What is ITIL 4? Definitive Guide to ITIL 4

IT Service Management according to ITIL 4.

According to the World Trade Organization, services are the largest and most dynamic component of the modern world.

Without a doubt, it is the primary way that most organizations create value for their customers and themselves.

Undeniably, due to rapid technological progress, services have become so dependent on Information Technology that it is currently impossible to imagine a business without it.

In this context, IT Service Management (ITSM) has been changing in order to support the organizational changes resulting from rapid digital evolution.

In this article, we will understand how ITIL works, from start to finish. We will see its main components, definition of concepts, and a summary of each of the service management practices described in the official ITIL 4 document.

About ITIL 4

Firstly, it is essential to understand that ITIL encompasses the practices of IT Service Management (ITSM).

Such practices embrace the customer experience context, value streams, and digital transformation.

They leverage the potential of modern technology in a flexible, coordinated, and integrated manner for effective governance and management of information technology-related services.

It is important to remember that the term ITIL 4 is a registered trademark owned by AXELOS. It is one of many options in the market built to guide IT Service Management of organizations.

Therefore, if you are interested in specializing in IT Service Management, the ITIL 4 certification is a well-recognized option in the market. However, there are other certifications such as ISO 20000, and the T-ISMF certification from IT Shaped, which is even more comprehensive as it encompasses other frameworks and libraries in addition to ITIL, such as VeriSM, MOF, ISO/IEC 20000, Scrum, Lean, DevOps, etc.

It’s worth checking out: What’s behind the ITIL commercial acronym?

The Heart of ITIL

The ITIL Service Value System (SVS)

First of all, let’s make it clear that the key components of ITIL 4 are the ITIL Service Value System (SVS) and the Four Dimensions of Service model.

The ITIL SVS represents how the various components and activities of the organization work together to facilitate the creation of value through service.

In this sense, they can be integrated in a flexible way, which requires integration and coordination to maintain consistency in the organization.

This generates a consistent, unified, and value-focused direction for the organization.

These components are: the ITIL Service Value Chain, the ITIL Guiding Principles, ITIL Practices, Governance, and Continual Improvement.

The ITIL service value chain provides an operational model for the creation, delivery, and continuous improvement of services.

It is flexible enough to be adapted to multiple approaches and adaptable so that organizations can respond to changing demands efficiently and effectively.

The guiding principles, in turn, are used to guide organizational decisions and ensure a collective understanding and overall approach to service management throughout the organization.

Finally, all components of the ITIL SVS are supported by continuous improvement.

The Four Dimensions

To ensure a holistic approach, that is, a global approach to service management, ITIL 4 brings four dimensions of service management.

From these dimensions, each component of the SVS should be considered.

The four dimensions are:

1. Organizations and People;
2. Information and Technology;
3. Partners and Suppliers;
4. Value Streams and Processes.

Keep reading as we will soon see each of these dimensions!

Key Concepts of Service Management

Everyone needs to know the key concepts of ITIL.

This way, organizations and individuals can collaborate and guide themselves through the everyday challenges of service management.

These concepts can be applied to all organizations and services, regardless of their different contexts.

And it’s worth remembering here the definition of Service Management:

It is a set of specialized organizational skills to generate value to consumers in the form of services.

Simple, isn’t it?

And to develop these skills or capabilities, it is necessary to:

• Understand the nature of value;
• Understand the nature of the scope of stakeholders;
• Understand how value creation can be achieved through services.

Value and Co-creation

The purpose of an organization is to create value for its stakeholders, which includes everyone involved in the organization’s services, such as the organization itself, investors, employees, users, and customers. But how can we create value?

Value is the perception of the benefit, utility, and importance of anything.

This definition is closely tied to the perception of stakeholders, both consumers and the organization.

Value is subjective.

Currently, value is increasingly generated from active collaboration between providers and consumers, rather than a purely one-way relationship.

Service providers can no longer act in isolation, seeking to define alone what will be considered value for consumers and users.

