INFO-TECH RESEARCH GROUP

Analyze Your Service Desk Ticket Data

Take a data-driven approach to service desk optimization.

EXECUTIVE BRIEF

Analyst Perspective

Benedict Chang Research Analyst, Infrastructure & Operations Info-Tech Research Group

Ken Weston ITIL MP, PMP, Cert.APM, SMC Research Director, Infrastructure & Operations Info-Tech Research Group

The perfect time to start analyzing your ticket data is now

Service desks improve their services by leveraging ticket data to inform their actions. However, many organizations don’t know where to start. It’s tempting to wait for perfect data, but there’s a lot of value in analyzing your ticket data as it exists today.

Start small. Track key tension metrics based on the out-of-the-box functionality in your tool. Review the metrics regularly to stay on track.

By reviewing your ticket data, you’re going to get better organically. You’re going to learn about the state of your environment, the health of your processes, and the quality of your services. Regularly analyze your data to drive improvements.

Make ticket analysis a weekly habit. Every week, you should be evaluating how the past week went. Every month, you should be looking for patterns and trends.

Executive Summary

Your Situation

Leverage your service desk ticket data to gain insights for improving your operations:

1. Use a data-based approach to allocate service desk resources.
2. Design appropriate SLOs and SLAs to better service end users.
3. Gain efficiencies for your shift-left strategy.
4. Communicate the current and future value of the service desk to the business.

Common Obstacles

Properly analyzing ticket data is challenging for the following reasons:

• Poor ticket hygiene and unclear ticket handling guidelines can lead to untrustworthy results.
• Undocumented tickets from various intake channels prevents you from seeing the whole picture.
• Service desk personnel are not sure where to start with analysis and are too busy to find time.
• Too many metrics are tracked to parse actionable insights from the noise.

Info-Tech’s Approach

Info-Tech’s approach to improvement:

• To reduce the noise, standardize your ticket data in a format that will ease analysis.
• Start with common analyses using the cleaned data set.
• Identify action items based on your ticket data.

Analyze your ticket data to help continually improve your service desk.

Slow down. Give yourself time.

Give yourself time to observe the new metrics and draw enough insights to make recommendations for improvement. Then, execute on those recommendations. Slow and steady improvement of the service desk only adds business value and will have a positive impact on customer satisfaction.

Your challenge

This research is designed to help service desk managers analyze their ticket data

Analyzing ticket data involves:

• Collecting ticket data and keeping it clean. Based on the metrics you’re analyzing, define ticket expectations and keep the data up to date.
• Showing the value of the service desk. SLAs are meaningless if they are not met consistently. The prerequisite to implementing proper SLAs is fully understanding the workload of the service desk.
• Understanding – and improving – the user experience. You cannot improve the user experience without meaningful metrics that allow you to understand the user experience. Different user groups will have different needs and different expectations of the level of service. Your metrics should reflect those needs and expectations.

36% of organizations are prioritizing ticket handling in IT for 2021 (Source: SDI, 2021)

12% of organizations are focusing directly on service desk improvement (Source: SDI, 2021)

Common obstacles

Many organizations face these barriers to analyzing their ticket data:

• Finding time to properly analyze ticket data is a challenge. Not knowing where to start can lead to not analyzing the proper data. Service desks end up either tracking too much data or not tracking the proper metrics.
• Data, even if clean, can be housed in various tools and databases. It’s difficult to aggregate data if the data is stored throughout various tools. Comparisons may also be difficult if the data sets aren’t consistent.
• Shifting left to move tickets toward self-service is difficult when there is no visibility into which tickets should be shifted left.

What your peers are saying about why they can’t start analyzing their ticket data:

• “My technicians do not consistently update and close tickets.”
• “My ITSM doesn’t have the capabilities I need to make informed decisions on shifting tickets left.”
• “My tickets are always missing data”
• “I’m constantly firefighting. I have no time for ticket data analysis.”
• “I have no idea where to start with the amount of data I have.”

Common obstacles that prevent effective ticket analysis

We asked IT service desk managers and teams about their biggest hurdles

Info-Tech’s approach

Repeat this analysis every business cycle:

• Gather Your Data
  Collect your ticket data OR start measuring the right metrics.
• Extract & Analyze
  Organize and visualize your data to extract insights
• Action the Results
  Implement low-effort improvements and celebrate quick successes.
• Implement Larger Changes
  Reference your ticket data while implementing process, tooling, and other changes.
• Communicate the Results
  Use your data to show the value of your effort.

Measure the value of this blueprint

Track these metrics as you improve

Use the data to tell you which aspects of IT need to be shifted left and which need to be automated

Your data will show you where you can improve.

As you act on your data, you should see:

• Lower costs per ticket
• Decreased average time to resolve
• Increased end-user satisfaction
• Fewer tickets escalated beyond Tier 1

See Info-Tech’s blueprint Optimize the Service Desk With a Shift-Left Strategy.

