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Critical Review of Open
Group IT4IT Reference
Architecture
Alan McSweeney
http://ie.linkedin.com/in/alanmcsweeney
https://www.amazon.com/dp/1797567616
Introduction
• Review of the Open Group’s IT4IT Reference Architecture
https://www.opengroup.org/it4it with respect to other
operational frameworks to determine its suitability and
applicability to the IT operating function
• IT4IT is intended to be an umbrella framework
independent of specific processes that takes a value
stream based approach
August 17, 2020 2
Topics
• Value Chain And Supply Chain
• Supply Chain Operations Reference (SCOR)
• Activity Based Costing
• Organisation Value Chain And IT Value Chain
• Introduction To IT4IT Reference Architecture
• Issues With IT4IT Framework
August 17, 2020 3
IT4IT Reference Architecture
• IT4IT is intended to be a reference architecture for the
management of the IT function
• It aims to take a value chain approach to create a model of the
functions that IT performs and the services it provides to assist
organisations in the identification of the activities that
contribute to business competitiveness
• It is intended to be an integrated framework for the
management of IT that emphasises IT service lifecycles
• It aims to identify what the IT function must do well
• It looks to attain efficiencies using supply chain-like approach
to IT services
• IT4IT reference architecture specifies an IT Value Chain
August 17, 2020 4
Value Chain And Supply Chain
• In order to understand the IT4IT approach it is first
important to understand the meaning of value chain and
supply chain
• The phrases value chain and supply chain are all too
frequently used without precise definitions and
understanding of what they exactly mean
August 17, 2020 5
Tradition View Of Value Chain
• Value chain view observes how an
organisation creates a finished
product or service from raw inputs
through activities that add value by
increasing its worth (the amount that
can be charged) over the sum of the
cost of the inputs
• Product or service is then offered or
made available to an external
customer or service user who
typically pays for them, directly or
indirectly
August 17, 2020 6
Raw Input Cost
Cost of Value
Adding
Activities
Value of
Finished
Product or
Services
Value
Added
Different Value Profiles For Different Products And
Services
• The different
types of
products and
services
developed and
offered by an
organisation
will have
different value
profiles
August 17, 2020 7
Raw Input Cost
Cost of Value
Adding Activities
Value of Finished
Product or
Services
Value
Added
Raw Input Cost
Cost of Value
Adding Activities
Value of Finished
Product or
Services
Value
Added
Raw Input Cost
Cost of Value
Adding Activities
Value of Finished
Product or
Services
Value
Added
Raw Input Cost
Cost of Value
Adding Activities
Value of Finished
Product or
Services
Value
Added
Traditional View of Primary And Secondary Value
Adding Activities
August 17, 2020 8
Legal, Regulatory, Environment, Health and Safety Services
Procurement, Supplier and Partner Services
Knowledge, Improvement and Change Services
Research and Develop and Manage Products and Services
Acquire
Raw Inputs
Create
Product or
Service
Market and
Sell Product
or Service
Deliver or
Supply
Product or
Service
Service and
Support
Product or
Service
Facilities Services
Financial Services
Information Technology Services
Human Resource Services
Value
Added
Supporting
and
Enabling
Secondary
Activities
Primary
Value
Creating
Activities
Value Chain
• The value chain is the series of primary activities and their
associated business processes that act on the raw inputs
and work towards creating and providing the finished
product or service to the target customer
• Value added is the cost at which the product or service is
sold or provided less the input costs
August 17, 2020 9
Acquire
Raw Inputs
Create
Product or
Service
Market and
Sell Product
or Service
Deliver or
Supply
Product or
Service
Service and
Support
Product or
Service
Value Chain And Business Processes
• The value chain is implemented through business processes
• The business process is a standard set of activities that is designed to
achieve a specific task transforming inputs into outputs
• The external value chain representation masks multiple internal
business processes
August 17, 2020 10
Acquire
Raw Inputs
Create
Product or
Service
Market and
Sell Product
or Service
Deliver or
Supply
Product or
Service
Service and
Support
Product or
Service
Traditional View of Primary And Secondary Value
Adding Activities
• Supporting and Enabling Secondary Activities are sets of
common services used across the organisation and
typically provided by shared business functions or by
outsourced service providers managed by business
functions
• The primary value chain activities call on the services
offered by the secondary activities
• The classification of these secondary activities and their
processes and relative importance will vary between
organisations
August 17, 2020 11
Value Chain And Supporting Activities And Processes
August 17, 2020 12
Legal, Regulatory, Environment, Health and Safety Services
Procurement, Supplier and Partner Services
Knowledge, Improvement and Change Services
Research and Develop and Manage Products and Services
Acquire
Raw
Inputs
Create
Product
or Service
Market
and Sell
Product
or Service
Deliver or
Supply
Product
or Service
Service
and
Support
Product or
Service
Facilities Services
Financial Services
Information Technology Services
Human Resource Services
Supporting and Enabling Secondary Activities
• Human Resource Services – staffing, recruitment, personnel management,
payroll, organisation management services
• Information Technology Services – management of the provision of IT
services
• Financial Services – invoicing, collection, debt management, financial
control services
• Facilities Services – locations, building and facilities management services
• Legal, Regulatory, Environment, Health and Safety Services – regulatory
monitoring and compliance, environmental and safety services
• Procurement, Supplier, and Partner Services – management of supplier
and product and service selection and acquisition and relationship
management services
• Knowledge, Improvement and Change Services – manage organisation
knowledge and manage service improvement and change initiatives
• Research and Develop and Manage Products and Services – identification
and development of new products and services
August 17, 2020 13
Contribution To Cost Of Value Adding Activities
• The costs of the core and extended activities involved in the end-to-
end supply of the product and service affects the value added
August 17, 2020 14
Raw Input Cost
Cost of Value
Adding
Activities
Value Achieved
for Finished
Product or
Service
Value
Added
Legal, Regulatory, Environment, Health and Safety Services
Procurement, Supplier and Partner Services
Knowledge, Improvement and Change Services
Research and Develop and Manage Products and Services
Acquire
Raw
Inputs
Create
Product
or Service
Market
and Sell
Product
or Service
Deliver or
Supply
Product
or Service
Service
and
Support
Product or
Service
Facilities Services
Financial Services
Information Technology Services
Human Resource Services
Profile Of Activity Cost Contribution To Value Chain
• Contribution and cost allocation for each primary and secondary activity to the product or
service cost profile will be different for each primary and secondary activity
• Cost profile of a product or service will also change over time
August 17, 2020 15
Legal, Regulatory, Environment, Health and Safety Services
Procurement, Supplier and Partner Services
Knowledge, Improvement and Change Services
Research and Develop and Manage Products and Services
Acquire
Raw
Inputs
Create
Product
or Service
Market
and Sell
Product
or Service
Deliver or
Supply
Product
or Service
Service
and
Support
Product or
Service
Facilities Services
Financial Services
Information Technology Services
Human Resource Services
Profiles Of Activity Cost Contribution To
Products/Services Value Chains
August 17, 2020 16
• The core and extended value chain cost profile for each
product or service will be different
Legal, Regulatory, Environment, Health and Safety Services
Procurement, Supplier and Partner Services
Knowledge, Improvement and Change Services
Research and Develop and Manage Products and Services
Acquire
Raw
Inputs
Create
Product
or Service
Market
and Sell
Product
or Service
Deliver or
Supply
Product
or Service
Service
and
Support
Product or
Service
Facilities Services
Financial Services
Information Technology Services
Human Resource Services
Value Chain And Organisation Competitiveness
• Sum of value generated across all products and services is
a measure of the current competitiveness of the
organisation
• An effective activity cost model identifies the actual cost of
primary and support services that contribute to the
generation of value
• Supply chain processes monitor the competitors and their
impact on value chains
August 17, 2020 17
Wider Supply Chain Context Of Value Chain
August 17, 2020 18
Legal, Regulatory, Environment, Health and Safety Services
Procurement, Supplier and Partner Services
Knowledge, Improvement and Change Services
Research and Develop and Manage Products and Services
Acquire
Raw
Inputs
Create
Product
or Service
Market
and Sell
Product
or Service
Deliver or
Supply
Product
or Service
Service
and
Support
Product or
Service
Facilities Services
Financial Services
Information Technology Services
Human Resource Services
Sourcing
Planning
Enabling
Delivery ReturnsWork in
Progress
Demand
Competition
Production
Support
Wider Supply Chain Context Of Value Chain
• The value chain is the specific set of activities that directly and
indirectly contribute to the creation and supply of the product or
service
• The value chain sits within a wider supply chain involving a range of
activities and events that impact the value chain, both negatively
and positively
• There are various views of how to categorise the supply chain
• The most widely used and most comprehensive one is Supply Chain
Operations Reference (SCOR) - https://www.apics.org/apics-for-
business/frameworks/scor
− The SCOR model identifies six primary supply management processes: Plan,
Source, Make, Deliver, Return and Enable
− The SCOR model is aimed at manufacturing, transportation, delivery and
logistics organisations
− However, its principles and structures can be readily applied and adapted to
service organisations
− Any analysis of supply chain activities should at least make reference to SCOR
August 17, 2020 19
SCOR Model Structure
August 17, 2020 20
SCOR
Performance
Performance
Attributes
Reliability
Responsiveness
Agility
Costs
Asset
Management
Efficiency
Metrics
Reliability Metrics
Responsiveness
Metrics
Agility Metrics
Costs Metrics
Asset
Management
Efficiency Metrics
Level 1 Metrics Level 2 Metrics
Level 3 Metrics
Process/ Practice
Maturity
Stage 1: Initial;
Stage 2:
Managed;
Stage 3: Defined;
Stage 4:
Quantitatively
Managed;
Stage 5:
Optimising
Processes
Level 1 – Major
Processes
Level 2 – Process
Categories
Level 3 – Process
Elements
Level 4 –
Improvement
Tools and
Activities
Practices
Standard
Practices
Best Practices
Emerging
Practices
People
Competency
Level
Expert
Proficient
Competent
Beginner
Novice
SCOR Metrics Level 1 And Level 2 Structure
August 17, 2020 21
Metrics
Reliability
Perfect Order
Fulfilment
% of Orders
Delivered In Full
Delivery
Performance to
Customer
Commit Date
Documentation
Accuracy
Perfect
Condition
Responsiveness
Order
Fulfilment Cycle
Time
Source Cycle
Time
Make Cycle
Time
Deliver Cycle
Time
Delivery Retail
Cycle Time
Agility
Upside Supply
Chain
Adaptability
Upside
Adaptability
(Source)
Upside
Adaptability
(Make)
Upside
Adaptability
(Deliver)
Upside Return
Adaptability
(Source)
Upside Return
Adaptability
(Deliver)
Downside
Supply Chain
Adaptability
Downside
Adaptability
(Source)
Downside
Adaptability
(Make)
Downside
Adaptability
(Deliver)
Overall Value-
at-Risk (VaR)
Supplier’s/
Customer’s/
Product’s Risk
Rating
Value at Risk
(Plan)
Value at Risk
(Source)
Value at Risk
(Make)
Value at Risk
(Deliver)
Value at Risk
(Return)
Time to
Recovery
Costs
Total SC
Management
Cost
Cost to Plan
Cost to Source
Cost to Make
Cost to Deliver
Cost to Return
Mitigation Cost
Cost of Goods
Sold (COGS)
Cost to Plan
Supply Chain
Cost to Plan
Source
Cost to Plan
Make
Cost to Plan
Deliver
Cost to Plan
Return
Asset
Management
Efficiency
Cash to Cash
Cycle Time
Days Sales
Outstanding
Inventory Days
of Supply
Days Payable
Outstanding
Return on
Supply Chain
Fixed Assets
Supply Chain
Revenue
Supply Chain
Fixed Assets
Return on
Working Capital
Accounts
Payable
(Payables
Outstanding)
Accounts
Receivable
(Sales
Outstanding)
Inventory
Sample SCOR Level 1/2/3 Metrics – Reliability
August 17, 2020 22
ReliabilityPerfect Order
Fulfilment
% of Orders Delivered
In Full
Delivery Item Accuracy Percentage of orders in which all items ordered are the items actually provided, and no extra items
are provided
Delivery Quantity
Accuracy
Percentage of orders in which all quantities received by the customer match the order quantities
(within mutually agreed tolerances)
Delivery Performance
to Customer Commit
Date
Customer Commit Date
Achievement Time
Customer Receiving
Percentage of orders which is received on time as defined by the customer
Delivery Location
Accuracy Percentage of orders which is delivered to the correct location and customer entity
Documentation
Accuracy
Compliance
Documentation
Accuracy
Percentage of compliance documentation that are complete, correct and readily available when and
how expected by customer, Government and other supply chain regulatory entities
Other Required
Documentation
Accuracy
Percentage of other required documentations (besides of compliance documentation, payment
documentation and shipping documentation) are complete, correct, and readily available when and
how expected by customer, Government and other supply chain regulatory entities
Payment
Documentation
Accuracy
Percentage of payment documentation that are complete, correct, and readily available when and
how expected by customer, Government and other supply chain regulatory entities
Shipping
Documentation
Accuracy
Percentage of shipping documentations are complete, correct, and readily available when and how
expected by customer, Government and other supply chain regulatory entities
Perfect Condition
% of Faultless
Installations Number of Faultless Installations divided by Total Number of Units Installed
% Orders/lines
received damage free
The number of orders / lines that are processed damage free divided by the total orders / lines
processed in the measurement period
Orders Delivered
Damage Free
Conformance
Percentage of orders which is delivered without damage
Orders Delivered
Defect Free
Conformance
Percentage of orders which is delivered without defect
Warranty and Returns Number of returns within the warranty period - warranty is a commitment, either expressed or
implied that a certain fact regarding the subject matter of a contract is presently true or will be true
SCOR Process Structure And Hierarchy – 1/3
August 17, 2020 23
SCOR
Plan
Plan Supply Chain
Identify, Prioritise
and Aggregate
Supply Chain
Requirements
Identify, Prioritise
and Aggregate
Supply Chain
Resources
Balance Supply
Chain Resources
with SC
Requirements
Establish and
Communicate
Supply Chain Plans
Plan Source
Identify, Prioritise
and Aggregate
Product
Requirements
Identify, Assess
and Aggregate
Product Resources
Balance Product
Resources with
Product
Requirements
Establish Sourcing
Plans
Plan Source
Identify, Prioritise
and Aggregate
Production
Requirements
Identify, Assess
and Aggregate
Production
Resources
Balance
Production
Resources with
Production
Requirements
Establish
Production Plans
Plan Deliver
Identify, Prioritise
and Aggregate
Delivery
Requirements
Identify, Assess
and Aggregate
Delivery
Resources
Balance Delivery
Resources and
Capabilities with
Delivery
Requirements
Establish Delivery
Plans
Plan Return
Assess and
Aggregate Return
Requirements
Identify, Assess
and Aggregate
Return Resources
Balance Return
Resources with
Return
Requirements
Establish and
Communicate
Return Plans
Source
Source Stocked
Product
Schedule Product
Deliveries
Receive Product
Verify Product
Transfer Product
Authorise Supplier
Payment
Source Make-to-
Order Product
Schedule Product
Deliveries
Receive Product
Verify Product
Transfer Product
Authorise Supplier
Payment
Source Engineer-
to-Order Product
Identify Sources of
Supply
Select Final
Supplier and
Negotiate
Schedule Product
Deliveries
Receive Product
Verify Product
Transfer Product
Authorise Supplier
Payment
Make
Make-to-Stock
Schedule
Production
Activities
Issue Material
Produce and Test
Package
Stage Product
Release Product
to Deliver
Waste Disposal
Make-to-Order
`Schedule
Production
Activities
Issue Sourced/In-
Process Product
Produce and Test
Package
Stage Finished
Product
Release Finished
Product to Deliver
Waste Disposal
Engineer-to-Order
Finalise
Production
Engineering
Schedule
Production
Activities
Issue Sourced/In-
Process Product
Produce and Test
Package
Stage Finished
Product
Release Product
to Deliver
Waste Disposal
SCOR Process Structure And Hierarchy – 2/3
August 17, 2020 24
SCOR
Deliver
Deliver Stocked
Product
Process Inquiry and
Quote
Receive, Enter, and
Validate Order
Reserve Inventory
and Determine
Delivery Date
Consolidate Orders
Build Loads
Route Shipments
Select Carriers and
Rate Shipments
Receive Product
from Source or
Make
Pick Product
Pack Product
Load Vehicle and
Generate Shipping
Documents
Ship Product
Receive and Verify
Product by
Customer
Install Product
Invoice
Deliver Make-to-
Order Product
Process Inquiry and
Quote
Receive, Configure,
Enter and Validate
Order
Reserve Inventory
and Determine
Delivery Date
Consolidate Orders
Build Loads
Route Shipments
Select Carriers and
Rate Shipments
Receive Product
from Source or
Make
Pick Product
Pack Product
Load Product and
Generate Shipping
Docs
Ship Product
Receive and Verify
Product by
Customer
Install Product
Invoice
Deliver Engineer-to-
Order Product
Obtain and Respond
to RFP/RFQ
Negotiate and
Receive Contract
Enter Order,
Commit Resources
and Launch Program
Schedule
Installation
Build Loads
Route Shipments
Select Carriers and
Rate Shipments
Receive Product
from Source or
Make
Pick Product
Pack Product
Load Product and
Generate Shipping
Docs
Ship Product
Receive and Verify
Product by
Customer
Install Product
Invoice
Deliver Retail
Product
Generate Stocking
Schedule
Receive Product at
Store
Pick Product from
backroom
Stock Shelf
Fill ShoppingCart
Checkout
Deliver and/or
install
Return
Source Return
Defective Product
Identify Defective
Product Condition
Disposition
Defective Product
Request Defective
Product Return
Authorisation
Schedule Defective
Product Shipment
Return Defective
Product
Deliver Return
Defective Product
Authorise Defective
Product Return
Schedule Defective
Return Receipt
Receive Defective
Product (includes
verify)
Transfer Defective
Product
Source Return MRO
Product
Identify MRO
Product Condition
Disposition MRO
Product
Request MRO
Return
Authorisation
Schedule MRO
Shipment
Return MRO
Product
Deliver Return MRO
Product
Authorise MRO
Product Return
Schedule MRO
Return Receipt
Receive MRO
Product
Transfer MRO
Product
Source Return
Excess Product
Identify Excess
Product Condition
Disposition Excess
Product
Request Excess
Product Return
Authorisation
Schedule Excess
Product Shipment
Return Excess
Product
Deliver Return
Excess Product
Authorise Excess
Product Return
Schedule Excess
Return Receipt
Receive Excess
Product
Transfer Excess
Product
SCOR Process Structure And Hierarchy – 3/3
August 17, 2020 25
SCOR
Enable
Manage Supply
Chain Business
Rules
Gather Business
Rule
Requirements
Interpret Business
Rule Requirement
Document
Business Rule
Communicate
Business Rule
Release/Publish
Business Rule
Retire Business
Rule
Manage Supply
Chain
Performance
Initiate Reporting
Analyse Reports
Find Root Causes
Prioritise Root
Causes
Develop
Corrective Actions
Approve and
Launch
Manage Data and
Information
Receive
Maintenance
Request
Determine/Scope
Work
Maintain
Content/Code
Maintain Access
Publish
Information
Verify Information
Manage Supply
Chain Human
Resources
Identify
Skills/Resource
Requirement
Identify Available
Skills/Resources
Match
Skills/Resources
Determine Hiring/
Redeployment
Determine
Training/
Education
Approve,
Prioritise and
Launch
Manage Supply
Chain Assets
Schedule Asset
Management
Activities
Take Asset Off-
line
Inspect and
Troubleshoot
Install and
Configure
Clean, Maintain
and Repair
Decommission
and Dispose
Inspect
Maintenance
Reinstate Asset
Manage Supply
Chain Contracts
Receive Contract
/Agreement
Updates
Enter and
Distribute
Contract
/Agreement
Activate/ Archive
Contract/
Agreement
Review
Contractual
Performance
Agreement
Identify
Performance
Issues/
Opportunities
Identify
Resolutions/
Improvements
Select, Prioritise
and Distribute
Resolutions
Manage Supply
Chain Network
Select Scope and
Organisation
Gather Input and
Data
Develop Scenarios
Model/Simulate
Scenarios
Project Impact
Select and
Approve
Develop Change
Program
Launch Change
Program
Manage
Regulatory
Compliance
Monitor
Regulatory
Entities
Assess Regulatory
Publications
Identify
Regulatory
Deficiencies
Define
Remediation
Verify/Obtain
License
Publish
Remediation
Manage Supply
Chain Risk
Establish Context
Identify Risk
Events
Quantify Risks
Evaluate Risks
Risk Handling
Strategy
Manage Supply
Chain
Procurement
Develop Strategy
and Plan
Pre-Procurement
/Market Test and
Market
Engagement
Develop
Documentation,
PPQ /Detailed
Spec/ Combine
with 1
Supplier Selection
to Participate in
ITT /RFQ
/Negotiation
Issue ITT /RFQ
Bid /Tender
Evaluation and
Validation
Contract Award
and
Implementation
Manage Supply
Chain Technology
Define Supply
Chain Technology
Requirements
Identify
Technology
Solution
Alternatives
Define/Update
Supply Chain IT
Roadmap
Select Technology
Solution
Deploy
Technology
Solution
Maintain and
Improve
Technology
Solution
Retire Technology
Solution
Wider SCOR Context
• The SCOR model is part of wider
set of operations reference
models that describe a view of
the critical elements in a value
chain
− Product Life Cycle Operations
Reference model (PLCOR)
• Manages the activities for product
innovation and product and portfolio
management
− Customer Chain Operations
Reference model (CCOR)
• Manages the customer interaction
processes
− Design Chain Operations
Reference model (DCOR)
• Manages the product and service
development processes
− Managing for Supply Chain
Performance (M4SC)
• Translates business strategies into
supply chain execution plans and
policies
August 17, 2020 26
DCOR Design Chain
Operations
PLCOR Product Life Cycle Operations
CCOR Customer Chain
Operations
SCOR Supply Chain Operations
M4SC Managing
for Supply Chain
Performance
Plan Source Make Deliver Return Enable
Plan Ideate Develop Launch Revise Enable
Plan
Relate
Sell
Contract
Assist
Plan
Research
Design
Integrate
Amend
Business Environment
M
a
r
k
e
t
s
S
u
p
p
l
i
e
r
s
Customers
SCOR Performance Metrics
August 17, 2020 27
Process
MetricsEach Process
Has Metrics
Practices
People
Data
MetricsMetrics
Metrics
Require Data
Key Supply Chain Processes
Planning
Develop, manage and maintain the organisation’s overall product or service supply chain
processes to ensure that demand and supply are balanced and optimised
Enabling
Implement and operate and monitor the performance of the supply chain management
processes such sourcing, logistics, finance, resourcing, information technology, sales and
support
Sourcing
Manage and operate the selection of suppliers and the sourcing of raw product or service
inputs as well as suppliers of secondary service
Production
Transform the raw material into the finished product or service to meet planned or actual
demand
Work in
Progress
Manage incomplete products and services as they are being worked or and transformed
Delivery
Deliver the completed products and services to customers including handling orders,
distribution, transportation
Returns Handle customer returns or rejections of delivered products and services
Support
Handle post-delivery support including maintenance, implementation of enhancements,
upgrades
Demand
Monitor, understand and handle customer demand for products and services and
circumstances that cause a change in demand and manage changes in those demands and
associated changes to the other supply chain processes
Competition
Monitor, understand and handle competition in the supply of products and services from
other sources and manage responses to competition
August 17, 2020 28
Supply Chain Impact On Value Chain
• Changes in the supply chain affect the value chain in many
ways:
− Sourcing, procurement and acquisition circumstances might
change, affecting input costs
− Product and service demand might change, affecting the ability to
achieve the anticipated value
− Competition might arise, affecting the cost that can be realised
for the products or services
− Support requirements might change, affecting value generated
− The level of product returns or service cancellations might be
different than planned for, impacting value achieved
• Value chain analysis does not exist in isolation
August 17, 2020 29
Activity Based Costing
• How do you know the costs of the primary and secondary processes
in the product or service value chain?
