the overall organization and both IT and the business must understand the consequences of actions and inactions.

[1] Each functional area may have multiple objectives - the illustration used in this article is purposefully simple.
[2] I need to thank Ivor Evans and Jayne Groll for the insight in describing IT services – “IT in support of X.”




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