Info-Tech’s methodology for analyzing service desk tickets

Insight summary

Slow down. Give yourself time.

Give yourself time to observe the new metrics and draw enough insights to make recommendations for improvement. Then, execute on those recommendations. Slow and steady improvement of the service desk only adds business value and will have a positive impact on customer satisfaction.

Iterate on what to track rather than trying to get it right the first time.

Tracking the right data in your ticket can be challenging if you don’t know what you’re looking for. Start with standardized fields and iterate on your data analysis to figure out your gaps and needs.

If you don’t know where to go, ticket data can point you in the right direction.

If you have service desk challenges, you will need to allocate time to process improvement. However, prioritizing your initiatives is easier if you have the ticket data to point you in the right direction.

Start with data from one business cycle.

Service desks don’t need three years’ worth of data. Focus on gathering data for one business cycle (e.g. three months). That will give you enough information to start generating value.

Let the data do the talking.

Leverage the data to drive organizational and process change in your organization by tracking meaningful metrics. Choose those metrics using business-aligned goals.

Paint the whole picture.

Single metrics in isolation, even if measured over time, may not tell the whole story. Make sure you design tension metrics where necessary to get a holistic view of your service desk.

Blueprint deliverables

Blueprint benefits

IT Benefits

• Discover and implement the proper metrics to improve your service desk
• Use a data-based approach to improve your customer service and operational goals
• Increase visibility with the business and other IT departments using a structured presentation

Business Benefits

• Quicker resolutions to incidents and service requests
• Better expectations for the service desk and IT
• Better visibility into the current state, challenges, and goals of the service desk
• More effective support when contacting the service desk

Info-Tech offers various levels of support to best suit your needs

Diagnostics and consistent frameworks used throughout all four options

Guided Implementation

A Guided Implementation (GI) is a series of calls with an Info-Tech analyst to help implement our best practices in your organization.

A typical GI is 3-4 calls over the course of 2-3 months.

What does a typical GI on this topic look like?

Phase 1

• Call #1: Scope requirements, objectives, and your specific challenges. Enter your data into the tool.

Phase 2

• Call #2: Assess the current state across the different dashboards.

Phase 3

• Call #3: Identify improvements and insights to include in the communication report.
• Call #4: Review the service desk ticket analysis report.

PHASE 1

Import Your Ticket Data

This phase will walk you through the following activities:

• 1.1.1 Define your objectives for analyzing ticket data
• 1.1.2 Identify success metrics
• 1.1.3 Import your ticket data into the tool
• 1.1.4 Update your ticket fields for future analysis

This phase involves the following participants:

• Service Desk Manager
• ITSM Manager
• Service Desk Technician

1.1.1 Define your objectives for analyzing ticket data

Input: Understanding of current service desk process and ticket routing

Output: Defined objectives for the project

Materials: Whiteboard/flip charts, Ticket Analysis Report

Participants: Service Desk Staff, Service Desk Manager, IT Director, CIO

Use the discussion questions below as a guide

1. Identify your main objective for analyzing ticket data. Use these three sample objectives as a starting point:
   • Demonstrate value to the business by improving customer service.
   • Improve service desk operations.
   • Reduce the number of recurring incidents.
2. Answer the following questions as a group:
   • What challenges do you have getting accurate data for this objective?
   • What data is missing for supporting this objective?
   • What kind of issues must be solved for us to make progress on achieving this objective?
   • What decisions are held up from a lack of data?
   • How can better ticket data help us to more effectively manage our services and operations?

Document in the Ticket Analysis Report.

1.1.2 Identify success metrics

Select metrics that will track your progress on meeting the objective identified in Activity 1.1.1.

Input: Understanding of current service desk process and ticket routing

Output: Defined objectives for the project

Materials: Whiteboard/flip charts, Ticket Analysis Report

Participants: Service Desk Manager, IT Director, CIO

Use these sample metrics as a starting point:

Document in the Ticket Analysis Report.

Inefficient ticket-handling processes lead to SLA breaches and unplanned downtime

Analyze the ticket data to catch mismanaged or lost tickets that lead to unnecessary escalations and impact business profitability

• Ticket Category – Are your tickets categorized by type of asset? By service?
• Average Ticket Times – How long does it take to resolve or fulfill tickets?
• Ticket Priority – What is the impact and urgency of the ticket?
• SLA/OLA Violations – Did we meet our SLA objectives? If not, why?
• Ticket Channel – How was the issue reported or ticket received?
• Response and Fulfillment – Did we complete first contact resolution? How many times was it transferred?
• Associated Tasks and Tickets – Is this incident associated with any other tasks like change tickets or problem tickets?