• How do you allocate the overheads associated with the shared
secondary activities and processes across all product and service
value chains?
• How do know the actual value being created?
• Activity-based costing (ABC) is an approach to understanding costing
that identifies activities in an organisation and assigns the cost of
each activity to all products and services according to the actual
consumption of those activities by each products or services
• Use as a tool for understanding product and service and customer
cost and profitability
• ABC supports strategic decisions such as pricing, investments,
outsourcing and identification and measurement of process
improvement initiatives
August 17, 2020 30
Activity Based Costing
• Establishing a cross-functional view of your organisation
and understanding what drives your costs is essential
• Pulling apart indirect or hidden costs and attributing them
correctly to products and services
August 17, 2020 31
Activities
Resources
Products, Services
and Customers
Cost Drivers Performance
Measures
Approaches To Determining Cost
• Organisational Element Accounting
August 17, 2020 32
Direct Costs Overhead
Accounting System
Approaches To Determining Cost
• Budgetary Cost Distribution /Commitment Accounting
August 17, 2020 33
Commitments and
Obligations
Accounting System
Approaches To Determining Cost
• Traditional Cost Accounting
August 17, 2020 34
Direct Labour
Direct Materials
Activities Output
Cost
Overhead
Approaches To Determining Cost
• Activity Based Costing
August 17, 2020 35
Direct Labour and
Overhead
Direct Materials
Activities Output
Cost
Steps To Implementing Activity Based Costing
August 17, 2020 36
General Ledger and
Other Sources
Departments
Activities
Cost Objects
Calculate
Profitability
Defining Activities
• Most organisations use a cost centre structure
• Recast the cost centre structure into activities
• Usually a hierarchy of activities
− Direct identification with product or service
− Process support
− Organisation and facility support
− Customer/market support
• Map from cost centre into activity hierarchy
August 17, 2020 37
Traditional Cost Accounting View - Direct Costs
August 17, 2020 38
▪ Product A
• 100 units
• 1 hour direct labour at €20/hour
• €20/unit direct cost
• 100 total hours total effort to
produce
▪ Product B
• 950 units
• 2 hours direct labour at €20/hour
• €40/unit direct cost
• 1,900 total hours of effort to
produce
• Total amount of effort for 100 units of Product A and 950 units of
Product B is 2,000 hours
• Assume the overheads total is €100,000
Traditional Cost Accounting View – Allocation Of
Overheads
• Traditional Cost Accounting Overhead Costs
− = €100,000 /2,000 hours of effort across both sets of product
creation activities
− = €50 per hour
• Product A
− 1 hour to produce
− = €50 x 1 hour
− = €50
• Product B
− 2 hours to produce
− = €50 x 2 hours
− = €100
August 17, 2020 39
Traditional Cost Accounting View - Total Cost
• Product A
• Direct Production Costs =
€20
• + Overhead = €50
• Total Cost = €70
• Product B
• Direct Production Costs =
€40
• + Overhead = €100
• Total Cost = €140
August 17, 2020 40
Activity Based Costing – Calculation Of Overheads
• Look at the activities the organisation performs for each
product and their costs
August 17, 2020 41
Activity Total Cost Cost Driver
Setup €10,000 Number of setups
Machining €40,000 Number of hours
Receiving €10,000 Number of receipts
Packaging €10,000 Number of deliveries
Engineering €30,000 Number of hours
Total €100,000
Activity Based Costing – Calculation Of Overheads
• Allocate activities to products and understand the actual
activity costs associated with each product
August 17, 2020 42
Activity Product A Cost Product B Cost Cost
Setup 1 €2,500 3 €7,500 €10,000
Machining 1 €2,000 3 €38,000 €40,000
Receiving 100 €2,500 1,900 €7,500 €10,000
Packaging 1 €2,500 3 €7,500 €10,000
Engineering 500 €15,000 500 €15,000 €30,000
Total €24,500 €75,500 €100,000
• Apportioning total overheads for each product according to
their actual usage:
− Product A - €24,500 /100 units = €245
− Product B - €75,500 /950 units = €79.47
Activity Based Costing Creates A Different View Of
Product Costs
• Product A
• Direct Costs = €20
• + ABC Overhead = €245
• Total Cost = €265
• Product B
• Direct Costs = €40
• + ABC Overhead = €79.47
• Total Cost = €119.47
August 17, 2020 43
Comparison Between Traditional Cost Accounting
and ABC
• Product A is much more expensive to produce than originally thought
• If Product A is priced based on original view of costs, you will lose money
• Product B is cheaper to produce and so its price could be reduced to
stimulate greater demand or capture greater market share for competitors
while still making a profit
• Activity Based Costing provides a better understanding of consumption of
resources across the product or service value chain
August 17, 2020 44
Product A Product B
TCA ABC TCA ABC
Direct Costs £20 £20 £40 £40
Overhead Costs £50 £245 £100 £79.47
Total £70 £265 £140 £119.47
Organisation Value Chain And IT Value Chain
• The IT value chain is a chain within a
chain
• The IT function supplies services to
the business to support and enable
its value chain
• The same principles that apply to
organisation value chains can be
applied to the IT value chain
August 17, 2020 45
Legal, Regulatory, Environment, Health and Safety Services
Procurement, Supplier and Partner Services
Knowledge, Improvement and Change Services
Research and Develop and Manage Products and Services
Acquire
Raw
Inputs
Create
Product
or Service
Market
and Sell
Product
or Service
Deliver or
Supply
Product
or Service
Service
and
Support
Product or
Service
Facilities Services
Financial Services
Human Resource Services
Legal, Regulatory, Environment, Health and Safety Services
Procurement, Supplier and Partner Services
Knowledge, Improvement and Change Services
Research and Develop and Manage Products and Services
Acquire
Raw
Inputs
Create
Product
or Service
Market
and Sell
Product
or Service
Deliver or
Supply
Product
or Service
Service
and
Support
Product or
Service
Facilities Services
Financial Services
Information Technology Services
Human Resource Services
IT Value Chain
Organisation Value
Chain
Organisation Value Chain And IT Value Chain
• In the case of services provided by the IT function, these
are rarely provided directly to paying external customers
− Even where the solutions and services are used directly by
external customers, the value generated accrues to the owning
business function
• The business value generated by the solutions and services
provided by the IT function is indirect
• The IT function has little direct control over the value the
business generates from the solutions and services
• The business uses the IT services as part of their value
chain.
August 17, 2020 46
Organisation Value Chain And IT Value Chain
• The IT function is all too often a monopoly provider of IT
services to the business functions or at least a gatekeeper
to external solution and service providers, allowing or
disallowing their introduction and use
• This gives rise to shadow IT where the business bypasses
what they view and experience as an unresponsive central
IT function and goes directly to external service providers
• Monopoly providers are in a privileged position and need
to recognise this and be subject to appropriate governance
and oversight to ensure that the lack of competition does
not lead to accidental or deliberate abuse.
August 17, 2020 47
Value Chain
Value Chain, Secondary Services, Supply Chain And
Cost Analysis
August 17, 2020 48
Secondary
Supporting
Services
and
Processes
Supply
Chain
Cost
Analysis
Value Chain Draws
on Secondary
Services
Wider Supply
Chain Impacts
Operation of Value
Chain
Accurate Cost
Analysis is
Important to
Understanding
Actual Value
Accurate Cost
Analysis is
Important to
Understanding
Actual Value
Wider
Organisation
Operating
Landscape
Supply Chain Assists With
Understanding External
Value Pressures
Supply Chain
Processes
Have Costs
Introduction To IT4IT Reference Architecture
August 17, 2020 49
IT4IT Reference Architecture
• IT4IT aims to be a standard and repeatable reference
architecture that enables the creation of an information
technology management environment
• It is intended to provide a guide to the design of the IT
service delivery function
• It seeks to enable organisations adapt to changes in
technologies, methodologies and processes without having
to alter the IT management approach, structure and
operations
August 17, 2020 50
IT4IT IT Value Chain
17 August 2020 51
Governance, Risk and Compliance
Strategy
to
Portfolio
Requirement
to
Deployment
Request to
Fulfil
Detect to
Correct
Resource and Project
Intelligence and Reporting
Sourcing and Vendor
Finance and Assets
Efficiency
and
Agility
Supporting
Activities
Value
Streams
Plan Build Deliver Run
IT4IT IT Value Chain
• Primary Value Streams
• Strategy to Portfolio
• Requirement to Deploy
• Request to Fulfil
• Detect to Correct
• Supporting Activities
• Governance Risk and
Compliance
• Sourcing and Vendor
• Intelligence and Reporting
• Finance and Assets
• Resource and Project
August 17, 2020 52
IT Pillars Of IT4IT Reference Architecture
• Service Model
• Information Model
• Functional Model
• Integration Model
August 17, 2020 53
Service Model
• Based on a provider/broker model to define the way IT
provides services to the business
• Emphasises services as the primary IT deliverable
• Uses a service-centric lifecycle framework to provide a
continuous assessment of the portfolio, sourcing and
integrating components and servers offered to consumers
• Service model is designed to store and manage service
information – entities, data, attributes, relationships
• Each of the four IT Value Streams uses elements of the
Service Model to create an integrated view of IT
August 17, 2020 54
IT4IT Service Model Backbone
August 17, 2020 55
Service Providers
Service Consumers
Service
Model
Conceptual Logical Realised
Continuous
Assessment
Continuous
Integration
Continuous
Delivery
Conceptual
Service
Logical
Service
Service
Release
Service
Release
Blueprint
Service
Catalog
Entry
Desired
Service
Actual
Service
Four Primary Value Streams
• Request to Fulfil (R2F)
• Accepts the Service Release Blueprint and
creates Service Catalog Entries describing
its technical capabilities that are
incorporated into Offers
• Offers have Service Contracts that define
their usage
• Services are moved into production
• Detect to Correct (D2C)
• Creates an operational service
management framework that monitors
service operation and use and the IT
Operations that incorporate services
• Provides feedback on service usage to
Strategy to Portfolio (S2P) for new services
or changes to existing services
August 17, 2020 56
• Strategy to Portfolio (S2P)
• Accepts and processes requests for
new services or changes to existing
services from business functions or IT
• Creates a Conceptual Service design
that connects the business and IT
elements of
• Requirement to Deploy (R2D)
• Accepts the Conceptual Service and
creates a more detailed description of the
Logical Service and its components
• In turn this is used to create Service
Release which is defined in Service
Release Blueprint
• The service is developed or procured and
delivered
Primary Value Streams And Service Models
August 17, 2020 57
Strategy to
Portfolio
Requirement to
Deployment
Request to
Fulfil
Detect to
Correct
Conceptual
Service
Model
Realised
Service
Model
Logical
Service
Model
Drive IT Value
Measure and Create Insight
Service Model Elements
• Each of the four value streams are designed to contain the
capabilities needed to manage the service lifecycle
• Capabilities are achieved as a set of functional components and
data objects
• Functional components are individual stand-alone technology
units that can perform a discrete function
• Functional components have defined data objects as inputs and
outputs
• Data objects are intended to hold essential, relevant sets of
(business) data that are used, processed, enriched, extended or
changed by functional components
• Data objects are also used to hold details on relationships
between functional components
August 17, 2020 58
IT Service Lifecycle
• The four Value Stream elements are intended to describe
the service lifecycle
• The functional components in each Value Stream elements
create and update data objects
August 17, 2020 59
Strategy to
Portfolio
Requirement
to Deployment
Request to
Fulfil
Detect to
Correct
IT Value Chain
Plan and drive the
IT portfolio to
achieve
business
innovation
Provide what the
business
needs when it
needs it
Describe,
catalogue, fulfil,
monitor and
manage service
usage
Anticipate and
resolve
operational and
service issues
IT4IT Information Model
• Information model consists of service lifecycle model data
objects and their linkages
• Each of the value streams creates, uses and updates data
objects
• Each data object describes a dimension of a service
• Data objects are inputs to or outputs from a functional
component or a phase of the service lifecycle
• Each data object has its own lifecycle
• The data object contains information structures that allows its
relationships be recorded and maintained
• IT4IT focuses on data rather than organisation processes or
structures
− The organisation information model is less subject to change that
processes or structures
August 17, 2020 60
Data Object Types
• Key Data Objects – contain information on how services are
created, provided and accessed
− Uses in managing the service lifecycle
• Service Model Backbone Data Objects – contain information
on the functionality provided
− Conceptual
− Logical
• Design
• Release
• Consumable
− Realised
• Desired
• Actual
• Auxiliary Data Objects – contain context and attribute
information
August 17, 2020 61
Functional Model
• Functional components are stand-alone building blocks
within value streams that create and use data objects
− Generally one data object for each functional component
• The Functional Model defines the functional components
and their relationships
• Functional components are linked to IT capabilities – a
function or activity that creates an result
August 17, 2020 62
Functional Model Types
• Primary Functional Component – performs a core role in
the actions of a value stream
• Secondary Functional Component – not central to the
operations of a value stream but there is a dependency
− May be a primary functional component to another value stream
or provide supporting functionality and capability
• Some functional components can be primary to more than
one value stream
August 17, 2020 63
Functional Components Within IT4IT Value Streams
August 17, 2020 64
Strategy to Portfolio
(S2P)
Enterprise Architecture
Policy
Proposal
Portfolio Demand
Service Portfolio
IT Investment Portfolio –
Auxiliary
Requirement to
Deploy (R2D)
Project
Requirement
Service Design
Source Control
Build
Build Package
Release Composition
Test
Defect
Request to Fulfil
(R2F)
Engagement Experience
Portal – Secondary
Offer Consumption
Offer Management
Catalog Composition
Request Rationalisation
Fulfilment Execution
Usage
Chargeback/Showback
Knowledge and Collaboration
Supporting Function
Detect to Correct
(D2C)
Service Monitoring
Event
Incident
Problem
Change Control
Configuration Management
Diagnostics and Remediation
Service Level
Integration Model
• IT4IT integration model aims to simplify the creation of management
subsystem using functional components
• Integrations are typically accompanied by a System of Record data
flow
• Integration types:
− System of Record Data Centric
• Enables consistent management of data object lifecycle
• Ensures data objects are consistently named and linked between functional components
• Maintains the integrity of the Service Model
− System of Engagement Experience-Centric
• User interface integrations
• Combine functional components to create a user-case or usage journey that facilitates
interactions
− System of Insight Intelligence, Analytics and KPI-Centric
• Data-centric integrations
• Provide end-to-end traceability, visibility, transparency and capture measurements
related to services
• Facilitates the exchange of structured and unstructured data that is created across the
value chain
August 17, 2020 65
IT Service
• IT services perform work on behalf of a service consumer
to generate a result, outcome or a change of state
• Three service elements
− Service Offer – the capability of the service that is made available
to and consumed
− Service Interaction – the invocation of the service by the service
consumer communicated to the service provider and the input
and output information
− Service System – the set of technology components, processes
and people that constitute the service, deliver on the Service
Offer and perform the Service Interaction
August 17, 2020 66
IT Service
August 17, 2020 67
Service System
Technology, Processes,
People, Skills,
Information
Service Offer
Published Capability,
Contract
Service Interaction
Invocation,
Performance,
Transaction
Is An
Abstraction
Of
Defines The
Provider Scope
And Expectations
IT Service
Service Outcome
Technology, Processes,
People, Skills,
Information
Enables
And
Allows
Results
In
Defines The
Consumer
Expectations
IT4IT Abstraction Levels And Class Structure
• IT4IT Reference Architecture has five levels of abstraction and
detail
• Each lower level extends the higher level with more detail
August 17, 2020 68
Level 1 – End-to-End Overview
Level 2 – Value Stream Documentation
Level 3 – Vendor-independent Architecture
Level 4 – Vendor-Specific Refinement Architecture
Level 5 – Solution Architecture
Contains vendor-
independent generalised
views that can be used for
strategy and planning and
the creation IT
management roadmaps
Contains specific details
that enable the
development of
implementation and the
design of products
Level 1 – End-to-End Overview
• Provides an overview of the IT4IT Reference Architecture
• Introduces the five core concepts:
− Value Streams
− Functional Components
− Service Lifecycle Data Objects
− Service Model Backbone Data Objects
− Relationships
August 17, 2020 69
Level 1 Class Model
• All data objects are viewed as service lifecycle data objects
• The service lifecycle data objects that represent the
Service Model are a type of lifecycle data object
August 17, 2020 70
Value Stream
Functional
Component
Lifecycle Data
Object
Service Backbone
Data Object
RelationshipHas One
or More
Has One
or More
Value Streams
• Value streams are groups of functional components and
data objects where value is created
− Strategy to Portfolio (S2P)
− Requirement to Deploy (R2D)
− Request to Fulfil (R2F)
− Detect to Correct (D2C)
• Supporting functions within the value chain model
− Supplier Management
− Asset Management
− Human Resource Management
− Legal
− IT Financial Management
August 17, 2020 71
Functional Components
• Smallest technology unit or component that can stand on
its own and be able to perform a useful function
• Has data objects as defined inputs and outputs
• Performs an operation on (one or more) data objects
• Functional components are associated with a specific
primary value streams and supporting functions
• Secondary functional components that operate on data
objects outside their primary value stream
August 17, 2020 72
IT4IT Level 1 Reference Architecture
August 17, 2020 73
Service Lifecycle Data Object
• Service lifecycle data object represents data(in a variety of
forms and formats that describe, represent or extend an aspect
of a service being offered by IT
• Data objects can be digital or physical and can contain
structured, semi-structured, or unstructured data
• Service Model Backbone data objects are a specific data object
type that combine all the information needed to offer and
manage a service
• The IT4IT reference architecture seeks to define the data
objects that are needed to ensure end-to-end operational or
financial traceability of a service along the service lifecycle
• The service lifecycle data objects represent the authoritative
source data and/or master data needed to manage the
business of IT
August 17, 2020 74
Relationships
• IT4IT Reference Architecture seek to defining both the data
objects and their key relationships
• The data objects and their relationships and dependencies
form the System of Record Fabric for IT management
• These relationships are viewed as System of Record
Integrations
