Proposing a comprehensive framework for ITSM efficiency

(1)

P ROPOSING A

C OMPREHENSIVE

F RAMEWORK FOR ITSM E ^FFICIENCY

2013MASI05 Master’s (Two years) thesis in Informatics (30 credits)

Mohammadreza Farmand

Name 1 Name 2

(2)

1

Title: Proposing a comprehensive framework for ITSM efficiency Year: 2013

Author: Mohammadreza Farmand Abstract

Nowadays, the main concern for IT-related service sector in organizations is to improve IT- Service Management (ITSM) by reducing cost of service in conjunction with growing in their efficiency and effectiveness. Particularly in IT firms, these concerns are much more imperative where the ITSM framework is the main section of providing service and feedback to managers.

However, a challenge is that this significant service segment is ineffective by customers (I.e. IT managers) since IT maintenance and IT operations are unnoticed by IT related research.

Academia together with industry demand a better knowledge and information of IT service management to work closely in order to improve efficiency and effectiveness of the system function.

In this research study, it is attempted to review the situation of ITSM framework (I.e., Metrics) about evaluation method based on Key Performance Indicators (KPIs) and best practices for IT- Service Management process in DB Schenker and to compare them with other corporations. At first, the researcher has done an extensive literature review on the earlier works of Metrics for IT Service Management. After extracting needed information, it is governed in an innovative way to make it more effective and efficient, then run a case study for better understanding of the real situation and to compare literature and real world. The researchers mainly choose Swedish companies as successful companies in IT management to review ITSM framework (i.e. KPIs).

Keywords: Comprehensive framework for ITSM, ITISM metrics, ITIL framework, Quality of Service

(3)

2

Acknowledgements

This master thesis has been written in efficiency of IT Service Management framework at the Department of IT and Business, University of Borås.

First of all I would like to appreciate Dr. Anders Hjalmarsson who assisted me to conduct my research properly.

I also would like to thank Nicklas Salomonson Ph.D., an Assistant Professor in Business Administration at the School of Business and IT, University of Borås, and Hannes Göbel Doctoral student at School of Business and IT and Director of Innovation Lab in University of Borås, for the unfailing support, in whole process of writing thesis. The support encouraged me to discover new methods for challenging with problem and difficulties.

Jun 2013

Mohammadreza Farmand

(4)

3

1. INTRODUCTION

The main purpose of this chapter is to describe the problem and to have an overall view on the study. In this chapter, first the author describes the background of the topic and secondly, the reasons that persuaded the author in the selection process.

1.1 Background

In today’s highly competitive business environment, information plays an important role.

Companies need to derive and share information as much as possible in an efficient way. This resource nourishes other resources of the company and it is an infrastructure for many other activities of the business. IT provides a standard operating environment to conduct these business activities.

As IT environment grows, its management becomes much more difficult and complex due to the volume and complexity of its hardware and software applications (Kumbakara 2008). In this complex environment many issues should be considered to increase the efficiency and effectiveness of the system. IT Service Management (ITSM) has been shaped to manage this complex environment with incorporating different management methods. According to (Mesquida, Mas et al. 2012): “ITSM is a process-oriented discipline which combines process management and industry’s best practices into a standard approach for optimizing IT services”.

ITSM nowadays is considered as a key issue in the IT area (McNaughton, Ray et al. 2010). With a comprehensive management framework, organizations would integrate and centralize different IT operations.

Academics and practitioners have tried to make some standards for ITSM. Some examples of these Standards are: ITIL (Information technology infrastructure library), ISO/IEC 20000, COBIT (Control objectives for information and related technology) and DMTF (Distributed management task force). The main task of all of these standards is to deliver the best quality IT service to the customers and fulfill the business needs and requirements.

In each of these standards, many methods and measurements are introduced to assess the IT operations and to help them increase the efficiency and effectiveness of the system. Measuring the performance of IT operations is very important and service measurements play an important role in ITSM. In this research study, first the author reviews these measurements and then he tries to interconnect them to each other and orchestrate them for better incorporation onto the practical environment.

(9)

8

1.2 Statement of problem

Although many academics and practitioners have tried to consider ITSM from different perspectives, this subject needs to be further developed. Increasing the quality of services is the main concern of many managers in the IT area; and much works have been done previously for the development of special standards in this area. Publishers of these standards mentioned many issues for the improvement of IT services. Measuring these services is one of the issues that are addressed by many academics and practitioners. There are many measurements in these standards from different views. In some situations, this bulk of measurements make the incorporation of them harder to incorporation for the managers and experts. This study tries to review all these measurements and orchestrate them with a different point of view.

1.3 Purpose of the study and expected outcome

In this research study, the author tries to have both theoretical and empirical points of view. At first, a comprehensive view on ITSM and its different standards is provided. The author tries to cover all the needed issues for the analysis part. The expectation from the discussions in this part is to extract measurements for evaluating ITSM performance and use them for the next part. In the second part of study, the main purpose of author is orchestrating extracted measurements for increasing the sufficiency of the standards and to find a comprehensive framework for IT service management efficiency.

 Main objectives

- Giving an overview of ITSM and its frameworks.

- Comparison of different frameworks to extract the strengths and weaknesses of them.

- Surveying and assessing the development of ITSM frameworks in selected companies.

To find out the problems and challenges of the ITSM implementations.

- Propose a practical framework to increase the ITSM efficiency.

- Defining and clarifying different ITSM metrics to incorporate them to the framework.

- Propose a comprehensive framework to improve ITSM efficiency.

