Setting the standard for IT best practices

How can the Information Technology Infrastructure Library improve industrial service organizations?

By Marcel Dix, Dr. Ralf Gitzel, and Chris M. Stich, ABB Corporate Research Center

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In brief:

  • ITIL is a set of best practices that suggest how IT infrastructures can be managed by the users of that technology.
  • ITIL treats IT infrastructure as an enabler to reach the targeted business goals; it focuses on market-proven good practices; it avoid having to go through repeated lesson-learning and wheel-reinventing.
  • It organizes best practices around the five phases of service lifecycle, from planning and implementing IT-based services to a continuous service improvement.

The Information Technology Infrastructure Library (ITIL) is a de facto standard for IT services. ITIL was developed by the Office of Government Commerce (OGC), a British governmental agency whose responsibility is to optimize the procurement and acquisition processes of the British public sector. It’s based on a collection of best practices that originate from the different stages of a service lifecycle framework. They cover guidance for building a service strategy as well as developing, implementing, operating and continuously improving services. The framework was developed for the IT and telecommunication sector and, therefore, at a first glance, doesn’t seem to be of immediate use to an industrial maintenance manager. However, because of a strong conceptual overlap, the principles of ITIL also can be applied to the industrial field service sector. You should know the basic principles of ITIL and its applicability to industrial service organizations.

What is ITIL?

The core purpose of the Information Technology Infrastructure Library is to standardize the provision of IT-related services to ensure efficiency and a high level of service quality. The ITIL approach covers both the processes and the resources (human and material) that execute them. ITIL’s key focus is on the service provider, who can be internal or external to the customer’s organization.

As illustrated in Figure 1, commercial use of computers started in the 1950s, when some extensive routine calculations (e.g. for accounting) were simply automated by huge calculators – the mainframes –hidden somewhere in the basement. Upper management found little interest in being involved in the planning and management of such resources.

Figure 1: History of IT and ITIL in organizations (based on Simonovich)
Figure 1: History of IT and ITIL in organizations (based on Simonovich)

Towards the end of the last century business saw a strong emergence of information technology in practically every department and process of the organization. Email became a key channel for human interaction; accountancy and HR implemented their processes in SAP, marketing and sales discovered the Internet, production achieved productivity gains through automation systems and so on.

In 1989 it had occurred to Britain’s OGC that through the emergence of information technology, organizations also became more dependent on these technologies. However, there was still a strong confusion how that IT infrastructure should be managed. Experience showed that without proper management of IT, several problems occur. For example, one element of bad IT management is cost inefficiency and suboptimal quality of IT-dependent business processes. Another is limited organizational responsiveness to increasingly saturated and competitive market environments. Organizations can be only as agile as their underlying IT infrastructure upon which it increasingly depends.

ITIL supports strategic decisions by putting its focus on the organization’s goals.

In response to these developments, the OGC published ITIL, a set of best practices that suggest how IT infrastructures can be managed. In 2001, the OGC published ITIL version 2 and reduced the number of volumes from 44 to 9. Version 3, the current version, was published in 2007. It consists of 6 volumes and moves from a process-based view to one based on a continuous service lifecycle. Today, ITIL is quite popular: The UK's National Health Service, IBM, HP, Microsoft, Shell Oil, Proctor & Gamble and British Airways, are examples of extensive ITIL practitioners.

ITIL version 3 has four key strengths. It treats the IT infrastructure not as overhead but as an enabler to reach the targeted business goals. ITIL supports strategic decisions by putting its focus on the organization’s goals. Traditional approaches treat IT as a separate concern, so any local solutions won’t necessarily benefit the organization as a whole. This leads to cost inefficiency and low quality.

Also, ITIL focuses on market-proven good practices. It helps organizations avoid having to go through its own lesson-learning and wheel-reinventing and it promotes operational excellence. Caterpillar, for example, increased its success rate in resolving customer problems within a fixed time from 30% to 90%. And Proctor & Gamble saved $125 million after implementing service management processes ITIL outlined.

ITIL’s third strength is its focus on standardization. A key ITIL concept is a common language where a confusion of meanings of terms had prevailed. This doesn’t only increase internal and external communication efficiency, it enables common thinking. Standardization also enables a better use of synergy effects and company resources.

Finally, ITIL not only helps improve service efficiency and quality, it makes this performance measurable through key performance indicators (KPIs). Service organizations would have little advantage in doing a good job it the “good” can’t be proven. Making service performance measurable also is a prerequisite for identifying performance deviations and appropriate corrective actions.

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