Instead, they should actively seek to establish mutually beneficial and interactive relationships with consumers, creatively and participatively in the service value chain.

Read also: Why co-create value with customers?

Organization and Stakeholders

In service management, there are many types of stakeholders, such as:

• Organization – a person or group of people who have a structure of functions and responsibilities, authorities, and relationships to achieve an objective.

Organizations vary in size, complexity, culture, and organizational structure.

In the role of service provider, the key for the organization is a clear understanding of who its consumers and stakeholders are.

• Service consumers – can vary. Within this concept, we can define the client, user, and sponsor. Each of them has a different participation in the service relationship structure.

• Client – is the one who defines the requirements for a service and takes responsibility for the results of consuming those services.

• User – is simply the one who uses the services.

• Sponsor – authorizes budgets for the consumption of services.

Examples of other stakeholders include individual employees of the organization, partners and suppliers, investors, government agencies, and others.

For the organization to be successful in its objectives, it is important that the relationships with all stakeholders be understood and managed.

If stakeholders are unhappy with the organization, the entire relationship between the provider and its consumers may be at risk.

Products and services

Os serviços em uma organização são baseados em um ou mais de seus produtos oferecidos.

The services within an organization are based on one or more of its offered products.

• Products – they are configurations of various resources controlled by the organization, such as people, value streams, processes, information, and technology, grouped into a product that has value for consumers.
• Services – a means of generating value co-creation by facilitating the consumer’s objectives, without them having to manage costs and risks.

See examples of services and products here!

Value: results, costs, and risks.

Achieving desired objectives depends on resources and costs that are associated with risks. In this sense, in the process of providing a service, the organization assumes part of these risks, facilitating the achievement of the objectives of consumers who benefit from this service.

What we call cost is basically the amount of money spent on a specific activity or resource.

Risk, on the other hand, is a possible event that can cause damage or losses, hindering the achievement of objectives.

It can also be defined as the uncertainty of an outcome, such as the probability of a negative result.

Finally, now that we have seen the main concepts of ITIL 4 and IT Service Management, we will enter the universe of the framework’s approach.

The Four Dimensions of Service Management

First and foremost, understand that to support a holistic approach to Service Management, ITIL 4 defines four dimensions.

These dimensions, collectively, are critical to creating value for customers and other stakeholders through products and services.

They are:

• Organizations and people;
• Information and technology;
• Partners and suppliers;
• Value streams and processes.

 

These four dimensions represent perspectives that are relevant to the entire Service Value System (SVS), including the complete service value chain and all ITIL practices.

Let’s go through them!

Organizations and People

The first dimension deals with Organizations and People.

The effectiveness of an organization cannot be guaranteed solely by an authority system!

Therefore, an organizational culture is essential to support objectives, as well as a high level of ability and competence of employees.

As the complexity of the organization increases, it becomes more important to ensure that the structure, management, as well as functions, responsibilities, and communication are well defined and aligned with the organization’s strategy and operating model.

Worth reading: Why Your Company Needs a Service Culture (and How to Create It)

Information and Technology

The second dimension is Information and Technology. When applied to the SVS, the dimension of Information and Technology includes the knowledge necessary for service management, as well as the required technologies.

It also incorporates relationships between different components of the SVS.

For many services, information management is the primary means of generating value to the consumer.

Regarding information, organizations should consider some questions, such as:

What information is managed by the services? What supporting information and knowledge are required to deliver and manage services? How will the information be protected, managed, archived, and disposed of?

Technology, in turn, is present in even the simplest of organizations. Nowadays, the use of mobile platforms, cloud, remote collaboration tools, and automated testing are commonplace among service providers.

Partners and Suppliers

The third dimension deals with Partners and Suppliers. Above all, every organization and service depends on services provided by other organizations, at some level.

This dimension encompasses the organization’s relationships with other organizations involved in the design, development, implementation, delivery, support, and/or continuous improvement of services.

It also incorporates contracts and other agreements between the organization and its partners or suppliers.