Encourage proper ticket-handling procedures to enable data quality

Ensure everyone understands the expectations and the value created from having ticket data that follows these expectations

• Create and update tickets, but not at the expense of good customer service. Agents can start the ticket but shouldn’t spend five minutes creating the ticket when they should be troubleshooting the problem.
• Update the ticket when the issue is resolved or needs to be escalated. If agents are escalating, they should make sure all relevant information is passed along within the ticket to the next technician.
• Update user of ETA if issue cannot be resolved quickly.
• Ticket templates for common incidents can lead to fast creation, data input, and categorizations. Templates can reduce the time it takes to create tickets from two minutes to 30 seconds.
• Update categories to reflect the actual issue and resolution.
• Reference or link to the knowledgebase article as the documented steps taken to resolve the incident.
• Validate with the client that the incident is resolved; automate this process with ticket closure after a certain time.
• Close or resolve the ticket on time.

Info-Tech Insight

Ticket handling ensures clean handovers, whether it is to higher tiers or back to the customer. When filling the ticket out with information intended for another party, ensure the information is written for their benefit and from their point of view.

Service Desk Ticket Analysis Tool overview

The Service Desk Ticket Analysis Tool will help you standardize your ticket data in a meaningful format that will allow you to apply common analyses to identify the actions you need to take to improve service desk operations

TABS 1 & 2 INSTRUCTIONS & DATA ENTRY	TAB 3 : TICKET SUMMARY TICKET SUMMARY DASHBOARDS	TABS 4 to 8: DASHBOARDS INCIDENT SERVICE REQUEST CATEGORY
Input at least three months of your exported ticket data into the corresponding columns in the tool to feed into the common analysis graphs in the other tabs.	This tab contains multiple dashboards analyzing how tickets come in, who requests them, who resolves them, and how long it takes to resolve them.	These tabs each have dashboards outlining analysis on incidents and service requests. The category tab will allow you to dive deeper on commonly reported issues.

1.1.3 Import your data into our Service Desk Ticket Analysis Tool

You can still leverage your current data, but use this opportunity to improve your service desk ticket fields down the line

Input: ITSM data log

Output: Populated Service Desk Ticket Data Analysis Tool

Materials: Whiteboard/flip charts, Service Desk Ticket Analysis Tool

Participants: Service Desk Manager, Service Desk Technicians

Start here:

• Extract your ticket data from your ITSM tool in an Excel or text format.
• Look at the fields on the data entry tab of the Service Desk Ticket Analysis Tool.
• Fill the fields with your ticket data by copying and pasting relevant sections. It is okay if you don’t have all the fields, but take note of the fields you are missing.
• With the list of the fields you are missing, run through the following activity to decide if you will need to adopt or add fields to your own service desk ticket tool.

When entering your data, pay close attention to the following fields:

• Time to Resolve: This is automatically calculated using data in the Open Date, Open Time, Close Date, and Close Time fields. You have three options for entering your data in these fields:
  1. Enter your data as the fields describe. Ensure your data contain only the field description (e.g. Open Date separated from Open Time). If your data contain Open Date AND Open Time, Excel will not show both.
  2. Enter your data only in Open Date and Close Date. If your ITSM does not separate date and time, you can keep the data in a single cell and enter it in the column. The formula in Time to Resolve will still be accurate.
  3. If your ITSM outputs Time to Resolve, overwrite the formula in the Time to Resolve column.
• SLA: If your ITSM outputs SLA fulfilled: Y/N, enter that directly into the SLA Fulfilled column.
• Blank Columns: If you do not have data for all the columns, that is okay. Continue with the following activity. Note that some stock dashboards will be empty if that is the case.
• Incidents vs. Service Requests: If you separate incidents and service requests, be sure to capture that in the SR/Incident for Tabs 4 and 5. If you do not separate the two, then you will only need to analyze Tab 3.

Use Info-Tech’s tool instead of building your own. Download the Service Desk Ticket Analysis Tool.

1.1.4 Update your ticket fields for future analysis

Input: Populated Service Desk Ticket Data Analysis Tool

Output: New ticket fields to track

Materials: Whiteboard/flip charts, Service Desk Ticket Analysis Tool

Participants: Service Desk Manager, Service Desk Technicians

As a group, pay attention to the ticket fields populated in the tool as well as the ticket fields that you were not able to populate. Use the example “Fields Captured” table to the right, which lists all fields present in the ticket analysis tool.

Discuss the following questions:

1. Consider the fields not captured. Would it be valuable to start capturing that data for future analysis?
2. If so, does your ITSM support that field?
3. Can you make the change in-house or do you have to bring in an external ITSM administrator to make the change?
4. Capture the results in the Ticket Analysis Report.

Document in the Ticket Analysis Report.

Info-Tech Insight

Don’t wait for your ticket quality to be perfect. You can still draw actions from your ticket data. They will likely be process improvements initially, but the exercise of pulling the data is a necessary first step.

Common ticket fields tracked by your peers

Which of these metrics do you track and action?

• Remember you don’t have to track every metric. Only track metrics that are actionable.