(10)

9

1.4 Research questions

In this research study the author tried to design appropriate research questions to fulfill the objectives of the research. Based on the purposes of this study, the author defined a main questions and some sub-questions which are mentioned below:

Main question:

How to improve ITSM efficiency in order to make a better contribution to IT industries?

Sub-questions:

 What are the operational needs related to ITSM framework and how to improve ITSM efficiency?

 What are the main strength and weakness points of the ITSM Performance in the practical areas?

 What are the Impacts of ITSM-ITIL (best practices) on IT/business operation?

1.5 Target group

The results from this research study can be useful for two groups of people.

1. The academics that their focus is on the IT service management and its various stages from meaning to implementation phases

First, this research study can be beneficial for academia and researchers who want to increase their knowledge about ITSM issues and its role in IT area. As mentioned above, one of the main purposes of this study is to give an overview on ITSM concept. To achieve this, the author reviewed many academic sources such as different journal papers and books to gather the appropriate information. Therefore, we can say this research study is a good reference for people who want to know more about the ITSM from its different definitions and advantages to various considered issues from different academics.

2. IT managers and specialists who their main consideration is how to implement ITSM- ITIL (Best-Practice) particularly in IT organizations

Second, in this research the author also considers the practical environment. This task is done with gathering information from different companies which are pioneers in this area. In this part different issues from the barriers of implementing ITSM from considering metrics to increase the efficiency of the system are provided. So people who want to find out how ITSM and its different issues are considered in practical environment can benefit from this part. So IT managers who request to find the answer of questions such as: “What skills are needed in order to make ITSM more effective and efficient in an IT organization?” and “How can ITSM be managed in an innovative way to make it more useful and operative?” can benefit from this study.

(11)

10

1.6 Experience and background of author

The researcher obtained bachelor degree in Information technology, E-commerce from Australian University of Wollongong in Dubai in 2008, immediately after graduation the author start took an internship in The Network Center Company in Dubai-UAE. The author served as the Net Work Administer as his main responsibility and worked with different products as well as Check Point software which is decrease security complexity and lowers total cost of ownership and also Extreme Network which provided the solutions for the company’s open network and provided a platform for improved business agility and different management products. While working in different project he found his interest in improving IT Service Management framework in IT corporations. Presently, the researcher is taking Master’s degree in Informatics with specialization in Co-Design of Business and IT, 120 ECTS at Högskolan i Boras. By collecting skills and knowledge foundation, through master courses and experiences from different assignments, the author has the skills and ability in performing research in the field of informatics.

1.7 Delimitations

As mentioned above, in this study the author covers both theoretical and empirical part of the issue. As many books and articles have been published in the area of ITSM concept the author has to select some specific parts to review based on his goals. These issues can be summarized in: The definitions of Information Technology Infrastructure Library (ITIL) and IT Service Management Framework (ITSM), the needs of comprehensive ITSM framework, advantages of using ITSM and its different framework and benefits of using ITIL best practice. In practical part, because of some constraints such as lack of time and companies to undertake survey at, the author has to limit himself to some limited number of companies for running his empirical part.

So the author limits the empirical part to some interviews and information which he gathered himself from practical environment.

(12)

11

1.8 Structure of the thesis

Introduction

In introduction part, the infrastructure of the thesis is discussed. Some Issues like the background of the research, purpose of the study, research questions and target group are provided.

Methodology The methods which author applied to his research study are discussed in methodology part. The methods for data collection, strategies for validating the thesis and analysis method are the parts which are presented by author in this section.

Theoretical frame of references

In theoretical frame of references chapter, the author presents concepts which he mentioned in his goals and makes the theoretical structure with reviewing previous academic works to use in analysis part.

Empirical study

In empirical study chapter, the author tries to gather some practical information about the ITSM to use in analysis part with running some interviews with companies.

Analysis

In this part, the author makes connection between theoretical and empirical part.

Different information gathered from theoretical and empirical part will be analyzed in this part with using mentioned methodologies.

Discussion

In discussion section, the conclusion of the study and its implication are provided by the author. Moreover, in this part the researcher evaluates the research and presents ideas for developing the concept.

Table1 Structure of the thesis

(13)

12

2 METHODOLOGY

In the methodology chapter, the author discusses about the methods used in different parts of the thesis. This chapter presents research strategy and research approaches. Moreover, at the end of this part the author presents the proofs of validity and reliability of the research study.

2.1 Research perspective

As stated, mainly there are two different scientific paradigms in this regard. According to him, the concept of paradigm refers to value, judgment, norms, standards, perspectives, myths, theories, frames of reference and approved procedures which is derived from the people and is a representative of their thoughts and action. The theory of knowledge has two main paradigms:

 Positivistic paradigm

When the knowledge is objective, scientific and tangible in nature the positivism paradigm comes in to account. As positivistic paradigm is tangible and objective, its basis should be contained in the nature. So, the basis of this concept is mainly from experiment, quantitative measurement and logical reasoning. This kind of paradigm is achieved through performing rational, logical and reasonable approach. Other issues like emotions, beliefs and feelings are not well suited in this kind of paradigm. In conclusion, this paradigm can be achieved via verifying hypothesis and different theories.

 Hermeneutic paradigm

If emotions, beliefs and feelings are applied in the research then it can be assumed that hermeneutic paradigm is achieved. The researcher of this kind of paradigm demonstrates his own perception of the issues. So this kind of paradigm is called “the concept which tries to review and develop theories and the interpretation and understanding of texts” in the academic views. The data in this paradigm comes from different theories and the researcher explains them based on his own feelings.

