Today’s Market Value of ITIL
Hi Guys–
We recently published a guide to help organizations develop a business case for ITIL. The focus was 2 fold - 1) to show the ROI on ITIL & IT Service Management best practices the market at large is seeing, and 2) to show where you can mine the business value of ITIL in your own organization to build an effective business case.
A fair amount of quantified value is being delivered through the leverage of ITIL and IT Service Management best practices. Here is an excerpt from the whitepaper documenting some of these returns.
Today’s Market Value of ITIL
ITIL essentially re-engineers the services provided by large IT departments from the perspective of their customers, eliminating unnecessary duplication of effort and presenting a consolidated set of consistent service offerings to end users. Reported gains include:
A 30% overall efficiency gain, from research conducted by IDC with 11 different Global 2000 organizations from different sectors and geographies. Specific gains include:
o Incident management and help desk support: 40.5%
o Managing and supporting servers: 30.9%
o Change management: 28.4%
o Managing and maintaining network infrastructure: 23.1%
o Maintaining configuration database: 22.8%
o Managing applications: 10%
o Problem management: 9.4%
o Service level management: 8.5%
o Average number of network devices controlled per FTE up 57%
o Average reduction in head count growth: 12.2%
The IDC study also documented significant gains that include:
o Three year cost of investment: $2.1 million
o Annual cost savings and increased revenue: $14.5 million
o Net present value of three year savings: $26.7 million
o Payback period: 11.8 months
o ROI over three year life of project: 422%
$500 million in savings from Proctor & Gamble, as well as a 6-8% reduction in operating costs and a 15-20% reduction in technology personnel.
25-35% reduction in time required to process changes across the infrastructure, a 39% reduction in systems abends, and a 75% reduction in ongoing compliance workload from Food Lion, an 1100 store grocery chain, working with Evergreen Systems.
Gartner research also surveyed 350 senior IT executives in 2005, and determined that “There was a strong positive correlation between those not using ITIL, and the degree to which respondents felt their infrastructure was under-funded. We believe this reflects their focus on creating a service driven organization, the need to be competitive and greater maturity.”
Clearly, Enterprise clients in all commercial sectors are beginning to harvest and document the cost reductions and efficiency gains yielded from ITIL and other IT process improvement projects.
If you have any stories of ITIL business value to share, I’d love to add them to the collection!
Here’s our White Paper on “Developing the Business Value for ITIL”.
Don
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