For each metric that you end up tracking:

• Look for trends over time.
• Brainstorm reasons why the metric could rise or fall.

Associate a metric with each improvement you execute.

• Performing this step will allow you to better see the value from your team’s efforts.
• It will also give you a quicker response than waiting for spikes in your data.

(Source: Info-Tech survey, 2021; N=20)

PHASE 2

Analyze Your Ticket Data

This phase will walk you through the following activities:

• 2.1.1 Review high-level ticket dashboards
• 2.2.1 Review incident, service request, and ticket category dashboards

This phase involves the following participants:

• Service Desk Manager
• Service Desk Technicians
• IT Managers

Visualize your ticket data as a first step to analysis

Identifying trends is easier when looking at diagrams, graphs, and figures

Start your analysis with common visuals employed by other service desk professionals

• Phase 2 will walk you through visualizing your data to get a better understanding of your ticket intake, incident management, and service request management.
• Each step will walk you through:
  • Common visualizations used by service desks
  • Patterns to look for in your visualizations
  • Actions to take to address negative patterns and to continue positive trends
• Share diagrams that underscore both the value being provided by the service desk as well as the scope of the pain points. Use Info-Tech’s Ticket Analysis Report template as a starting point.

“Being able to tell stories with data is a skill that’s becoming ever more important in our world of increasing data and desire for data-driven decision making. An effective data visualization can mean the difference between success and failure when it comes to communicating the findings of your study, raising money for your nonprofit, presenting to your board, or simply getting your point across to your audience.” - Cole Knaflic, Founder and CEO, Storytelling with Data: A Data Visualization Guide for Business Professionals

Use the detailed dashboards to determine the next steps for improvement

A single number doesn’t tell the whole picture

Analyze trends over time:

• Analyze trends by day, by week, by month, and by year to determine:
  • When are the busy periods? (E.g. Do tickets tend to spike every morning, every Monday, or every September?)
  • When are the slow periods? (E.g. Do tickets drop at the end of the day, at midday, on Fridays, or over the summer?)
• Are spikes or drops in volume consistent trends or one-time anomalies?

Then build a plan to address them:

• How will you handle volume spikes, if they’re consistent?
• What can your resources work on during slow times, if they are consistent?
• If you assume no shrinkage, can you handle the peaks in volume if you make all FTEs available to work on tickets at a certain time of day?

Look for seasonal trends. In this example, we see high ticket volumes in May and January, with lower ticket volumes in June and July when many staff are taking holidays. However, also be careful to look at the big picture of how you pulled the data. August through October sees a high volume of open tickets because the data set is pulled in November, not because there’s a seasonal spike on tickets not closing at the end of the fiscal year.

Track ticket data over time

Make low-effort adjustments before major changes

Don’t rush to a decision based off the first numbers you see

Review ticket summary dashboard

Ideally, you should track ticket patterns over an entire year to get a full sense of trends within each month of the year. At minimum, track for 30 days, then 60, then 90, and see if anything changes. The longer you can track ticket patterns, the more accurate your picture will be.

Review additional dashboards

If you separate incidents and service requests, and you have accurate ticket categories, then you can use these dashboards to further break down the data to identify ticket trends.

The output of the ticket analysis will only be as accurate as its input.
To get the most accurate results, first ensure your data is accurate, then analyze it over as much time as possible. Aggregating with accurate data will give you a better picture of the trends in demand that your service desk sees.

Not separating incidents and service requests? Need to fix your ticket categories? Visit Standardize the Service Desk to get started.

Analyze incidents and requests separately

Each type has its own set of customer experiences and expectations

• Different ticket types are associated with radically different prioritization, routing, and service levels. For instance, most incidents are resolved within a business day, but requests take longer to implement.
• If you fail to distinguish between ticket types, your metrics will obscure service desk performance.
• From a ticket analysis standpoint, separating ticket types prior to analysis or, better yet, at intake allows for cleaner data. In turn, this means more structured analyses, better insights, and more meaningful actions. Not separating ticket types may still get you to the same conclusions, but it will be much more difficult to sift through the data.

Incident

An unanticipated interruption of a service.
The goal of incident management is to restore the service as soon as possible, even if the resolution involves a workaround.

Request

A generic description for a small change or service access.
Requests are small, frequent, and low risk. They are best handled by a process distinct from incident, change, and project management.

Not separating incidents and service requests? Need to fix your ticket categories? Visit Standardize the Service Desk to get started.

Step 2.1

Analyze Your High-Level Ticket Data

Dashboards

• Ticket Volume
• Ticket Intake
• Ticket Handling and Resolution
• Ticket Categorization

This step will walk you through the following activities:

Visualize the current state of your service desk.

This step involves the following participants:

• Service Desk Manager
• Service Desk Technicians
• IT Managers

Outcomes of this step

Build your metrics baseline to compare with future metric results.

