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Behind the Savings: Downsizing
Of course, ITIL implementations take considerable time. Tracy Schroeder, VP for IT at the University of San Francisco, implemented ITIL's service support a year ago and is only now considering service delivery. Schroeder says she assigned a team from her 63 IT staffers to calculate high-level metrics, such as downtime and bandwidth drain, so the department can get a better sense of what to expect.
"I don't want to write any checks I can't cash," Schroeder says. Having the right SLAs in place, she says, will make it easier to identify what IT can deliver to users, what to watch for from providers and when to raise the alarm that service isn't up to par.
And then there's the potential cost weighing on every ITIL implementation. Overruns stem from the fact that while the framework describes best practices, it fails to prescribe suggestions on how to implement them. At even the most efficient institutions, quantifiable results can take years.
Some CIOs, however, have been able to fight through initial expenditures to save money with ITIL. Coldwater Creek's Carper says that since his 100-person department began using ITIL, he has saved big bucks through a 50% reduction in hiring. With fewer employees, IT has saved $500,000 over three years on software licensing agreements since it doesn't need the number of seats it had previously. "We're leaner and meaner," Carper says.
Michele Hudnall, director of service management at Managed Objects Inc., a business service management company, says companies that have realized the biggest financial gain from ITIL have emerged from the implementation with fewer full-time employees than they had when they went in. "The truth is that a CIO will never save hard dollars with process improvements unless he or she reduces staff," Hudnall says. "Unless you're willing to cut people, if you want to use the process to save money, there's almost no reason to go through ITIL at all."
ITIL 3.0: Coming Soon
In December 2005, the OGC issued notice of a third refresh, known commonly as ITIL 3.0. This version will likely include five core subjects, not seven: service design, service introduction, service operations, service improvement and service strategies.
This new version won't eliminate anything; rather, it reorganizes material into supposedly more accessible formats. According to ITIL pioneer Johnson, version 3.0 will update ITIL's second iteration by reflecting the major changes in the way businesses buy and utilize IT services today.
Specifically, the new version will integrate Web services. There will be free material for current ITIL subscribers to address issues specific to vertical markets, such as financial services. And there will be more references to return on investment, Johnson adds.
As his team continues to sharpen its approach to services, Bertolini of Oakland County is eager to see the new iteration. Since implementing ITIL earlier this decade, the department has pulled out service desk software from Datawatch Corp. and re-engineered processes with Unicenter software from CA related to incident management.
When the new ITIL comes out, Bertolini and his IT project manager, Norma Miller, say they plan to tweak their service strategies accordingly. Miller, who is in charge of the ITIL effort, says the county will hold periodic workshops and make announcements on the intranet about how the new iteration will affect process management and beyond.
"That's the thing about service; it's always changing," Miller says. "Now that we've got the best practices in place, it's up to us to make sure that our people continue to use them and stay ahead of whatever other changes we need to make."
Matt Villano is a freelance writer living in Half Moon Bay, Calif. Write to him at editor@ciodecisions.com.
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