Value Streams and Processes

The fourth and final dimension of service management deals with Value Streams and Processes.

Like the other dimensions, it applies to both the overall SVS and specific products and services.

In both contexts, it defines activities, workflows, controls, and procedures necessary to achieve objectives.

Value Streams and Processes, applied to the organization and SVS, focus on how the various parts of the organization work together in a coordinated and integrated manner to enable the creation of value through products and services.

The dimension focuses on which activities the organization performs and how they are organized, as well as how the organization ensures that it is effectively facilitating value generation for all stakeholders.

A value stream is a series of steps that the organization uses to create and deliver products and services to the consumer.

Therefore, it is the combination of the organization’s value chain activities.

Processes, on the other hand, are what turn an input into an output, defining a series of actions and procedures along the way.

See also: The 4 Ps of ITSM, according to ITIL 4 – Process, Product, People, and Partners.

What to conclude about the Four Dimensions of Service Management?

In conclusion, the four dimensions represent a holistic approach to service management. The organization must ensure there is a balance of focus between each dimension.

The impact of external factors on the dimensions must also be considered.

It is essential that the SVS is approached through the four dimensions, as any failure in one dimension can lead to a decrease in the quality of services and products.

The ITIL Service Value System (SVS)

The ITIL SVS describes how all components and activities of an organization work together as a system to enable value generation.

Each service value system of each organization interfaces with other organizations, forming an ecosystem that creates value for all, including its consumers and stakeholders.

In summary, the following components are included in the SVS:

• Guiding Principles – recommendations that guide an organization in all circumstances, regardless of changes in its objectives, strategies, types of work, or management structure;
• Governance – the way in which an organization is controlled and directed;
• Service Value Chain – a set of interconnected activities that an organization performs to deliver value;
• Practices – a set of organizational resources used to work or achieve an objective;
• Continual Improvement – a recurring activity performed at all levels to ensure that the organization’s performance meets the expectations of stakeholders.

See: ITIL 4 Service Value System

The ITIL guiding principles:

1. Focus on Value

Every activity conducted by the organization should have as its primary objective the creation of value for its customers, stakeholders, and itself.

2. Start Where You Are

Eliminating all old processes and services to build something entirely new, no matter how ineffective they may be, is not always the best decision.

This approach can waste not only time but also resources and services that could be significant for the improvement process.

Don’t start changing things before first considering what is already available to help with that change.

3. Progress Iteratively with Feedback

Doing everything at once is a temptation that should be avoided.

Even complex and large initiatives should be done iteratively, by organizing the work into smaller and manageable sections that can be executed and completed in a practical way.

This way, the focus on each effort becomes clear and easy to maintain.

4. Collaborate and Promote Visibility

Collaboration and cooperation are better than isolated work, which often becomes an “organizational silo”.

With the right people in the right roles, creative solutions and contributions can come from unexpected sources. Therefore, inclusion is a better policy than exclusion.

5. Think and Work Holistically

All organization activities should be focused on delivering value.

Thus, if these activities are done in isolation, rather than integrated, the organization’s results for stakeholders will be compromised.

Taking a holistic perspective to service management includes establishing an understanding of how all parts of the organization work together in an integrated way.

This requires clear visibility from beginning to end on how demand is captured and translated into results.

6. Keep Everything Simple and Practical

Always opt for the fewest number of steps to achieve a goal.

Focus on results should produce practical solutions that deliver valuable results.

Therefore, if a process, service, action, or metric does not produce a useful outcome, it should be eliminated.

7. Optimize and Automate

Governance

Every organization is led by a person or group responsible at a high level for the performance and compliance of the organization. All organizations, regardless of their type and size, perform governance-related activities.

Governance is carried out through the following activities:

• Assess – the assessment of the organization, its strategy, portfolios, and relationships with other parties.

Governance is responsible for regularly assessing the organization, as the needs of stakeholders and circumstances change and evolve frequently;

• Direct – the preparation and implementation of organizational policies and strategies.