Dashboards: Ticket Volume

Analyze your data for insights

• Analyze volume trends by day, by week, by month, and by year to determine:
  • When are the busy periods? (E.g. Do tickets tend to spike every morning, every Monday, or every September?)
  • When are slow periods? (E.g. Do tickets drop at the end of the day, at midday, on Fridays, or over the summer?)
• Are spikes or drops in volume consistent trends or one-time anomalies?
• What can your resources be working on during slow times? Are you able to address ticket backlog?

Dashboards: Ticket Intake

Analyze your data for insights

• Determine how to drive intake to the most appropriate solution for your organization:
  • A web portal is the most efficient intake method, but it must be user friendly to increase its adoption.
  • The phone should be available for urgent requests or incidents. Encourage those who call with a request to submit a ticket through the portal.
  • Discourage use of email if it is unstructured, as users don’t provide enough detail, and often two or three transactions are required for triage.
  • If walk-ups are encouraged, structure and formalize the support so it can be resourced and managed rather than interrupt-driven.

Dashboard: Ticket Handling and Resolution

Analyze your data for insights

• Look at your ticket load by technician and by tier. This is an essential step to set your baseline to measure your shift-left initiatives. If you are focusing on self-service or Tier 1 training, the ticket load from higher tiers should decrease over time.
• If Tiers 2 and 3 are handling the majority of the tickets, this could be a red flag indicating tickets are inappropriately escalated or Tier 1 could use more training and support.
• For average time to resolve and average time to resolve by tier, are you meeting your SLAs? If not, are your SLAs too aggressive? Are tickets left open and not properly closed?

Dashboard: Ticket Categorization

Analyze your data for insights

• Ticket categorization is critical to clean data. Having a categorization scheme with categories that are miscellaneous, too specific, or too general easily leads to inaccurate reporting or confusing workflows for technicians.
• When looking at your ticket categories, first look for duplicate categories that could be collapsed into one.
• Also look at your top five to seven categories and see if they make sense. Are these good candidates in your organization for automation or shift-left?
• Compare your Tier 1 categories. The level of specificity for these categories should be comparable to easily run reports. If they are not, assess the need for a category redesign.

Step 2.2

Analyze Incidents, Service Requests, and Ticket Categories

Dashboards

• Incidents
• Service Requests
• Volume by Ticket Category
• Resolution Times by Priority and/or Category
• Tabs for More Granular Investigation and Reporting

This step will walk you through the following activities:

Visualize your incident and service request ticket load and analyze trends. Use this information and cross reference data sets to gain a holistic view of how the service desk interacts with IT and the business.

This step involves the following participants:

• Service Desk Manager
• Service Desk Technicians
• IT Managers

Outcomes of this step

Gain actionable, data-driven improvements based on your incident and service request data. Show the value of the service desk and highlight improvements needed.

Incident and Service Requests Dashboard: Priority and SLA

Analyze your data for insights

• Your ticket priority distribution for overall load and time to resolve (TTR) should look something like above with low-priority tickets having higher load and TTR and high/critical-priority tickets having a lower load and lower TTR. If it is reversed, that is a good indication that the service desk is too reactive or isn’t properly prioritizing its work.
• If your SLA has a high failure rate, consider reassessing your targets with SLOs that you can meet before publishing them as achievable SLAs.

Incident and Service Requests Dashboard: Priority and SLA

Analyze your data for insights

• Examine your ticket handling by looking at ticket status and resolution codes.
  • If you have a lot of blanks, then tickets are not properly handled. Consider reinforcing your standards for close codes and statuses.
  • Alternatively, if tickets are left open, you may have to build follow-ups on stale tickets into your process or introduce proper auto-close processes.

Category, Resolution Time, and Resolution Code Dashboards

These PivotCharts allow you to dig deeper

Investigate whether there are trends in ticket volume and resolution times within specific categories and subcategories

Tab 6, Category Dashboard; tab 7, Resolution Time Dashboard; and tab 8, Resolution Code Dashboard are PivotCharts. Use these tabs to investigate whether there are trends in ticket volume, resolution times, and resolution codes within specific categories and subcategories.

Start with the charts that are available. The +/- buttons will allow you to show more granular information. By default, this granularity will be into the levels of the ticket categorization scheme.

For most categorization schemes, there will be too many categories to properly graph. You can apply a filter to investigate specific categories by clicking on the drop-down buttons.

Use these tabs for more granular investigation and reporting

TAB 6 CATEGORY DASHBOARD	TAB 7 RESOLUTION TIME DASHBOARD	TAB 8 RESOLUTION TIME DASHBOARD
Investigate ticket distributions in first, second, and third levels. Are certain categories overcrowded, suggesting they can be split? Are certain categories not being used?	Do average resolution times match your service level agreements? Do certain categories have significantly different resolution times? Are there areas that can benefit from shift-left?	Are resolution codes being accurately used? Are there trends in resolution codes? Are these codes providing sufficient information for problem management?