• This System of Record Relationship Mapping is designed to
ensure end-to-end service traceability and to ensure the
Service Model integrity is be maintained across the lifecycle
• Adhering to it removes any confusion and conflicts that may
arise from process re-engineering exercises that may take place
within the IT function
August 17, 2020 75
IT4IT System Of Record Fabric
• System of Record Fabric showing the Service Lifecycle Data
Object and their relationships
August 17, 2020 76
IT4IT Level 2 Reference Architecture
• Level 2 expands on Level 1 with the following:
− The relationships between data objects have
multiplicity/cardinality (one-to-one, one to many, many-to-many)
attributes added
− Details on data flows between functional components are added
− Data flows details on integrations are added
− Relationships between capability disciplines and functional
components are added
August 17, 2020 77
IT4IT Level 2 Class Model
• Multiplicity is the number of allowable instances of an element in terms of the
relationships between data object instances
• Only key relationships - those that contribute to the advancement of the service
lifecycle – are defined
• There are other relationships that may be needed to define specific policies,
processes or capabilities but these are not prescriptive
August 17, 2020 78
Level 2 Data Flows
• A data flow represents the exchange of information
between functional components
• Data flow information is added in Level 2 diagrams to
identify the need for data integration and data sharing
• Data flow information can identify dependencies between
functional components and illustrate how they work
together to deliver value
August 17, 2020 79
Level 2 System of Record (SoR) Integration
• The System of Record (SoR) Integration is the authoritative
source system for integrations between functional components
• In order for the system of record relationships to be
maintained over the service lifecycle these integrations and
their key data objects must be well defined
• A data flow creates a relationship or dependency between two
data objects in the functional components that participate in
the data flow
• The relationship between the two data objects must be
maintained
• The lifecycles of the two data objects are interlinked so updates
to one may have an impact on the other
• The integrations ensure the integrity of the system of record
fabric and the Service Model
August 17, 2020 80
Level 2 System of Record (SoR) Integration – Sample
Data Object State Model Dependency
• Events can give rise to Incidents
• The states of Event and Incident data objects are therefore both
interrelated and interdependent
August 17, 2020 81
Level 2 System of Engagement (SoE) Integration
• Integrations exist between functional components to
enable interactions with the associated data objects
• Called system of engagement integrations
• Integrations follow-on from use cases within value streams
• Show how data object relationships give rise to or have an
impact on system-to-system and human-to-system
August 17, 2020 82
Level 2 System of Engagement (SoE) Integration -
Sample
August 17, 2020 83
Level 2 Capability Discipline
• Capabilities enable organisation achieve results through a
combination of people, process and technologies
− Different organisation types and profiles will have different sets of
capability requirements with different priorities
• Organisations require many capabilities across solution design
and delivery, programme and project management and service
management
• Capabilities are achieved as a set of functional components and
data objects
• Functional components are individual stand-alone technology
units that can perform a discrete function
• The IT4IT reference does not define key capabilities or define a
means to assess what capabilities are important
− It assumes that key capabilities can be derived from existing
frameworks
August 17, 2020 84
Level 2 Capability Discipline – Sample
August 17, 2020 85
IT4IT Level 3 Reference Architecture – Vendor-
independent Architecture
• Level 3 of IT4IT contains a more formal specification of
the reference architecture
• Details on scenarios, essential attributes and essential
services are added
• Level 3 extends the Level 2 Class Model
August 17, 2020 86
Level 3 Scenarios
• Scenarios describe interactions between actors and
functional components of a system
• Scenarios represent larger sets of interactions
• Scenarios are designed to provide explanations of the IT4IT
Reference Architecture in a format that is easy to
understand
• Scenarios can be customised to meet the requirements of
organisations that use IT4IT
• Scenarios are specific implementations or use cases of
IT4IT to deliver service-centred facilities
August 17, 2020 87
Sample Scenarios Envisaged By IT4IT
• Multi-Vendor Selection and Management
• Demand and Capacity Management
• Change and Configuration Management
• Service Request Management, Self Service and Knowledge
Management
• Business Strategy and Solution Portfolio Management
• Cloud Platform and Solution Selection and Management
• Business Intelligence, Reporting and Data Visualisation
• Asset Management
• Financial and Cost Management
• Risk Management
August 17, 2020 88
Scenario Descriptions
Descriptive Element Details
Introduction Overview of the scenario and description of the goal to be achieved
Requirements Requirements represent the necessary properties of the system
components needed to achieve the objectives defined by the
scenario goals
Process Flow Defines the scenario process and its sequence of activities and steps
Automation Specification using
the Reference Architecture
Details how the IT4IT Reference Architecture will support and
enable the specific process contained in the scenario
Essential Services Supporting
the Scenario
Service integrations between functional components and data
objects involved in the scenario
Data Objects and Essential
Attributes
Details on the data objects and their of the objects that that are
essential in the operation of the scenario to maintain the integrity
of the system of record fabric
Any Proposed Changes or
Extensions to the Reference
Architecture
Details on any proposed or required changes or enhancements to
the IT4IT reference architecture to enable the operation of the
scenario
August 17, 2020 89
Level 3 Essential Attributes
• Data exchanged between functional components is represented as data objects
• Level 3 defines the necessary data object attributes
− Most basic essential attributes are a unique identifier and the data object lifecycle status
• Minimum set that is needed to maintain the integrity of the system of record
fabric
• Example shows the essential attributes that uniquely identify an Event and an
Incident
August 17, 2020 90
Level 3 Essential Services
• Essential services provide facilities to enable integration
between functional components or access a data object
• IT4IT intends that essential services are implemented as a
web service, micro service or API rather than individual
point-to-point integrations
• IT4IT currently does not contain a defined list of essential
services
August 17, 2020 91
Level 4
• Levels 4 and 5 of IT4IT are intended to be owned and
controlled by suppliers of IT management products and
services
• Level 4 allows providers to design and detail their services,
interfaces and exchange models that should be derived
from Level 3
• Extensions can include
− Data model and data objects
− Scenarios
− Processes
− Integrations
August 17, 2020 92
Level 5
• Level 5 allows for provider-specific representations for
how elements of or all of the IT4IT Reference Architecture
are implemented
• Contains the specifications and/or functionality for IT
management products and services
• Includes variations and adaptations of IT4IT
August 17, 2020 93
Strategy to Portfolio (S2P) Value Stream
August 17, 2020 94
Objective is for IT to contribute to
business strategy and planning enabling
IT alignment with business plans
Traditional IT Planning and Portfolio Planning
• Focus is on evaluation, approval and
delivery tracking of project proposals
• Emphasises minimising costs for IT
initiatives or assets
• No overall IT portfolio view across IT Architecture,
PMO and Service Portfolio functional areas
• Inconsistent solution delivery and service
management processes
• Inconsistent and poor quality data
• Poor tracking and connection across conceptual,
logical and physical domains of service delivery
IT needs accurate and current information on
the IT portfolio
• Understand the relationships
• and dependencies
• Enable the co-ordination of all the
elements of IT in
• Ensure IT function supports business
objectives and goals
IT4IT S2P Value Stream
• Aims to provide overall view of IT portfolio
activities through data integrations across
all areas of the IT portfolio
• Seeks to provide a blueprint for optimising
service and investment
• Looks to provides greater understanding of
the relationships between the many IT
functional areas such as IT Architecture,
PMO, Application Management, Operations
Management and Security Management
• Intends to provide an end-to-end IT
portfolio view makes visible the key data
objects frequently ignored during IT
portfolio planning activities
• Defines a framework to define key data
objects and their relationships
Limitations
Requires
IT4IT Aims
Strategy to Portfolio (S2P) Value Stream Functional
Components And Data Objects Overview
August 17, 2020 95
Strategy to Portfolio (S2P) Business Value
Proposition
Provide a complete view
of IT portfolio across the
Enterprise Architecture,
PMO and Service
Management functions
Allow IT portfolio
decisions to be made
based on business
priorities
Enable prioritised IT
investments based on IT
portfolio analysis factors
such as impacts on
architecture, service
roadmap, business
priorities
Balance IT investments
across strategic and
operational areas
Provide accurate view of
business and IT demand
Ensure IT portfolio data
consistency
Support service lifecycle
tracking through
conceptual, logical, and
physical domains
Communicate with
business stakeholders
through IT portfolio
roadmaps
August 17, 2020 96
• Provide a framework for connecting those functions that
support IT Portfolio Management, ensuring data consistency
and proper data hand-offs in order to optimise the
organisation’s IT Portfolio Management
Strategy to Portfolio (S2P) Key Performance
Indicators And Critical Success Factors
August 17, 2020 97
Success Factor Performance Indicators
Business and IT Alignment • Ratio of new and maintenance activities, effort and cost
Accurate View of Overall
Demands from Business
• Demand requests, types and delivery per service as a percentage of overall IT budget that can be traced to formalised demand
and service requests from business
• Structured and operational Demand Management process with continuous improvement efforts to minimise the number of
demand queues that staff must respond to
Service Portfolio
Rationalisation
• A formal Service Portfolio functional component process exists under a Service Portfolio Management process owner
• Classifications and agreed definitions for understanding functional and technical redundancy and business value of the IT service
are implemented and operational
• Processes for consistently evaluating and tagging portfolio entries are implemented and operational
• Service portfolio is subject to ongoing rationalisationusing the taxonomies, implemented as continuous improvement
• Service and IT Portfolio Management functions and processes are rationalised with clear scoping and relationship established
Service Portfolio Financial
Analysis
• Financial reports are produced regularly to show the ongoing investment and spend in each service/application
• Financial reports are compared with business outcomes and the financial objectives that have been achieved
Service Portfolio Reporting
and Analysis
• A service portfolio exists and is used to decide which services to offer
Service Investment
Tracking
• The investment in each service in the service portfolio is known and quantified
• Investment in each service is reported, from the initial investment and the monthly, quarterly, and annual ongoing budget spend
and cost of operation
Improved Customer
Satisfaction
• Number/percentage of satisfied customers per service/application
Stewardship of IT
Investment
• Capital expenditure and operational expenditure
• Software license percentage actually in use
• Planned versus actual service costs
• Average cost of IT delivery (per service/application) per customer.
Enterprise Security
Alignment
• Frequency of security assessments against latest standards and guidelines
• Deficiencies against security standards and policies
Strategy to Portfolio (S2P) Functional Components
August 17, 2020 98
Strategy to Portfolio
(S2P)
Enterprise Architecture
Policy
Proposal
Portfolio Demand
Service Portfolio
IT Investment Portfolio –
Auxiliary
Requirement to
Deploy (R2D)
Project
Requirement
Service Design
Source Control
Build
Build Package
Release Composition
Test
Defect
Request to Fulfil
(R2F)
Engagement Experience
Portal – Secondary
Offer Consumption
Offer Management
Catalog Composition
Request Rationalisation
Fulfilment Execution
Usage
Chargeback/Showback
Knowledge and Collaboration
Supporting Function
Detect to Correct
(D2C)
Service Monitoring
Event
Incident
Problem
Change Control
Configuration Management
Diagnostics and Remediation
Service Level
Enterprise Architecture Functional Component
August 17, 2020 99
Purpose • Create and manage long-term IT investment frameworkand delivery plan that are criticalto business strategic objectives
Functional
Elements
• Create and manage long-term IT investment frameworkand delivery plan
• Identify strategic IT architecturalcomponents based on current business vision, strategy, goals, and requirements
• Develop target state business, information, application,technology, and security blueprints based on strategies, principles, and policies
Key Data Objects • Enterprise Architecture - contains references to the target state architecture landscape representing planned and deployed IT services
Key Attributes • ID - Unique service identifier
• Component - Architectural buildingblocks required to enable a service
• Diagram - As-is business, data, application, and technology domain architecture description from the viewpoint of IT service owners
Key Data Object
Relationships
• Enterprise Architectureto ConceptualService – used to track which service components and service diagrams are allocated to which service(s)
Policy Functional Component
August 17, 2020 100
Purpose • Manage the creation, review, approval and audit of all IT policies
Functional
Elements
• Align and map IT policies to Enterprise Architecture
• Manage policies relating to IT governance
• Manage IT security and regulatory policiesby incorporatingexternal and internal security and regulatory compliances
• Enable review and approval of IT policies based on roles and responsibilities
• Manage the distribution and acceptance of policies used on predefined templates and schedules for designated IT stakeholders
• Provide visibilityinto IT Policyattributes such as types, status, non-compliance, audit history, and issues
• Define pricing/costingpolicies and capture informationrelated to Service Contracts
• Maintain policy revision history and review period or obsolescence rules
• Log and track IT policy exceptions and track policies for exception identification, evaluation, and status report leading to corrective action
Data
Architecture
Elements
• Associate one or more policies to one or more Conceptual Services
Key Data Objects • Policy - Central repository for storing and organising all types of IT policies based on various templates and classificationfactors
Key Attributes • ID - Unique policy identifier
• Description - Description/detailsof the policy
• Applicable Geography - Which geographies the policy applies to
Key Data Object
Relationships
• Policy to Conceptual Service - Multiple policies might be applicablefor a single
• service or a single policy may be applicablefor multipleservices
• Policy to Requirement - Requirements may be sourced from policies or may
• reference policies in order to remain in compliancewith previously agreed policies
Proposal Functional Component
August 17, 2020 101
Purpose • Manage the portfolio of IT proposals that are proposed, approved, active, deferred or rejected
Functional
Elements
• Create a structured Scope Agreement that includes proposals from rationalisedPortfolioBacklog Items through a structured analysis approach
• Send proposed IT investments to the IT Investment Portfolio functionalcomponent for scoping and investment decisions
• Update Scope Agreement(s) to compare approved baseline and actual resulting
• benefits derived from completing the IT Initiatives
• Review, evaluate and take action on Scope Agreement change requests from the R2D Value Stream
• Consider the R2D Value Stream project portfolio as the authoritativesource for the list of IT deliverablesor services that will be rendered during a
delivery lifecycle
• Create project portfolio views for specific business functions
• Manage the project portfolio entries through the Project Management framework being used
• Ensure that the project portfolioreports back to the investment portfolio in order to accurately track progress and outcomes for a given Scope
Agreement
• Implementsecurity controls necessary for protecting the various classificationsof data
Key Data Objects • Scope Agreement - Proposals are created from rationalisedPortfolioBacklog Items
• Scope Agreements reflect budget, cost/benefit projections, scope, status,
• and other key attributes of proposed work
• Views can be created for specific business functions
• Used for building the IT investment plan of record for the organisation or a business function
Key Attributes • ID - Unique identifier of the Scope Agreement
• Description -Details of the Scope Agreement
• Business Entity - Business or geographic unit
• Proposed Budget - Requested
• Approved Budget - Approved budget
• Status - Status such as proposed, approved, rejected
Key Data Object
Relationships
• Scope Agreement to Portfolio Backlog Item - One Scope Agreement can be associated to one or more demand data objects
• Scope Agreement to IT Budget Item - Helps track budget allocated to which Scope Agreement.
• Scope Agreement to IT Initiative - Helps track IT Initiative(s)to Scope Agreement
Portfolio Demand Functional Component
August 17, 2020 102
Purpose • Log, maintain, and evaluate all demands (new service, enhancements, defects) coming into IT through a single mechanism
• The single mechanism co-ordinates demands across all of project ideation, service request management, incident management, continuous
improvementand other demand channels
• Correlate incomingdemand to similarexisting demand or create new demand
Functional
Elements
• Capture PortfolioBacklog Items from business
• Capture PortfolioBacklog Items from Problem Management activities
• Capture PortfolioBacklog Items from the Service Portfolio functionalcomponent Activities
• Capture PortfolioBacklog Items for defect fix requests which exceed the operations budget or require urgent attention due to business impact on
existing service
• Support backlog item data object backlog ranking, trending, and analysis based on requested services, timeline, business unit origination, etc.
• Categorise and group the demands and push demands to the Proposal functional component
• Receive scoping and investment decisions from the Proposal functional component
• Associate one or more Requirements(user stories, use-cases, business rules, etc.) to a
• PortfolioBacklog Item
Key Data Objects • Portfolio Backlog Item - Represent the repository of all incoming demands includingbut not limitedto new requests, enhancement requests and defect
fix requests
Key Attributes • ID - Unique identifier
• Description - Description/detailsof the Portfolio Backlog Item (demand request)
• Source - Where did the demand originatefrom (e.g., person/department)
• Scope Agreement ID - Unique identifier of the related Scope Agreement
• Estimated Budget - May store budget (as estimated during creation of the Scope Agreement) of the Portfolio Backlog Item
• Expected Completion Date - Expected completion date (as estimated during creation of the Scope Agreement) of the PortfolioBacklog Item.
