ITSM and Business Value Management: Addressing Core Challenges and Delivering Strategic Impact

Abstract

Business Value Management (BVM) is central to modern enterprises aiming to align strategic objectives with operational outcomes. Despite its importance, organisations often struggle to measure, realise, and sustain business value effectively. This paper examines the primary challenges in BVM and demonstrates how IT Service Management (ITSM) processes, aligned with the ITIL 4 framework, can overcome these challenges. Through structured alignment, measurable service delivery, and continual improvement, ITSM emerges as a powerful enabler of business value.

1. Introduction

In an increasingly digital business landscape, the mandate for IT departments has shifted from merely supporting operations to driving value. Business Value Management seeks to maximise outcomes from every investment, project, and service delivered. Yet, many organisations face systemic barriers, ranging from poor data visibility to siloed operations, that hinder value realisation.

IT Service Management, particularly when guided by ITIL best practices, provides a framework for aligning IT services with business goals, delivering reliable outcomes, and adapting dynamically to change. This paper explores how ITSM practices directly support BVM by breaking down the major problems and mapping them to ITSM-based solutions.

2. Common Challenges in Business Value Management

2.1 Lack of Value Visibility

One of the most pressing challenges in BVM is a lack of transparency into how IT initiatives translate into business outcomes. Leaders may invest in systems or services without clear KPIs or traceable impacts.

Symptoms:

• Unclear definition of "value"

• IT initiatives disconnected from strategic goals

• Failure to track outcomes post-deployment

2.2 Misalignment Between IT and Business

Business units often speak in terms of revenue, customer experience, or risk mitigation, while IT teams discuss uptime, ticket volumes, changes, MTTR, and throughput. This disconnect leads to divergent priorities and missed opportunities to evolve the business.

Symptoms:

• IT roadmaps not aligned with business objectives

• Business dissatisfaction with IT service delivery

• Tactical focus over strategic enablement

2.3 Ineffective Demand and Portfolio Management

Organisations frequently struggle to prioritise initiatives, fund value-generating projects, or retire low-value services.

Symptoms:

• Overloaded project pipelines

• Lack of visibility into resourcing schedules leading to bottlenecks

• Failure to decommission underperforming services

2.4 Insufficient Performance Measurement

Without robust performance indicators, value is often inferred rather than measured. This leads to subjective assessments, misjudged success, and limited improvement.

Symptoms:

• Inconsistent KPIs

• Lack of real-time reporting

• Manual or siloed data analysis

2.5 Inability to Adapt to Change

Rapid technological evolution demands agility, and organisations that lack the mechanisms for feedback and adaptation are invariably falling behind.

Symptoms:

• Rigid governance processes

• Long release cycles

• Reactive rather than proactive decision-making

3. How ITSM Supports Business Value Management

ITSM practices, particularly those based on ITIL 4, offer a systematic way to address these challenges. Below we explore how specific ITSM capabilities map to BVM requirements.

3.1 Service Strategy and Portfolio Management

Challenge Addressed: Misalignment and demand overload

ITSM Support:

• Service Portfolio Management helps identify, evaluate, and prioritise services that contribute to business value.

• Business Relationship Management facilitates continuous engagement with business units to capture demand and align roadmaps.

Example:
A retail chain uses ITSM to rationalise its service portfolio, focusing investment on mobile payment systems aligned with customer behaviour trends, while retiring outdated back-office systems.

Best Practice Tip:

Maintain a rolling service portfolio review cycle involving business stakeholders every quarter.

3.2 Value Stream Mapping

Challenge Addressed: Visibility and measurement

ITSM Support:

• ITIL 4's value stream mapping identifies how each service contributes to outcomes, helping track and optimise value delivery.

• Cross-functional mapping aligns IT activities with business workflows.

Example:
A financial institution maps its loan application value stream from online request to credit decision, pinpointing IT services that affect turnaround time and customer satisfaction.

Best Practice Tip:

Link every IT service to at least one value stream metric (e.g., transaction speed, conversion rate, service cost per use).

3.3 Service Level Management (SLM)

Challenge Addressed: Misalignment and vague expectations

ITSM Support:

• SLM formalizes agreements between IT and business, setting measurable, business-relevant expectations.

• It ensures IT focuses on outcomes, not just activities.

