1. Lead Strategic Decision Making With Service Portfolio Management
Ensure you are investing in high-value IT services with a well-managed service portfolio.

2. Our understanding of the problem
CIO
CTO
VP IT
Client Program/Portfolio Manager
Identify and articulate the value IT services provided for the business.
Optimize your IT spend on high-value services and initiatives.
Drive strategic innovation and revenue generation with improved information and decision making.
Become a strategic business partner.
CEO
Service Delivery Manager
Business Relationship Manager
Identify improvement opportunities to increase service value.
Understand the importance placed on service initiatives in a business context.
Manage the Business/IT relationship by helping to ensure alignment of purpose.
Ensure common understanding of value in service discussions.

3. ANALYST PERSPECTIVE
Become a strategic value creator by establishing a dynamic view of service value.
Organizations are being driven to innovate and transform by the digital world and CIOs are perfectly positioned to emerge as strategic business leaders. To do so, IT has to establish its credibility and provide visible knowledge and value in the strategic space.
This is a process that starts by establishing trust through operational excellence, and peaks with the development of a dynamic perspective of service value through the creation and management of the service portfolio.
This active view of service value enables true innovation and leadership, while ensuring service benefits are realized and IT spend is allocated where it matters most to support business outcomes.
Valence Howden,
Senior Manager, CIO Advisory Info-Tech Research Group

4. Executive summary
CIOs are not able to differentiate between high and low-value services.
The modern CEO expects IT to innovate and generate revenue for the organization.
IT departments have trouble reacting quickly to competitive shifts in the market.
The service portfolio empowers IT to be a catalyst in business strategy, change, and growth.
IT must drive value-based investment by understanding value of all services in the portfolio.
Organizations must assess the value of their services throughout their lifecycle to optimize business outcomes and IT spend.
There are no standardized processes for the intake of new ideas and no consistent view of the drivers needed to assess the value of these ideas.
IT is spending money on low-value services and doesn’t have the ability to understand and track value in order to prioritize IT investment.
CIOs are not trusted to drive innovation.
Optimize IT investments by prioritizing services that provide more value to the business, ensuring that you do not waste money on low-value or out-of-date IT services.
Ensure that services are directly linked to business objectives, goals, and needs, keeping IT embedded in the strategic vision of the organization.
Enable the business to understand the impact of IT capabilities on business strategy.
Ensure that IT maintains a strategic and tactical view of the services and their value.
Drive agility and innovation by having a streamlined view of your business value context and a consistent intake of ideas.
Provide strategic leadership and create new revenue by understanding the relative value of new ideas vs. existing services.

5. 1 2 3 Service Portfolio Management
The service portfolio is an overarching document used to track and manage the lifecycle of all services, including active services, services in the pipeline for development, and those that are no longer offered.
Measure services by value, not technology. 1
Clarify and articulate service value.
Gain the ability to differentiate noise from value. Perform consistent assessment of IT services to confirm they are aligned with strategic business goals, enabling service prioritization according to their value. 2
Enable decision making.
Knowledge of the relative value of services enables more intelligent decision making related to service creation, enhancement, replacement, and retirement.
Support strategic outcomes.
The service portfolio supports the strategic “long game” in ensuring benefits are realized for IT services. 3

6. Assess and articulate the value of a service
The Goal
The Problem
IT’s strategic importance is often directly related to how close IT services and capabilities are to the fulfillment of business strategy.
The more actively it is required for the product or service provided to the consumer, the more visibly strategic its value is to the organization.
IT and Business leaders often rush to judgement when it comes to deciding the value of a service, and assess solely on the basis of revenue and cost.
Organizations often don’t understand the different ways that services provide value, especially in qualitative ways that are not easily articulated in numbers.
The Solution
Drive strategy by developing your service portfolio and aligning the context of value, and the assessment of new and existing services in your organization. This will allow you to optimize your spend by directing funds where they matter most, allow you to effectively and consistently assess ideas, and spearhead innovation, revenue creation, and achievement of business value outcomes.

