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Service Design and Building the IT Service Portfolio

  • Sample Chapter is provided courtesy of Cisco Press.
  • Date: Apr 6, 2018.


  1. Service Portfolio Overview
  2. Designing IT Services
  3. Designing the Service Portfolio
  4. Summary

Chapter Description

In this sample chapter from IT as a Service (ITaaS) Framework, The: Transform to an End-to-End Services Organization and Operate IT like a Competitive Business, examine the purpose, goals, and value potential of a Service portfolio. You’ll also explore how to design specific elements of the Service portfolio and review various guidelines, best practices, and lessons learned for the successful design of IT Services across the enterprise.

Designing the Service Portfolio

Chapter 4 provided details on the purpose and value of additional levels in the Service delivery taxonomy. These additional levels created a hierarchy for our portfolio and enabled the aggregation of Services (Service categories and Strategic Service Groups) along with the management of individual Services (Service Offerings and Service assets). The following sections describe the actual design and designation of elements at each level of the taxonomy and provide examples and best practices for each.

Designing Service Offerings

Recall from Chapter 4 that the availability of Service Offerings within the Service taxonomy affords Service Owners a highly flexible mechanism for managing an individual Service. They could be leveraged simply to organize and ease the management of a Service, deliver differentiated capabilities while minimizing resources and assets, and even create levers for use in facilitating desired outcomes. Even more significant was their low overhead and ability to be introduced with little impact to the Service landscape.

The level of flexibility afforded by Service Offerings, their low management overhead, and isolation from impacting the broader Services landscape provide teams with an ideal first option for facilitating delivery of new capability requirements. If it is later determined that the Service Offering warrants its own Service, the capabilities can be spun out and a Service Owner assigned, TCO model constructed, and performance strategy developed. The key is that unless there is an obvious requirement for a new Service, teams should attempt to minimize.

Cisco recommends that IT Transformation teams attempt to designate one to two Service Offerings during the Service design phase. Doing so can help potential stakeholders better envision the future focus and size of a proposed Service during vetting and support newly initiated Service Owners in getting the Service up and running. This is strictly a recommendation and not a requirement, however, because teams can sometimes struggle to define details at the offering level for some Service types and should not allow their Service design activities to be stalled. Even then, transformation teams can expect their initial proposals for Service Offerings to change dramatically through the process of vetting and finalizing the initial Service portfolio, however, and due to their flexibility and low management overhead, they can be leveraged to address the various competing requests from different stakeholder groups. Teams should also anticipate Service Owners making their own changes to proposed offerings soon after taking over a Service. Transformation teams should view this as a Service Owner having gained a working understanding of the ITaaS framework and confidently taking on the responsibilities for driving more value from the Service.

Service Offerings can often be identified by working through the various capabilities they provide for the management of a Service and considering whether they apply. For example, does the proposed Service need to provide any level of differentiation in its capabilities? Can the capabilities be grouped by customer base or underlying Service asset?

In the long term, each Service should ideally define a minimum of two Service Offerings, but this is not a definitive requirement. Remember that many Service Owners find it easier to designate appropriate Service Offerings after several months of managing Service delivery. In general, Service Owners tend to most often leverage three to five Service Offerings. In cases where more than five Service Offerings are required, the Service Owner’s efforts to manage and maintain each can potentially begin to outweigh the value they add. Numerous Service Offerings can also be an indicator that one or more offerings should be considered for their own separate Services.

Capturing Service Asset References

Service assets require little to no “design” work. Instead, IT Transformation teams are required only to identify the different types of Service assets associated with a Service. From there, the real design effort involves how best to reference the often extensive array of Service assets in the Service portfolio while still ensuring that it can be leveraged as a strategic tool for steering the IT organization.