• IT Service ID - The conceptual service ID. Is demand related to a live service (e.g., enhancement requests)
• Fulfilment Status - Status information
• Decision Maker - Informationon who took the decisions related to the demand
Key Data Object
Relationships
• Portfolio Backlog Item to Conceptual Service - One Conceptual Service may be related to one or more PortfolioBacklog Items
• Portfolio Backlog Item to Requirement - A PortfolioBacklog Item is mapped to one or more Requirements which will need to be delivered to successfully
fulfilthe demand
• Portfolio Backlog Item to Scope Agreement - One or more PortfolioBacklog Items may be included in a Scope Agreement
Service Portfolio Functional Component
August 17, 2020 103
Purpose • Manage the portfolio of services in plan, transition, production and retirement
• Be the authoritative source for the list of services that IT delivers, has deliveredin the past, or brokers to itself and
• Business
• Any IT service within the Service Portfoliofunctional component often corresponds to one or more entries in the Offer Catalog
Functional
Elements
• Assess the effectiveness and efficiencyof current services delivered to business
• Manage all inventory informationabout services or applications; includingbusiness benefits, risk, quality, fit to purpose, etc
• Compare similarservices or applications to identify rationalisationopportunities
• Evaluate the portfolio with regard to value/cost performanceand risk/criticalityto maximise portfolio value, align and prioritiseresource allocations, and
balance supply and demand
• Review proposed portfoliochanges; decide whether to keep, retire, or modernise services or applications
• Create, review, and update service roadmaps
• Determine and track the TCO of a service and associated return on investment
• Determine and track operations spend
• Create and maintain service blueprints and endpoints
Key Data Objects • Conceptual Service - Represents the business perspective of the service and is the service interaction or the business capability of the service
• Conceptual Service Blueprint - contains the various deliveryoptions for a given Conceptual Service
Key Attributes • Conceptual Service
• ID - Unique identifier of the Conceptual Service
• Details - Details of the Conceptual Service
• Owner - Owner of the Conceptual Service
• Status - Status of the Conceptual Service; e.g., planned, retired, etc.
• Business Unit/Portfolio - The business unit or portfolio to which the service belongs
• Budgeted Spend - Approved budget for service development and maintenance
• TCO: Total cost of ownership of a Conceptual Service (includes development, run, enhancement and overhead charges)
• Recovery - Return on investment against the Conceptual Service
• Conceptual Service Blueprint
• ID - Unique identifier of the Conceptual Service Blueprint
• Details - Details of the Conceptual Service Blueprint
• Conceptual Service ID - Unique identifier of the Conceptual Service to which the Blueprint is associated
Key Data Object
Relationships
• Conceptual Service
• Conceptual Service to Logical Service - Traceabilityis maintainedbetween one Conceptual Service and one or more Logical Services
• Enterprise Architectureto ConceptualService - Traceabilityis maintained between one or more Conceptual Services and the Enterprise
Architecture drawings, diagrams and other documents that describe those services
• Conceptual Service to Portfolio Backlog Item - One Conceptual Service may be related to one or more PortfolioBacklog Items.
• Conceptual Service to IT Budget Item - Budget for one Conceptual Service may be spread across multiplebudget items and one budget item
should hold budget for a single Conceptual Service
• Conceptual Service to Policy - Multiple Policiesmight be applicablefor a single service or a single Policy may be applicablefor multipleservices
• Conceptual Service Blueprint
• Conceptual Service to Conceptual Service Blueprint - One Conceptual Service may have multiple Conceptual Service Blueprints
• IT Cost Model to ConceptualService Blueprint - One IT cost model (rule engine) can be applicable for multipleConceptual Service Blueprints
• Conceptual Service Blueprint to Logical Service Blueprint - One Conceptual Service Blueprint could have one or more Logical Service Blueprints
IT Investment Portfolio – Auxiliary Functional Component
August 17, 2020 104
Purpose • Manage the portfolio of all authorised IT investments
Functional
Elements
• Manage the entire IT investment lifecycle
• Be the authoritative source for all IT investments requested over a given time period
• Receive proposed IT investments for developmentfrom the Proposal functional component
• Receive proposed IT investments for run and maintain and non-service investments from investment owners
• Assess proposal feasibilityfor cost, value, etc. and obtain required approval from Finance
• Communicate the status of the final scoping and investment decisions back to the respective stakeholders.
Key Data Objects • IT Budget Item – Contains an authoritativelist of approved IT investments pertaining to a service
Key Attributes • Financial Period - Financial period for which the IT Budget Item is recorded.
• Investment ID - Unique identifier of the service or investment (e.g., overhead) for which the IT Budget Item is recorded
• Investment Type - Nature of investment (e.g., run, development, overhead)
• Approved Budget - Approved budget
• Spend - Actual spend
Key Data Object
Relationships
• IT Budget Item to Conceptual Service - One IT Budget Item shall hold budget for a single Conceptual Service and budget for one Conceptual Service may
be spread across multiple IT Budget Items
• IT Budget Item to Scope Agreement - Helps track how much IT budget is allocated to which Scope Agreement(s)
Requirement to Deploy (R2D) Value Stream
Overview
• Aims to ensure predictable, cost-effective, high quality
results of service delivery to business consumers while
seeking to achieve high levels of component re-use,
flexibility, speed and collaboration across the IT function to
support traditional and new approaches for service
creation and service sourcing
August 17, 2020 105
Requirement to Deploy (R2D) Value Stream
Overview
August 17, 2020 106
Make service delivery predictable
and efficient across dispersed teams,
multiple suppliers and different
solution delivery approaches and
technologies
• Many different parties are involved in
solutions sourcing
• Each party works with their own
processes, technologies and approaches
• New technologies and approaches such as
cloud sourcing, agile development,
continuous delivery, data growth and
demands have created the need for IT to
be able to manage development and
delivery of solutions in a hybrid or multi-
sourced environment
• The gap between business expectations of
IT solutions and IT solution provision
capability and capacity is getting wider
• IT operations may not be able to
accommodate new technologies and
environments fast enough to meet the
requirements of solution consumers
• Development organisations create
solutions in isolation that are made live
without adequate
• There are still too many incidents
immediately after a solution or service is
released into production
Why
• Be able to provide an overview of planned activities
• Put management controls in place to lessen the impact of
high staff turnover and capture the knowledge that would
otherwise be lost and cause schedules to be negatively
impacted
• Speak a common language with all parties involved and
provide a common methodology to achieve the high-
quality results
• Build a culture of collaboration between IT operations and
IT development to ensure service release success
• Establish control over the quality of a service regardless of
the number of suppliers involved in development and/or
delivery
• Ensure that each service release is high quality, fit-for-
purpose and meets customer expectations
How IT Must Respond
Requirement to Deploy (R2D) Value Stream
Functional Components And Data Objects Overview
August 17, 2020 107
Requirement to Deploy (R2D) Goals
• Understand the evolving relationship between planning and
delivery. planning of complex solutions requires information
only available through iterative attempts to fulfil requirements
so both planning and building must occur simultaneously
• IT operations and development must improve collaboration
across business and technical domains and suppliers
• Drive predictable outcomes without driving out innovation -
innovation and process efficiency are two elements of
competitive advantage that IT departments bring to the
business that frequently co-exist badly - emphasis on on-time
project delivery tends to suppress innovation - IT must
continuously improve its ability to execute in such a way that
on-time innovation is standard
August 17, 2020 108
Requirement to Deploy (R2D) Business Value
Proposition
August 17, 2020 109
Optimise the pipeline of
projects and smaller
demand requests for faster
service realisation
Ensure predictable
outcomes the solution or
service delivered performs
as requested, leading to
higher rates of solution
consumer acceptance and
better alignment with
actual business needs
Establish controls to
manage the quality, utility,
security and cost of
services, independent of
delivery method,
technology, source or
provider
Provide increase
management information
for traceability and
benchmarking of internal
and external solution and
service developers and
suppliers
Ensure that all services are
designed in accordance
with standards and policies
(Compliance, Enterprise
Architecture, Risk
Management, IT Financial
Management)
Provide improved inputs to
IT Financial Management
on actual solution and
service delivery and
operation cost
Demonstrate the link
between solution and
services and business value
by creating and maintaining
the service blueprint
Accelerate the sourcing and
delivery of solutions and
services
• Provide a framework of functional components and data objects so
IT functions can better control the quality, utility, schedule and cost
of services regardless of the specifics of the technology and delivery
model
Requirement to Deploy (R2D) Key Performance
Indicators And Critical Success Factors – 1
August 17, 2020 110
Success Factor Performance Indicators
Improved Quality • Number of defects not found
• % of actual versus planned executed tests
• % of critical defects found early in unit testing versus UAT
Improved Project and
Feature Execution
• % of projects, solutions and services delivered on time
• % of successful projects, solutions and services
• Deviation of planned to actual effort
• Number of identified issues
• Number of opened risks
• Amount of backlog/work-in-process
Improved Management of
IT Investment
• % of actual versus planned project, solution and service cost
• % of change in project, solution and service cost
• % of budget at risk
Increased Use of
Automation
• % of automated tests
Solution Delivery
Excellence
• % of requirements tested and completed
• % of requirements traced to tests
• % of reviewed requirements
• % of successful builds
• % of changes resulting in Incidents
• Ratio of detected to closed defects at release
Improve Early Life Success
of Releases
• % of Incidents during warranty period
• % of successful/unsuccessful deployments for the project
• % of emergency changes
• Pass rates on UAT/validated requirements
Requirement to Deploy (R2D) Key Performance
Indicators And Critical Success Factors – 2
August 17, 2020 111
Success Factor Performance Indicators
Operations and
Development
Collaboration
• Trend on early life support/UAT success metrics
• % rework
Improve Financial Visibility • Planned cost versus actual cost
Maintain a Linkage
between Business Services
and IT Initiatives
• Aggregate (roll up) service development costs by business service
High Quality Service
Design Specifications at
the Outset
• % reduction in the rework required for new or changed service solutions in subsequent lifecycle stages
Integration Test Success • Trend on the number of installation errors in all the packages in the integration environment
• Number of applications or services that require exceptions outside of the existing infrastructure portfolio
Design-Review to Ensure
Application Design
Complies with all Policies,
including Security
• Number of application designs that pass a security policy review
Early Testing of
Applications for Security
Vulnerabilities
• % of severity 1 security defects fixed before application is released
Requirement to Deploy (R2D) Functional
Components
August 17, 2020 112
Strategy to Portfolio
(S2P)
Enterprise Architecture
Policy
Proposal
Portfolio Demand
Service Portfolio
IT Investment Portfolio –
Auxiliary
Requirement to
Deploy (R2D)
Project
Requirement
Service Design
Source Control
Build
Build Package
Release Composition
Test
Defect
Request to Fulfil
(R2F)
Engagement Experience
Portal – Secondary
Offer Consumption
Offer Management
Catalog Composition
Request Rationalisation
Fulfilment Execution
Usage
Chargeback/Showback
Knowledge and Collaboration
Supporting Function
Detect to Correct
(D2C)
Service Monitoring
Event
Incident
Problem
Change Control
Configuration Management
Diagnostics and Remediation
Service Level
Project Functional Component
August 17, 2020 113
Purpose • Manage the creation and provide ongoing delivery supervision of IT Initiatives that create new or enhance existing services based on the Scope
Agreement, track and report on execution status, manage communication between internal and external stakeholder, manage deliveryfinances, manage
scope and handle changes, supervise resource acquisition
Functional
Elements
• Be the system of record (authoritative source) for all IT Initiatives
• Manage interactions with other functionalcomponents
• Manage the lifecycleof the IT Initiativeand govern, coordinate, influence, and direct IT Initiativeexecution
• Manage the acquisition of resources
• Manage the status of the IT Initiative and maintain traceability between IT Initiativesand associated applications and service(s)being developed
• Coordinate resources, finances, tasks, and milestones for IT Initiatives, and provide ongoing execution oversight of IT Initiatives when creating new
services or enhancements to existing services
• Create IT Initiativesbased on the specifications outlined in the Scope Agreement, includingcost, time, scope, and quality
• Aggregate, track, and report status, resources consumed against project plan, or project burn down, and communicate these to stakeholders
• Ensure financialgoals and boundary conditions are adhered to and track spending
• Manage change control
Key Data Objects • IT Initiative - Contains informationon the scope of the work to be performedand created from and associated with the Scope Agreement.
Data
Architecture
• Associate a Scope Agreement to one or more IT Initiatives
• Associate an IT Initiative to a service
• Associate an IT Initiative to one or more RFCs
• Associate an IT Initiative with IT Budget Items
Key Attributes • ID - Unique identifierof the effort/initiative
• Name - Full name of the effort/initiative
• Status - Status of the effort/initiative
• Service Release - Identifier of one or more Service Releases
• RFC ID - Identifierof one or more RFCs
• Budget - Budget for the IT Initiative
• Actual Spend - Actual spend on the IT Initiative
• Start Date - IT Initiative start date
• End Date - IT Initiativecompletiondate
• Scope Agreement ID - Unique identifier of the related Scope Agreement
Key Data Object
Relationships
• Scope Agreement to IT Initiative - Linkage between the proposal that authorised one or more IT Initiatives
• IT Initiative to Service Release - An IT Initiative will manage the creation of one or more Service Releases required to deliver the IT Initiative
• IT Initiative to Request for Change (RFC) - An Initiativewill be related to one or many RFC records in order to manage all changes resulting from a single
work effort (initiative)
Requirement Functional Component
August 17, 2020 114
Purpose • Collect, refine, track progress and manage requirements through the lifecycleof a service, maintain traceabilityof each requirement to the original source
and derive deliverybacklogs which will feed queues for enhancing IT services
Functional
Elements
• Be the system of record (authoritative source) for all requirements
• Collect, refine, scope, and track progress of requirements
• Manage the lifecycleof the requirement
• Manage the state of a requirement
• Manage requirementsthrough the lifecycleof a deliveryand maintain traceabilityof each requirement to its original source
• Derive product or program backlogs which will serve as work queues
• Trace requirementto one or more test cases
Key Data Objects • Requirement – Contains details the needs or conditions to meet for a new or altered service
Data
Architecture
• Allow recursive relationshipsbetween requirements
• Allow hierarchicalrelationshipsbetween Requirements
• Associate a requirement to a service
• Associate one or more Requirementsto a Service Release
• Associate one or more Requirementsto a PortfolioBacklog Item
Key Attributes • ID - Unique identifier of a given Requirement
• Type - Identifies the category of a Requirement (i.e., epic, theme, feature, user story, non-functional, functional, etc.)
• Summary - Represents the short description/title/summaryof a given Requirement
• Logical Service ID - Unique identifier of the related Logical Service
• Requirement Source - A reference to the Requirementsource such as policy, backlog item, etc.
• Owner -The person or team that is assigned to this Requirement
• Service Release ID - Unique identifier of the related Service Release
Key Data Object
Relationships
• Logical Service to Requirement - One or more Requirements will be used to define the required behaviour from the Logical Service
• Service Release to Requirement - Describes a version of the service which fulfils one or more Requirements
• Requirement to Test Case - A Requirementis traced to one or more Test Cases to ensure stated needs or conditions have been successfully delivered or
met
• Portfolio Backlog Item to Requirement - A PortfolioBacklog Item is mapped to one or more Requirements which will need to be delivered to successfully
fulfilthe demand
• Policy to Requirement - Requirements may be sourced from policies or may reference policies in order to remain in complianceto previously agreed
policies for an organisation
• Requirement to Source - Source will fulfil one or many Requirements, and for a given Requirement, there could be multiple Sources created/modified
Service Design Functional Component - 1
August 17, 2020 115
Purpose • Identify the new or existing services required to meet the needs of the Scope Agreement and the associated IT Initiative
• Create a Logical Service that describes the service structure and behaviour taking into account the service system and the service offer and ensure that
the architecture and Logical Service Blueprint are compliant with all standards and policies, includingsecurity standards and policies
• Create the service design specification
• Identify the service delivery model and potential service suppliers
• Implementdata collection and measurementframework so IT can capture actual data about how IT services are performingrather than relying only on
anecdotal input from the service consumers
• Ensure that the service is architected to meet the applicableKPIs and SLAs
Functional
Elements
• be the system of record (authoritative source) for all Logical Services
• identify the new or existing services required to meet the needs of the Scope Agreement and IT Initiative
• Leverage the Conceptual Service and Portfolio Backlog Items from the S2P Value Stream along with Requirementsto produce a Logical Service that
describes the service structure and behaviour
• Create various architecturalartefacts (data flow diagrams, technical schematics, etc.) that comply with the IT Initiativespecificationsand boundaries
• Create service design specification document (Logical Service Blueprint)
• identify the service delivery model (in-source, outsource, etc.) and service suppliers to meet the Requirements within the chosen deliverymodel
• Enable interaction with IT operations to develop support plan/requirements for an IT Service
• Ensure that the architecture and Logical Service Blueprint are compliant with all standards and policies, including security standards and policies
• Ensure that the architecture and Logical Service Blueprint meet all Requirements, includingsecurity requirements, to ensure the confidentiality, integrity,
and availabilityof the service
• Put data collectionand measurement framework in place so that IT can capture actual data about how IT services are performing, rather than relying
only on anecdotal input from service consumers
• Ensure traceabilityis done through the Requirementfunctional component
• Receive the development spend from the Project functionalcomponent and pass it to the Service Portfolio functional component
Key Data Objects • Logical Service - bridge between the service interaction and service system containing the group of logical components needed to provide the expected
outcome or service interaction
• Logical Service Blueprint - design of the logical service that details the components and how those components relate to one another
Service Design Functional Component - 2
August 17, 2020 116
Key Attributes • Logical Service
• ID - Unique identifier
• Name - Meaningfulname
• Description - Short description of the purpose
• Conceptual Service ID - Unique identifier of the related Conceptual Service
• Budgeted Spend - Approved budget for development of a service
• Actual Spend - Actual spend for the development of a service
• Logical Service Blueprint
• ID - Unique identifier
• Name - Meaningfulname of the
• Description - Short description of the purpose of the Logical Service Blueprint
• Version - Version
• Logical Service ID - Unique identifier of the related Logical Service
• ArchitectureDesign - An architecturalrepresentation (diagram)of the service system components
Key Data Object
Relationships
• Conceptual Service to Logical Service - One or more Logical Services represents the logical components which are necessary to provide the expected
outcome of the Conceptual Service
• Logical Service to Requirement - One or more Requirements will be used to define the required behaviour from the Logical Service
• Logical Service to Service Release - A Logical Service can lead to the creation of one or more Service Releases in order to deliver the required service
outcomes
• Logical Service to Logical Service Blueprint - A Logical Service structure and behaviour can be detailed by one or more Logical Service Blueprints
Source Control Functional Component
August 17, 2020 117
Purpose • Develop source code or infrastructure based on the Logical Service Blueprint, Service Design Package, and IT Initiativepriorities
• Ensure that the source code meets the design specifications, organisation policies, standards and non-functional requirements so that the service can be
operated successfully and meets solution consumer expectations
• Manage the development backlog of requirements and defects
Functional
Elements
• Be the system of record (authoritative source) for all source
• Manage the source lifecycle
• develop source code or infrastructurebased on the Logical Service Blueprint,
• Service Design Package, and IT Initiative priorities
• Ensure that the source code meets the design specifications, organisational policies, standards, and non-functional requirementsso that the service can
be operated successfully and meets solution consumer expectations
• Manage the development backlog of requirements and defects
• Create (automated) test scripts includingunit testing and scripts for static applicationsecurity testing that follow a formal software security assurance
methodology
• Run security tests on core code to identify existing security issues at the start of the development cycle so that assessment of scope/requirements
set/schedule for existing services being changed can be negotiated early
• Manage source code images and store them in a source data object repository
Key Data Objects • Source - Created or purchased solution to meet the requirementsfor a particularService Release
Data
Architecture
• Allow recursive relationshipsbetween source
• Allow hierarchicalrelationshipsbetween source
• Associate source to a service
• Associate one or many requirements to one or many sources
• Associate one or many builds to the related source
Key Attributes • ID - Unique identifier
• Version - Version of the Source
• Requirement ID - Identifier of the related requirement(s)
Key Data Object
Relationships
• Source to Requirement - Source will fulfil one or many requirements, and for a given requirement, there could be multiplesources created/modified
• Source to Build - Source can be built multipletimes to create several Build versions
Build Functional Component
August 17, 2020 118
Purpose • Receive the source data object from the Source Control functional component and manage the creation, implementation, automation, and security and
storage of all builds
Functional
Elements
• Receive the Source data object from the Source Control functional component and manage the creation, implementation, automation, and security and
storage of all Builds
• Create the Build from the Source data object for a particular service component
• Automate the Build process to support the Build schedule and build frequency requirements in order to support daily Build and smoke test plans or
continuous integration plans
• Run dynamic applicationsecurity testing no later than when the final Build data object is received and before the RFCs are created for moving the new or
changed service into production
• Manage Builds and versioning in a DefinitiveMedia Library (DML)
• Develop automated Build storage procedures and automated compilationtechniques and tools
• Monitor and report on the results of each integrationBuild
• Initiate or automate the delivery of Builds to the Build Package functional component for validationby the acceptance testing team as candidate release
builds
Key Data Objects • Build - Created from Source and versioned
Data
Architecture
• Be the system of record (authoritative source) for all Builds
• Manage the version of each individualBuild
• Associate a Build to a service
• Associate Source to one or many Builds if a Source Control functional component exists
• Associate one or many Builds to one or many Test Cases which are executed as part of the Build creation if a Test functional component exists
• Associate one or many Builds to a Build Package if a Build Package functional component exists
Key Attributes • ID - Unique identifier
• Version -Version of the build
• Source ID - Identifier of the related source
• Test Case ID - Identifier of the related test case(s)
• Build Package ID - Identifier of the related build package after it has been created
Key Data Object
Relationships
• Source to Build -Source can be built multipletimes to create several Build versions
• Build to Test Case - One or many Builds can be related to one or many Test Cases used as part of the Build creation
• Build Package to Build - A Build Package is comprised of one or many Builds.
