ITIL, Lies, Damn Lies & Statistcs

August 11, 2009

This blog has covered quite a bit about the IT Infrastructure Library (ITIL) within the context of the benefits I believe it can provide to the small to medium enterprise.

However, as there is no such thing as a silver bullet in business, I want to point out a post at The ITSkeptic titled; Crap Factoid Alert: Implementing an IT Service Management Solution Can Save a Business More than $500,000

The above post is a goodie and is referencing how dangerous statistics (especially when in software marketing spiels) can be.

While my experience has shown that SME’s can benefit from ITIL, as a ‘C’ level exec, if you are looking for questions and answers on a hard and fast ROI, you will probably be disappointed.

Here’s The Rub

I am going to take a plunge here; Does your General Ledger have charts of accounts titled Frustration or Downtime?

I doubt it.

Moving into an IT Management framework that is ITIL aligned (or any other framework for that matter) deals a lot with the internal processes and roles that improve IT service levels. ITIL is not a Cookbook that forces a business to do things this way. But a road map of best practices.

The point here is that if we have a hypothetical balance sheet that we can call example A, it may show zero CAPEX costs for IT infrastructure, yet it has no means of accounting for hours of lost productivity and frustration as IT infrastructure assets have failed, no way to account for inefficiency in IT service etc.

You then spend dollars and time moving towards ITIL alignment, then a hypothetical balance sheet we can call example B shows costs of  X on replacement IT infrastructure, yet again, it cannot account for the fact that hours of lost productivity and frustration are  no longer there.

THE SMB Takeaway

In my opinion, there is a value in ITIL for SME’s, But most of us have not had the experience with the accounting for softer dollar parts of the balance sheet. The ones that do not directly include operating and capital expenses.

From a pure expense view of your G/L, you may never see a firm return on investment for an ITIL implementation. Simply because accurately accounting for its benefit contains the requirement that we understand the benefits of improved productivity and improved service levels.

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3 Responses to “ITIL, Lies, Damn Lies & Statistcs”

  1. itorganization2017 Says:

    Good points, Elliot. I’ve worked long and hard trying to figure out the cost/benefits for implementing ITIL, and any such analysis is, ultimately, bogus. The biggest problem (which also applies to CMMI) is that companies most in the need of process discipline don’t have the baseline data on which to build a business case, or against which to forecast estimates.

    IMHO, you have to:

    1) Absolutely believe that you HAVE TO increase your process management discipline (and have a clear idea of why and what types of benefits it will bring.
    2) Once you’ve reached that commitment, you have to decide what approach you will take.

    • elliotross Says:

      Vaughan, Thanks for dropping by!

      I agree – and that baseline data requirement is one that most SME’s definitely do not have.

      I have definitely written about ITIL – but I have tried to stress that the process maturity required for **any** framework is the guiding principle.

      A business with a strong internal process management framework that they built themselves, will be much farther ahead than trying ITIL, ISO, CMMI, CoBIT or any other framework that an organization hopes will be a silver bullet.

      Regards

      Elliot


  2. […] Excerpt from: ITIL, Lies, Damn Lies & Statistcs […]


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