PHASE 3

Communicate Your Insights

This phase will walk you through the following activities:

• 3.1.1 Review common recommendations
• 3.2.1 Review ticket reports daily
• 3.2.2 Incorporate ticket data into retrospectives and team updates
• 3.2.3 Regularly review trends with business leaders
• 3.2.4 Tell a story with your data

This phase involves the following participants:

• Service Desk Manager
• Service Desk Technicians
• IT Managers

Step 3.1

Build Recommendations Based on Your Ticket Data

Activities

• 3.1.1 Review common recommendations

This step will walk you through the following activities:

Review common recommendations as a first step to extracting insights from your own data.

This step involves the following participants:

• Service Desk Manager
• Service Desk Technicians

Outcomes of this step

You will gain an understanding of the common challenges with service desks and ticket analysis in general. See which ones apply to you to inform your ticket data analysis moving forward.

Review these common recommendations

1. Fix your ticket categories
   Organize your ticket categorization scheme for proper routing and reporting.
2. Focus more on self-service
   Self-service is essential to enable shift-left strategies. Focus on knowledgebase processes and portal ease of use.
3. Update your service catalog
   Improve your service catalog, if necessary, to make it easy for end users to request services and for the service desk to provide those services.
4. Direct volume toward other channels
   Walk-ups make it more difficult to properly log tickets and assign service desk resources. Drive volume to other channels to improve your ticket quality.
5. Crosstrain Tier 1 on certain topics
   Tier 1 breadth of knowledge is essential to drive up first contact resolution.
6. Build more automation
   Identify bottlenecks and challenges with your ticket data to streamline ticket handling and resolution.
7. Revisit service level agreements
   Update your SLAs and/or SLOs to prioritize expectation management for your end users.
8. Improve your data quality
   You can only analyze data that exists. Revisit your ticket-handling guidelines and more regularly check tickets to ensure they comply with those standards.

Optimize your processes and look for opportunities for automation

Leverage Info-Tech research to improve service desk processes

Review your service desk processes and tools for optimization opportunities:

• Clearly establish ticket-handling guidelines.
• Use ticket templates to reduce time spent entering tickets.
• Document incident management and service request fulfillment workflows and eliminate any unnecessary steps.
• Automate manual tasks wherever possible.
• Build or improve a self-service portal with a knowledgebase to allow users to resolve their own issues, reducing incoming ticket volume to the service desk.
• Optimize your internal knowledgebase to reduce time spent troubleshooting recurring issues.
• Leverage AI capabilities to speed up ticket processing and resolution.

Standardize the Service Desk

This project will help you build and improve essential service desk processes, including incident management, request fulfillment, and knowledge management.

Optimize the Service Desk With a Shift-Left Strategy

This project will help you build a strategy to shift service support left to optimize your service desk operations and increase end-user satisfaction.

Step 3.2

Action and Communicate Your Ticket Data

Activities

• 3.2.1 Review your ticket queues daily
• 3.2.2 Incorporate ticket data into retrospectives and team status updates
• 3.2.3 Regularly review trends with business leaders
• 3.2.4 Tell a story with your data

This step will walk you through the following activities:

Organize your scrums to report on the metrics that will inform daily and monthly operations.

This step involves the following participants:

• Service Desk Manager
• Service Desk Technicians
• IT Managers

Outcomes of this step

Use the dashboards and data to inform your daily and monthly scrums.

3.2.1 Review your ticket queues daily

Clean data is still useless if not used properly

• The metrics you’ve chosen to measure and visualize in the previous step are useful for informing your day-to-day, week-to-week, and month-to-month strategies for the service desk and IT. Conduct scrums daily to action your dashboard data to help clear ticket queues.
• Reference your dashboards daily with each IT team.
• You need to have a dashboard of open tickets assigned to each team.

Review Daily

• Ticket volume over the last day (look for spikes)
• SLA breach risks/SLA breaches
• Recurring incidents
• Tickets open
• Tickets handed over (confirmation of handover)

3.2.2 Incorporate ticket data into retrospectives and team status updates

Explain your metric spikes and trends

• Hold weekly or monthly meetings to review the ticket trends selected during Phases 1 and 2 of this blueprint.
• Review ticket spikes, identify seasonal trends, and discuss root causes (e.g. projects/changes going live, onboarding blitz).
• Discuss any actions associated with spikes and seasonal trends (e.g. resource allocation, hiring, training).
• You can incorporate other IT leaders or departments in this meeting as needed to discuss action items for improvement, quality assurance concerns, customer service concerns, and/or operating level agreement concerns.