The overall structure of this research work is built on the positivistic approach. As mentioned earlier, the researcher builds his research upon reviewing the academic resources. So the basis of the thesis comes from scientific and rational resources. The second type of data comes from empirical study. The researcher tries to connect these parts by deploying his own explanation and understating from the information. So in this part the research has somehow a hermeneutic approach.

(14)

13

Research studies can be categorized into two main approaches to conduct in a scientific research;

quantitative and qualitative researches (Bryman & Bell, 2011).

In quantitative research, the researcher uses numerical data in his study and tries to make connection between variables. Therefore, the quantitative research goal is to develop mathematical models or different hypotheses. In the opposite, there is other type of research which is Qualitative research. In this type of research, the author mainly uses the methods such as observation, analyzing text and documents, interviews, recording and transcribing to develop his research study. Explanatory questions such as ‘Why’ is the basis of this type of research. To summarize, qualitative researcher is “subjective” and quantitative research is “objective”.

As mentioned in previous parts, in this research the author uses information from different academic resources and practical environment. As it is clear the nature of his concept of this area of concern is considered as managerial issue. So information used in this study is qualitative and has the subjective nature.

2.2 Research strategy

The main purpose of this study is to help IT managers/organization realize possible influence or significance which brought by IT Service Management Processes Metrics and to give IT managers and IT users a useful reference when they try to establish or improve a ITSM framework efficiency.

To fulfil these purposes, this research includes both theoretical and empirical study. In order to achieve the goals of the research, it is important to have an intensive text investigation through different academic resources in the theoretical part. It is also important to acquire appropriate information through extensive communication with the people in the empirical part. The aim of the author in this research study is to present a research based on theoretical studies with considering empirical data gathered from practical environment.

Firstly, the author reviews different academic resources to build his theoretical foundation. After reviewing the literature of the concept comprehensively, the researcher enters a practical environment with performing a case study and an interview with a company such as DB Schenker. Finally, after gathering enough information the researcher analyses the information with setting up a connection between the information gathered from practical environment and the literature. Generally our research strategy is divided into two types of research strategy;

Exploratory and explanatory.

 Empirical research study

The empirical investigations are guided by the outcomes of experiments or observation based on the facts and realities that are made by the researcher. Based on the explanatory studies in the empirical study, for finding the comprehensive framework for ITSM the researcher is going to compare different perspectives of the same condition in various companies to attain a final model that are used to support and make the theoretical findings durable (Chisnall, 1981; Noon 1983 ). Finally, the researcher could draw that

(15)

14

something important like collecting related evidences has been added to the body of knowledge. Here in this thesis, case study is used as empirical research approach to analyze specific research unit.

 Case Study

According to Blatter (2008; 2008), case studies were fundamentally needed for the primary research strategy at the inception of modern social science. Here, the proposed research strategy is a case study. The need of the thesis is to analyze different qualitative elements of ITSM framework and ITIL strategy guide. According to Oates (2006), the most common methods for data generation are questionnaires, interviews and observations. Thus, in order to gather information on the elements of IT service management efficiency, Interviews are highlighted as the most operative and effective method .This will be similar to most qualitative methods as informative, holistic and recognize multiple realities that answers questions relying on “what”, “who”, “why” and

“how” it can be improved.

 Theoretical studies

Exploratory study deals with the conditions where the problem is not very clear and is used for better understanding the problem. At the first stage, there are unlimited numbers of perceptions and academic studies for collecting the knowledge about IT service management (Cooper and Schindler 2003; Blumberg, Cooper et al. 2008, 1998).Then, the theoretical study will develop the conceptual model in order to present answers for the research questions. Moreover, in the analysis and result chapter comparative analysis method will focus on both studies’ result where inconsistency may be clarified. Based on the comparative analysis method the new conceptual model will be offered.

2.3 Data collection method

As mentioned before in the structure of thesis part, the author in this research study first is going to have a review on the academic resources related to the subject area. After gathering valuable academic information from valid resources the author will continue the study with gathering needed information from selected companies. Data used in this research can be categorized in two main parts: Primary Data and Secondary Data.

2.3.1 Primary data

Primary data is the one that comes from practical experiences. Personal experiments such as interviews and direct observation are the example of this type of data. In these methods, all the information of the experiments is important for the researcher and gathering information as much as it is possible is the key issue for success.

In this research study, the author selected the interview method to gather appropriate information for verifying the theoretical part for achieving the defined purposes. In a point of view, there are mainly two types of interview sampling: probability and non-probability. Probability is a kind of sampling which the selection of interviews is random. Conversely, in non-probability method

(16)

15

interviews are determined and the selection method is not random based. Referring to the research strategy in which the information of theoretical part should be compared by the information of practical ones, verified information is important for the author. Therefore, the author selected some determined interviews for gathering needed information.

In the interviews the author seeks to gather some information related to the metrics for managing ITSM such as ITIL V3/V2 and COBIT. Using practical information to serve as an aid to introduce and categorize these metrics can be the main purpose of this part. To achieve this goal, the author had some cooperation with innovation lab of Borås University who were involved in an ITSM project and also conducted some interviews with IT manager of DB Schenker Company which is credited as the pioneer company of logistics. DB Schenker is an organization which provides transports, logistics and information services globally. More information about this company is provided by the author in empirical part.

Qualitative interviews are normally categorized in unstructured, semi-structured, and structured (Bloom & Crabtree, 2006). The author tried to arrange the semi-structured interview with an expert in this company which could give reliable information. Some open and close questions have been selected to conduct the meeting. To better conduct the interview, the researcher sent some general questions before the meeting. But to have more challenge during the interview some specific open questions have been selected to be asked in the meeting.

