In-Depth

Take Control of Business Services

• By John K. Waters
• October 1, 2005

IT/business alignment has been a top priority of CIOs for many years, obviously because enterprises want their IT and business people singing from the same sheet of music.

This perennial passion for bringing IT and business together continues to stir up an alphabet soup of three-letter solutions, the latest of which is BSM, or business services management.

BSM promises to provide a realistic way of forging that longed for link between IT operations and business management. But even if the new BSM offerings deliver, deploying them successfully is going to present IT with some serious challenges.

BSM is about correlating the performance of an organization’s business services (e-mail, supply chain management, CRM, ERP) with its IT infrastructure components (servers, applications, routers). It has been lately characterized as an approach or strategy for managing the IT environment from a business perspective. The problem with that definition is it allows vendors to stretch “BSM” over such a wide range of products that the label becomes thin. Dozens of vendors are currently using “BSM” in their marketing materials, but they’re not all providing the same solutions.

“There’s a lot of hype out there right now around BSM,” says Gartner analyst Debra Curtis. “IT organizations have to remember there is no magic fairy dust for aligning IT with their business unit customers, whatever the vendors may seem to be promising.”

Vendors are positioning BSM as the ultimate solution to the IT/business alignment challenge, essentially promising their products can transform IT from a cost center to a business enabler by aligning the delivery of IT with business process priorities.

“I think they are overstating the case when they talk about business processes,” says analyst Neil Macehiter of Macehiter Ward-Dutton. “The reality is that the vast majority of real business processes are not automated by IT. Processes depend on collaboration between people, which is often ad hoc in nature and poorly supported by the technologies, and which tend to be the focus of systems management solutions.”

Corporate culture shock
IT/business alignment presents significant cultural and organizational implications. Although a BSM solution can help get business and IT in sync, that relationship is as much about collaboration between those two groups as any solution on the market, Macehiter says. Consequently, no BSM project will succeed without a significant cultural shift.

Curtis defines BSM in narrow terms: “To me, BSM is not a strategy or an approach, but a product category.” Products in this category focus on IT apps and infrastructure components, she says. They have the ability to create an object model that shows how a business service depends on these components; to gather real-time or operational status information on those components, directly or through existing monitoring tools; and to process that information against the object model.

Gartner identifies products from companies including IBM, Hewlett-Packard, Computer Associates International, Interlink, Managed Object Solutions, Mercury Interactive, Micromuse, Proxima and BMC Software as meeting these criteria. Effective BSM products provide, among other features, correlation technology for comparing IT metrics against business metrics; service-modeling capabilities to help define the business services; and automation capabilities to let IT systems trigger alerts, generate trouble tickets and take action to resolve issues.

At this stage in BSM’s evolution, the success of a deployment depends less on the crop of products than on the maturity of the IT organization—how well it has defined what a business service is.

“Many IT organizations have not yet progressed to the point where they are thinking about what they deliver in terms of business-oriented services,” says Macehiter. “They’re still thinking about what they deliver in terms of CPU power or network bandwidth. It can take a while to work out the relationship with their business unit customers and come to the place where they have defined these business relevancies.”

It’s up to IT to figure it out, Macehiter says, because IT usually defines its own processes and services in a language that business can understand. “It’s about IT aligning with the business, he says. “Not the other way around.”

Boris Gdalevich, capacity performance manager at Quest Diagnostics, agrees. “It’s true that technical people typically prefer to work with technical stuff,” he says. “They want to concentrate on the things they understand perfectly. Monitoring processor utilization, for example, makes sense to a technical person. But this is a reactive approach, and not very effective for aligning IT with business. As an IT person, you must accept the responsibility for understanding the nature of the business, for finding ways to collect business-related information, and to understand, analyze and correlate this information. You can’t expect the business people to go so deep to understand IT.”

Divining business pattern changes
Quest Diagnostics is one of the country’s largest providers of diagnostic laboratory testing, information and services. Quest performs personal health testing on more than 100 million patients and more than 250 million diagnostic laboratory tests each year. Quest’s customers include patients and consumers, physicians, hospitals, health insurers, employers and government agencies.