Review Weekly/Monthly

• Ticket volume
• Ticket category by priority level over time
• Tickets from different business groups, VIP groups, and different vertical levels
• Tickets escalated, tickets that didn’t need to be escalated, tickets that were incorrectly escalated
• Ticket priority levels over time
• Most requested services
• Tickets resolved by which group over time
• Ability to meet SLAs and OLAs over time by different groups

3.2.3 Regularly review trends with business leaders

Use your data to help improve business relationships

Review the following with business leaders:

• Volume of work done this past time cycle for the leader’s group
• Trends and spikes in the data and possible explanations for them (note: get their input on the potential causes of trends)
• Improvements you plan to execute within the service desk
• Action items you need from the business leader

Use your data to show the value you provide to the group. Schedule quarterly meetings with the heads of different business groups to discuss the work that the service desk does for each group.

Show trends in incidents and service requests: “I see you have a spike in CRM tickets. I’ve been working with the CRM team to address this issue.”

3.2.4 Tell a story with your data

Effectively communicate with the business and leadership

• With your visualized metrics, organize your story into a presentation for different stakeholder groups. You can use the Ticket Analysis Report as a starting point to provide data about:
  • Value provided by the service desk
  • Successes
  • Opportunities for Improvements
  • Current state of KPIs
• Include information about the causes of data trends and actions you will take in response to the data.
• For each of these themes, look at the metrics you’ve chosen to track and see which ones fit to tell the story. Let the data do the talking.
• Consider supplementing the ticket data with data from other systems. For example, you can include data on transactional customer satisfaction surveys, knowledgebase utilization, and self-service utilization.

Download the Ticket Analysis Report.

Ticket Analysis Report

Include the following information as you build your ticket analysis report:

• Value Provided by the Service Desk
  Start with the value provided by the service desk to different areas of the business. Include information about first contact resolution, average resolution times, ticket volume (e.g. by category, priority, location, requestor).
• Successes
  Successes is a general field that can include how process improvements have impacted the service desk or how initiatives have enhanced shift-left opportunities. Highlight any positive trends over time.
• Opportunities for Improvement
  Let the data guide the conversation to where improvements can be made. Day-to-day ops, self-service tools, shifting work left from Tier 2, Tier 3, standardizing a non-standard service, and staffing adjustments are possibilities for this section.
• Current State of KPIs
  Mean time to resolve, FCR, ticket volume, and end-user satisfaction are great KPIs to include as a starting point.

Download the Ticket Analysis Report.

Summary of Accomplishment

Problem Solved

You now have a better understanding of how to action your service desk ticket data, including improvements to your current ticket templates for incidents and service requests.

You also have the data to craft a story to different stakeholder groups to celebrate the successes of the service desk and highlight possible improvements. Continue this exercise iteratively to continue improving the service desk.

Remember, ticket analysis is not a single event but an ongoing initiative. As you track, analyze, and action more data, you will find more improvements.

If you would like additional support, have our analysts guide you through other phases as part of an Info-Tech workshop.

Contact your account representative for more information.

workshops@infotech.com 1-888-670-8889

Additional Support

If you would like additional support, have our analysts guide you through other phases as part of an Info-Tech workshop.

Contact your account representative for more information.

workshops@infotech.com 1-888-670-8889

To accelerate this project, engage your IT team in an Info-Tech workshop with an Info-Tech analyst team. Info-Tech analysts will join you and your team at your location or welcome you to Info-Tech’s historic Toronto office to participate in an innovative onsite workshop.

The following are sample activities that will be conducted by Info-Tech analysts with your team:

Analyze your dashboards An analyst will walk through the ticket data and dashboards with you and your team to help interpret the data and tailor improvements	Populate your ticket data report Given the action items from this solution set, an analyst will help you craft a report to celebrate the successes and highlight needed improvements in the service desk.

Related Info-Tech Research

Optimize the Service Desk With a Shift-Left Strategy

The best type of service desk ticket is the one that doesn’t exist.

Incident & Problem Management

Don’t let persistent problems govern your department.

Design & Build a User-Facing Service Catalog

Improve user satisfaction with IT with a convenient menu-like catalog.

Bibliography

Bayes, Scarlett. “ITSM: 2021 & Beyond.” Service Desk Institute, 2021. Web.

“Benchmarking Report v.9.” Service Desk Institute, 17 Jan. 2020. Web.

Bennett, Micah. “The 9 Help Desk Metrics That Should Guide Your Customer Support.” Zapier, 3 Dec. 2015. Web.

“Global State of Customer Service: The transformation of customer service from 2015 to present day.” Microsoft Dynamics 365, Microsoft, 2020. Web.

Goodey, Ben. “How to Manually Analyze Support Tickets.” SentiSum, 26 July 2021. Web.

Jadhav, Megha. “Four Metrics to Analyze When Using Ticketing Software.” Vision Helpdesk Blog, 21 Mar. 2016. Web.

Knaflic, Cole Nussbaumer. Storytelling with Data: A Data Visualization Guide for Business Professionals. Wiley, 2015.

Li, Ta Hsin, et al. “Incident Ticket Analytics for IT Application Management Services.” 2014 IEEE International Conference on Services Computing, 2014. Web.