Build Package Functional Component
August 17, 2020 119
Purpose • Create a deployable package made up of one or many Builds
• Manage the Build Packages and relationships to the Service Release Blueprints
Functional
Elements
• Create a deployable package made up of one or many Builds.
• Manage the Build Packages and relationships to the Service Release Blueprints
• Be the system of record (authoritative source) for all Build Packages
Key Data Objects • Build Package - A compilation of one or many Builds in a deployable package
Data
Architecture
• Associate a Build Package to a service
• Associate one or more Builds to a Build Package if a Build functional component exists
• Associate one or more Service Release Blueprints to one or more Build Packages if a Release Composition functional component exists
Key Attributes • ID - Unique identifier
• Name - Meaningful name of the Build Package
Key Data Object
Relationships
• Build Package to Build - Build Package is comprised of one or more Builds
• Build Package to Service Release Blueprint - Multiple build packages, which represent the deployable content of the service components, can be
deployed using the instructions contained in the Service Release Blueprints
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture
Critical Review of Open Group IT4IT Reference Architecture

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Critical Review of Open Group IT4IT Reference Architecture

  • 1. Critical Review of Open Group IT4IT Reference Architecture Alan McSweeney http://ie.linkedin.com/in/alanmcsweeney https://www.amazon.com/dp/1797567616
  • 2. Introduction • Review of the Open Group’s IT4IT Reference Architecture https://www.opengroup.org/it4it with respect to other operational frameworks to determine its suitability and applicability to the IT operating function • IT4IT is intended to be an umbrella framework independent of specific processes that takes a value stream based approach August 17, 2020 2
  • 3. Topics • Value Chain And Supply Chain • Supply Chain Operations Reference (SCOR) • Activity Based Costing • Organisation Value Chain And IT Value Chain • Introduction To IT4IT Reference Architecture • Issues With IT4IT Framework August 17, 2020 3
  • 4. IT4IT Reference Architecture • IT4IT is intended to be a reference architecture for the management of the IT function • It aims to take a value chain approach to create a model of the functions that IT performs and the services it provides to assist organisations in the identification of the activities that contribute to business competitiveness • It is intended to be an integrated framework for the management of IT that emphasises IT service lifecycles • It aims to identify what the IT function must do well • It looks to attain efficiencies using supply chain-like approach to IT services • IT4IT reference architecture specifies an IT Value Chain August 17, 2020 4
  • 5. Value Chain And Supply Chain • In order to understand the IT4IT approach it is first important to understand the meaning of value chain and supply chain • The phrases value chain and supply chain are all too frequently used without precise definitions and understanding of what they exactly mean August 17, 2020 5
  • 6. Tradition View Of Value Chain • Value chain view observes how an organisation creates a finished product or service from raw inputs through activities that add value by increasing its worth (the amount that can be charged) over the sum of the cost of the inputs • Product or service is then offered or made available to an external customer or service user who typically pays for them, directly or indirectly August 17, 2020 6 Raw Input Cost Cost of Value Adding Activities Value of Finished Product or Services Value Added
  • 7. Different Value Profiles For Different Products And Services • The different types of products and services developed and offered by an organisation will have different value profiles August 17, 2020 7 Raw Input Cost Cost of Value Adding Activities Value of Finished Product or Services Value Added Raw Input Cost Cost of Value Adding Activities Value of Finished Product or Services Value Added Raw Input Cost Cost of Value Adding Activities Value of Finished Product or Services Value Added Raw Input Cost Cost of Value Adding Activities Value of Finished Product or Services Value Added
  • 8. Traditional View of Primary And Secondary Value Adding Activities August 17, 2020 8 Legal, Regulatory, Environment, Health and Safety Services Procurement, Supplier and Partner Services Knowledge, Improvement and Change Services Research and Develop and Manage Products and Services Acquire Raw Inputs Create Product or Service Market and Sell Product or Service Deliver or Supply Product or Service Service and Support Product or Service Facilities Services Financial Services Information Technology Services Human Resource Services Value Added Supporting and Enabling Secondary Activities Primary Value Creating Activities
  • 9. Value Chain • The value chain is the series of primary activities and their associated business processes that act on the raw inputs and work towards creating and providing the finished product or service to the target customer • Value added is the cost at which the product or service is sold or provided less the input costs August 17, 2020 9 Acquire Raw Inputs Create Product or Service Market and Sell Product or Service Deliver or Supply Product or Service Service and Support Product or Service
  • 10. Value Chain And Business Processes • The value chain is implemented through business processes • The business process is a standard set of activities that is designed to achieve a specific task transforming inputs into outputs • The external value chain representation masks multiple internal business processes August 17, 2020 10 Acquire Raw Inputs Create Product or Service Market and Sell Product or Service Deliver or Supply Product or Service Service and Support Product or Service
  • 11. Traditional View of Primary And Secondary Value Adding Activities • Supporting and Enabling Secondary Activities are sets of common services used across the organisation and typically provided by shared business functions or by outsourced service providers managed by business functions • The primary value chain activities call on the services offered by the secondary activities • The classification of these secondary activities and their processes and relative importance will vary between organisations August 17, 2020 11
  • 12. Value Chain And Supporting Activities And Processes August 17, 2020 12 Legal, Regulatory, Environment, Health and Safety Services Procurement, Supplier and Partner Services Knowledge, Improvement and Change Services Research and Develop and Manage Products and Services Acquire Raw Inputs Create Product or Service Market and Sell Product or Service Deliver or Supply Product or Service Service and Support Product or Service Facilities Services Financial Services Information Technology Services Human Resource Services
  • 13. Supporting and Enabling Secondary Activities • Human Resource Services – staffing, recruitment, personnel management, payroll, organisation management services • Information Technology Services – management of the provision of IT services • Financial Services – invoicing, collection, debt management, financial control services • Facilities Services – locations, building and facilities management services • Legal, Regulatory, Environment, Health and Safety Services – regulatory monitoring and compliance, environmental and safety services • Procurement, Supplier, and Partner Services – management of supplier and product and service selection and acquisition and relationship management services • Knowledge, Improvement and Change Services – manage organisation knowledge and manage service improvement and change initiatives • Research and Develop and Manage Products and Services – identification and development of new products and services August 17, 2020 13
  • 14. Contribution To Cost Of Value Adding Activities • The costs of the core and extended activities involved in the end-to- end supply of the product and service affects the value added August 17, 2020 14 Raw Input Cost Cost of Value Adding Activities Value Achieved for Finished Product or Service Value Added Legal, Regulatory, Environment, Health and Safety Services Procurement, Supplier and Partner Services Knowledge, Improvement and Change Services Research and Develop and Manage Products and Services Acquire Raw Inputs Create Product or Service Market and Sell Product or Service Deliver or Supply Product or Service Service and Support Product or Service Facilities Services Financial Services Information Technology Services Human Resource Services
  • 15. Profile Of Activity Cost Contribution To Value Chain • Contribution and cost allocation for each primary and secondary activity to the product or service cost profile will be different for each primary and secondary activity • Cost profile of a product or service will also change over time August 17, 2020 15 Legal, Regulatory, Environment, Health and Safety Services Procurement, Supplier and Partner Services Knowledge, Improvement and Change Services Research and Develop and Manage Products and Services Acquire Raw Inputs Create Product or Service Market and Sell Product or Service Deliver or Supply Product or Service Service and Support Product or Service Facilities Services Financial Services Information Technology Services Human Resource Services
  • 16. Profiles Of Activity Cost Contribution To Products/Services Value Chains August 17, 2020 16 • The core and extended value chain cost profile for each product or service will be different Legal, Regulatory, Environment, Health and Safety Services Procurement, Supplier and Partner Services Knowledge, Improvement and Change Services Research and Develop and Manage Products and Services Acquire Raw Inputs Create Product or Service Market and Sell Product or Service Deliver or Supply Product or Service Service and Support Product or Service Facilities Services Financial Services Information Technology Services Human Resource Services
  • 17. Value Chain And Organisation Competitiveness • Sum of value generated across all products and services is a measure of the current competitiveness of the organisation • An effective activity cost model identifies the actual cost of primary and support services that contribute to the generation of value • Supply chain processes monitor the competitors and their impact on value chains August 17, 2020 17
  • 18. Wider Supply Chain Context Of Value Chain August 17, 2020 18 Legal, Regulatory, Environment, Health and Safety Services Procurement, Supplier and Partner Services Knowledge, Improvement and Change Services Research and Develop and Manage Products and Services Acquire Raw Inputs Create Product or Service Market and Sell Product or Service Deliver or Supply Product or Service Service and Support Product or Service Facilities Services Financial Services Information Technology Services Human Resource Services Sourcing Planning Enabling Delivery ReturnsWork in Progress Demand Competition Production Support
  • 19. Wider Supply Chain Context Of Value Chain • The value chain is the specific set of activities that directly and indirectly contribute to the creation and supply of the product or service • The value chain sits within a wider supply chain involving a range of activities and events that impact the value chain, both negatively and positively • There are various views of how to categorise the supply chain • The most widely used and most comprehensive one is Supply Chain Operations Reference (SCOR) - https://www.apics.org/apics-for- business/frameworks/scor − The SCOR model identifies six primary supply management processes: Plan, Source, Make, Deliver, Return and Enable − The SCOR model is aimed at manufacturing, transportation, delivery and logistics organisations − However, its principles and structures can be readily applied and adapted to service organisations − Any analysis of supply chain activities should at least make reference to SCOR August 17, 2020 19
  • 20. SCOR Model Structure August 17, 2020 20 SCOR Performance Performance Attributes Reliability Responsiveness Agility Costs Asset Management Efficiency Metrics Reliability Metrics Responsiveness Metrics Agility Metrics Costs Metrics Asset Management Efficiency Metrics Level 1 Metrics Level 2 Metrics Level 3 Metrics Process/ Practice Maturity Stage 1: Initial; Stage 2: Managed; Stage 3: Defined; Stage 4: Quantitatively Managed; Stage 5: Optimising Processes Level 1 – Major Processes Level 2 – Process Categories Level 3 – Process Elements Level 4 – Improvement Tools and Activities Practices Standard Practices Best Practices Emerging Practices People Competency Level Expert Proficient Competent Beginner Novice
  • 21. SCOR Metrics Level 1 And Level 2 Structure August 17, 2020 21 Metrics Reliability Perfect Order Fulfilment % of Orders Delivered In Full Delivery Performance to Customer Commit Date Documentation Accuracy Perfect Condition Responsiveness Order Fulfilment Cycle Time Source Cycle Time Make Cycle Time Deliver Cycle Time Delivery Retail Cycle Time Agility Upside Supply Chain Adaptability Upside Adaptability (Source) Upside Adaptability (Make) Upside Adaptability (Deliver) Upside Return Adaptability (Source) Upside Return Adaptability (Deliver) Downside Supply Chain Adaptability Downside Adaptability (Source) Downside Adaptability (Make) Downside Adaptability (Deliver) Overall Value- at-Risk (VaR) Supplier’s/ Customer’s/ Product’s Risk Rating Value at Risk (Plan) Value at Risk (Source) Value at Risk (Make) Value at Risk (Deliver) Value at Risk (Return) Time to Recovery Costs Total SC Management Cost Cost to Plan Cost to Source Cost to Make Cost to Deliver Cost to Return Mitigation Cost Cost of Goods Sold (COGS) Cost to Plan Supply Chain Cost to Plan Source Cost to Plan Make Cost to Plan Deliver Cost to Plan Return Asset Management Efficiency Cash to Cash Cycle Time Days Sales Outstanding Inventory Days of Supply Days Payable Outstanding Return on Supply Chain Fixed Assets Supply Chain Revenue Supply Chain Fixed Assets Return on Working Capital Accounts Payable (Payables Outstanding) Accounts Receivable (Sales Outstanding) Inventory
  • 22. Sample SCOR Level 1/2/3 Metrics – Reliability August 17, 2020 22 ReliabilityPerfect Order Fulfilment % of Orders Delivered In Full Delivery Item Accuracy Percentage of orders in which all items ordered are the items actually provided, and no extra items are provided Delivery Quantity Accuracy Percentage of orders in which all quantities received by the customer match the order quantities (within mutually agreed tolerances) Delivery Performance to Customer Commit Date Customer Commit Date Achievement Time Customer Receiving Percentage of orders which is received on time as defined by the customer Delivery Location Accuracy Percentage of orders which is delivered to the correct location and customer entity Documentation Accuracy Compliance Documentation Accuracy Percentage of compliance documentation that are complete, correct and readily available when and how expected by customer, Government and other supply chain regulatory entities Other Required Documentation Accuracy Percentage of other required documentations (besides of compliance documentation, payment documentation and shipping documentation) are complete, correct, and readily available when and how expected by customer, Government and other supply chain regulatory entities Payment Documentation Accuracy Percentage of payment documentation that are complete, correct, and readily available when and how expected by customer, Government and other supply chain regulatory entities Shipping Documentation Accuracy Percentage of shipping documentations are complete, correct, and readily available when and how expected by customer, Government and other supply chain regulatory entities Perfect Condition % of Faultless Installations Number of Faultless Installations divided by Total Number of Units Installed % Orders/lines received damage free The number of orders / lines that are processed damage free divided by the total orders / lines processed in the measurement period Orders Delivered Damage Free Conformance Percentage of orders which is delivered without damage Orders Delivered Defect Free Conformance Percentage of orders which is delivered without defect Warranty and Returns Number of returns within the warranty period - warranty is a commitment, either expressed or implied that a certain fact regarding the subject matter of a contract is presently true or will be true
  • 23. SCOR Process Structure And Hierarchy – 1/3 August 17, 2020 23 SCOR Plan Plan Supply Chain Identify, Prioritise and Aggregate Supply Chain Requirements Identify, Prioritise and Aggregate Supply Chain Resources Balance Supply Chain Resources with SC Requirements Establish and Communicate Supply Chain Plans Plan Source Identify, Prioritise and Aggregate Product Requirements Identify, Assess and Aggregate Product Resources Balance Product Resources with Product Requirements Establish Sourcing Plans Plan Source Identify, Prioritise and Aggregate Production Requirements Identify, Assess and Aggregate Production Resources Balance Production Resources with Production Requirements Establish Production Plans Plan Deliver Identify, Prioritise and Aggregate Delivery Requirements Identify, Assess and Aggregate Delivery Resources Balance Delivery Resources and Capabilities with Delivery Requirements Establish Delivery Plans Plan Return Assess and Aggregate Return Requirements Identify, Assess and Aggregate Return Resources Balance Return Resources with Return Requirements Establish and Communicate Return Plans Source Source Stocked Product Schedule Product Deliveries Receive Product Verify Product Transfer Product Authorise Supplier Payment Source Make-to- Order Product Schedule Product Deliveries Receive Product Verify Product Transfer Product Authorise Supplier Payment Source Engineer- to-Order Product Identify Sources of Supply Select Final Supplier and Negotiate Schedule Product Deliveries Receive Product Verify Product Transfer Product Authorise Supplier Payment Make Make-to-Stock Schedule Production Activities Issue Material Produce and Test Package Stage Product Release Product to Deliver Waste Disposal Make-to-Order `Schedule Production Activities Issue Sourced/In- Process Product Produce and Test Package Stage Finished Product Release Finished Product to Deliver Waste Disposal Engineer-to-Order Finalise Production Engineering Schedule Production Activities Issue Sourced/In- Process Product Produce and Test Package Stage Finished Product Release Product to Deliver Waste Disposal
  • 24. SCOR Process Structure And Hierarchy – 2/3 August 17, 2020 24 SCOR Deliver Deliver Stocked Product Process Inquiry and Quote Receive, Enter, and Validate Order Reserve Inventory and Determine Delivery Date Consolidate Orders Build Loads Route Shipments Select Carriers and Rate Shipments Receive Product from Source or Make Pick Product Pack Product Load Vehicle and Generate Shipping Documents Ship Product Receive and Verify Product by Customer Install Product Invoice Deliver Make-to- Order Product Process Inquiry and Quote Receive, Configure, Enter and Validate Order Reserve Inventory and Determine Delivery Date Consolidate Orders Build Loads Route Shipments Select Carriers and Rate Shipments Receive Product from Source or Make Pick Product Pack Product Load Product and Generate Shipping Docs Ship Product Receive and Verify Product by Customer Install Product Invoice Deliver Engineer-to- Order Product Obtain and Respond to RFP/RFQ Negotiate and Receive Contract Enter Order, Commit Resources and Launch Program Schedule Installation Build Loads Route Shipments Select Carriers and Rate Shipments Receive Product from Source or Make Pick Product Pack Product Load Product and Generate Shipping Docs Ship Product Receive and Verify Product by Customer Install Product Invoice Deliver Retail Product Generate Stocking Schedule Receive Product at Store Pick Product from backroom Stock Shelf Fill ShoppingCart Checkout Deliver and/or install Return Source Return Defective Product Identify Defective Product Condition Disposition Defective Product Request Defective Product Return Authorisation Schedule Defective Product Shipment Return Defective Product Deliver Return Defective Product Authorise Defective Product Return Schedule Defective Return Receipt Receive Defective Product (includes verify) Transfer Defective Product Source Return MRO Product Identify MRO Product Condition Disposition MRO Product Request MRO Return Authorisation Schedule MRO Shipment Return MRO Product Deliver Return MRO Product Authorise MRO Product Return Schedule MRO Return Receipt Receive MRO Product Transfer MRO Product Source Return Excess Product Identify Excess Product Condition Disposition Excess Product Request Excess Product Return Authorisation Schedule Excess Product Shipment Return Excess Product Deliver Return Excess Product Authorise Excess Product Return Schedule Excess Return Receipt Receive Excess Product Transfer Excess Product
  • 25. SCOR Process Structure And Hierarchy – 3/3 August 17, 2020 25 SCOR Enable Manage Supply Chain Business Rules Gather Business Rule Requirements Interpret Business Rule Requirement Document Business Rule Communicate Business Rule Release/Publish Business Rule Retire Business Rule Manage Supply Chain Performance Initiate Reporting Analyse Reports Find Root Causes Prioritise Root Causes Develop Corrective Actions Approve and Launch Manage Data and Information Receive Maintenance Request Determine/Scope Work Maintain Content/Code Maintain Access Publish Information Verify Information Manage Supply Chain Human Resources Identify Skills/Resource Requirement Identify Available Skills/Resources Match Skills/Resources Determine Hiring/ Redeployment Determine Training/ Education Approve, Prioritise and Launch Manage Supply Chain Assets Schedule Asset Management Activities Take Asset Off- line Inspect and Troubleshoot Install and Configure Clean, Maintain and Repair Decommission and Dispose Inspect Maintenance Reinstate Asset Manage Supply Chain Contracts Receive Contract /Agreement Updates Enter and Distribute Contract /Agreement Activate/ Archive Contract/ Agreement Review Contractual Performance Agreement Identify Performance Issues/ Opportunities Identify Resolutions/ Improvements Select, Prioritise and Distribute Resolutions Manage Supply Chain Network Select Scope and Organisation Gather Input and Data Develop Scenarios Model/Simulate Scenarios Project Impact Select and Approve Develop Change Program Launch Change Program Manage Regulatory Compliance Monitor Regulatory Entities Assess Regulatory Publications Identify Regulatory Deficiencies Define Remediation Verify/Obtain License Publish Remediation Manage Supply Chain Risk Establish Context Identify Risk Events Quantify Risks Evaluate Risks Risk Handling Strategy Manage Supply Chain Procurement Develop Strategy and Plan Pre-Procurement /Market Test and Market Engagement Develop Documentation, PPQ /Detailed Spec/ Combine with 1 Supplier Selection to Participate in ITT /RFQ /Negotiation Issue ITT /RFQ Bid /Tender Evaluation and Validation Contract Award and Implementation Manage Supply Chain Technology Define Supply Chain Technology Requirements Identify Technology Solution Alternatives Define/Update Supply Chain IT Roadmap Select Technology Solution Deploy Technology Solution Maintain and Improve Technology Solution Retire Technology Solution
  • 26. Wider SCOR Context • The SCOR model is part of wider set of operations reference models that describe a view of the critical elements in a value chain − Product Life Cycle Operations Reference model (PLCOR) • Manages the activities for product innovation and product and portfolio management − Customer Chain Operations Reference model (CCOR) • Manages the customer interaction processes − Design Chain Operations Reference model (DCOR) • Manages the product and service development processes − Managing for Supply Chain Performance (M4SC) • Translates business strategies into supply chain execution plans and policies August 17, 2020 26 DCOR Design Chain Operations PLCOR Product Life Cycle Operations CCOR Customer Chain Operations SCOR Supply Chain Operations M4SC Managing for Supply Chain Performance Plan Source Make Deliver Return Enable Plan Ideate Develop Launch Revise Enable Plan Relate Sell Contract Assist Plan Research Design Integrate Amend Business Environment M a r k e t s S u p p l i e r s Customers
