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The five core ITIL publications provide guidance as follows: Service Strategy: defines the perspective, position, plans and patterns that a service provider needs to execute to meet an organizations business outcomes. Service Design: includes the design of the services, governing practices, processes and policies required to realize the service providers strategy and to facilitate the introduction of services into supported environments. Service Transition: ensures that new, modified or retired services meet the expectations of the business as documented in the service strategy and service design stages of the lifecycle. Service Operation: coordinates and carries out the activities and processes required to deliver and manage services at agreed levels to business users and customers Continual Service Improvement: ensures that services are aligned with changing business needs by identifying and implementing improvements to IT services that support business processes. Remember the lifecycle phases by the mnemonic TDOCS (as in technical documentation), that is, transition, design, operation, continual improvement, and strategy.

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Deciding what services should be offered and to whom is an integral part of service strategy. Service Strategy provides guidance on how to view service management not only as an organizational capability but as a strategic asset. It describes the principles underpinning the practice of service management which are useful for developing service management policies, guidelines and processes across the ITIL service lifecycle. Service Strategy processes are as follows: 1. Strategy management for IT services 2. Service portfolio management 3. Financial management for IT services 4. Demand management, and 5. Business relationship management Note the differences in unit ITILFND05 in the foundation syllabus in knowledge required; knowledge of some processes is not required (they are listed in the course for the sake of completeness); for others the purpose, objectives and scope must be known; for still others, the purpose, objectives, scope, basic concepts, process activities and interfaces must be known; use the syllabus to help focus your studies.

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Service Design provides guidance for the design and development of services and service management practices, including design principles and methods for converting strategic objectives into portfolios of services and service assets. The scope of Service Design is not limited to new services, but includes the changes and improvements necessary to increase or maintain value to customers over the lifecycle of services, the continuity of services, achievement of service levels, conformance to standards and regulations, guidance on how to develop design capabilities for service management. Service Design processes are as follows: 1. Design coordination 2. Service catalogue management 3. Service level management 4. Availability management 5. Capacity management 6. IT service continuity management 7. Information security management 8. Supplier management

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Voiceover Transcripts 4

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Service transition provides guidance on moving new and changed services into production; for example, this includes things like deployment of new services (including providing a framework for evaluating service capabilities and risk profiles before new or changed services are deployed), decommissioning services, and transfer of services between service providers. The service knowledge management system or SKMS is a key concept of ITIL Service Transition; the SKMS is a set of tools and databases that is used to manage knowledge, information and data. The service knowledge management system includes the configuration management system, as well as other databases and information systems. The service knowledge management system includes tools for collecting, storing, managing, updating, analyzing and presenting all the knowledge, information and data that a provider will need to manage the full lifecycle of IT services. Service transition processes are as follows: 1. Transition planning and support 2. Change management 3. Service asset & configuration management 4. Release and deployment management 5. Service validation and testing 6. Change evaluation 7. Knowledge management

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Voiceover Transcripts 5

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Service Operation provides best practice for managing services in supported environments, guidance on achieving effectiveness and efficiency in service delivery and support to ensure value for customers, users and service providers. It covers managing availability of services, controlling demand, optimizing capacity utilization, scheduling of operations, avoiding or resolving service incidents and managing problems, new models and architectures such as shared services, utility computing, web services and mobile commerce to support service operation. Service Operations processes are: 1. Event management 2. Incident management 3. Request fulfillment 4. Problem management 5. Access management Service Operations functions are: 1. Service desk 2. Technical management 3. IT operations management 4. Application management Remember, processes and functions are NOT the same. A process is a set of activities; a function is a set of people. A process is a structured set of activities designed to accomplish a specific objective, for example, the event management process. A function is team or group of people and the tools or other resources they use to carry out one or more processes or activities for example, the service desk.
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Continual Service Improvement CSI looks for ways to improve process effectiveness and efficiency, as well as cost effectiveness. CSI identifies and implements improvements to IT services. CSI improvement activities support each lifecycle stage: service strategy, service design, service transition, service operation, and CSI itself. There is only one process in the CSI service lifecycle phase: the seven-step improvement process. Its steps are: 1. Identify the strategy for improvement 2. Define what you will measure 3. Gather the data 4. Process the data 5. Analyze the information and data 6. Present and use the information, and 7. Implement improvement CSI runs through and supports the other lifecycle phases. This is important to understand. All phases of the lifecycle strategy, design, transition, and operation, as well as CSI itself, can benefit from continual improvement.