The company maintains three major data centers in the U.S. alone, and hundreds of smaller data centers for labs around the world. Not surprisingly, Quest maintains a large IT department, with a staff of more than a thousand. Through mergers and acquisitions, the company has grown what Gdalevich describes as a “pretty wide infrastructure,” with a range of operating systems and applications.

Quest uses BMC’s Patrol product to monitor its diverse mix of servers and applications, which includes Oracle, Sybase and Microsoft SQL Server.

What appeals to Gdalevich about BSM is its potential for divining business pattern changes, which reflect more accurately the requirements IT needs to fulfill to truly support the business. Tools such as processor utilization monitors merely track changes without providing key, business-oriented variables.

“Let’s say your business unit manager tells you that a system that has been used by 1,000 doctors will soon be used by 10,000,” he says. “It would be simple if you could say, I know how much capacity 1,000 use, let’s just multiply by 10 and we’ll have the new capacity requirements. But that approach fails to take into account customer behavior. Three months ago, when the system was first rolled out, doctors didn’t use it very much. Now, three months later, they’re used to it and they use it a lot—say from 20 percent to 50 percent. So you must correlate two variables: number of users and business patterns.”

The promise of BSM is it will correlate these and other variables to provide a clear picture of how well a company’s network infrastructure responds to and supports certain IT services defined in business terms. Though the onus for translating IT’s processes and services into a language business can understand may fall on the technical people, there’s virtually no way to define IT services in business terms without working closely with the business unit customers, Curtis says.

“No BSM tool is going to miraculously provide these service definitions,” Curtis says. “It’s complicated and challenging work, but you have to start there.”

As the IT organization works with the business units to define how a business service should be monitored and managed, and how to measure the service in IT terms, it’s best to focus on where you’re likely to get the biggest bang for your buck, Macehiter advises.

“In terms of getting a better understanding of how your business is performing, you need to start with the key processes in your business that really make a difference,” he says. “Monitoring the processes that support non-differentiating aspects of your business—the processes that support your monthly payroll, for example—will have limited value in a BSM context.”

Subject to change
Although the processes that differentiate a business vary by vertical market, and even by organization within a market, virtually all of them live at the edge of the enterprise, where they actually touch customers and partners. In a company such as Wal-Mart, these are the processes that support relationships with its suppliers; in a company like Dell, they are the processes that allow customers to configure and select products, and then streamline the interactions with manufacturers and the relationships with their suppliers.

“These are processes that emphasize agility and flexibility,” Macehiter says, “that are subject to potentially frequent business-driven change and typically involve multiple customer and off-the-shelf application solutions.”

This is one of the most challenging questions IT organizations implementing BSM will be called upon to answer, says Gdalevich. “You have to decide which internal or external business services, processes or transactions the company cannot live without,” he says. “But don’t try to change the world overnight. Take the time to establish priorities.”

What is there to see?
Once you define the services and set the priorities, decide how to display the information. “What is it you want to see?” Gdalevich asks. “Do you want a workflow diagram, a hierarchical model, a pie chart? Don’t underestimate this step. You have internal and external consumers of this information, and they may have different ideas about how it should look.” Next, determine where that information lives in your system, and what its dependencies are; true service definitions must include all of the underlying components.

“In finance verticals, for example, the stock trade application is typically the service they provide,” Curtis explains. “So all of the network connections, all of the server components and all of the things that are required to enable that stock trade application are all part of this service definition.”

Where the information is physically stored is actually a secondary consideration, says Macehiter. The key issue is the ability to access that information in the context of the services that are being monitored and measured. This requires BSM solutions to integrate effectively with information and application integration solutions, as well as business intelligence/analytics solutions/business activity monitoring solutions—a capability for which many vendors are currently relying on niche vendor relationships.