  • 27. SCOR Performance Metrics August 17, 2020 27 Process MetricsEach Process Has Metrics Practices People Data MetricsMetrics Metrics Require Data
  • 28. Key Supply Chain Processes Planning Develop, manage and maintain the organisation’s overall product or service supply chain processes to ensure that demand and supply are balanced and optimised Enabling Implement and operate and monitor the performance of the supply chain management processes such sourcing, logistics, finance, resourcing, information technology, sales and support Sourcing Manage and operate the selection of suppliers and the sourcing of raw product or service inputs as well as suppliers of secondary service Production Transform the raw material into the finished product or service to meet planned or actual demand Work in Progress Manage incomplete products and services as they are being worked or and transformed Delivery Deliver the completed products and services to customers including handling orders, distribution, transportation Returns Handle customer returns or rejections of delivered products and services Support Handle post-delivery support including maintenance, implementation of enhancements, upgrades Demand Monitor, understand and handle customer demand for products and services and circumstances that cause a change in demand and manage changes in those demands and associated changes to the other supply chain processes Competition Monitor, understand and handle competition in the supply of products and services from other sources and manage responses to competition August 17, 2020 28
  • 29. Supply Chain Impact On Value Chain • Changes in the supply chain affect the value chain in many ways: − Sourcing, procurement and acquisition circumstances might change, affecting input costs − Product and service demand might change, affecting the ability to achieve the anticipated value − Competition might arise, affecting the cost that can be realised for the products or services − Support requirements might change, affecting value generated − The level of product returns or service cancellations might be different than planned for, impacting value achieved • Value chain analysis does not exist in isolation August 17, 2020 29
  • 30. Activity Based Costing • How do you know the costs of the primary and secondary processes in the product or service value chain? • How do you allocate the overheads associated with the shared secondary activities and processes across all product and service value chains? • How do know the actual value being created? • Activity-based costing (ABC) is an approach to understanding costing that identifies activities in an organisation and assigns the cost of each activity to all products and services according to the actual consumption of those activities by each products or services • Use as a tool for understanding product and service and customer cost and profitability • ABC supports strategic decisions such as pricing, investments, outsourcing and identification and measurement of process improvement initiatives August 17, 2020 30
  • 31. Activity Based Costing • Establishing a cross-functional view of your organisation and understanding what drives your costs is essential • Pulling apart indirect or hidden costs and attributing them correctly to products and services August 17, 2020 31 Activities Resources Products, Services and Customers Cost Drivers Performance Measures
  • 32. Approaches To Determining Cost • Organisational Element Accounting August 17, 2020 32 Direct Costs Overhead Accounting System
  • 33. Approaches To Determining Cost • Budgetary Cost Distribution /Commitment Accounting August 17, 2020 33 Commitments and Obligations Accounting System
  • 34. Approaches To Determining Cost • Traditional Cost Accounting August 17, 2020 34 Direct Labour Direct Materials Activities Output Cost Overhead
  • 35. Approaches To Determining Cost • Activity Based Costing August 17, 2020 35 Direct Labour and Overhead Direct Materials Activities Output Cost
  • 36. Steps To Implementing Activity Based Costing August 17, 2020 36 General Ledger and Other Sources Departments Activities Cost Objects Calculate Profitability
  • 37. Defining Activities • Most organisations use a cost centre structure • Recast the cost centre structure into activities • Usually a hierarchy of activities − Direct identification with product or service − Process support − Organisation and facility support − Customer/market support • Map from cost centre into activity hierarchy August 17, 2020 37
  • 38. Traditional Cost Accounting View - Direct Costs August 17, 2020 38 ▪ Product A • 100 units • 1 hour direct labour at €20/hour • €20/unit direct cost • 100 total hours total effort to produce ▪ Product B • 950 units • 2 hours direct labour at €20/hour • €40/unit direct cost • 1,900 total hours of effort to produce • Total amount of effort for 100 units of Product A and 950 units of Product B is 2,000 hours • Assume the overheads total is €100,000
  • 39. Traditional Cost Accounting View – Allocation Of Overheads • Traditional Cost Accounting Overhead Costs − = €100,000 /2,000 hours of effort across both sets of product creation activities − = €50 per hour • Product A − 1 hour to produce − = €50 x 1 hour − = €50 • Product B − 2 hours to produce − = €50 x 2 hours − = €100 August 17, 2020 39
  • 40. Traditional Cost Accounting View - Total Cost • Product A • Direct Production Costs = €20 • + Overhead = €50 • Total Cost = €70 • Product B • Direct Production Costs = €40 • + Overhead = €100 • Total Cost = €140 August 17, 2020 40
  • 41. Activity Based Costing – Calculation Of Overheads • Look at the activities the organisation performs for each product and their costs August 17, 2020 41 Activity Total Cost Cost Driver Setup €10,000 Number of setups Machining €40,000 Number of hours Receiving €10,000 Number of receipts Packaging €10,000 Number of deliveries Engineering €30,000 Number of hours Total €100,000
  • 42. Activity Based Costing – Calculation Of Overheads • Allocate activities to products and understand the actual activity costs associated with each product August 17, 2020 42 Activity Product A Cost Product B Cost Cost Setup 1 €2,500 3 €7,500 €10,000 Machining 1 €2,000 3 €38,000 €40,000 Receiving 100 €2,500 1,900 €7,500 €10,000 Packaging 1 €2,500 3 €7,500 €10,000 Engineering 500 €15,000 500 €15,000 €30,000 Total €24,500 €75,500 €100,000 • Apportioning total overheads for each product according to their actual usage: − Product A - €24,500 /100 units = €245 − Product B - €75,500 /950 units = €79.47
  • 43. Activity Based Costing Creates A Different View Of Product Costs • Product A • Direct Costs = €20 • + ABC Overhead = €245 • Total Cost = €265 • Product B • Direct Costs = €40 • + ABC Overhead = €79.47 • Total Cost = €119.47 August 17, 2020 43
  • 44. Comparison Between Traditional Cost Accounting and ABC • Product A is much more expensive to produce than originally thought • If Product A is priced based on original view of costs, you will lose money • Product B is cheaper to produce and so its price could be reduced to stimulate greater demand or capture greater market share for competitors while still making a profit • Activity Based Costing provides a better understanding of consumption of resources across the product or service value chain August 17, 2020 44 Product A Product B TCA ABC TCA ABC Direct Costs £20 £20 £40 £40 Overhead Costs £50 £245 £100 £79.47 Total £70 £265 £140 £119.47
  • 45. Organisation Value Chain And IT Value Chain • The IT value chain is a chain within a chain • The IT function supplies services to the business to support and enable its value chain • The same principles that apply to organisation value chains can be applied to the IT value chain August 17, 2020 45 Legal, Regulatory, Environment, Health and Safety Services Procurement, Supplier and Partner Services Knowledge, Improvement and Change Services Research and Develop and Manage Products and Services Acquire Raw Inputs Create Product or Service Market and Sell Product or Service Deliver or Supply Product or Service Service and Support Product or Service Facilities Services Financial Services Human Resource Services Legal, Regulatory, Environment, Health and Safety Services Procurement, Supplier and Partner Services Knowledge, Improvement and Change Services Research and Develop and Manage Products and Services Acquire Raw Inputs Create Product or Service Market and Sell Product or Service Deliver or Supply Product or Service Service and Support Product or Service Facilities Services Financial Services Information Technology Services Human Resource Services IT Value Chain Organisation Value Chain
  • 46. Organisation Value Chain And IT Value Chain • In the case of services provided by the IT function, these are rarely provided directly to paying external customers − Even where the solutions and services are used directly by external customers, the value generated accrues to the owning business function • The business value generated by the solutions and services provided by the IT function is indirect • The IT function has little direct control over the value the business generates from the solutions and services • The business uses the IT services as part of their value chain. August 17, 2020 46
  • 47. Organisation Value Chain And IT Value Chain • The IT function is all too often a monopoly provider of IT services to the business functions or at least a gatekeeper to external solution and service providers, allowing or disallowing their introduction and use • This gives rise to shadow IT where the business bypasses what they view and experience as an unresponsive central IT function and goes directly to external service providers • Monopoly providers are in a privileged position and need to recognise this and be subject to appropriate governance and oversight to ensure that the lack of competition does not lead to accidental or deliberate abuse. August 17, 2020 47
  • 48. Value Chain Value Chain, Secondary Services, Supply Chain And Cost Analysis August 17, 2020 48 Secondary Supporting Services and Processes Supply Chain Cost Analysis Value Chain Draws on Secondary Services Wider Supply Chain Impacts Operation of Value Chain Accurate Cost Analysis is Important to Understanding Actual Value Accurate Cost Analysis is Important to Understanding Actual Value Wider Organisation Operating Landscape Supply Chain Assists With Understanding External Value Pressures Supply Chain Processes Have Costs
  • 49. Introduction To IT4IT Reference Architecture August 17, 2020 49
  • 50. IT4IT Reference Architecture • IT4IT aims to be a standard and repeatable reference architecture that enables the creation of an information technology management environment • It is intended to provide a guide to the design of the IT service delivery function • It seeks to enable organisations adapt to changes in technologies, methodologies and processes without having to alter the IT management approach, structure and operations August 17, 2020 50
  • 51. IT4IT IT Value Chain 17 August 2020 51 Governance, Risk and Compliance Strategy to Portfolio Requirement to Deployment Request to Fulfil Detect to Correct Resource and Project Intelligence and Reporting Sourcing and Vendor Finance and Assets Efficiency and Agility Supporting Activities Value Streams Plan Build Deliver Run
  • 52. IT4IT IT Value Chain • Primary Value Streams • Strategy to Portfolio • Requirement to Deploy • Request to Fulfil • Detect to Correct • Supporting Activities • Governance Risk and Compliance • Sourcing and Vendor • Intelligence and Reporting • Finance and Assets • Resource and Project August 17, 2020 52
  • 53. IT Pillars Of IT4IT Reference Architecture • Service Model • Information Model • Functional Model • Integration Model August 17, 2020 53
  • 54. Service Model • Based on a provider/broker model to define the way IT provides services to the business • Emphasises services as the primary IT deliverable • Uses a service-centric lifecycle framework to provide a continuous assessment of the portfolio, sourcing and integrating components and servers offered to consumers • Service model is designed to store and manage service information – entities, data, attributes, relationships • Each of the four IT Value Streams uses elements of the Service Model to create an integrated view of IT August 17, 2020 54
  • 55. IT4IT Service Model Backbone August 17, 2020 55 Service Providers Service Consumers Service Model Conceptual Logical Realised Continuous Assessment Continuous Integration Continuous Delivery Conceptual Service Logical Service Service Release Service Release Blueprint Service Catalog Entry Desired Service Actual Service
  • 56. Four Primary Value Streams • Request to Fulfil (R2F) • Accepts the Service Release Blueprint and creates Service Catalog Entries describing its technical capabilities that are incorporated into Offers • Offers have Service Contracts that define their usage • Services are moved into production • Detect to Correct (D2C) • Creates an operational service management framework that monitors service operation and use and the IT Operations that incorporate services • Provides feedback on service usage to Strategy to Portfolio (S2P) for new services or changes to existing services August 17, 2020 56 • Strategy to Portfolio (S2P) • Accepts and processes requests for new services or changes to existing services from business functions or IT • Creates a Conceptual Service design that connects the business and IT elements of • Requirement to Deploy (R2D) • Accepts the Conceptual Service and creates a more detailed description of the Logical Service and its components • In turn this is used to create Service Release which is defined in Service Release Blueprint • The service is developed or procured and delivered
  • 57. Primary Value Streams And Service Models August 17, 2020 57 Strategy to Portfolio Requirement to Deployment Request to Fulfil Detect to Correct Conceptual Service Model Realised Service Model Logical Service Model Drive IT Value Measure and Create Insight
  • 58. Service Model Elements • Each of the four value streams are designed to contain the capabilities needed to manage the service lifecycle • Capabilities are achieved as a set of functional components and data objects • Functional components are individual stand-alone technology units that can perform a discrete function • Functional components have defined data objects as inputs and outputs • Data objects are intended to hold essential, relevant sets of (business) data that are used, processed, enriched, extended or changed by functional components • Data objects are also used to hold details on relationships between functional components August 17, 2020 58
  • 59. IT Service Lifecycle • The four Value Stream elements are intended to describe the service lifecycle • The functional components in each Value Stream elements create and update data objects August 17, 2020 59 Strategy to Portfolio Requirement to Deployment Request to Fulfil Detect to Correct IT Value Chain Plan and drive the IT portfolio to achieve business innovation Provide what the business needs when it needs it Describe, catalogue, fulfil, monitor and manage service usage Anticipate and resolve operational and service issues
  • 60. IT4IT Information Model • Information model consists of service lifecycle model data objects and their linkages • Each of the value streams creates, uses and updates data objects • Each data object describes a dimension of a service • Data objects are inputs to or outputs from a functional component or a phase of the service lifecycle • Each data object has its own lifecycle • The data object contains information structures that allows its relationships be recorded and maintained • IT4IT focuses on data rather than organisation processes or structures − The organisation information model is less subject to change that processes or structures August 17, 2020 60
  • 61. Data Object Types • Key Data Objects – contain information on how services are created, provided and accessed − Uses in managing the service lifecycle • Service Model Backbone Data Objects – contain information on the functionality provided − Conceptual − Logical • Design • Release • Consumable − Realised • Desired • Actual • Auxiliary Data Objects – contain context and attribute information August 17, 2020 61
  • 62. Functional Model • Functional components are stand-alone building blocks within value streams that create and use data objects − Generally one data object for each functional component • The Functional Model defines the functional components and their relationships • Functional components are linked to IT capabilities – a function or activity that creates an result August 17, 2020 62
  • 63. Functional Model Types • Primary Functional Component – performs a core role in the actions of a value stream • Secondary Functional Component – not central to the operations of a value stream but there is a dependency − May be a primary functional component to another value stream or provide supporting functionality and capability • Some functional components can be primary to more than one value stream August 17, 2020 63
  • 64. Functional Components Within IT4IT Value Streams August 17, 2020 64 Strategy to Portfolio (S2P) Enterprise Architecture Policy Proposal Portfolio Demand Service Portfolio IT Investment Portfolio – Auxiliary Requirement to Deploy (R2D) Project Requirement Service Design Source Control Build Build Package Release Composition Test Defect Request to Fulfil (R2F) Engagement Experience Portal – Secondary Offer Consumption Offer Management Catalog Composition Request Rationalisation Fulfilment Execution Usage Chargeback/Showback Knowledge and Collaboration Supporting Function Detect to Correct (D2C) Service Monitoring Event Incident Problem Change Control Configuration Management Diagnostics and Remediation Service Level
  • 65. Integration Model • IT4IT integration model aims to simplify the creation of management subsystem using functional components • Integrations are typically accompanied by a System of Record data flow • Integration types: − System of Record Data Centric • Enables consistent management of data object lifecycle • Ensures data objects are consistently named and linked between functional components • Maintains the integrity of the Service Model − System of Engagement Experience-Centric • User interface integrations • Combine functional components to create a user-case or usage journey that facilitates interactions − System of Insight Intelligence, Analytics and KPI-Centric • Data-centric integrations • Provide end-to-end traceability, visibility, transparency and capture measurements related to services • Facilitates the exchange of structured and unstructured data that is created across the value chain August 17, 2020 65
  • 66. IT Service • IT services perform work on behalf of a service consumer to generate a result, outcome or a change of state • Three service elements − Service Offer – the capability of the service that is made available to and consumed − Service Interaction – the invocation of the service by the service consumer communicated to the service provider and the input and output information − Service System – the set of technology components, processes and people that constitute the service, deliver on the Service Offer and perform the Service Interaction August 17, 2020 66
  • 67. IT Service August 17, 2020 67 Service System Technology, Processes, People, Skills, Information Service Offer Published Capability, Contract Service Interaction Invocation, Performance, Transaction Is An Abstraction Of Defines The Provider Scope And Expectations IT Service Service Outcome Technology, Processes, People, Skills, Information Enables And Allows Results In Defines The Consumer Expectations
  • 68. IT4IT Abstraction Levels And Class Structure • IT4IT Reference Architecture has five levels of abstraction and detail • Each lower level extends the higher level with more detail August 17, 2020 68 Level 1 – End-to-End Overview Level 2 – Value Stream Documentation Level 3 – Vendor-independent Architecture Level 4 – Vendor-Specific Refinement Architecture Level 5 – Solution Architecture Contains vendor- independent generalised views that can be used for strategy and planning and the creation IT management roadmaps Contains specific details that enable the development of implementation and the design of products
  • 69. Level 1 – End-to-End Overview • Provides an overview of the IT4IT Reference Architecture • Introduces the five core concepts: − Value Streams − Functional Components − Service Lifecycle Data Objects − Service Model Backbone Data Objects − Relationships August 17, 2020 69
  • 70. Level 1 Class Model • All data objects are viewed as service lifecycle data objects • The service lifecycle data objects that represent the Service Model are a type of lifecycle data object August 17, 2020 70 Value Stream Functional Component Lifecycle Data Object Service Backbone Data Object RelationshipHas One or More Has One or More
  • 71. Value Streams • Value streams are groups of functional components and data objects where value is created − Strategy to Portfolio (S2P) − Requirement to Deploy (R2D) − Request to Fulfil (R2F) − Detect to Correct (D2C) • Supporting functions within the value chain model − Supplier Management − Asset Management − Human Resource Management − Legal − IT Financial Management August 17, 2020 71
  • 72. Functional Components • Smallest technology unit or component that can stand on its own and be able to perform a useful function • Has data objects as defined inputs and outputs • Performs an operation on (one or more) data objects • Functional components are associated with a specific primary value streams and supporting functions • Secondary functional components that operate on data objects outside their primary value stream August 17, 2020 72
  • 73. IT4IT Level 1 Reference Architecture August 17, 2020 73
  • 74. Service Lifecycle Data Object • Service lifecycle data object represents data(in a variety of forms and formats that describe, represent or extend an aspect of a service being offered by IT • Data objects can be digital or physical and can contain structured, semi-structured, or unstructured data • Service Model Backbone data objects are a specific data object type that combine all the information needed to offer and manage a service • The IT4IT reference architecture seeks to define the data objects that are needed to ensure end-to-end operational or financial traceability of a service along the service lifecycle • The service lifecycle data objects represent the authoritative source data and/or master data needed to manage the business of IT August 17, 2020 74
  • 75. Relationships • IT4IT Reference Architecture seek to defining both the data objects and their key relationships • The data objects and their relationships and dependencies form the System of Record Fabric for IT management • These relationships are viewed as System of Record Integrations • This System of Record Relationship Mapping is designed to ensure end-to-end service traceability and to ensure the Service Model integrity is be maintained across the lifecycle • Adhering to it removes any confusion and conflicts that may arise from process re-engineering exercises that may take place within the IT function August 17, 2020 75
  • 76. IT4IT System Of Record Fabric • System of Record Fabric showing the Service Lifecycle Data Object and their relationships August 17, 2020 76
  • 77. IT4IT Level 2 Reference Architecture • Level 2 expands on Level 1 with the following: − The relationships between data objects have multiplicity/cardinality (one-to-one, one to many, many-to-many) attributes added − Details on data flows between functional components are added − Data flows details on integrations are added − Relationships between capability disciplines and functional components are added August 17, 2020 77