Recall that Service Assets are the various resources, assets, processes, and even budgets that actually enable the capabilities delivered by a Service. Service assets can include everything from standalone applications to large-scale application suites, to hardware spanning everything from servers, storage arrays, smartphones, laptops, network devices, and of course, IT staff (people) resources. Documenting each asset involved in the delivery of a Service would represent a major effort, and IT Transformation teams working through the design of the initial portfolio are likely eager to understand to what degree they are required to identify these many assets.

The short answer is that the IT Service portfolio should reference only the types of Service assets in use and, whenever possible, link or map directly to other platforms such as asset databases, application portfolios, configuration management databases (CMDBs), or even corporate directories. These platforms are purpose-built for the function of managing and documenting specific information, and are better suited for capturing details such as licensing information, serial numbers, or similar data unique to each. The design work focuses on reviewing the structure and organization of these platforms, and determining how best to link information to the Service portfolio, including the appropriate level of detail to associate with each. The following Service asset references might be contained in a portfolio.

  • IT Staffing Resources: Level 1 Support Desk Team

  • Hardware: Networking Equipment: WAN Routers

  • Software: Standalone Licensed Application: [NAME]

  • Software: Multi-User Hosted Platform: ERP System [NAME]:

Many IT organizations develop solutions for linking to these systems from the Service portfolio, allowing customers to navigate from one platform to a complete listing of applications associated with a Service and to locate detailed data such as cost and licensing information. Successfully linking information between platforms can accelerate multiple strategies and processes for Service delivery and other functions of the IT organization.

Designing Strategic Service Groups

Chapter 4 established the purpose of the top level of Service aggregation within an ITaaS Service taxonomy and portfolio as providing the CIO and senior IT leaders with a strategic view of the IT Service landscape. With this in mind, the specific elements that make up this topmost level of the Service delivery hierarchy depend on the aspects of the enterprise business and IT organization that IT leaders want to establish visibility to.

IT Transformation teams can begin developing an initial proposal for the elements that will populate this level of the portfolio in parallel with initiating Service design. However, they should remain conscious of several considerations. First is that the designation of Strategic Service Groups (SSGs) should not be allowed to influence the design of any individual Services to a significant degree, much less to supersede fundamental Service design principles. In other words, teams should ensure they are foremost designing Services in response to requirements for technical capabilities, and not proposing Services simply to populate a proposed Strategic Service Group. Transformation teams should also anticipate that as the Service design effort progresses and the final landscape of IT Services across the enterprise begins to take shape, they may be required to revisit an earlier proposal for Strategic Service Groups. With this in mind, they may choose to defer proposing SSGs until they have progressed the Service design effort beyond its anticipated midway point. Teams should also always remember that the final design can and should be heavily influenced by the IT leadership team.

Cisco recommends that this level of the taxonomy be populated with no more than ten elements and considers four to six to be ideal for most IT organizations. Designating fewer than four or more than ten Strategic Service Groups begins to strip this level of aggregation of its strategic significance. Cisco’s reference taxonomy designates six Strategic Service Groups.

The best advice when proposing a set of Strategic Service Groups is for IT Transformation teams to consider these questions: What types of questions will the CIO and senior IT leaders have regarding the IT Service landscape? What is the most valuable view of aggregated Services information to support their top priorities and the decisions they will be faced with? Some examples of these may include

  • Do we have visibility to the technical capabilities the IT organization delivers that have been deemed a competitive advantage to enterprise business operations?

  • What are the total operating costs for Services supporting common corporate functions and delivering capabilities that are standard requirements across businesses, and are there any emerging trends that these Services could adopt to decrease these costs?

  • What are the total costs of Services that enable the IT operating model, how have those costs changed over time, and how are they forecasted to change?

  • What is the high-level performance of core Technology Foundation Services, and how is this impacting Business Operations and Enterprise End-Customer Services that directly enable our customers?