7. Driving strategic business outcomes is the top priority for a CIO
Working alongside the business to improve outcomes is top of the list on the CIO’s agenda
Top 6 CIO job competencies required
Understanding strategic business priorities
Influence with internal stakeholders
Technology vision and leadership
Ability to lead fast-changing complex environments
Communication skills
Talent management 1 2 3 4 5 6
Source: Deloitte 2015 CIO Survey

8. Manage the service portfolio to effectively make decisions, prove success, and analyze challenges
Despite a global IT spend of over $4 trillion, 67% of CEOs and CIOs are misaligned on how IT should enable the business.
With the dramatic increase in digital technology and business’ appetite to use new technologies to enable their own innovations, CIOs are challenged with the need to rapidly understand business inputs, improve stakeholder satisfaction, and assess their own teams’ internal capabilities.
A model is needed to enable the CIO to rapidly make decisions, prove success, and identify opportunities and challenges. Service portfolio management is that model.
Source: Info-Tech’s CIO/CXO Alignment Diagnostic

9. Promote and Cultivate Innovation Through Service Portfolio Management
Enable agility and innovation in the changing digital environment by understanding your service portfolio
Alignment
Service alignment with business goals can identify critical business functions and outcomes that are under-served by current IT services. This will highlight new opportunities and improvement needs.
Structure
It is critical to have a structure that simplifies the ability to see the impact of emerging technologies against existing services and initiatives.
This enhances decision making and can reduce costs by re-prioritizing or eliminating planned service initiatives before they are launched.
Framework
A consistent framework around value assessment allows for more rapid assessment of new and innovative ideas, accelerating the move from ideation to development.
Promote and Cultivate Innovation Through Service Portfolio Management
Understanding the usage and active value of services drives innovation when combined with a dynamic understanding of your market space.

10. Take the path to become a strategic partner
You must follow the path to strategic partnership and create new business value
Take the path to become a strategic partner
Firefighter
Trusted Operator
Strategic Partner
Measured by value-based performance. Drive growth, build agility, and lead innovation.
Utility
Measured by cost efficiency rather than value creation.
Capability
Low
High
Service Provider
Service portfolio management is based on understanding value and managing/improving value in a measurable way that enables IT to demonstrate strategic and transformative leadership.
There is a critical point where cost reduction, efficiency gains, and more effective work provide a diminishing return on investment.
Maturity

11. Technology-Centric Service Delivery Proposition
Managing IT to provide business value is a 21st century IT leadership imperative
IT service delivery of the 21st century must focus on enterprise-level objectives and aim to empower the business, while deriving priorities from customer outcomes, business strategy, and the related strategic technology needs.
Technology-Centric Service Delivery Proposition
IT-aligned leadership behaviors.
Reactive leadership posture.
Technology focus.
Discrete technology processes and siloes.
Technology and IT function-related goals.
Start
Business Value Service Delivery Proposition
Enterprise-aligned leadership behaviors.
Business-critical goals focus.
Strategically integrated services.
Proactive leadership posture.
Strategic partnership based on business outcomes.
Developing a Process and Structure to Impact Business Decisions
Embedding Service Orientation in the Organization
Building a Strategic Partnership
Leadership must develop the capability to execute at a high level.
Leadership must embed business and service orientation throughout IT.
Leadership must move beyond technical excellence and cultivate a strategic business view.

12. Enable significant improvement in business outcomes through service portfolio management
Service portfolio management’s lifecycle view of services and service value enables IT to become a strategic partner and leader by:
Optimizing Investment
Optimize IT spend by driving investment in high-value services and removing low-value ones. 1
Establishing a Framework for Value Assessment
Create a structure for assessing and prioritizing new ideas and initiatives. 4
Improving Decision Making
Provide easily accessible information to support active decision making for existing services – improve, replace, maintain, or retire. 2
Building Service Orientation
Guarantee IT maintains a customer and service-oriented view of IT services. Provide a tactical approach to a service perspective. 5
Aligning to Strategic Goals
Ensure all services are tied to the business goals and functions that they provide or enable. 3
Preparing IT Capability
Make sure IT capabilities and resource impacts are part of strategic decision making. 6

13. Track and manage the entire lifecycle of services
Pipeline
Service Catalog
Retired
Services
Service Intake
Inception
When a new service is proposed, it is added to the service portfolio through the service intake process.
The service pipeline contains services that are proposed, assessed, and in-development/rejected.
The service catalog tracks all active services that are deployed to the users.
Services that are no longer valuable are taken out of active service and may be decommissioned.
Retirement