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As you can see, ITIL 20011 Edition includes 26 process and 4 functions. Processes new to ITIL 2011 edition include Strategy Management for IT Services, Business Relationship Management, and Design coordination; in 2011 edition, the Evaluation process was renamed to Change evaluation. The processes are assigned to a phase in a lifecycle and listed there because generally this is where they first become important in the lifecycle; it would be erroneous to think that the stage that they are assigned to is the only place where activity is completed nothing could be further from the truth; financial management, configuration managementin fact all of these processes have activity that occurs throughout the lifecycle. And while it is depicted sequentially here in this diagram, the entire CSI phase underpins all four of the other phases. Having said this this there is a general sequence to the lifecycle, and it can be said that some things come before others in the lifecycle; when viewed through that lense, these groupings and ordering make sense.

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Voiceover Transcripts 8

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The five core ITIL publications provide guidance as follows: Service Strategy: defines the perspective, position, plans and patterns that a service provider needs to execute to meet an organizations business outcomes. Service Design: includes the design of the services, governing practices, processes and policies required to realize the service providers strategy and to facilitate the introduction of services into supported environments. Service Transition: ensures that new, modified or retired services meet the expectations of the business as documented in the service strategy and service design stages of the lifecycle. Service Operation: coordinates and carries out the activities and processes required to deliver and manage services at agreed levels to business users and customers Continual Service Improvement: ensures that services are aligned with changing business needs by identifying and implementing improvements to IT services that support business processes. Remember the lifecycle phases by the mnemonic TDOCS (as in technical documentation), that is, transition, design, operation, continual improvement, and strategy.

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Voiceover Transcripts 9

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Deciding what services should be offered and to whom is an integral part of service strategy. Service Strategy provides guidance on how to view service management not only as an organizational capability but as a strategic asset. It describes the principles underpinning the practice of service management which are useful for developing service management policies, guidelines and processes across the ITIL service lifecycle. Service Strategy processes are as follows: 1. Strategy management for IT services 2. Service portfolio management 3. Financial management for IT services 4. Demand management, and 5. Business relationship management Note the differences in unit ITILFND05 in the foundation syllabus in knowledge required; knowledge of some processes is not required (they are listed in the course for the sake of completeness); for others the purpose, objectives and scope must be known; for still others, the purpose, objectives, scope, basic concepts, process activities and interfaces must be known; use the syllabus to help focus your studies.

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Voiceover Transcripts 10

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Service Design provides guidance for the design and development of services and service management practices, including design principles and methods for converting strategic objectives into portfolios of services and service assets. The scope of Service Design is not limited to new services, but includes the changes and improvements necessary to increase or maintain value to customers over the lifecycle of services, the continuity of services, achievement of service levels, conformance to standards and regulations, guidance on how to develop design capabilities for service management. Service Design processes are as follows: 1. Design coordination 2. Service catalogue management 3. Service level management 4. Availability management 5. Capacity management 6. IT service continuity management 7. Information security management 8. Supplier management

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Voiceover Transcripts 11

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Service transition provides guidance on moving new and changed services into production; for example, this includes things like deployment of new services (including providing a framework for evaluating service capabilities and risk profiles before new or changed services are deployed), decommissioning services, and transfer of services between service providers. The service knowledge management system or SKMS is a key concept of ITIL Service Transition; the SKMS is a set of tools and databases that is used to manage knowledge, information and data. The service knowledge management system includes the configuration management system, as well as other databases and information systems. The service knowledge management system includes tools for collecting, storing, managing, updating, analyzing and presenting all the knowledge, information and data that a provider will need to manage the full lifecycle of IT services. Service transition processes are as follows: 1. Transition planning and support 2. Change management 3. Service asset & configuration management 4. Release and deployment management 5. Service validation and testing 6. Change evaluation 7. Knowledge management