2.3.2 Secondary data

Secondary data includes information from scientific articles, documents, websites and other valuable records. This data builds the foundation of the research and considers as a valuable resource to evaluate and validate the study. Commonly gathering secondary data from its resources is done through qualitative methodologies.

2.4 Data Analysis procedures

To achieve his research goal, the author should have a comprehensive analysis while performing appropriate methods. Strauss & Corbin (1990) mentions the significance of the processes in research study and also stress to provide special attention to it. Data analysis processes are the most significant phase in writing research articles in order to support inclusive decision making processes and to provide reliable outcome (Strauss and Corbin 1990).

As we mentioned earlier in section 2.1, we had selected the qualitative perspective approach where an inductive approach is practical to our thesis investigation. According to (Backman 1998) data analysis in the qualitative research is a difficult task. Once information managed for analysis, the relevant data to research question will be shaped according to unrelated, relevant and general value data to research question.

In the analysis and results chapter of both theoretical and empirical studies which investigates the research sub-questions is answered and these results will go through a comparative analysis according to characteristic of this study where the data will be assessed and results will be

(17)

16

presented. According to Mills (2008), comparison is the most important aspect in the analysis of great number of social science research, which essentially follows from the frame of reference.

Generally, it happens between different objects, such as individuals, groups, cases, settings, themes, statements, different points in time and interviews (Mills 2008).

At the first step, the researcher of this study grouped theoretical findings based on the required information from reliable resources (e.g. academic resources). Then the researcher gathers the information from real world by running some interviews with DB Schenker Sweden, the empirical results are then used to analyse our theoretical studies with the facts and metrics obtained from various organizations for comprehensive IT service management framework issues. The next step is to analyse and to compare the results through comparative analysis based on the classified data that are allocated at the final step in order to explore new result. Finally, concluding the subject according to arguments from last two parts.

2.5 Strategies for validating findings

Reliability is: “The degree of consistency between two measures of the same” (Mehrens and Lehmann 1987). It defines a research as “reliable” when it is consistent and the results are not different from the results of the same studies. As mentioned before, the basis of this research is built on academic resources. The researcher tries to select the most important and reliable one in the area of ITSM concept. So it can be assumed that the theoretical part has the accepted level of reliability from the researcher’s point of view. In empirical part, the researcher has selected some of the best known companies to run his interviews and gather appropriate information. The people who had been interviewed are experts in the related area and the researcher used his knowledge which was acquired from theoretical part to make the empirical part as reliable as possible.

If the researcher can measure what has been defined at the beginning of the research in the end we can say the research has validity. There are two kinds of validity:

1. Internal validity

Internal validity is defined when we can appropriately connect the theoretical part with empirical one we can say the research has internal validity. For instance, in this research the researcher used interview method. And he gathered some information from different people. If the interviews performed in its best way the information has validity and we can make connection with reliable information from theoretical part.

2. External validity

External Validity is defined when the research can be generalized. To summarize, it refers to the degree use of using the results in the future. In this research, since the results are the combination of theory and empirical study it can be fruitful for academics and practitioners to use and develop this concept.

(18)

17

2.6 Result presentation method

The researcher of this study chose written format for his work. As the purpose of this research is making contribution to the selected area with giving appropriate information this format has been selected. Figures and tables have been selected to make information more visible for the reader.

The Harvard system is used by the author for referring the sources. In Harvard system, the name of author and the publish date are provided when an issue is used.

(19)

18

3 THEORETICAL FRAMES OF REFERENCES 3.1 Key concepts

IT Service Management (ITSM): IT management focuses on the management area of IT processes such as IT services and products. According to, Silva Molina, E. j. a. p., Leonel and Flors, Jonny and Vargas, Norman (2005), IT management should be included in the IT Governance process. But, there is an obvious difference between IT management and IT governance. The term IT management mainly concentrates on the effective supply of IT services and products and the management of IT functions. But, IT governance focuses on broader areas such as “performing and transforming IT to meet present and future demands of the business and clients”. According to Rakesh, “Good IT governance is about creating a learning organization and culture of effective IT decision making” (Silva Molina 2005; Rakesh 2009).

IT Infrastructure Library (ITIL): ITIL models Verson2/Version3 illustrate the most accepted guidance for enterprise IT operations to meet the need of services and products in order to provide cost-effective and efficient IT operation inside the Government Computer Center (GCC).

COBIT: The Control Objectives for Information and related Technology (COBIT) governance has been generated by Information System Audit and Control Association (ISACA). COBIT is a combining tool that gives permits the managers to link the activity among technical issues, control requirements and business risks. The first Version of COBIT was produced in 1996 and the latest version released in 2007 as V4.1 (Grembergen, 1997).

Metrics: “ metric is just another term for a “measure” or “meter” that shows the performance of the system based on percentages or means. Metrics identify what is to be measured for IT such as: technology processes and services. Metrics deliver the feedback mechanism that allows management to navigate, control and guide IT toward strategic objectives under continuous improvement process” (Brooks, 2006).

Performance Measurements (PMs): According to Lohman, Fortuin, &Wouters, “PM is an activity that managers perform in order to reach predefined goals that are derived from the company’s strategic objectives (Lohman, Fortuin et al. 2004).

Key Performance Indicators (KPIs): is a metric, value or quantity and it is a type of performance measurement. The KPIs provide the opportunity to compare against an internal or external object in order to indicate of performance, such as benchmarking of inside performance with external criteria (Ahmad and Dhafr 2002; David 2010).

Quality Management System (QMS): Quality Management System (QMS) is the organizational step-by-step improvement structure, procedures, analysis and necessary resources to implement QM (Hank 2006).

