ITIL Financial Management - Increasingly Challenging

Managing a successful IT service delivery function (or business) during these times is an increasingly complex situation.

Today, a service owner needs to be knowledgeable about a lot of different process standards, best practices and service management developments.

As the delivery of IT products and services evolves constantly, a proper and accurate view of the company's service realted assets and underpinning financial capability is necessary.

With the dynamic breakthroughs in technology, interested internal clients are now demanding more from their IT service providers; including quality perfomance and a clearer view of the operational functions and controls that maintain the IT service operation.

Employing proper financial management within the service lifecycle can only give both the client and the service provider a sense of security and transparency during their business relationship.

After applying ITIL based financial management, both the client and the service provider aims to have the following capabilities:

* Enhanced decision making
* Speed of change
* Service portfolio management
* Financial compliance and control
* Operational control
* Value capture and creation

Though IT has been looked down in the past as a menial sector of the business organizations, the dynamic quality of the business has put IT industry, as one of the more important industries in this century.

It seems that the IT industry has a similar structure like a market-facing company, that they also regularly evaluate their business stance and aims to have an accurate view of how their services are responding to their client's needs.

This increasing similarity is a great shift for the IT business, as this would mean lowered costs while still producing quality services.

Here's a quick look at the commonality of interests between the business and IT: -

1. Visible, consistent run cost structures

For an IT firm to function flawlessly, it will be easier to know where the money is spent within the service operation.

2. Service consumption, modelling, valuation and planning confidence

They share the same need to have a client that they can serve their products, model and plan a working and efficient service strategy with.

3. Service investment analysis

It is necessary to make sure that the planned service will be valuable and worth the investment for the clients.

4. Financial process supporting rapid change in: budget, business need and value networks. There should be a strict monitoring of budget spending within the service operation.

5. Service portfolio management and optimization

The IT is advised to have an accurate description of their services and assets by providing their clients with their service portfolio. It should aim to optimize and improve the quality of their client's services and operation.

6. Known variable cost and dynamics

Knowing how to control the essential variables within the service operation is necessary and helpful for the service provider.

7. Service provisioning optimization

Once the service is functioning, the IT firm should be able to monitor and help in enhancing their client's services.

8. Financial compliance

The services organisation must work within the budget restrictions agreed and orientate around the plans of their clients.