ITIL 4 - new concepts, more service value

With ITIL 4, the next evolutionary stage of best practices in service management was presented in 2019. Increasing requirements and new technologies such as Cloud or DevOps made a revision of the service management guidelines necessary. But what are the concrete differences to ITIL V3 and what added value does the new version offer companies and their IT departments?

This article explains these issues and shows the practical benefits of ITIL 4. It is an excerpt from a comprehensive white paper that USU wrote together with ITIL expert Stephen Mann.

The „Service Value System“

ITIL 4 puts value creation – or co-creation – front and center. It defines a generic operating model which IT organizations should use to individually describe, execute, monitor, and optimize their activities. This operating model defines best practices for all three of processes, organization, and technology. It specifies that all activities must start with a demand from the business and ultimately lead to added value for the business. ITIL 4 calls this value-oriented operating model the “service value system”.

The core of this operating model is the service value chain. It defines six generic activity types, which are necessary to produce value-adding services:

Figure 1: Service Value Chain with its 6 generic activity types
Source: AXELOS, “ITIL Foundation: ITIL 4 Edition” (2019)

These activity types are used to label the steps in specific value adding workflow chains. ITIL 4 calls these workflow chains “service value streams”. A simple value stream to resolve an incident can be described as follows:

• Demand – an employee has an issue they need assistance with
• Engage – they contact the service desk
• Deliver & support – the service desk agent fixes the issue
• Value – it’s at this point that the value is realized because the employee can be productive again.

The Meaning of Practices

In ITIL V3/2011 the individual disciplines of an IT organization were described with the help of 26 ITIL processes of four functions. In ITIL 4 this is done by defining 34 “practices.” Examples of ITIL 4 practices include well-known disciplines such as "incident management" or "service catalog management." However, there are completely new disciplines too, such as "workforce and talent management".

Practices go beyond the descriptions of the previous ITIL V3/2011 processes, with each ITIL 4 practice PDF covering the following:

• The practice’s roles in the service value chain (for example, to show that a practice focuses more on “Plan” activities than on “Deliver & support,” say)
• Processes applicable to the practice
• The organizations and people involved in the practice
• The information and technology needs of the practice
• Considerations for partners and suppliers relative to the practice.

Service Value Streams

As mentioned above, ITIL 4 calls value adding workflow chains “service value streams.” The ITIL 4 Foundation Book provides the following value stream examples:

• An end user needs an incident to be resolved
• An error in third-party software creates issues for an end user
• A business requirement for a significant new IT service
• A regulatory change requires new software development.

The detailed description of the first example using the generic activity types is:

Figure 2: Service Value Stream “incident resolution”
Source: AXELOS, “ITIL Foundation: ITIL 4 Edition” (2019)

And this is where the added value of the service value chain activity types becomes apparent. To represent a value-adding workflow, a Demand activity must mark the start and a Value activity must deliver the result. You can also quickly see if continuous improvement (activity type = Improve) is part of the process.

The following diagram shows the process flow of the service value stream example “incident resolution” introduced above. It shows the relationships between all the elements defined by ITIL 4: the service value stream, comprised of multiple service value chain activities, split up in a sequence of ITIL 4 processes from various ITIL 4 practices : 

Figure 3: Service Value Stream “incident resolution” with its service chain activities, practices and processes

This diagram also shows the basic idea of ITIL 4: it embeds processes in higher-level value streams to show where, and to prove that, these processes deliver value.

White Paper

The practical impact of ITIL 4

You want to know more about the ITIL 4 practices? This article is an excerpt from an extensive white paper that can be downloaded for free here:

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