SERVQUAL: a multiple-item scale for measuring consumer perceptions of service quality.

(20)

19

3.2 Subject areas relevant for the research

In this section, we discuss subject areas that contribute in obtaining the results of our research questions. We narrowed down the key concepts in the subject areas as:

1. Knowledge on ITSM Frameworks and essential needs of ITSM in IT industries.

2. ITSM based on The IT Infrastructure Library (ITIL) 3. Decision-making Process.

The diagrammatical representation below clarifies how the subject areas are relevant for our research question and how they help to answering it.

Figure1 Relation of three subject areas

(21)

20

3.3 Previous research

To the best of the author’s knowledge there is no obtainable work which performs the collection and comparison of different IT Service Management processes and metrics from different IT corporations on real life process data. Nevertheless, there are several works that are highly related to this academic work and influences ITSM process and operation framework.

First of all, there are several works on the application of Implementing ITIL-ITSM using best practices, standards and management techniques.

In “Key performance indicators: developing, implementing, and using winning KPIs”, David (2010) presented different approaches to find critical success factors over 300 performance measures and how to brainstorm the performance measure. Also in the second edition of the book he illustrated that how to track and identify organization’s KPIs in order to increase the success factors (David 2010).

Jurison (1996) argues that Information Technology (IT) can provide important benefits, but in great number of cases these benefits are captured by other stakeholders and not captured by the firms that made the investment; he also proposed a framework for distribution of IT benefits(Jurison 1996).

In “ITIL: What It Is And What It Isn't”, Hank M (2006) examined in the measuring techniques of successful companies when implementing the ITIL-best practice. He describes Service Support and Service delivery and explains its stress on ITSM-ITIL best practice that it does not stand alone and it could be successful when applying with other practices. The authors suggest that there are three certain tasks such as, appropriate goal setting through a Process Maturity Framework (PMF), rigorous auditing and reporting through a Quality Management System (QMS) and Project Management and a Continuous Service Improvement Program (CSIP), to support ITIL-usage. Furthermore, he also provided more information about business-aligned IT process and continuous improvement of the operational and tactical elements specially those processes that focused on service quality by clients and users (Hank 2006).

Apart from the other works on Improving the efficiency of IT service management field, there is a real life example of a case study which is focusing on IT framework and Service Strategy process of Steel Manufacturing Enterprise (SMC) which are related to the subject area of this thesis. In a manufacturing enterprise, Zhong and Xin (2010) used integration of COBIT and ITIL best practice to improve ITSM framework, they also introduced an approach to service strategy evaluation framework in SMC by providing indicators for different evaluation process in order to improve the result from ITIL implementation and to increase the improvements on changed IT processes, they use different approaches to find the problem of Business-IT alignment in SMC.

The approach aims at minimizing the difficulty of business-IT alignment in importance within the IT community. In the same article Bartolini et al (2006), has suggested an IT Management by Business Objectives (MBO) method, which is a special method to ensure business strategic objectives-IT alignment, by defining a new system for decision support in ITSM. It is closely related to the ITIL component in operational level and tactical level of theoretical research (Bartolini, Salle et al. ; Zhong and Xin).

(22)

21

In “E-government: ITIL-Based Service Management Case Study”, Meziani and Saleh (2010) developed a service management self-assessment plans for the government agency to support continuous quality improvement of IT processes based on ITIL governance- gap analysis methods with the respect to ITIL standards (Meziani and Saleh).

In “Managed IT services: the role of IT standards” Narayanan (2008) argues the practical issues based on standards and the management of IT services delivered by external or outsourced service providers. Here, the purpose of the authors is to assist IT organizations to understand the significance of having a mutual standard for managing IT services (Narayanan 2008).

Grembergen and Haes (2009) illustrated a set of best practices (COBIT Framework) for management, control and assurance of information technology, and categorized them around a logical framework based on 34 IT processes.

Marrone and Kolbe (2011) studied the benefits of both operational and strategic of IT Service Management. The research outcome indicates that as the implementation of ITIL increased, the number of realized benefits increased, like: the levels of maturity of the Business-IT alignment.

Jung-Oh, Sang-Geun et al (2008) suggested an effectively measuring method about maturity of security management supporting.

However, there are some other studies about IT Service Management metrics ‘influence in IT Corporation decision-making.

Shatzkin (2005) emphasizes on the needs of publishers to review their own metrics in order to be sure they are not leading them into wrong business decisions (Shatzkin 2005).

Ahmad and Dhafr (2002) illustrated the creation of KPIs in industrial areas. They also presented a new methodology, a critical evaluation and a few examples of implementing KPIs are included.

Lohman and Fortuin et al. (2004) analyzed the case study carried out at the european operations department of Nike. Their results are related to continued enhancement of PMS, the act of similar enterprises for PM and the standardized metrics role. It also proposes that improving PMSs must to a large scope not be considered as a “ design ” effort; instead it must be considered as a “co-ordination effort” (Lohman, Fortuin et al. 2004).

However, there are more studies about Measuring Service Quality and development of SERVQUAL.

Parasuraman, A, Zeithaml, Valarie A and Berry, Leonard L. (1994) in their article highlighted the arguments and evidences that are necessary for a balanced assessment and evaluation of service quality measurement such as underlining unresolved issues. Also in the research “a conceptual Model of Service Quality and Its Implications for Future Research” Parasuraman and Zeithaml et al. (1985) illustrated the most importance of service quality model (Parasuraman, Zeithaml et al. 1985; Parasuraman, Zeithaml et al. 1994).