14. Service portfolio management is not project portfolio management, but they are related
While all forms of portfolio management are similar in terms of governing portfolios and ensuring the right investment decisions are made, they vary in scope.
Service Portfolio Management
Service portfolio management is a high-level view of services through their lifecycle. This starts with the intake and assessment of new/changed service ideas based on an initial business case, and extends until an active service is retired.
Project Portfolio Management
Project portfolio management is a high-level view of the projects an organization is implementing through its project lifecycles, prioritizing approved projects/programs and making sure they are executed to completion.
Project portfolio management sits within the overarching view of the service portfolio management process.
Service portfolio management outputs are a direct input into project portfolio management, and the output of project portfolio management provides input back into service portfolio management upon project completion.

15. Project Portfolio Mgmt.
Service portfolio management is not project portfolio management; it encompasses project portfolio management
Pipeline
Service Catalog
Project Portfolio Mgmt.
Project Proposal
Steering Committee
Approval Stage
Execution
Retired
Services
Service Intake
New Services +
Existing Services
Status: Proposed
Status: Active
Status: In Development
Status: Proposed
Service portfolio management feeds into project portfolio management.
After a new service or service improvement initiative is assessed and approved, project portfolio management is the process to ensure the service is planned and implemented on time, in scope, on budget, and delivers the expected business value.
The finished project produces an active service that is ready to be deployed to customers.
Status: In Development
Status: Active

16. Don’t let conventional wisdom become your roadblock
Service portfolios are not well suited to implement in smaller organizations.
Size does not limit implementation of the service portfolio; the main requirement is maturity and service stability.
All organizations will gain value and insight from an active understanding of the value proposition of their services.
Info-Tech Perspective
The effort to establish a service portfolio is too difficult.
While medium effort is required, this is a mature high-reward process that can drive your business forward.
The value assessment and portfolio approach reduces your up-front effort so that you will realize the benefit sooner.
Value assessment is the same as application rationalization.
The service portfolio is always driven from an outside-in perspective of services and business outcomes.
It looks at services and related outcomes across their lifecycle, beyond simply the applications or technology that are used.

17. Don’t let conventional wisdom become your roadblock
Only cost reduction matters.
There are many factors other than cost and revenue that drive the value of a service.
When you assess the value of your services and initiatives, include criteria based on quality and risk in combination with financial impact, in order to make holistic, consistent, and organization-specific decisions.
Info-Tech Perspective
To add a service, something else has to be removed.
This can be true in terms of work that can be performed during a particular fiscal year but not in service valuation.
Structured value assessment through the service portfolio drives decision making without pre-existing expectation and expands your options.
Enterprise services are utilities.
When assessing the value of internal services like , their use in supporting or enabling critical business outcomes needs to be understood.
Articulate the impact and outcome of not providing these services by developing an understanding of their business-enabling value using the service portfolio.

18. Business Relationship Management
Establish your credibility with the business before implementing service portfolio management
Consistent operational excellence is the foundation upon which strategic partnership and innovation are built. No one will trust you to lead until you have your operational house in order.
Core Elements
Stable IT Environment
Proactive Thinking
Service
Portfolio Management
Service Orientation
Business Relationship Management
Preferably, the organization should also have an active, maintained service catalog in place.

19. Ensure your organizational structure and culture support service portfolio management
Process implementations are most effective when paired with a culture and organizational structure that reinforces and enables them.
Implementing service portfolio management requires adjustments to the way decisions are made in an organization, and a consistent perspective of the context of value across the organization.
This is a transformative change and, like any organizational or strategic change, is impacted by the behavior and design of the business.
To ensure the process successfully embeds in the organization, it has to be implemented and optimized to the organization’s structure, and enabled through cultural/behavioral reinforcement.

20. Reinforce and influence behaviors through service portfolio management1
Align Value Context 2
Define Committee Members
Value assessment and portfolio management require governing committee members to have a consistent and aligned perspective of business value creation.
Roles and responsibilities of committee members must be adjusted to ensure decisions are aligned with this perspective, and enforced through process (e.g. voting/assessment exemptions where there is a conflict of interest). 3
Make Transparent Decisions
Decision making must comply, and be seen to comply, with the portfolio process to maintain credibility. 4
Embed Value Approach
Terms of reference for the governing committee must reflect the diverse views and contexts of value that are valid in the organization. 5
Embrace Ideation 6
Communicate
Organizational culture must embrace intake of ideas from all areas of the organization.
Compliance requirements for the approach need to be communicated within the organization.
Leadership expectations must be adjusted within the organization to support it.