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Voiceover Transcripts 12

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Service Operation provides best practice for managing services in supported environments, guidance on achieving effectiveness and efficiency in service delivery and support to ensure value for customers, users and service providers. It covers managing availability of services, controlling demand, optimizing capacity utilization, scheduling of operations, avoiding or resolving service incidents and managing problems, new models and architectures such as shared services, utility computing, web services and mobile commerce to support service operation. Service Operations processes are: 1. Event management 2. Incident management 3. Request fulfillment 4. Problem management 5. Access management Service Operations functions are: 1. Service desk 2. Technical management 3. IT operations management 4. Application management Remember, processes and functions are NOT the same. A process is a set of activities; a function is a set of people. A process is a structured set of activities designed to accomplish a specific objective, for example, the event management process. A function is team or group of people and the tools or other resources they use to carry out one or more processes or activities for example, the service desk.
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Continual Service Improvement CSI looks for ways to improve process effectiveness and efficiency, as well as cost effectiveness. CSI identifies and implements improvements to IT services. CSI improvement activities support each lifecycle stage: service strategy, service design, service transition, service operation, and CSI itself. There is only one process in the CSI service lifecycle phase: the seven-step improvement process. Its steps are: 1. Identify the strategy for improvement 2. Define what you will measure 3. Gather the data 4. Process the data 5. Analyze the information and data 6. Present and use the information, and 7. Implement improvement CSI runs through and supports the other lifecycle phases. This is important to understand. All phases of the lifecycle strategy, design, transition, and operation, as well as CSI itself, can benefit from continual improvement.

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Voiceover Transcripts 14

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In the service design processes specified in ITIL 2007 Edition (formerly known as ITIL V3) an overarching process to coordinate design was not included. The addition of this process in ITIL 2011 Edition is significant it a recognition of the need for an overall process that orchestrates the components of design. Without this process, the components of the service design package may be completed (see the relevant section for a refresher on what those components are), but when assembled may end up being so many Frankenstein monsters. The principle is simple: Let us have coordination so that design is efficient, effective, repeatable, and standardized. Have a look back at the section that covers the components of the service design package and juxtapose these against the design coordination process on the facing page. Think about your organization: do you have such an overarching process? Or are you focused at lower levels, for example, application development and infrastructure engineering, with no overall assurance that a service will be produced with all components necessary for ongoing operation with sustained service level achievement? In either case, what happens as a result?

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Voiceover Transcripts 15

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One of the objectives of the design coordination process is to monitor and improve the performance of the service design lifecycle stage. Some things that are NOT the objectives of the design coordination process include ensuring that service availability targets are met; this is an objective of availability management; defining, documenting, agreeing, monitoring, measuring and reviewing service levelsthis is an objective of service level management; and providing and maintaining a single source of consistent information on all operational servicesthis is an objective of servicer catalog management. In the service design processes specified in ITIL 2007 Edition (formerly known as ITIL V3) an overarching process to coordinate design was not included. The addition of this process in ITIL 2011 Edition is significant it a recognition of the need for an overall process that orchestrates the components of design. Without this process, the components of the service design package may be completed, but when assembled may end up being so many Frankenstein monsters.

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Voiceover Transcripts 16

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Value is viewed as the level to which the service meets customer's expectations and therefore they make the ultimate decision on whether the service will drive value. Customers, not IT senior management, not financial management for IT services, not supplierscustomers and customers alone define the value of a service. The IT service provider, in fact all stakeholders, can influence the customers perception of value and actual value realized, but in the end value is calculated in the customers mind. Think for a minute about some services you use, for example, mobile phone service and cable TV service; for each of the four characteristics of value cited here, take some notes in three columns: desired state, actual state, gap: for example, What mix of features are provided and what are their costs? What mix / cost would you like? What is the gap? Can you think of a service that once was valuable to you but is no longer due to changing circumstances (for example, video rental stores)?

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Voiceover Transcripts 17

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Utility is what the service does; warranty how well it can be expected to perform or work. For example, an order-processing service should allow sales people to access customer details, stock availability, and shipping information. Any aspect of the service that improves the ability of sales people to better process sales orders would be considered utility. As you can see in the diagram, for any service or product to have utility it must either support performance or remove constraints. So for example I might choose one order processing service over another if it allows me to process orders on mobile devices, removing the constraint of being tied to a desk to do so. While utility is what a service does, warrantee is how well it can be expected to do it. As you can see in the diagram, warranty components are matched to the key provisions of a service level agreement: 1) Availability provisions when will the service be available? 2) Capacity (performance) provisions transaction turnaround times, etc. 3) IT service continuity provisions what will happen in a business interruption, when will service be restored? 4) Security provisions how will the confidentially, integrity and availability of the services information assets be protected? .