(23)

22

In SERVQUAL: A Multiple-Item Scale for Measuring Consumer Perceptions of Service Quality”, Parasuraman (1988) presented information on the improvement of SERVQUAL scale from the studies of different researchers for measuring customer perceptions of service quality in organizations, this study focused on perceived quality as a scale of SERVQUAL (Parasuraman 1988).

The author’s experience shows that users benefit from the efficiency improvements accrued by appropriate service strategy in whole ITSM implementation. He continue to work with IT Service management (Tactical-service delivery and Operational-service support), and Continues Service Improvement to increase IT service management indicators in IT industries.

3.4 Relevant literature sources

In previous research discussion, a few studies related to ITSM and implementing ITIL-best practices into organizational framework were presented that could provide direct help and references. This topic follows the criteria in chapter two. The related literature was selected from

“Metrics for IT Service Management book, online databases were searched at University of Borås Libraries, Innovation-lab and internet. A great number of e-journals were browsed by topic and databases were searched by the key words.

Databases: used were, ACM Digital Library, Wiley Online Library, EBSCO, ScienceDirect, SpringerLink and Blackwell Synergy.

Key words: IT Service Management, Service Management, IT Infrastructure Library, ITIL, ITSM best practice, Comprehensive framework for ITSM, metrics for ITSM, ITIL process framework. All the referenced articles in the literature review were issued in peer-reviewed journal that serve as a research sources for both academic researchers and experts.

Brooks, P (2006) emphasizes on the implementation of IT Service Management in his book

―includes practical information on the provision of useful and meaningful metrics‖. He provides specific examples and templates for the use of each metric (Brooks and Forum 2006).

Pollard, C. and A. Cater-Steel 2009 article: “Justifications, Strategies, and Critical Success Factors in successful ITIL Implementations in U.S. and Australian companies: An Exploratory Study” was published in Information Systems Management”. It is a peer-reviewed scientific journal. The authors deem that not all ITIL implementations are successful and some have been dissatisfied with the outcomes. Some conclusion from exploratory study, illustrated that, successful implementations applying ITIL V2 framework into their ITSM process. In this research also authors divided Critical Success Factors (CSFs) into different parts in order to assist IT managers such as, interdepartmental communication and collaboration, use of consultants, training and careful software selection, creating an ITIL-friendly culture, executive management support, process, and customer-focused metrics. This study will give reference to a successful IT service management framework.

Zhong, Y. and W. Xin 2010 article: “An ITIL based ITSM practice: A case study of steel manufacturing enterprise” was published in - Service Systems and Service Management (ICSSSM), 2010 7th International Conference on Service Systems and Service Management,

(24)

23

IEEE. In this paper authors illustrates the importance of the practical process to implement the ITSM in one of steel manufacturing corporations. And divided the service strategy in this firm to four main parts: Change Management, Resource Configuration, Accident Management and Release Management (Zhong, Y. and W. Xin).

Meziani, R. and I. Saleh 2010 article: “e-government: ITIL-based service management case study”. Proceedings of the 12th International Conference on information integration and web- based applications & services, published in ACM. In this paper the authors introduced the ITIL framework in order to accomplish Quality Service (QS) and overcome problems related with the growth of IT systems. This research is valuable to be a reference

Bartolini, C., M. Salle, et al. 2006 article: “IT service management driven by business objectives an application to incident management” published in IEEE/IFIP Network Operations and Management Symposium.

McLaughlin, K. and F. Damiano article: “American ITIL”, published in ACM. McLaughlin, K.

and F. Damiano argue about how college using ITIL, containing, Problem Management, Incident Management, developing internal Operating Level Agreements (OLA's), establishing Service Level Agreements (SLA's) and creating metrics. It is closely related to the second part of theoretical research that allows managers to decide and make meaningful metrics that the customer/users can understand.

McNaughton, B., P. Ray, et al. 2010 article: "Designing an evaluation framework for IT service management" Published in Information & Management. The authors are believed that, there is a lack of research and study on benefits of implementing and using ITIL processes have been predicted. Therefore, The authors goals is to present a design of a holistic evaluation framework for improvement of ITSM framework with particular focus on ITIL.this study will give reference ITSM-ITIL benefits in organizations framework.

Parasuraman, A., V. A. Zeithaml, et al. 1994 article: "Alternative scales for measuring service quality: A comparative assessment based on psychometric and diagnostic criteria" Published in Journal of Retailing. They also authored "Reassessment of Expectations as a Comparison Standard in Measuring Service Quality: Implications for Further Research” which is published in" The Journal of Marketing. These researches are valuable to be references.

Silva Molina, E. J. a. P., Leonel and Flores, Jonny and Vargas, Norman 2005 article: “How to identify and Measure the Level of Alignment between IT and Business Governance”. It is peer- reviewed scientific journal and was presented in PICMET conference. The main part of this article contains a new perspective and preliminary concepts on how to measure the level of alignment between IT and business governance. However, the authors believe that, the main reasons why organizations fail to achieve the full potential of their Information technology investment is related to the lack of alignment, between information technology and business strategies. This research is valuable to be a reference.