Cisco’s ITaaS framework and reference portfolio contain a set of SSGs based closely on the original organizing principles of Cisco IT’s portfolio and then refined across numerous enterprise businesses of different sizes and industries. As with any segment of the reference portfolio, they can both accelerate and guide the efforts of the transformation team, but should be carefully reviewed and customized when necessary to address the characteristics and goals of each IT organization and enterprise business.

  • Competitive Advantage Business Services: Business Operations Services that primarily enable processes for enterprise lines of business, including delivery of technical capabilities identified as differentiating the enterprise business in the marketplace, outperforming competitors, or supporting strategies and outcomes driven by the leadership team.

  • Standard Business Services: Business Operations Services that primarily enable processes for enterprise lines of business via common standard, matured capabilities common within the industry.

  • Corporate Functions Services: Business Operations Services that primarily enable processes for common corporate functions such as human resources, legal, and finance.

  • Enterprise Productivity Services: Enterprise End-Customer Services that enable general productivity, communication, and collaboration across the enterprise.

  • Technical Infrastructure and Platform Services: Technology Foundation Services that enable technical capabilities consumed by other IT Services to deliver capabilities.

  • IT as a Business Services: Business Operations Services that enable processes unique to the IT operating model and allow the IT organization to run like a competitive business.

Aggregation of IT Services across the Strategic Service Groups recommended by the reference portfolio effectively aligns Technology Foundation and Enterprise End-Customer Service types into different classes, providing IT leaders with direct visibility of and ability to focus on the unique needs of each. From there, Business Operations Service types are categorized by the operations the Service enables, establishing visibility to Services that enable common corporate function BUs, industry and enterprise unique lines of business, and the IT organization itself. For those Services enabling the lines of business, IT and business leaders can additionally distinguish those that provide capabilities that can disrupt the industry and establish the enterprise as a market leader. This differentiation allows the IT organization to subject competitive advantage Services to unique requirements, such as dedicated Service Reviews with business execs, investment prioritization, and increased scrutiny on Service performance.

Once again, the names and guidance for categorizing Services within a specific Strategic Service Group can and should be customized as required to facilitate the purpose and goals of the IT organization. Regardless of how closely the finalized Service portfolio reflects those included in the reference portfolio, the key is that teams remember the name and purpose of establishing this level of the taxonomy. If the designation of elements fails to create a strategic view of the IT Service landscape, this level of the Service delivery taxonomy has failed in its fundamental purpose.

Designing Service Categories

The common role of this taxonomy and portfolio level is to provide an initial step of aggregation for the likely significant set of IT Services defined in the portfolio. Chapter 4 described that it could be leveraged to create opportunities in various ways and for different segments of the IT organization. Services can be grouped by architecture, technology domain, or even by customer base. The key consideration for the IT Transformation team is the opportunity and value it creates for the IT organization.

Cisco recommends transformation teams consider grouping Technology Foundation and Enterprise End-Customer Service types by technology domain, and business operation Services by function. Table 6-2 provides examples.

Table 6-2 Domain and Function Grouping

Sample Service Categories IT Services
Enterprise Sales Function Services Revenue Accounting Capabilities, Customer Data Management, Partner Program Management
Collaboration Services Email and Calendaring, Video Conferencing, Messaging Technologies
Network and Access Services Corporate Network, Partner Connections, Home and Remote Access
Application Development Services Enterprise Application Customization and Development, Mobile App Development, Programmable Infrastructure Development

A second consideration is to allow Service Architects and the EA practices to group Services into share architecture categories. In doing so this option creates an aggregation of Services that better facilitates architectural planning.

A Service category should contain a minimum of two to three Services, and no more than a dozen, beyond which the group of Services can become difficult to manage. Remember, for Service delivery frameworks that have adopted a four-level taxonomy, this is the level that is removed from the Service delivery hierarchy in favor of retaining the functionality of Strategic Service Groups. Transformation teams that initially chose to progress a five-level taxonomy and now find themselves struggling to populate Service categories with more than two Services should consider moving instead to a four-level portfolio.

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