The governance procedure for a service portfolio is called service portfolio management (SPM). A service provider can manage investments across the service lifecycle by evaluating each service’s business value.

A service provider uses service portfolio management to restrict the entrance of any service by tracking any investment in services from the creation to the delivery and retired stages.

Purpose of Service Portfolio Management

• SPM ensures a provider has the right mix of services to satisfy their plan.
• SPM requires financing permission for all service entry or withdrawal. Depending on the service provider’s organization, a financial strategy was needed to recoup costs or produce a profit.

Objective Of Service Portfolio Management

• To help a service provider decide which services to offer and which to retire. This considers risk and potential return.
• To document every service the supplier plans and operates.
• Manage a service portfolio that clearly articulates the business needs each service addresses and supports.
• Run every new service through standardized activities and procedures to ensure management, service delivery, and support information is captured and supplied to the appropriate management processes.
• To determine how well each service supports the service provider’s plan.
• To control diverse services and investments.
• To review each CSIP service.
• Through the service portfolio, build a service catalog.
• To track service investments over time.

Scope

The following items fall under the purview of IT Service Portfolio Management’s scope of operations:

For an internal service provider, their execution of service portfolio management requires them to work closely with each business unit in the organization to assess the service investment and returns.For an external service provider, their execution of service portfolio management required them to be able to evaluate each service more overtly as each service should generate profit directly or support the services which are generating profit.

Portfolio Management Roles and Functions

Static Process Roles

• Service Portfolio Process Manager: The service portfolio process manager has to manage the entire process and is responsible for its effectiveness and efficiency.
• Service Portfolio Process Owner: The service portfolio process owner is the process initiator and is accountable for defining the strategic goals of the process and allocating all the resources required for the process
• SP Management Team: The service portfolio management team is the team associated with it’s process.

Dynamic Process Roles

• Service Agent: The role that is in charge of the current activity in the SPM process is shown in the Service Agent field of each service record. If the rules allow it, a functional escalation can be used to change the Service Agent.
• Service Owner: The person or board who is responsible for the overall budget as well as the particular charges associated with the service is known as the Service Sponsor.
• Service Sponsor:The individual or board that is accountable for the overall budget as well as the particular costs associated with the service is known as the Service Sponsor.
• Requirements Requestor: The requirements requestor can be a single person or a group of people who tell the IT service provider what new needs they need to meet.
• Service Design Team:The design of a service falls under the purview of the service design team, which is responsible for all of the associated responsibilities.

Portfolio Management Value

The following benefits of service portfolio management:

• It provides the firm with the information it needs to make sound investment and de-investment decisions in the service sector.
• It is through portfolio management that the IT services and the company’s strategic goals are more closely aligned.
• As a result, IT is no longer seen as a necessary evil, but as a tool that can add real value to a company.
• It improves the company’s ability to meet the needs of its customers.
• As a result, the company is given a clear picture of the IT service’s potential influence on the business.
• It aids in enhancing the productivity of employees by directing their attention and concentration to the most important and profitable services.

Portfolio Management Principles

The main principle of SM management is to enable a service provider to understand the following:

• The services provided by SPM
• The investments made in those services
• The strategy and objectives of each service in terms of business value.

As a result of this knowledge, the service provider is in a better position to manage and control its service at every stage of the service lifecycle.

There are 4 major phases of activity:

• Define: This phase entails the collecting and validation of the whole inventory, which includes all current and proposed services, as well as their business justifications.
• Analyze: During this step, the service provider figures out what services it needs to offer in order to reach its goals. In addition, it is determined how well the current service portfolio fits these needs and how to prioritize and balance supply and demand.
• Approve: Each service in the portfolio, as well as the amount of money invested in it, must be approved. Every update to a service in the portfolio must be approved as well. Even when a service is being phased out, clearance is needed.
• Charter: A charter is needed for each project that wants to build, improve, or get rid of a service. Documenting the scope of the project and defining the terms of reference, as well as approving any changes to the service portfolio, is the goal of the project charter.

Risks & Challenges

The following challenges can be encountered by service portfolio management:

• A lack of access to information is required for business.
• Absence of formal project management or change management.
• A service portfolio that is focused only on the service provider’s aspect of its services.
• Absence of a project or customer portfolio.

Some of the risks faced are as follows:

• Customer pressure can lead to ill-informed decisions regarding which services to offer and invest in.
• The services being offered cannot be measured adequately.

Conclusion

In general, the management of service portfolios ensures that businesses make the right choices regarding investments, establishing the business case, and having a clear grasp of the expected return on investment (ROI). Service portfolio management is the process of analyzing all of the important factors that must be considered in order to give clients access to high-quality information technology services and the expenditures that must be made in order to construct, run, and supply these services. Through the ITIL 4 Foundation certification program, you will not only have the opportunity to advance your career in Service Management, but you will also acquire helpful skills and best practices.

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