(25)

24

3.5 Knowledge on ITSM frameworks

During the last two decades, the ITSM-related frameworks have provided better systematic approach to the management of IT services in the fields of IT operation to continual improvement, implementation and design (Marrone and Kolbe 2011). For example, different studies have concentrated on the adoption of IT Service Management (ITSM) as a “specific service oriented best practice” (Marrone and Kolbe 2011). According to Winniford et al. (2009), about 45% of US corporations are operating an ITSM while 15% are preparation its usage (Winniford, Conger et al. 2009).IT service management is somehow the quality customer service that tries to ensure that customer needs and expectations are met at all times. (Tan, Cater-Steel et al. 2009). IT organization need a structure approach for measuring IT service support process such as using IT Infrastructure Library (ITIL, ISO20000), Control Objectives for Information and Related Technology (COBIT), Six Sigma, Enhanced Telecom Operation Map (ETOM) and Sarbanes Oxley (SOX), Microsoft’s Operations Framework (MOF), IBM Systems Management Solutions Lifecycle (IT Process Model) and HP IT Service Management Reference Model are emerging as some of the more popular Standards in IT Service Management, Governance, Quality and operation issues (Brooks 2006; Hank 2006; Tan, Cater-Steel et al. 2009;

McNaughton, Ray et al. 2010). According to the “IT Governance Institute (2008) ITSM framework with the highest adoption rate is IT Infrastructure Library (ITIL) with 24%, followed by Control Objectives for Information and related Technology (COBIT) with an adoption rate of 14%” (Marrone and Kolbe 2011).

3.6 Needs of ITSM in organization

ITSM increases the level of the communication efficiency between business departments. And provides a structure in order to plan, research and implement IT services. The needs of ITSM in organizations can be changes in the ways they operate, communicate and do business and also develop and innovate, gain market advantage and differentiate themselves to their end customers (Brooks 2006). In addition, ITSM allows companies to internally govern and follow to the set global standards (Mior 2008).

(26)

25

However, the types of the ITSM benefits and allocation among stakeholder group can be different based on the purpose of the system and managerial goals. Therefore, In order to attain the maximum level of efficiency we must first identify IT and business goals to understand better the needs of organization, managers and stakeholders. (Silva Molina, Plazaola et al.). According to Jurison (1996), “stakeholders are all those parties who affect or are affected by a corporation’s actions, behaviour, and policies. Thus, IT investment made by stakeholder or IT management based on different business demands can be issues mentioned below:

- “Take customers as centre and provide IT services that meet customer’s demands.

- Enhanced quality.

- Low cost IT service in company.

- Better response to the client needs.

- Evaluating service delivery precisely” (Jurison 1996).

For better understanding of the ITSM concept in organization, reviewing the ITSM component would be useful. ITSM components consist of Process, Technology, Manpower (people), Organization, and Security, which is recently added to organization construction to develop the system security (Park, Kim et al. 2008; McNaughton, Ray et al. 2010). Figure 1 illustrates the component of ITSM.

Figure2 ITSM components

 Processes

The most important element to construct ITSM system (e.g.IT business process facilitates and keeps up IT service).

 High secure manpower and organization

To provide better IT service level and arranges proper tasks in organization.

 Technology and security

To provide best possible tools and automated solutions to develop process in higher level of efficiency and safety

People Organisation

Technology Process

ITSM

(27)

26

As mentioned earlier, IT service is connected to the four fundamentals of Information Technology Service Management (ITSM). So when IT is aligned with the business strategy and the organization, it can do what it wants to do. Furthermore, IT and new technologies enable the organization to do new things that were never possible before (Silva Molina, Plazaola et al.). The strategic outcome is that the overall business benefits from effective IT-related service and IT benefits that are integral to the company’s business plans will be delivered to the maximum economical value. Two alignment directions can be identified;

One on the way that IT is aligned to business and the other, on the way that business can be aligned to IT, both directions are equally important.(Jerry 2003; Marrone and Kolbe 2011).

However, new studies try to provide a solution for clarifying the confusion about IT values such as cost, management methods and process of development for parities, managers and researchers. For instance, the most cited ones concentrate on three different reasons among many other explanations in the field of ITSM such as,

1. “Inappropriate measures, 2. Inappropriate unit of analysis,

3. Failure to account for time lag” (Jurison 1996; Marrone and Kolbe 2011) 3.6.1 Organizational requests for improvement of ITSM measurement

In ever-growing market, IT management is the key issue and one of the most significant aspects of organizational control. E .j. Silvia Molina et al, (2005) expressed that, “the lack of association between IT and Business strategies is one of the main reasons why projects fail to realize the full potential of their investments”. Thus organizations rely upon IT service management to enable them to achieve their company vision and goals by facilitating the new system and management methods. For example, The key issue in having a new system design is to provide benefits as well as set up new IT service management system which is followed by creating competitive advantages for different tactical opportunities rather than developing operational efficiency(Jurison 1996). Moreover, as Notowidigdo reports: “new strategic systems can be considered either internal, having direct benefit to the company, or external, having direct benefit to customers”(Notowidigdo 1984).Therefore, new IT Service Management requested by IT manager and investor decision to accept cost and receiving some benefits.

There are several progresses, which have created a request for organizations to grow their IT service management. First, “co-operation must to be improved along the IT management and offer more flexibility, less cost, faster introduction on new products to clients and decreasing delivery times. Several organizations are managed functionally”. For instance, around the following levels of production, it might be difficult to manage the supply chain; such as sales, marketing, purchasing, distribution, and manufacturing (Lohman, Fortuin et al. 2004).

Secondly, better IT management is not only important across functional borders, but also across countries. For instance, sales and marketing turn to be as centralized, the organizations change with the local products, services, products and customers to the organization that serves particular products for the whole Europe. Therefore, it is essential to manage supply change and IT service management to a European level of standard in order to move “product distribution, marketing, demand management and distribution” to a European scale. Thirdly, linking measurements operation across chain of separate departments as a result of providing better

(28)

27

service opportunity to end-consumer is another critical issue which must be considered(Lohman, Fortuin et al. 2004). According to Lohman (2004), there are five different problems in organization regarding the lack of IT management such as,

- “Lack of unit and cohesion structure between metrics.