Example:
An insurance company includes claims cycle time and customer satisfaction scores as service level objectives for its claims processing platform.

Best Practice Tip:

Replace technical SLAs with OLAs and Experience Level Agreements (XLAs) for better business alignment.

3.4 Continual Improvement

Challenge Addressed: Adaptability and underperformance

ITSM Support:

• Continual Improvement embeds a feedback loop that reviews services, processes, and practices in light of changing business needs.

• It fosters agility by supporting experimentation and rapid iteration.

Example:
A manufacturing firm uses regular improvement sprints to refine its production analytics platform, reducing downtime by 15% in six months.

Best Practice Tip:

Establish a continual improvement register with business-linked improvement themes and owners.

3.5 Financial Management and Transparency

Challenge Addressed: Poor investment accountability

ITSM Support:

• ITIL’s Financial Management practice tracks cost, value, and return for each service.

• It supports value-based decision making, such as cost optimization and reinvestment.

Example:
A government agency uses financial transparency to shift spending from legacy systems toward digital citizen services with higher engagement.

Best Practice Tip:

Use a simple IT value scorecard that includes cost, usage, satisfaction, and outcome indicators.

3.6 Change Enablement

Challenge Addressed: Inability to adapt quickly

ITSM Support:

• Change Enablement ensures safe, swift adaptation of IT services without disrupting business value.

• Standard changes and automation reduce risk while accelerating outcomes.

Example:
A SaaS company automates deployment of low-risk updates using a change catalogue, enabling faster release cycles with fewer incidents.

Best Practice Tip:

Categorise changes by business impact and automate where possible to speed value delivery.

4. ITSM Practices in a Business Value Framework

To fully support BVM, ITSM must be woven into the broader business value ecosystem. Below is a mapping of ITSM practices to the four pillars of value realisation:

Value Definition

Service Portfolio, Business Analysis

Identify and prioritise high-impact opportunities

Value Planning

Financial Management, SLM

Budgeting, defining success, establishing targets

Value Delivery

Change Enablement, Request Management

Implement with minimal disruption

Value Measurement

SLM, Continual Improvement

Track, report, and optimise outcomes

5. Cross-Functional Collaboration and Culture

BVM isn’t just a process, it’s a mindset. ITSM supports cultural transformation by encouraging shared goals, transparency, and continual dialogue.

5.1 Embedding Business Value in Roles

• Service Owners are accountable for business outcomes, not just uptime.

• Business Relationship Managers translate strategic goals into service plans.

5.2 Governance and Decision-Making

• CABs should include business representatives.

• Improvement plans must be co-owned by business units.

Cultural Best Practice Tip:

Co-create service catalogues and SLAs with business input and not just IT authorship.

6. Real-World Examples of ITSM-Driven Value Management

Case Study 1: Healthcare Provider

Problem: Delays in patient discharge due to IT system downtimes.
ITSM Practice Applied: Service Level Management, Incident Management.
Outcome: SLAs aligned with patient throughput KPIs; discharge delays reduced by 25%.

Case Study 2: Global Retailer

Problem: Poor alignment between seasonal business campaigns and IT capacity.
ITSM Practice Applied: Capacity and Demand Management.
Outcome: 99.99% uptime during Black Friday; increased online sales by 18%.

Case Study 3: Logistics Company

Problem: Wasted investment in underused services.
ITSM Practice Applied: Financial Management, Service Portfolio Review.
Outcome: Decommissioned 15% of services, saving $3M annually.

7. Closing Thoughts

Business Value Management is essential for enterprises that want to thrive in dynamic markets. Yet, the path to consistent value realisation is fraught with challenges; many of which stem from misalignment, poor measurement, and lack of agility.

ITSM, when applied strategically, addresses these challenges head-on. Through practices like service portfolio management, value stream mapping, continual improvement, and change enablement, ITSM transforms IT from a cost centre to a value enabler.

To harness this potential, organisations must:

• Integrate ITSM deeply into value planning and review processes

• Evolve IT roles to include business accountability

• Invest in tooling and training to improve transparency and automation

Ultimately, ITSM provides the connective tissue that allows business value to not only be defined, but delivered, measured, and enhanced.

Final Thought:

“Value isn’t just what IT delivers—it’s what the business achieves through IT.”