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Give Demand Management the Attention it Deserves

Nov 14, 2007

Michael LaChance

Recognize that your process definition and metrics will evolve as you learn more about your organization’s capabilities and systems limitations. In short, defining the demand management process is no different from defining any other ITIL process. Documenting demand management by putting the process to paper will help cement understanding of everyone involved. In fact, it will probably be the most important first step; as so many stakeholders will have widely divergent views of demand management.

The next step is to produce a holistic view of work intake and the resources available for fulfilling these requests. This is lot harder than it sounds. Start by understanding the load placed on your organization by projects and service requests. Leverage the project office, portfolio/program management and time accounting systems to get a handle on project demand, keeping in mind some tweaking of those systems may be required to produce a services centric view of the organization’s work.

The Metrics

The importance of accurate and useful time accounting data cannot be overestimated. Staffing costs are usually the biggest portion of an IT organization budget so it’s essential you can categorize, classify and account for effort expended in working on projects, fulfilling service requests and “keeping the lights on” production support activities.

Careful planning and alignment with your organization’s service model and service catalog will allow you to understand where your organization is spending time and is a critical prerequisite to projecting resource needs across the planning horizon. Only after you can fully characterize your workload should you engage your customers to collectively develop prioritization approaches.

Business activities drive demand for IT services. Your demand management process should include workflow and define approvals required to handle variances or unplanned needs. Business relationship managers should be intimately involved in the demand management process as their knowledge of customer strategic plans will factor into future resource needs. Plus, the relationships manages will leverage the measures and metrics that results from demand management to publicize service delivery performance or look for improvement opportunities

Assign a senior leader as process owner for demand management. This person should be well respected with a wide variety skills in the areas of project and portfolio management, service request fulfillment, procurement, resource management and service economics with excellent customer service, negotiation and facilitation skills.

Integrate demand management process into your company’s governance structures by creating a new entity, such as a Demand Management Council, consisting of senior IT and business decision makers and chaired by the process owner.

Tackling demand management is not a trivial understanding. Prerequisites include a defined service delivery model and a services oriented mindset, a mature service catalog, and good project/financial management disciplines with attendant systems support. Start small with demand management then build on success over time. Soon your IT organization will find itself influencing customer demand by incentivizing services, dynamically adjusting schedules and allocation of resources in response to changing business needs, all the while enhancing the overall efficiency and effectiveness of its operations.

Michael LaChance is VP of IT Production Services for The Travelers Companies in Hartford, CT. Michael can be reached at mblachan@travelers.com.