- Insecurity and doubt about what to measure.

- Decentralized.

- Lack of communication among users and producers of PI (Performance indicator).

- Spread IT infrastructure” (Lohman, Fortuin et al. 2004).

 The new style of IT management vs. Traditional styles IT management

According to Marquis, H. (2009) the new styles of IT Service are complex communication and collaboration system, including business oriented service support in that IT services, are managed by technology department and planned based on the business demands. The main important change in organizational management system is to support how they collaborate to achieve an objective. For instance; if the ITSM are well designed and followed the line with business requirements, they can capture the control of the system. Like what Information Technology Infrastructure Library (ITIL) really espouses (Brooks 2006; Marquis December 2009).

Another issue is the communication. The communication is a vital part of IT services management and is a two-way process. So it is important to integrate requirements from the various stakeholders and use their involvement throughout to improve service delivery and process operation (Brooks 2006; McNaughton, Ray et al. 2010). On the other hand, the traditional style of IT management function is silo-based which the structure is a little different from process and performance (hardware/software, help desk, application management and network system). For instance, almost every business uses silos to gather specialist into groups such as in medicine, military and education. Usually, this silo makes group technologies and their technologists into convenient units (C. Rudd 2004; McNaughton, Ray et al. 2010).

3.7 IT Service Management based on the IT Infrastructure Library

Within the last few years, majority of companies such as consulting organizations and vendors have declined IT service management methodologies to skip into the ITIL concept and implemented the ITIL framework to set of descriptive management documents to develop ITSM frameworks. ITIL is a continuous technique of managing and operating of IT which is based on providing high quality service by dealing with the needs of a complex system and customer’s request for flexibility and changes in order to increasing customer’s satisfaction, determining business-IT alignment and continuously improving tactical and operational level of business performance in order to focus on service quality (McNaughton, Ray et al. 2010; Marquis December 2009).

(29)

28

ITIL developed in 1980 by the UK’s Office of Government Commerce, with the name of Central Computer and Telecommunications Agency. ITIL illustrates the most accepted guidance for enterprise IT operations and provided cost-effective and efficient IT operation inside the Government Computer Centres. For instance, recently each Request For Proposal (RFP) from government and project activity needs an ITIL based response. in addition ITIL is used in a combination with one or more other best practices to manage IT such as, “ISO 27000 (a standard for IT security), COBIT (framework for IT Governance and Controls), Six Sigma (quality methodology), TOGAF (framework for IT architecture)” (Zhen and Xin-yu 2007; Tan, Cater- Steel et al. 2009; Marquis 2009).

3.7.1 Successful IT Service Management through ITIL process adoption

In order to have a successful IT structure in an organization, we should understand the difference between process and performance. Process illustrates the work presented by people. However, often, managers consider that a process shows an organizational structure. For example, according to (Marquis December 2009) 45% of IT organization will be crashed as a result of misunderstanding process and performance. However, this chaos might be caused by organizational refusal to it. Moreover, according to Marquis (2009), a study by Evergreen System showed that 72 % of companied that answered a questioner found the main difficulty to ITIL adoption in their business is organizational resistance as a result of lack of knowledge in understanding ITIL goals. As ITIL stated that; ITIL process approach means that process has to be controlled and managed over more than one area surrounded by traditional hierarchical construction (Marquis December 2009).

However, effective ITIL Implementers indicate that their success did not come from, consultants, software changes, training, and work-structure. But in order to succeed we must involve leadership skills and empower staff at different stages. According to McNaughton; “There are 50,000 ITIL certified professionals worldwide and 24.1% of IT managers in large organizations are familiar with the ITIL standards” (McNaughton, Ray et al. 2010; Marquis December 2009).

On the other hand, one of the important reason for ITIL collapse in organization is because organizations think ITIL is a “project you do” and when is over is done. For instance, successful organizations mostly use other best practices, management techniques and standards when implementing ITIL (Hank 2006).

(30)

29

There are three main practices needed to support ITIL usage as below.

First Practice: project management and a Continuous Service Improvement Program (CSIP):

The CSIP is doing ITIL and is a formal process of including:

 “Managing the process of change needed to move an IT organization.

 Stakeholders

 Establishing goals”(Hank 2006)

Second Practice: appropriate target setting through a Process Maturity Framework (PMF): Some famous PMF selections are:

 “Capability Maturity Model/Integration (CMMI, CMM)

 COBIT Governance” (Hank 2006)

Further, the PMF is to recognize “organizational and process maturity and capability” like,

“where” to implement and “when” to start implementing method based on ITIL.

Third Practice: Rigorous auditing and reporting through a Quality Management System (QMS) ITIL(Hank 2006).

Table2. The four perceptions of using ITIL within the organization

1. Management Perspective

Highest level in organization which is to certify that other units (financial, business and collective user) are correctly deliberated in the evaluation (McNaughton, Ray et al. 2010).

2. Technology Perspective

To provide a positive effect on different parts like: technological efficiency, IT personnel and resource efficiency, and specific IT related costs and budgets (McNaughton, Ray et al. 2010).

3. IT Users Perspective

Who are interacting with IT help or service desk for their needs like; systems, technology, equipment, products and services of the IT department on a daily basis to support processes (McNaughton, Ray et al. 2010).

4. IT Employees Perspective

IT department’s personnel includes: first and second support, network and database administrators, security personnel and application owner (McNaughton, Ray et al. 2010).