21. Info-Tech’s service portfolio management approach aligns with COBIT 5
Core outcomes of service portfolio management based on COBIT 5.0:
Ensure an appropriate investment mix of services is defined and aligned with enterprise strategy.
Business cases are evaluated and prioritized before funds are allocated.
A comprehensive and accurate view of the service portfolio performance exists.
Analyze business requirements and the way in which IT-enabled services and service levels support business processes. Discuss and agree on potential services and service levels with the business, and compare them with the current service portfolio to identify new or changed services or service level options.
Benefits have been realized due to benefit monitoring. 1 2
COBIT5 is used in the process of defining and refining the IT value scenarios used in our top-down value identification methodology.
The values align with the governance perspective aligned to benefits realization, risk optimization, and resource optimization. 3 4 5

22. Develop and act on relevant metrics for the service portfolio
The process goals and metrics measure the effectiveness of the process put in place.
Process Goals and Metrics for Service Portfolio Mgmt.
Percent of IT value drivers mapped to business value drivers.
Amount ($) of revenue generated from approved investments.
Percent of approved IT services where expected benefits/ROI are realized.
Percent of IT-enabled investments where claimed benefits are met or exceeded.
Percent of investments where realised benefits have been measured and compared to business case expectations.
Percent of IT spend (IT investment) aligned with organizational value priorities.
Source: COBIT 5 and the metrics development approach
EXAMPLE
Metric
Percent of IT-enabled investments where claimed benefits are met or exceeded.
Prerequisite
This metric requires active measurement of the actual vs. expected benefits of a service or initiative.
Calculation
(Number of approved investments meeting or exceeding expected / total number of approved investments) *100.

23. Develop and act on relevant metrics for the service portfolio
The IT goals and metrics measure the benefits of the process.
IT Goals and Metrics for Service Portfolio Mgmt.
Percent of IT investments that have traceability to enterprise strategy.
Degree to which enterprise management is satisfied with IT’s contribution to enterprise strategy.
Percent of changes from the investment program reflected in the relevant IT portfolios.
Percent of investments where realised benefits have been measured and compared to business case expectations.
Percent of enterprise strategic goals and requirements supported by IT strategic goals.
Number of services retired based on value assessment and related cost savings.
Source: COBIT 5 and the metrics development approach
EXAMPLE
Metric
Percent of services retired based on value assessment and related cost savings.
Prerequisite
This metric requires service-based costing information to be available. It identifies cost savings from value-based service removal.
Calculation
Count of total number of services retired based on value assessments.
Combined dollar amount of costs recovered or redirected after retirement/decommissioning.

24. CASE STUDY Executive Brief case study – Healthcare Integration
Industry – Health care
The Situation
A change in the government’s mandate for jurisdictional involvement in electronic healthcare provision, paired with a need to align different healthcare organizations, changed the healthcare organization’s objective from technology owner/supplier, to integrator, support owner, governor, and enabler.
The Initiative
Business and IT groups within the governance committee were involved in a Governance Optimization initiative which included developing a revised intake structure and initiative assessment criteria which was then approved and socialized across the organization.
The governance committee’s purpose, roles, responsibilities, and authority was revised and membership expanded to represent all value contexts.
Active services were reviewed consistently to confirm they were still valuable in providing or enabling core clinical outcomes and met the cost-optimization requirement for reuse and interoperability.
The Result
Executive support and buy-in was required to overcome initial resistance to the changes, but communication of the necessity to change around the modified mandate allowed the initiative to move forward.
The revised approach improved the agility and effectiveness of decision making and resulted in the removal or replacement of low-value services and the recovery of 20% of budgeted operating expenses which were redirected to optimize more critical or legislatively required services.
The optimized handling of initiatives enabled the prioritization and accelerated completion of two critical, highly visible integration services. These initiatives had a publicly announced release date and were critical for the organization’s reputation. The value context inputs from architecture allowed for a more agile software development approach to be implemented, tied to leveraging existing IT capabilities.