Strategies define the direction and prioritization for organizational activity. Policies establish requirements for the behavior of everyone in the organization;

• Monitor – the monitoring of the organization’s performance and practices, as well as its products and services. The purpose of this is to ensure that performance is in line with policies and direction.

Check it out: How to implement IT Governance in a pastry shop.

The Service Value Chain (SVC)

The Service Value Chain (SVC) is the central element of the SVS. It is an operational model that demonstrates the main activities necessary to respond to demand and facilitate the creation of value.

The six activities of the service value chain are:

1. Plan – aims to ensure a shared understanding of the vision, current status, and direction of improvement for all four dimensions, products, and services of the organization;
2. Improve – improvement ensures continuous enhancement of the organization’s products, services, and practices, as well as the four dimensions of service management;
3. Engage – the engagement activity clarifies stakeholder needs through transparency and good relationships with all involved;
4. Design and Transition – design and transition ensure that products and services meet stakeholders’ expectations of quality, cost, and time-to-market;
5. Obtain/Build – the purpose of obtaining/building value is to ensure that service components are available when and where they are needed;
6. Deliver and Support – the purpose of deliver and support is to ensure that services are delivered and supported according to agreed specifications and stakeholder expectations.

Continuous Improvement

Continuous improvement is present in all areas of the organization, as well as at all levels, from strategic to operational.

To maximize service effectiveness, every employee should have this concept in mind, always looking for opportunities for evolution.

In this sense, ITIL 4 provides a model that can be used as a high-level guide for improvement initiatives:

ITIL Management Practices

– General Management Practices –

Architecture Management

The objective of this practice is to provide an understanding of all the elements that make up the organization, as well as how these elements interact and relate to each other.

Continual Improvement

The purpose of the continual improvement practice is to align the organization’s practices and services with the constantly changing business needs.

This is done through the continuous improvement of the products, services, and practices involved in managing products and services.

Information Security Management

Information Security Management seeks to protect the information necessary for the organization to conduct its business.

This practice is related to the CIA triad: Confidentiality, Integrity, and Availability, which should guide all processes related to information and its security.

Knowledge Management

Knowledge Management aims to maintain and improve the effective and convenient use of the organization’s information.

Measurement and Reporting

This practice aims to reduce uncertainty levels through relevant data and evaluation in the appropriate context. This makes it possible to contribute to decision-making and continuous improvement.

Organizational Change Management

This practice aims to ensure that changes in the organization are implemented successfully through the management of the human aspects of these changes.

Portfolio Management

O objetivo aqui é garantir que a organização possui o conjunto correto de programas, projetos, produtos e serviços para executar sua estratégia, segundo seus recursos.

Project Management

Project Management aims to ensure that all organization projects are successfully delivered.

Relationship Management

This practice aims to establish and nurture the connection between the organization and stakeholders at a strategic and tactical level.

It includes the identification, analysis, monitoring, and continuous improvement of relationships with stakeholders.

Risk Management

The purpose of Risk Management is to ensure that the organization understands and deals with risks effectively.

It is an integral part of all organizational activities, central to the organization’s SVS.

Service Financial Management

The purpose of this practice is to support the organization’s strategies by ensuring that financial resources and investments are being used effectively.

Strategy Management

This practice formulates the organization’s objectives and determines the course of action and allocation of resources necessary to achieve them.

Supplier Management

The objective is to appropriately manage the organization’s suppliers, as well as their performances, to ensure the provision of quality products and services.

This involves creating closer and collaborative relationships with key suppliers to reduce the risk of failures and increase the generated value.

Workforce and Talent Management

This practice ensures that the organization has personnel with appropriate skills and knowledge in suitable roles to support business objectives.

– Service Management Practices –

Availability Management

Availability Management aims to ensure that services deliver the agreed levels of availability to meet the needs of consumers and users.

Availability refers to the ability of an IT service or other configuration item (CI) to perform its function when required.