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Voiceover Transcripts 18

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You can see from this description that service design is a bit of a misnomer. Yes the scope of service design includes services adding them, changing them. But it also includes the design of things that are not services per se, but underpin services and service management: The design of the service portfolio Technology and management architecture design The design of processes The design of measurement methods and metrics As you can see, the last four things mentioned above are not services; it is important to remember is that they are inscope for service design (hence the misnomer) and taken together with service design, they are called the five major aspects of service design in ITIL. Give some thought to these aspects. Think about your organization. Are all of these aspects included in the scope of what your organization does in design? Does your organization do a good job of scaling the level of effort and scrutiny required in each area based on the nature of the change? What is working well and what is not?

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Voiceover Transcripts 19

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We use this mnemonic to recall the parts of a business case: In McKinleyville, Beavers Ravaged Redwoods. Where initiatives have potential or proven significant risk or cost to the businessfor example, major changes to a service, or the proposed introduction or retirement of a serviceand where multiple alternatives exist for meeting the desired outcome, a business case must be made. Your organization may use a different structure and sequence and call the sections something different, but in general, a business case must include: 1) Some sort of short introduction or executive summary (Introduction) 2) Background on the scope and methods applied to the business case, along with the assumptions the bound it (Methods and Assumptions) 3) An analysis of the positive and negative aspects of moving on the business case (as well as the opportunity cost of not moving forward) (Business Impacts) 4) An analysis of the potential risks (again, ideally both associated with moving forward and not moving forward) along with contingencies to pursue should those risks accrue (Risks and Contingencies) 5) And finally, as a basis for a go / no go decision on the initiative, given the nature of the solution, impacts, risks, and alternatives, we must suggest a preferred path forward (Recommendations)

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The service portfolio represents the commitments and investments made by a service provider across all customers and market spaces. It represents present contractual commitments, new service development and ongoing service improvement plans initiated by CSI. The portfolio also includes third-party services, which are an integral part of service offerings to customers. Some third-party services are visible to the customers (e.g. desktop repairs) while others are not (e.g. wide area networking services). In other words, the service portfolio is the complete set of services that is managed by a service provider. It identifies services in a conceptual stage, namely all services the organization would provide if it had the resources, capabilities and funding. It identifies all the resources presently engaged or being released in various stages of the service lifecycle. The service portfolio should have the right mix of services in the pipeline and catalogue to secure the financial viability of the service provider, since the service catalogue is the only part of the portfolio that lists services that recover costs or earn profits. Lastly, the service portfolio covers retired services.

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Voiceover Transcripts 21

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Given scarce resources and time, where should we invest our efforts? What services should we introduce? Retire? Change? What criteria should we use to decide? Let us be clear on this and manage the full lifecycle of services as a portfoliothis is what the service portfolio is about. As business needs and available technologies evolve, IT strategies, and therefore the portfolio of services required to achieve the position indicated by those strategies, needs to change. With service portfolio management, we apply the generic principles of portfolio management (as applied to financial portfolios of stocks, bonds and other investments, and more similarly, to portfolios of projects, as in project portfolio management) to services. The other part of this idea is ensuring ready access to the basic information required to effectively and efficiently run a services business. All of this information is in the stores and systems shown at the bottom of the figure. The CMS is how all of it is accessed, and is intended to provide a single pane of glass view into all of this information, underpinning the service portfoliothat is, what you have planned, in operation, and what you have retired.

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Voiceover Transcripts 22

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The idea with service catalog management is to put someone, or a group on point to own making sure how the organization and its services are presented to customers is satisfactory. Customers should easily be able to understand services offered, option (if any), their value and cost. Internal IT staff and suppliers should have ready access to the technical view of services. That is why there are two views of the service catalog: business and technical. For example, as a customer dont care a jot about how many cell towers your mobile phone service provider has, what technology they run, where they are positioned, how they are configured, etc. What you care about is the level of service provided: speed, coverage, and the like. This is the business view of the servicer catalogue. Internal staff and supplier for the provider care about this technical information a great deal. How else are they going to service a cell tower if they dont know where it is, how it is configured, etc. That is the purpose of the technical view of the service catalog. For examination purposes, be able to recall that the service catalogue has two views: business and technical.