Some IT organizations have a tendency to use the names of their business apps as a shorthand for the business services they deliver, Curtis says. They’ll say they are delivering an SAP service, for example, or a quote-to-order service for the CRM application they use. Although this is probably harmless in most organizations, the practice may encourage the organization to focus on the packaged application software and ignore the software components and infrastructure hardware required to enable it. Again: true service definitions include all underlying components and dependencies.

IT organizations that are truly ready for BSM are those that have also achieved a relatively high level of management process maturity, Macehiter says. These organizations have established good configuration management and rigorous change-management processes. They have deployed event-management and monitoring software to provide a source of data on how the components are doing. And they’ve worked out the business oriented services definitions, and they have a clear understanding of the logical linkages among those services.

“If you look at the typical evolution of an IT department,” says Gdalevich. “They start with a reactive strategy, and then move over time to a proactive strategy. Things like configuration management, change-management, event management and capacity monitoring are the first solutions they put in place. But these are reactive. As they move toward proactivity, they are forced to understand the business impact of specific servers, what system metrics could impact the business and to begin thinking about how they will correlate business and system information. For the first time, IT is being called upon to develop a clear understanding of the business. BSM can be helpful with this change, but not without significant efforts inside the company.”

Mature organizations also tend to have well-defined, business-oriented service level agreements in place; shared infrastructure services based on an increasingly virtualized infrastructure; organizational structures to facilitate collaboration between business and IT; and a policy-based approach to management and monitoring. They also tend to have standardized their IT processes, for example, around the IT Infrastructure Library.

Currently, the percentage of IT organizations that are mature enough to support a successful BSM deployment is relatively small, Macehiter says, leaving the vendors with a relatively narrow addressable market.

“Traditionally, the way we’ve managed IT systems has been within the context of the IT systems themselves,” Macehiter says. “It’s been about how well the servers or the network or the database is performing. The challenge now is to manage IT in the context of how good a job it’s doing for the business. That kind of shift in thinking won’t happen overnight. The IT organizations that have managed to become more business aligned and service-oriented have gone through a lot of work to get there.”

Despite the current size of the market, some industry watchers expect big things from BSM in the next few years. META Group (now part of Gartner) predicts that over the next 2 years, 15 percent of Global 2000 business will derive competitive advantages by using BSM, and 90 percent will initiate BSM projects by 2007.

“[These numbers] in no way mean that all of the companies that are initiating BSM projects are sufficiently mature from an IT perspective to reap the full benefits or to derive the maximum competitive advantage,” Macehiter says. “Initiating a BSM project does not require that an organization has reached the peak of IT maturity. BSM is not a short-term initiative, and both the benefits these organizations will derive from BSM and the level of IT maturity will evolve.”

The bottom line
The bottom line on BSM is hard to measure, because the products themselves are evolving, and because realizing the proposed benefits of BSM has significant organizational and cultural implications that are difficult to quantify. The ultimate costs are dependent on factors including the level of heterogeneity of the existing IT environment, the extent to which shared infrastructure services are deployed, the extent to which key business processes are automated, and the current systems management environment.

“I would go so far as to say that any figures would be misleading at this point,” say Macehiter. “It is important for readers to recognize that achieving the proposed benefits of BSM is an ongoing, evolutionary process.”

Both analysts agree that laying the necessary groundwork for BSM product deployment could be as valuable to the organization as the BSM project itself.

“When you do all these things—working with the business unit to define services, learning to link IT investments with business results—you improve the credibility of the IT organization,” Curtis says. “You are demonstrating that you understand the business requirements, that you know how your IT components relate to something that’s much more business relevant.”

According to Curtis, the process of gearing up appropriately for a BSM deployment earns IT credibility because the techies must go to a great deal of effort—effort that is highly visible to the business units—to understand the business. Business would recognize how the BSM project would pay off in large measure because of these preparations, and IT’s effort to turn itself into a more business-oriented organization is likely to make business feel that IT is on the same team, and they will take them more seriously. That’s worth a lot.


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