25. Use these icons to help direct you as you navigate this research
Use these icons to help guide you through each step of the blueprint and direct you to content related to the recommended activities.
This icon denotes a slide where a supporting Info-Tech tool or template will help you perform the activity or step associated with the slide. Refer to the supporting tool or template to get the best results and proceed to the next step of the project.
This icon denotes a slide with an associated activity. The activity can be performed either as part of your project or with the support of Info-Tech team members, who will come onsite to facilitate a workshop for your organization.

26. Info-Tech offers various levels of support to best suit your needs
Guided Implementation
“Our team knows that we need to fix a process, but we need assistance to determine where to focus. Some check-ins along the way would help keep us on track.”
DIY Toolkit
“Our team has already made this critical project a priority, and we have the time and capability, but some guidance along the way would be helpful.”
Workshop
“We need to hit the ground running and get this project kicked off immediately. Our team has the ability to take this over once we get a framework and strategy in place.”
Consulting
“Our team does not have the time or the knowledge to take this project on. We need assistance through the entirety of this project.”
Diagnostics and consistent frameworks used throughout all four options

27. Best-Practice Toolkit Guided Implementations
Lead Strategic Decision Making With Service Portfolio Management – project overview
1. Establish the Service Portfolio
2. Develop a Value Assessment Framework
3. Manage Intake and Assessment of Initiatives
4. Assess Active Services
5. Manage and Communicate the Service Portfolio
Best-Practice Toolkit
1.1 Establish and understand the service portfolio process by setting up the service portfolio worksheet.
1.2 Understand at a high level the steps involved in managing the service portfolio.
1.3 Adapt the service portfolio worksheet and create a plan to begin documenting services in the worksheet.
2.1 Understand the need for a value assessment framework.
2.2 Identify the organizational context of value through a holistic look at business objectives.
2.3 Determine the influence of organizational structure and culture on new services.
2.4 Leverage Info-Tech’s Value Assessment Tool to validate and determine service value.
3.1 Create a centralized intake process to manage all new service ideas.
3.2 Manage and assess all service proposals consistently using the Value Assessment Framework.
3.3 Create a process to hand over approved service ideas to the project management office.
3.4 Transfer completed initiatives to the service catalog.
4.1 Continuously validate the value of existing service through the Value Assessment Framework.
4.2 Determine the future of service based on the value and usage of the service.
4.3 Take the appropriate next step for the service, whether it is to improve, replace, maintain, or retire.
5.1 Communicate and implement the service portfolio within the organization.
5.2 Create a mechanism to identify changes within the organization and to seek out continuous improvement opportunities for the service portfolio management process and procedures.
Guided Implementations
Review the Service Portfolio Worksheet.
Adapt the Service Portfolio Worksheet.
Complete the culture and organizational structure assessment.
Complete the Value Assessment Tool for different services.
Review and design the service intake process.
Review and adapt the service intake form.
Assess the value of a few existing services.
Determine the appropriate next steps for the assessed services.
Create a communication plan.
Create a monitoring process to address feedback.

28. Workshop overview
Contact your account representative or for more information.
Workshop Day 1
Workshop Day 2
Workshop Day 3
Workshop Day 4
Activities
Set up the Service Portfolio Worksheet and assess service value
1.1 Review the Service Portfolio Worksheet.
1.2 Adapt the Service Portfolio Worksheet.
1.3 Understand value from business context.
1.4 Determine the governing body.
1.5 Assess culture and organizational structure.
1.6 Complete the value assessment.
1.7 Discuss value assessment score.
Create a service intake process
2.1 Review or design a service intake process.
2.2 Review the service intake form.
2.3 Design a process to assess and transfer service ideas.
2.4 Design a process to transfer completed services to the service catalog.
Assess active services
3.1 Discuss/review management of active services.
3.2 Complete a value assessment for an active service.
3.3 Determine service value and usage.
3.4 Determine the next step for the service.
3.5 Document the decision regarding service outcome.
Communicate and implement the process
4.1 Create a communication plan for service portfolio and value assessment.
4.2 Create a communication plan for service intake.
4.3 Create a procedure to continuously validate the process.
Deliverables
Service Portfolio Worksheet
Identification of organizational structure and culture
Value assessment for different services
Service Intake Form
Operating procedures for services based on value assessment result
Service portfolio communication plan
Service portfolio implementation/post-implementation plan