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Voiceover Transcripts 23

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This figure shows a service catalog with two views: above the line we see the business/customer service catalog view, with the mapping between each business process and the customer-facing IT services that underpin it. This is the service catalog for the business to see and use. Below the line we see the supporting services and how they map to the customerfacing services they enable. This is the technical /supporting service catalog view for the IT service provider and supplier to see and use. Recall that a customer-facing service is an IT service that is visible to the customer. These are normally services that support the customers business processes and facilitate one or more outcomes desired by the customer. In contrast, a supporting service is an IT service that is not directly used by the business, but is required by the IT service provider to deliver customer-facing services (for example, a directory service or a backup service). Supporting services may also include IT services only used by the IT service provider.

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Voiceover Transcripts 24

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This figure shows a service catalog with three views: A wholesale customer view, a retail customer view, and a supporting services view. The three-view service catalog structure is the same as the two-view catalog below the line, in the supporting services view. What is different is what is above the linecustomers are broken into two categories: wholesale and retail. The difference between wholesale and retail customers hinges on who sells to whom; a retail customer is someone you sell directly to; a wholesale customer is someone you sell to who is a middleman, who then in turn sells to a retail customer. This three-view service catalog structure may not be relevant for your business, but for many IT service providers, this is precisely the model that works. For example, a computer equipment manufacturer typically sells directly to consumers (retail) but also sells to channel resellers (wholesale) who in turn add value and resell to the general public.

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Voiceover Transcripts 25

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Service level management is concerned with ensuring achievable targets are agreed; during service design this means talking to the business about what they want and what it will take to deliver it consistently, and then making sure all the things that support consistent delivery to agreed service quality levels are in place and add up; these include the products / technology, people, process, partners, agreements (service level agreements, operating level agreements, and underpinning contracts), sub-services, and the like. The general spirit of service level management should be, yes we can do it, and this is what it will cost. A fudge factor needs to be built in to ensure service levels can be met consistently, and service level management must make absolutely certain that what is being agreed is achievable, for example, it is impossible to provide 5 9s of availability while riding on a 1 9 network. While services are live service level management reports achievements against targets and instigates action to preempt or correct issues.

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It is important to understand and distinguish between the objectives of service level management and other ITIL processes, in particular, business relationship and service catalogue management. The relationship with Availability, Capacity, IT Service Continuity, and Security management should be clear as these are primary provisions of a service level agreement (capacity often being covered under performance, for example, so many transactions per second, as performance is rooted in capacity). For examination purposes, it is important to be able to identify and distinguish between service-, customer-based, and multi-level SLAs. Distinguishing between a service level agreement, service level requirement, and service level target is also important. Take a moment to look these up in the glossary and compare definitions. You must be able to recall key aspects of service reporting, especially SLAM charts. Lastly, what a service improve plan or SIP is and service level managements role in it is important to recall.

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The service level management process is responsible for ensuring all things add up to hitting the agreed levels of service, or taking proactive action either to ward off potential issues or deal with issues affecting service quality reactively. So, for example, service level management has responsibility for reviewing not just SLAs, but OLAs and UC on a regular basis to make sure they either are working as intended and supporting the agreed levels of service or, if not, taking action to make it so. While service level management may rely on other processes for support (for example, availability management for availability data and capacity management for performance data), service level management has ultimate accountability for the actual and perceived quality of the service. This includes customer satisfaction and relationships as well as ensuring that anything that underpins service support and deliveryagreements, documentation, monitoring, processesis as it should be to support agreed levels of service.

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When negotiating service level agreements, inputs from representatives of all the other processes need to be consulted for their opinion on what targets can realistically be achieved. This makes sense when you consider that all processes can affect and be affected by service level management, especially those process that show up as warranty items in the service level agreements themselves: availability, capacity (or performance, as performance is rooted in capacity), security, and IT service continuity. Most assuredly business relationship management, service catalog management, incident, supplier, and design coordination must also be consulted at various phases of the lifecycle in order to ensure that the service can and will consistently meet agreed service levels. Each has key domain knowledge pertinent to the task at hand; overlooking consulting and informing them would only put the service at risk.