Business Analysis

This practice analyzes the business or business element, defines needs, and recommends solutions for those needs, facilitating the creation of value for stakeholders.

In this sense, business analysis enables an organization to communicate its needs in a meaningful way.

Performance and Capacity Management

Aims to ensure that services achieve agreed and expected levels of performance, thereby satisfying current and future demand in a way that optimizes costs.

Performance is the measure of what is delivered by a system, individual, team, practice, or service.

Change Enablement

Proposes to maximize the number of changes in products and services by correctly assessing risks, authorizing changes, and managing the change schedule.

A change is the addition, modification, or removal of anything that has a direct or indirect impact on services.

Incident Management

Incident Management seeks to minimize the negative impact of incidents by restoring normal service operation as quickly as possible.

An incident is an interruption of a service or a reduction in the quality of a service.

See: How to Handle User Incidents and Problems in ITIL?

IT Asset Management

Aims to plan and manage the lifecycle of all IT assets, enabling the organization to maximize value, control costs, manage risks, make informed decisions, and comply with regulatory and contractual requirements.

An IT asset is any valuable component that can contribute to the delivery of an IT product or service.

Event Monitoring and Management

The purpose of this practice is to systematically observe services and their components, as well as to record and report state changes identified as events.

An event is any significant state change for the management of a service or other configuration item (CI).

Problem Management

The purpose of Problem Management is to reduce the likelihood and impact of incidents, as well as to manage known errors and solutions.

This is done through the identification of real or potential causes of these incidents.

The actual or potential cause of one or more incidents is called a problem.

A known error is a problem that has been analyzed but not yet resolved.

Release Management

This practice aims to make new and modified services available for use.

A release is the deployment for use of a version of a service or other configuration item.

Service Catalog Management

The Service Catalog Management practice provides a single source of consistent information about all services offered by the organization.

This ensures that this source is available to relevant stakeholders.

Service Configuration Management

Aims to ensure accurate and reliable information about the configuration of services and their configuration items (CIs) is available when needed.

A configuration item (CI) is any component that needs to be managed to deliver an IT service.

Service Continuity Management

The purpose of this practice is to ensure that the availability and performance of a service are maintained at sufficient levels in the event of a disaster.

In this sense, this practice provides a framework for developing organizational resilience with the ability to produce effective responses that ensure the interests of stakeholders and the reputation of the organization.

Service Design

This practice designs products and services suitable for their purposes and uses.

This includes planning and organizing people, partners and suppliers, information, communication, technology, and practices.

Service Desk

The purpose of the Service Desk is to capture demand for incident resolution and service requests. In this sense, it is also an entry point and a single point of contact between the provider and all its users.

Service Level Management

Aims to define clear business targets for service levels, as well as to ensure that service delivery is appropriately evaluated, monitored, and managed.

A service level is one or more metrics that define the expected or delivered quality of the service. Service Level Agreements (SLAs) are a documented agreement between a service provider and a consumer that identifies the required services and the acceptable level of those services.

Service Request Management

Service Request Management aims to support the agreed quality of a service through the appropriate handling of predefined service requests or requests initiated by the user.

A service request is a user request that initiates a service action.

Service Validation and Testing

The purpose of this practice is to ensure that new and modified products and services meet defined requirements.

– Technical Management Practices –

Deployment Management

This practice aims to move new or changed hardware, software, documentation, processes, or other components to active environments.

Infrastructure and Platform Management

The purpose of this practice is to monitor the infrastructure and platforms used by the organization.

Therefore, this practice enables the monitoring of available technological solutions.

Software Development and Management

The objective of this practice is to ensure that applications meet the needs of internal and external stakeholders in terms of functionality, reliability, maintainability, compliance, and auditability.

Conclusion

Thus, I conclude this article, where we saw the main components of ITIL, the definition of its concepts, and a summary of each of the service management practices described in the official ITIL 4 document.

Finally, if you have any questions, feel free to go back and review each topic. Also, feel free to leave your questions in the comments, and I will be happy to answer them!