  • 78. IT4IT Level 2 Class Model • Multiplicity is the number of allowable instances of an element in terms of the relationships between data object instances • Only key relationships - those that contribute to the advancement of the service lifecycle – are defined • There are other relationships that may be needed to define specific policies, processes or capabilities but these are not prescriptive August 17, 2020 78
  • 79. Level 2 Data Flows • A data flow represents the exchange of information between functional components • Data flow information is added in Level 2 diagrams to identify the need for data integration and data sharing • Data flow information can identify dependencies between functional components and illustrate how they work together to deliver value August 17, 2020 79
  • 80. Level 2 System of Record (SoR) Integration • The System of Record (SoR) Integration is the authoritative source system for integrations between functional components • In order for the system of record relationships to be maintained over the service lifecycle these integrations and their key data objects must be well defined • A data flow creates a relationship or dependency between two data objects in the functional components that participate in the data flow • The relationship between the two data objects must be maintained • The lifecycles of the two data objects are interlinked so updates to one may have an impact on the other • The integrations ensure the integrity of the system of record fabric and the Service Model August 17, 2020 80
  • 81. Level 2 System of Record (SoR) Integration – Sample Data Object State Model Dependency • Events can give rise to Incidents • The states of Event and Incident data objects are therefore both interrelated and interdependent August 17, 2020 81
  • 82. Level 2 System of Engagement (SoE) Integration • Integrations exist between functional components to enable interactions with the associated data objects • Called system of engagement integrations • Integrations follow-on from use cases within value streams • Show how data object relationships give rise to or have an impact on system-to-system and human-to-system August 17, 2020 82
  • 83. Level 2 System of Engagement (SoE) Integration - Sample August 17, 2020 83
  • 84. Level 2 Capability Discipline • Capabilities enable organisation achieve results through a combination of people, process and technologies − Different organisation types and profiles will have different sets of capability requirements with different priorities • Organisations require many capabilities across solution design and delivery, programme and project management and service management • Capabilities are achieved as a set of functional components and data objects • Functional components are individual stand-alone technology units that can perform a discrete function • The IT4IT reference does not define key capabilities or define a means to assess what capabilities are important − It assumes that key capabilities can be derived from existing frameworks August 17, 2020 84
  • 85. Level 2 Capability Discipline – Sample August 17, 2020 85
  • 86. IT4IT Level 3 Reference Architecture – Vendor- independent Architecture • Level 3 of IT4IT contains a more formal specification of the reference architecture • Details on scenarios, essential attributes and essential services are added • Level 3 extends the Level 2 Class Model August 17, 2020 86
  • 87. Level 3 Scenarios • Scenarios describe interactions between actors and functional components of a system • Scenarios represent larger sets of interactions • Scenarios are designed to provide explanations of the IT4IT Reference Architecture in a format that is easy to understand • Scenarios can be customised to meet the requirements of organisations that use IT4IT • Scenarios are specific implementations or use cases of IT4IT to deliver service-centred facilities August 17, 2020 87
  • 88. Sample Scenarios Envisaged By IT4IT • Multi-Vendor Selection and Management • Demand and Capacity Management • Change and Configuration Management • Service Request Management, Self Service and Knowledge Management • Business Strategy and Solution Portfolio Management • Cloud Platform and Solution Selection and Management • Business Intelligence, Reporting and Data Visualisation • Asset Management • Financial and Cost Management • Risk Management August 17, 2020 88
  • 89. Scenario Descriptions Descriptive Element Details Introduction Overview of the scenario and description of the goal to be achieved Requirements Requirements represent the necessary properties of the system components needed to achieve the objectives defined by the scenario goals Process Flow Defines the scenario process and its sequence of activities and steps Automation Specification using the Reference Architecture Details how the IT4IT Reference Architecture will support and enable the specific process contained in the scenario Essential Services Supporting the Scenario Service integrations between functional components and data objects involved in the scenario Data Objects and Essential Attributes Details on the data objects and their of the objects that that are essential in the operation of the scenario to maintain the integrity of the system of record fabric Any Proposed Changes or Extensions to the Reference Architecture Details on any proposed or required changes or enhancements to the IT4IT reference architecture to enable the operation of the scenario August 17, 2020 89
  • 90. Level 3 Essential Attributes • Data exchanged between functional components is represented as data objects • Level 3 defines the necessary data object attributes − Most basic essential attributes are a unique identifier and the data object lifecycle status • Minimum set that is needed to maintain the integrity of the system of record fabric • Example shows the essential attributes that uniquely identify an Event and an Incident August 17, 2020 90
  • 91. Level 3 Essential Services • Essential services provide facilities to enable integration between functional components or access a data object • IT4IT intends that essential services are implemented as a web service, micro service or API rather than individual point-to-point integrations • IT4IT currently does not contain a defined list of essential services August 17, 2020 91
  • 92. Level 4 • Levels 4 and 5 of IT4IT are intended to be owned and controlled by suppliers of IT management products and services • Level 4 allows providers to design and detail their services, interfaces and exchange models that should be derived from Level 3 • Extensions can include − Data model and data objects − Scenarios − Processes − Integrations August 17, 2020 92
  • 93. Level 5 • Level 5 allows for provider-specific representations for how elements of or all of the IT4IT Reference Architecture are implemented • Contains the specifications and/or functionality for IT management products and services • Includes variations and adaptations of IT4IT August 17, 2020 93
  • 94. Strategy to Portfolio (S2P) Value Stream August 17, 2020 94 Objective is for IT to contribute to business strategy and planning enabling IT alignment with business plans Traditional IT Planning and Portfolio Planning • Focus is on evaluation, approval and delivery tracking of project proposals • Emphasises minimising costs for IT initiatives or assets • No overall IT portfolio view across IT Architecture, PMO and Service Portfolio functional areas • Inconsistent solution delivery and service management processes • Inconsistent and poor quality data • Poor tracking and connection across conceptual, logical and physical domains of service delivery IT needs accurate and current information on the IT portfolio • Understand the relationships • and dependencies • Enable the co-ordination of all the elements of IT in • Ensure IT function supports business objectives and goals IT4IT S2P Value Stream • Aims to provide overall view of IT portfolio activities through data integrations across all areas of the IT portfolio • Seeks to provide a blueprint for optimising service and investment • Looks to provides greater understanding of the relationships between the many IT functional areas such as IT Architecture, PMO, Application Management, Operations Management and Security Management • Intends to provide an end-to-end IT portfolio view makes visible the key data objects frequently ignored during IT portfolio planning activities • Defines a framework to define key data objects and their relationships Limitations Requires IT4IT Aims
  • 95. Strategy to Portfolio (S2P) Value Stream Functional Components And Data Objects Overview August 17, 2020 95
  • 96. Strategy to Portfolio (S2P) Business Value Proposition Provide a complete view of IT portfolio across the Enterprise Architecture, PMO and Service Management functions Allow IT portfolio decisions to be made based on business priorities Enable prioritised IT investments based on IT portfolio analysis factors such as impacts on architecture, service roadmap, business priorities Balance IT investments across strategic and operational areas Provide accurate view of business and IT demand Ensure IT portfolio data consistency Support service lifecycle tracking through conceptual, logical, and physical domains Communicate with business stakeholders through IT portfolio roadmaps August 17, 2020 96 • Provide a framework for connecting those functions that support IT Portfolio Management, ensuring data consistency and proper data hand-offs in order to optimise the organisation’s IT Portfolio Management
  • 97. Strategy to Portfolio (S2P) Key Performance Indicators And Critical Success Factors August 17, 2020 97 Success Factor Performance Indicators Business and IT Alignment • Ratio of new and maintenance activities, effort and cost Accurate View of Overall Demands from Business • Demand requests, types and delivery per service as a percentage of overall IT budget that can be traced to formalised demand and service requests from business • Structured and operational Demand Management process with continuous improvement efforts to minimise the number of demand queues that staff must respond to Service Portfolio Rationalisation • A formal Service Portfolio functional component process exists under a Service Portfolio Management process owner • Classifications and agreed definitions for understanding functional and technical redundancy and business value of the IT service are implemented and operational • Processes for consistently evaluating and tagging portfolio entries are implemented and operational • Service portfolio is subject to ongoing rationalisationusing the taxonomies, implemented as continuous improvement • Service and IT Portfolio Management functions and processes are rationalised with clear scoping and relationship established Service Portfolio Financial Analysis • Financial reports are produced regularly to show the ongoing investment and spend in each service/application • Financial reports are compared with business outcomes and the financial objectives that have been achieved Service Portfolio Reporting and Analysis • A service portfolio exists and is used to decide which services to offer Service Investment Tracking • The investment in each service in the service portfolio is known and quantified • Investment in each service is reported, from the initial investment and the monthly, quarterly, and annual ongoing budget spend and cost of operation Improved Customer Satisfaction • Number/percentage of satisfied customers per service/application Stewardship of IT Investment • Capital expenditure and operational expenditure • Software license percentage actually in use • Planned versus actual service costs • Average cost of IT delivery (per service/application) per customer. Enterprise Security Alignment • Frequency of security assessments against latest standards and guidelines • Deficiencies against security standards and policies
  • 98. Strategy to Portfolio (S2P) Functional Components August 17, 2020 98 Strategy to Portfolio (S2P) Enterprise Architecture Policy Proposal Portfolio Demand Service Portfolio IT Investment Portfolio – Auxiliary Requirement to Deploy (R2D) Project Requirement Service Design Source Control Build Build Package Release Composition Test Defect Request to Fulfil (R2F) Engagement Experience Portal – Secondary Offer Consumption Offer Management Catalog Composition Request Rationalisation Fulfilment Execution Usage Chargeback/Showback Knowledge and Collaboration Supporting Function Detect to Correct (D2C) Service Monitoring Event Incident Problem Change Control Configuration Management Diagnostics and Remediation Service Level
  • 99. Enterprise Architecture Functional Component August 17, 2020 99 Purpose • Create and manage long-term IT investment frameworkand delivery plan that are criticalto business strategic objectives Functional Elements • Create and manage long-term IT investment frameworkand delivery plan • Identify strategic IT architecturalcomponents based on current business vision, strategy, goals, and requirements • Develop target state business, information, application,technology, and security blueprints based on strategies, principles, and policies Key Data Objects • Enterprise Architecture - contains references to the target state architecture landscape representing planned and deployed IT services Key Attributes • ID - Unique service identifier • Component - Architectural buildingblocks required to enable a service • Diagram - As-is business, data, application, and technology domain architecture description from the viewpoint of IT service owners Key Data Object Relationships • Enterprise Architectureto ConceptualService – used to track which service components and service diagrams are allocated to which service(s)
  • 100. Policy Functional Component August 17, 2020 100 Purpose • Manage the creation, review, approval and audit of all IT policies Functional Elements • Align and map IT policies to Enterprise Architecture • Manage policies relating to IT governance • Manage IT security and regulatory policiesby incorporatingexternal and internal security and regulatory compliances • Enable review and approval of IT policies based on roles and responsibilities • Manage the distribution and acceptance of policies used on predefined templates and schedules for designated IT stakeholders • Provide visibilityinto IT Policyattributes such as types, status, non-compliance, audit history, and issues • Define pricing/costingpolicies and capture informationrelated to Service Contracts • Maintain policy revision history and review period or obsolescence rules • Log and track IT policy exceptions and track policies for exception identification, evaluation, and status report leading to corrective action Data Architecture Elements • Associate one or more policies to one or more Conceptual Services Key Data Objects • Policy - Central repository for storing and organising all types of IT policies based on various templates and classificationfactors Key Attributes • ID - Unique policy identifier • Description - Description/detailsof the policy • Applicable Geography - Which geographies the policy applies to Key Data Object Relationships • Policy to Conceptual Service - Multiple policies might be applicablefor a single • service or a single policy may be applicablefor multipleservices • Policy to Requirement - Requirements may be sourced from policies or may • reference policies in order to remain in compliancewith previously agreed policies
  • 101. Proposal Functional Component August 17, 2020 101 Purpose • Manage the portfolio of IT proposals that are proposed, approved, active, deferred or rejected Functional Elements • Create a structured Scope Agreement that includes proposals from rationalisedPortfolioBacklog Items through a structured analysis approach • Send proposed IT investments to the IT Investment Portfolio functionalcomponent for scoping and investment decisions • Update Scope Agreement(s) to compare approved baseline and actual resulting • benefits derived from completing the IT Initiatives • Review, evaluate and take action on Scope Agreement change requests from the R2D Value Stream • Consider the R2D Value Stream project portfolio as the authoritativesource for the list of IT deliverablesor services that will be rendered during a delivery lifecycle • Create project portfolio views for specific business functions • Manage the project portfolio entries through the Project Management framework being used • Ensure that the project portfolioreports back to the investment portfolio in order to accurately track progress and outcomes for a given Scope Agreement • Implementsecurity controls necessary for protecting the various classificationsof data Key Data Objects • Scope Agreement - Proposals are created from rationalisedPortfolioBacklog Items • Scope Agreements reflect budget, cost/benefit projections, scope, status, • and other key attributes of proposed work • Views can be created for specific business functions • Used for building the IT investment plan of record for the organisation or a business function Key Attributes • ID - Unique identifier of the Scope Agreement • Description -Details of the Scope Agreement • Business Entity - Business or geographic unit • Proposed Budget - Requested • Approved Budget - Approved budget • Status - Status such as proposed, approved, rejected Key Data Object Relationships • Scope Agreement to Portfolio Backlog Item - One Scope Agreement can be associated to one or more demand data objects • Scope Agreement to IT Budget Item - Helps track budget allocated to which Scope Agreement. • Scope Agreement to IT Initiative - Helps track IT Initiative(s)to Scope Agreement
  • 102. Portfolio Demand Functional Component August 17, 2020 102 Purpose • Log, maintain, and evaluate all demands (new service, enhancements, defects) coming into IT through a single mechanism • The single mechanism co-ordinates demands across all of project ideation, service request management, incident management, continuous improvementand other demand channels • Correlate incomingdemand to similarexisting demand or create new demand Functional Elements • Capture PortfolioBacklog Items from business • Capture PortfolioBacklog Items from Problem Management activities • Capture PortfolioBacklog Items from the Service Portfolio functionalcomponent Activities • Capture PortfolioBacklog Items for defect fix requests which exceed the operations budget or require urgent attention due to business impact on existing service • Support backlog item data object backlog ranking, trending, and analysis based on requested services, timeline, business unit origination, etc. • Categorise and group the demands and push demands to the Proposal functional component • Receive scoping and investment decisions from the Proposal functional component • Associate one or more Requirements(user stories, use-cases, business rules, etc.) to a • PortfolioBacklog Item Key Data Objects • Portfolio Backlog Item - Represent the repository of all incoming demands includingbut not limitedto new requests, enhancement requests and defect fix requests Key Attributes • ID - Unique identifier • Description - Description/detailsof the Portfolio Backlog Item (demand request) • Source - Where did the demand originatefrom (e.g., person/department) • Scope Agreement ID - Unique identifier of the related Scope Agreement • Estimated Budget - May store budget (as estimated during creation of the Scope Agreement) of the Portfolio Backlog Item • Expected Completion Date - Expected completion date (as estimated during creation of the Scope Agreement) of the PortfolioBacklog Item. • IT Service ID - The conceptual service ID. Is demand related to a live service (e.g., enhancement requests) • Fulfilment Status - Status information • Decision Maker - Informationon who took the decisions related to the demand Key Data Object Relationships • Portfolio Backlog Item to Conceptual Service - One Conceptual Service may be related to one or more PortfolioBacklog Items • Portfolio Backlog Item to Requirement - A PortfolioBacklog Item is mapped to one or more Requirements which will need to be delivered to successfully fulfilthe demand • Portfolio Backlog Item to Scope Agreement - One or more PortfolioBacklog Items may be included in a Scope Agreement
  • 103. Service Portfolio Functional Component August 17, 2020 103 Purpose • Manage the portfolio of services in plan, transition, production and retirement • Be the authoritative source for the list of services that IT delivers, has deliveredin the past, or brokers to itself and • Business • Any IT service within the Service Portfoliofunctional component often corresponds to one or more entries in the Offer Catalog Functional Elements • Assess the effectiveness and efficiencyof current services delivered to business • Manage all inventory informationabout services or applications; includingbusiness benefits, risk, quality, fit to purpose, etc • Compare similarservices or applications to identify rationalisationopportunities • Evaluate the portfolio with regard to value/cost performanceand risk/criticalityto maximise portfolio value, align and prioritiseresource allocations, and balance supply and demand • Review proposed portfoliochanges; decide whether to keep, retire, or modernise services or applications • Create, review, and update service roadmaps • Determine and track the TCO of a service and associated return on investment • Determine and track operations spend • Create and maintain service blueprints and endpoints Key Data Objects • Conceptual Service - Represents the business perspective of the service and is the service interaction or the business capability of the service • Conceptual Service Blueprint - contains the various deliveryoptions for a given Conceptual Service Key Attributes • Conceptual Service • ID - Unique identifier of the Conceptual Service • Details - Details of the Conceptual Service • Owner - Owner of the Conceptual Service • Status - Status of the Conceptual Service; e.g., planned, retired, etc. • Business Unit/Portfolio - The business unit or portfolio to which the service belongs • Budgeted Spend - Approved budget for service development and maintenance • TCO: Total cost of ownership of a Conceptual Service (includes development, run, enhancement and overhead charges) • Recovery - Return on investment against the Conceptual Service • Conceptual Service Blueprint • ID - Unique identifier of the Conceptual Service Blueprint • Details - Details of the Conceptual Service Blueprint • Conceptual Service ID - Unique identifier of the Conceptual Service to which the Blueprint is associated Key Data Object Relationships • Conceptual Service • Conceptual Service to Logical Service - Traceabilityis maintainedbetween one Conceptual Service and one or more Logical Services • Enterprise Architectureto ConceptualService - Traceabilityis maintained between one or more Conceptual Services and the Enterprise Architecture drawings, diagrams and other documents that describe those services • Conceptual Service to Portfolio Backlog Item - One Conceptual Service may be related to one or more PortfolioBacklog Items. • Conceptual Service to IT Budget Item - Budget for one Conceptual Service may be spread across multiplebudget items and one budget item should hold budget for a single Conceptual Service • Conceptual Service to Policy - Multiple Policiesmight be applicablefor a single service or a single Policy may be applicablefor multipleservices • Conceptual Service Blueprint • Conceptual Service to Conceptual Service Blueprint - One Conceptual Service may have multiple Conceptual Service Blueprints • IT Cost Model to ConceptualService Blueprint - One IT cost model (rule engine) can be applicable for multipleConceptual Service Blueprints • Conceptual Service Blueprint to Logical Service Blueprint - One Conceptual Service Blueprint could have one or more Logical Service Blueprints