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Consider the business you support: are there certain times specific services and applications are more critical than others? Where demand is higher or lower than at others? It is vital that IT understand and accommodate the rhythm of the business. For example, some candy manufactures make the largest share of their profits right around Halloween, Easter, and Christmas. Department stores often have big, one-day, once-a-year sales. Certain financial application features may go lightly used and have low impact on the business 99% of the time, but at month, quarter, and year-end financial close become mission critical. In each case, IT should know the rhythm and stage resources accordingly. Identifying and managing capacity to meet the demands of patterns of business of activity is a key activity in a customer and service focused IT provider. While this may seem like, extra work, consider that given scarce resources, being able to shape your capacity to meet better understood, actual demand is more efficient and in the endless work than dealing with the issues of over and under capacity, or being on your back foot because of a lack of understanding of what is happening in the business; things like when peaks and valley are happening, and what the consequences are for IT in term of requirements for its capacity and capability to meet peaks and valleys in demand.

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Voiceover Transcripts 30

295

The supplier management process ensures that suppliers meet business expectations, maintains information in a supplier and contractor management information system, and negotiates external agreements to support the delivery of services Supplier management does NOT, for example, negotiates operational level agreements or OLAs; this is undertaken by service level management. A supplier and contract management information system or SCMIS is set of tools, data and information that are used to support supplier management. The CSI register is an ITIL Continual Service Improvement concept; the supplier management process contributes to it along with all other processes, but does not own it; the CSI register is owned by the continual service improvement process and is a database or structured document used to record and manage improvement opportunities throughout their lifecycle.

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A primary purpose of business relationship management is to understand customers needs and ensure they are met. The business relationship management process primary role is to act as a translator for the business, to translate the value of a proposed or current service or change or problem resolution or opportunity found in a technology trend for the customer. This requires keen business communication skills, understanding of the business and IT at a management level, and comprehension of not just current technology trends but what they might mean for the business. You can expect a tight tie here with service portfolio management, working with BRM and the customer to sort which services to introduce, change, and retire. As with all ITIL processes, BRM exists and is called out because it represents something of management significance. It is not enough to have the specification, quality, or delivery; expectations must be systematically set and perceptions must be systematically managed; understanding of the other and othercentered communication must be practiced. This is the job of business relationship management as it relates to customers.

2012 by Pultorak & Associates, Ltd. All rights reserved. Course 4276 Service Offerings and Agreements v2.1 Voiceover Transcripts v1.0

www.pultorak.com (206) 729-1107

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Service level management focuses on the service and what underpins it, and reaches up and out to the business; the primary objective of service level management is to understand the service required, along with service levels, and to make sure that all the things that are required to support those service levels are in place. A related role is business relationship management. The difference in focus in right there in the name: service level management manages service levels; business relationship management manages the relationship with the business. Said another way, a business relationship manager sits up in bed at night and cant sleep with the relationship with the business is out of kilter, and the service level manager does the same when a proposed or existing service does not have everything it needs to consistently meet required utility and warranty. As you can imagine, part of the business relationship management role is to educate the customer on the features of IT services and their benefits in general and specifically for the customer. The importance of this education role cannot be understated.

2012 by Pultorak & Associates, Ltd. All rights reserved. Course 4276 Service Offerings and Agreements v2.1 Voiceover Transcripts v1.0

www.pultorak.com (206) 729-1107

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When preparing for the examination, be sure to get and take all available official sample examinations, and check your answers and rationale afterwards to ensure understanding. There are also some 3rd-party sample examinations available that are worth having a look at, as well as flash cards and other study aids, many of which are free, and all of which can be had through a quick search of the Internet. Also be sure to review the syllabus and glossary thoroughly, checking understanding of all required concepts, principles and models, and the glossary for definitions and acronyms required by the syllabus. You have 60 minutes in which to answer 26 of 40 questions correctly, or 90 seconds per question. If you get stuck on a question (that is, spending more than a minute and a half) skip it, move on, and come back to it. Get past the easy questions first and then come back to complete those that gave you trouble. Lastly, be sure to read and follow all instructions for paper-based exams and check and follow all instructions for online exams to ensure your technology works and you wont get flustered when you go to sit the actual exam because your equipment is not working or you do not know how the exam will work.

2012 by Pultorak & Associates, Ltd. All rights reserved. Course 4276 Service Offerings and Agreements v2.1 Voiceover Transcripts v1.0

www.pultorak.com (206) 729-1107

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