  • 104. IT Investment Portfolio – Auxiliary Functional Component August 17, 2020 104 Purpose • Manage the portfolio of all authorised IT investments Functional Elements • Manage the entire IT investment lifecycle • Be the authoritative source for all IT investments requested over a given time period • Receive proposed IT investments for developmentfrom the Proposal functional component • Receive proposed IT investments for run and maintain and non-service investments from investment owners • Assess proposal feasibilityfor cost, value, etc. and obtain required approval from Finance • Communicate the status of the final scoping and investment decisions back to the respective stakeholders. Key Data Objects • IT Budget Item – Contains an authoritativelist of approved IT investments pertaining to a service Key Attributes • Financial Period - Financial period for which the IT Budget Item is recorded. • Investment ID - Unique identifier of the service or investment (e.g., overhead) for which the IT Budget Item is recorded • Investment Type - Nature of investment (e.g., run, development, overhead) • Approved Budget - Approved budget • Spend - Actual spend Key Data Object Relationships • IT Budget Item to Conceptual Service - One IT Budget Item shall hold budget for a single Conceptual Service and budget for one Conceptual Service may be spread across multiple IT Budget Items • IT Budget Item to Scope Agreement - Helps track how much IT budget is allocated to which Scope Agreement(s)
  • 105. Requirement to Deploy (R2D) Value Stream Overview • Aims to ensure predictable, cost-effective, high quality results of service delivery to business consumers while seeking to achieve high levels of component re-use, flexibility, speed and collaboration across the IT function to support traditional and new approaches for service creation and service sourcing August 17, 2020 105
  • 106. Requirement to Deploy (R2D) Value Stream Overview August 17, 2020 106 Make service delivery predictable and efficient across dispersed teams, multiple suppliers and different solution delivery approaches and technologies • Many different parties are involved in solutions sourcing • Each party works with their own processes, technologies and approaches • New technologies and approaches such as cloud sourcing, agile development, continuous delivery, data growth and demands have created the need for IT to be able to manage development and delivery of solutions in a hybrid or multi- sourced environment • The gap between business expectations of IT solutions and IT solution provision capability and capacity is getting wider • IT operations may not be able to accommodate new technologies and environments fast enough to meet the requirements of solution consumers • Development organisations create solutions in isolation that are made live without adequate • There are still too many incidents immediately after a solution or service is released into production Why • Be able to provide an overview of planned activities • Put management controls in place to lessen the impact of high staff turnover and capture the knowledge that would otherwise be lost and cause schedules to be negatively impacted • Speak a common language with all parties involved and provide a common methodology to achieve the high- quality results • Build a culture of collaboration between IT operations and IT development to ensure service release success • Establish control over the quality of a service regardless of the number of suppliers involved in development and/or delivery • Ensure that each service release is high quality, fit-for- purpose and meets customer expectations How IT Must Respond
  • 107. Requirement to Deploy (R2D) Value Stream Functional Components And Data Objects Overview August 17, 2020 107
  • 108. Requirement to Deploy (R2D) Goals • Understand the evolving relationship between planning and delivery. planning of complex solutions requires information only available through iterative attempts to fulfil requirements so both planning and building must occur simultaneously • IT operations and development must improve collaboration across business and technical domains and suppliers • Drive predictable outcomes without driving out innovation - innovation and process efficiency are two elements of competitive advantage that IT departments bring to the business that frequently co-exist badly - emphasis on on-time project delivery tends to suppress innovation - IT must continuously improve its ability to execute in such a way that on-time innovation is standard August 17, 2020 108
  • 109. Requirement to Deploy (R2D) Business Value Proposition August 17, 2020 109 Optimise the pipeline of projects and smaller demand requests for faster service realisation Ensure predictable outcomes the solution or service delivered performs as requested, leading to higher rates of solution consumer acceptance and better alignment with actual business needs Establish controls to manage the quality, utility, security and cost of services, independent of delivery method, technology, source or provider Provide increase management information for traceability and benchmarking of internal and external solution and service developers and suppliers Ensure that all services are designed in accordance with standards and policies (Compliance, Enterprise Architecture, Risk Management, IT Financial Management) Provide improved inputs to IT Financial Management on actual solution and service delivery and operation cost Demonstrate the link between solution and services and business value by creating and maintaining the service blueprint Accelerate the sourcing and delivery of solutions and services • Provide a framework of functional components and data objects so IT functions can better control the quality, utility, schedule and cost of services regardless of the specifics of the technology and delivery model
  • 110. Requirement to Deploy (R2D) Key Performance Indicators And Critical Success Factors – 1 August 17, 2020 110 Success Factor Performance Indicators Improved Quality • Number of defects not found • % of actual versus planned executed tests • % of critical defects found early in unit testing versus UAT Improved Project and Feature Execution • % of projects, solutions and services delivered on time • % of successful projects, solutions and services • Deviation of planned to actual effort • Number of identified issues • Number of opened risks • Amount of backlog/work-in-process Improved Management of IT Investment • % of actual versus planned project, solution and service cost • % of change in project, solution and service cost • % of budget at risk Increased Use of Automation • % of automated tests Solution Delivery Excellence • % of requirements tested and completed • % of requirements traced to tests • % of reviewed requirements • % of successful builds • % of changes resulting in Incidents • Ratio of detected to closed defects at release Improve Early Life Success of Releases • % of Incidents during warranty period • % of successful/unsuccessful deployments for the project • % of emergency changes • Pass rates on UAT/validated requirements
  • 111. Requirement to Deploy (R2D) Key Performance Indicators And Critical Success Factors – 2 August 17, 2020 111 Success Factor Performance Indicators Operations and Development Collaboration • Trend on early life support/UAT success metrics • % rework Improve Financial Visibility • Planned cost versus actual cost Maintain a Linkage between Business Services and IT Initiatives • Aggregate (roll up) service development costs by business service High Quality Service Design Specifications at the Outset • % reduction in the rework required for new or changed service solutions in subsequent lifecycle stages Integration Test Success • Trend on the number of installation errors in all the packages in the integration environment • Number of applications or services that require exceptions outside of the existing infrastructure portfolio Design-Review to Ensure Application Design Complies with all Policies, including Security • Number of application designs that pass a security policy review Early Testing of Applications for Security Vulnerabilities • % of severity 1 security defects fixed before application is released
  • 112. Requirement to Deploy (R2D) Functional Components August 17, 2020 112 Strategy to Portfolio (S2P) Enterprise Architecture Policy Proposal Portfolio Demand Service Portfolio IT Investment Portfolio – Auxiliary Requirement to Deploy (R2D) Project Requirement Service Design Source Control Build Build Package Release Composition Test Defect Request to Fulfil (R2F) Engagement Experience Portal – Secondary Offer Consumption Offer Management Catalog Composition Request Rationalisation Fulfilment Execution Usage Chargeback/Showback Knowledge and Collaboration Supporting Function Detect to Correct (D2C) Service Monitoring Event Incident Problem Change Control Configuration Management Diagnostics and Remediation Service Level
  • 113. Project Functional Component August 17, 2020 113 Purpose • Manage the creation and provide ongoing delivery supervision of IT Initiatives that create new or enhance existing services based on the Scope Agreement, track and report on execution status, manage communication between internal and external stakeholder, manage deliveryfinances, manage scope and handle changes, supervise resource acquisition Functional Elements • Be the system of record (authoritative source) for all IT Initiatives • Manage interactions with other functionalcomponents • Manage the lifecycleof the IT Initiativeand govern, coordinate, influence, and direct IT Initiativeexecution • Manage the acquisition of resources • Manage the status of the IT Initiative and maintain traceability between IT Initiativesand associated applications and service(s)being developed • Coordinate resources, finances, tasks, and milestones for IT Initiatives, and provide ongoing execution oversight of IT Initiatives when creating new services or enhancements to existing services • Create IT Initiativesbased on the specifications outlined in the Scope Agreement, includingcost, time, scope, and quality • Aggregate, track, and report status, resources consumed against project plan, or project burn down, and communicate these to stakeholders • Ensure financialgoals and boundary conditions are adhered to and track spending • Manage change control Key Data Objects • IT Initiative - Contains informationon the scope of the work to be performedand created from and associated with the Scope Agreement. Data Architecture • Associate a Scope Agreement to one or more IT Initiatives • Associate an IT Initiative to a service • Associate an IT Initiative to one or more RFCs • Associate an IT Initiative with IT Budget Items Key Attributes • ID - Unique identifierof the effort/initiative • Name - Full name of the effort/initiative • Status - Status of the effort/initiative • Service Release - Identifier of one or more Service Releases • RFC ID - Identifierof one or more RFCs • Budget - Budget for the IT Initiative • Actual Spend - Actual spend on the IT Initiative • Start Date - IT Initiative start date • End Date - IT Initiativecompletiondate • Scope Agreement ID - Unique identifier of the related Scope Agreement Key Data Object Relationships • Scope Agreement to IT Initiative - Linkage between the proposal that authorised one or more IT Initiatives • IT Initiative to Service Release - An IT Initiative will manage the creation of one or more Service Releases required to deliver the IT Initiative • IT Initiative to Request for Change (RFC) - An Initiativewill be related to one or many RFC records in order to manage all changes resulting from a single work effort (initiative)
  • 114. Requirement Functional Component August 17, 2020 114 Purpose • Collect, refine, track progress and manage requirements through the lifecycleof a service, maintain traceabilityof each requirement to the original source and derive deliverybacklogs which will feed queues for enhancing IT services Functional Elements • Be the system of record (authoritative source) for all requirements • Collect, refine, scope, and track progress of requirements • Manage the lifecycleof the requirement • Manage the state of a requirement • Manage requirementsthrough the lifecycleof a deliveryand maintain traceabilityof each requirement to its original source • Derive product or program backlogs which will serve as work queues • Trace requirementto one or more test cases Key Data Objects • Requirement – Contains details the needs or conditions to meet for a new or altered service Data Architecture • Allow recursive relationshipsbetween requirements • Allow hierarchicalrelationshipsbetween Requirements • Associate a requirement to a service • Associate one or more Requirementsto a Service Release • Associate one or more Requirementsto a PortfolioBacklog Item Key Attributes • ID - Unique identifier of a given Requirement • Type - Identifies the category of a Requirement (i.e., epic, theme, feature, user story, non-functional, functional, etc.) • Summary - Represents the short description/title/summaryof a given Requirement • Logical Service ID - Unique identifier of the related Logical Service • Requirement Source - A reference to the Requirementsource such as policy, backlog item, etc. • Owner -The person or team that is assigned to this Requirement • Service Release ID - Unique identifier of the related Service Release Key Data Object Relationships • Logical Service to Requirement - One or more Requirements will be used to define the required behaviour from the Logical Service • Service Release to Requirement - Describes a version of the service which fulfils one or more Requirements • Requirement to Test Case - A Requirementis traced to one or more Test Cases to ensure stated needs or conditions have been successfully delivered or met • Portfolio Backlog Item to Requirement - A PortfolioBacklog Item is mapped to one or more Requirements which will need to be delivered to successfully fulfilthe demand • Policy to Requirement - Requirements may be sourced from policies or may reference policies in order to remain in complianceto previously agreed policies for an organisation • Requirement to Source - Source will fulfil one or many Requirements, and for a given Requirement, there could be multiple Sources created/modified
  • 115. Service Design Functional Component - 1 August 17, 2020 115 Purpose • Identify the new or existing services required to meet the needs of the Scope Agreement and the associated IT Initiative • Create a Logical Service that describes the service structure and behaviour taking into account the service system and the service offer and ensure that the architecture and Logical Service Blueprint are compliant with all standards and policies, includingsecurity standards and policies • Create the service design specification • Identify the service delivery model and potential service suppliers • Implementdata collection and measurementframework so IT can capture actual data about how IT services are performingrather than relying only on anecdotal input from the service consumers • Ensure that the service is architected to meet the applicableKPIs and SLAs Functional Elements • be the system of record (authoritative source) for all Logical Services • identify the new or existing services required to meet the needs of the Scope Agreement and IT Initiative • Leverage the Conceptual Service and Portfolio Backlog Items from the S2P Value Stream along with Requirementsto produce a Logical Service that describes the service structure and behaviour • Create various architecturalartefacts (data flow diagrams, technical schematics, etc.) that comply with the IT Initiativespecificationsand boundaries • Create service design specification document (Logical Service Blueprint) • identify the service delivery model (in-source, outsource, etc.) and service suppliers to meet the Requirements within the chosen deliverymodel • Enable interaction with IT operations to develop support plan/requirements for an IT Service • Ensure that the architecture and Logical Service Blueprint are compliant with all standards and policies, including security standards and policies • Ensure that the architecture and Logical Service Blueprint meet all Requirements, includingsecurity requirements, to ensure the confidentiality, integrity, and availabilityof the service • Put data collectionand measurement framework in place so that IT can capture actual data about how IT services are performing, rather than relying only on anecdotal input from service consumers • Ensure traceabilityis done through the Requirementfunctional component • Receive the development spend from the Project functionalcomponent and pass it to the Service Portfolio functional component Key Data Objects • Logical Service - bridge between the service interaction and service system containing the group of logical components needed to provide the expected outcome or service interaction • Logical Service Blueprint - design of the logical service that details the components and how those components relate to one another
  • 116. Service Design Functional Component - 2 August 17, 2020 116 Key Attributes • Logical Service • ID - Unique identifier • Name - Meaningfulname • Description - Short description of the purpose • Conceptual Service ID - Unique identifier of the related Conceptual Service • Budgeted Spend - Approved budget for development of a service • Actual Spend - Actual spend for the development of a service • Logical Service Blueprint • ID - Unique identifier • Name - Meaningfulname of the • Description - Short description of the purpose of the Logical Service Blueprint • Version - Version • Logical Service ID - Unique identifier of the related Logical Service • ArchitectureDesign - An architecturalrepresentation (diagram)of the service system components Key Data Object Relationships • Conceptual Service to Logical Service - One or more Logical Services represents the logical components which are necessary to provide the expected outcome of the Conceptual Service • Logical Service to Requirement - One or more Requirements will be used to define the required behaviour from the Logical Service • Logical Service to Service Release - A Logical Service can lead to the creation of one or more Service Releases in order to deliver the required service outcomes • Logical Service to Logical Service Blueprint - A Logical Service structure and behaviour can be detailed by one or more Logical Service Blueprints
  • 117. Source Control Functional Component August 17, 2020 117 Purpose • Develop source code or infrastructure based on the Logical Service Blueprint, Service Design Package, and IT Initiativepriorities • Ensure that the source code meets the design specifications, organisation policies, standards and non-functional requirements so that the service can be operated successfully and meets solution consumer expectations • Manage the development backlog of requirements and defects Functional Elements • Be the system of record (authoritative source) for all source • Manage the source lifecycle • develop source code or infrastructurebased on the Logical Service Blueprint, • Service Design Package, and IT Initiative priorities • Ensure that the source code meets the design specifications, organisational policies, standards, and non-functional requirementsso that the service can be operated successfully and meets solution consumer expectations • Manage the development backlog of requirements and defects • Create (automated) test scripts includingunit testing and scripts for static applicationsecurity testing that follow a formal software security assurance methodology • Run security tests on core code to identify existing security issues at the start of the development cycle so that assessment of scope/requirements set/schedule for existing services being changed can be negotiated early • Manage source code images and store them in a source data object repository Key Data Objects • Source - Created or purchased solution to meet the requirementsfor a particularService Release Data Architecture • Allow recursive relationshipsbetween source • Allow hierarchicalrelationshipsbetween source • Associate source to a service • Associate one or many requirements to one or many sources • Associate one or many builds to the related source Key Attributes • ID - Unique identifier • Version - Version of the Source • Requirement ID - Identifier of the related requirement(s) Key Data Object Relationships • Source to Requirement - Source will fulfil one or many requirements, and for a given requirement, there could be multiplesources created/modified • Source to Build - Source can be built multipletimes to create several Build versions
  • 118. Build Functional Component August 17, 2020 118 Purpose • Receive the source data object from the Source Control functional component and manage the creation, implementation, automation, and security and storage of all builds Functional Elements • Receive the Source data object from the Source Control functional component and manage the creation, implementation, automation, and security and storage of all Builds • Create the Build from the Source data object for a particular service component • Automate the Build process to support the Build schedule and build frequency requirements in order to support daily Build and smoke test plans or continuous integration plans • Run dynamic applicationsecurity testing no later than when the final Build data object is received and before the RFCs are created for moving the new or changed service into production • Manage Builds and versioning in a DefinitiveMedia Library (DML) • Develop automated Build storage procedures and automated compilationtechniques and tools • Monitor and report on the results of each integrationBuild • Initiate or automate the delivery of Builds to the Build Package functional component for validationby the acceptance testing team as candidate release builds Key Data Objects • Build - Created from Source and versioned Data Architecture • Be the system of record (authoritative source) for all Builds • Manage the version of each individualBuild • Associate a Build to a service • Associate Source to one or many Builds if a Source Control functional component exists • Associate one or many Builds to one or many Test Cases which are executed as part of the Build creation if a Test functional component exists • Associate one or many Builds to a Build Package if a Build Package functional component exists Key Attributes • ID - Unique identifier • Version -Version of the build • Source ID - Identifier of the related source • Test Case ID - Identifier of the related test case(s) • Build Package ID - Identifier of the related build package after it has been created Key Data Object Relationships • Source to Build -Source can be built multipletimes to create several Build versions • Build to Test Case - One or many Builds can be related to one or many Test Cases used as part of the Build creation • Build Package to Build - A Build Package is comprised of one or many Builds.
  • 119. Build Package Functional Component August 17, 2020 119 Purpose • Create a deployable package made up of one or many Builds • Manage the Build Packages and relationships to the Service Release Blueprints Functional Elements • Create a deployable package made up of one or many Builds. • Manage the Build Packages and relationships to the Service Release Blueprints • Be the system of record (authoritative source) for all Build Packages Key Data Objects • Build Package - A compilation of one or many Builds in a deployable package Data Architecture • Associate a Build Package to a service • Associate one or more Builds to a Build Package if a Build functional component exists • Associate one or more Service Release Blueprints to one or more Build Packages if a Release Composition functional component exists Key Attributes • ID - Unique identifier • Name - Meaningful name of the Build Package Key Data Object Relationships • Build Package to Build - Build Package is comprised of one or more Builds • Build Package to Service Release Blueprint - Multiple build packages, which represent the deployable content of the service components, can be deployed using the instructions contained in the Service Release Blueprints