Olson, Sarah. “10 Help Desk Metrics for Service Desks and Internal Help Desks.” Zendesk Blog, Sept. 2021. Web.

Paramesh, S.P., et al. “Classifying the Unstructured IT Service Desk Tickets Using Ensemble of Classifiers.” 2018 3rd International Conference on Computational Systems and Information Technology for Sustainable Solutions (CSITSS), 2018. Web.

Volini, Erica, et al. “2021 Global Human Capital Trends: Special Report.” Deloitte Insights, 21 July 2021. Web.

“What Kind of Analysis You Can Perform on a Ticket Management System.” Commence, 3 Dec. 2019. Web.

INFO-TECH RESEARCH GROUP

Develop an Availability and Capacity Management Plan

Manage capacity to increase uptime and reduce costs.

ANALYST PERSPECTIVE

The cloud changes the capacity manager’s job, but it doesn’t eliminate it.

"Nobody doubts the cloud’s transformative power. But will its ascent render “capacity manager” an archaic term to be carved into the walls of datacenters everywhere for future archaeologists to puzzle over? No. While it is true that the cloud has fundamentally changed how capacity managers do their jobs , the process is more important than ever. Managing capacity – and, by extent, availability – means minimizing costs while maximizing uptime. The cloud era is the era of unlimited capacity – and of infinite potential costs. If you put the infinity symbol on a purchase order… well, it’s probably not a good idea. Manage demand. Manage your capacity. Manage your availability. And, most importantly, keep your stakeholders happy. You won’t regret it."

Jeremy Roberts,

Consulting Analyst, Infrastructure Practice

Info-Tech Research Group

Availability and capacity management transcend IT

This Research Is Designed For:

✓ CIOs who want to increase uptime and reduce costs

✓ Infrastructure managers who want to deliver increased value to the business

✓ Enterprise architects who want to ensure stability of core IT services

✓ Dedicated capacity managers

This Research Will Help You:

✓ Develop a list of core services

✓ Establish visibility into your system

✓ Solicit business needs

✓ Project future demand

✓ Set SLAs

✓ Increase uptime

✓ Optimize spend

This Research Will Also Assist:

✓ Project managers

✓ Service desk staff

This Research Will Help Them:

✓ Plan IT projects

✓ Better manage availability incidents caused by lack of capacity

Executive summary

Situation

• IT infrastructure leaders are responsible for ensuring that the business has access to the technology needed to keep the organization humming along. This requires managing capacity and availability.
• Dependencies go undocumented. Services are provided on an ad hoc basis, and capacity/availability are managed reactively.

Complication

• Organizations are overprovisioning an average of 59% for compute, and 48% for storage. This is expensive. With budget pressure mounting, the cost of this approach can’t be ignored.
• Lead time to respond to demand is long. Half of organizations have experienced capacity-related downtime, and almost 60% wait 3+ months for additional capacity. (451 Research, 3)

Resolution

• Conduct a business impact analysis to determine which of your services are most critical, and require active capacity management that will reap more in benefits than it produces in costs.
• Establish visibility into your system. You can’t track what you can’t see, and you can’t see when you don’t have proper monitoring tools in place.
• Develop an understanding of business needs. Use a combination of historical trend analyses and consultation with line of business and project managers to separate wants from needs. Overprovisioning used to be necessary, but is no longer required.
• Project future needs in line with your hardware lifecycle. Never suffer availability issues as a result of a lack of capacity again.

Info-Tech Insight

1. Components are critical. The business doesn’t care about components. You, however, are not so lucky…
2. Ask what the business is working on, not what they need. If you ask them what they need, they’ll tell you – and it won’t be cheap. Find out what they’re going to do, and use your expertise to service those needs.
3. Cloud shmoud. The role of the capacity manager is changing with the cloud, but capacity management is as important as ever.

Save money and drive efficiency with an effective availability and capacity management plan

Overprovisioning happens because of the old style of infrastructure provisioning (hardware refresh cycles) and because capacity managers don’t know how much they need (either as a result of inaccurate or nonexistent information).

According to 451 Research, 59% of enterprises have had to wait 3+ months for new capacity. It is little wonder, then, that so many opt to overprovision. Capacity management is about ensuring that IT services are available, and with lead times like that, overprovisioning can be more attractive than the alternative. Fortunately there is hope. An effective availability and capacity management plan can help you:

• Identify your gold systems
• Establish visibility into them
• Project your future capacity needs

Balancing overprovisioning and spending is the capacity manager’s struggle.

Availability and capacity management go together like boots and feet

Availability and capacity are not the same, but they are related and can be effectively managed together as part of a single process.

If an IT department is unable to meet demand due to insufficient capacity, users will experience downtime or a degradation in service. To be clear, capacity is not the only factor in availability – reliability, serviceability, etc. are significant as well. But no organization can effectively manage availability without paying sufficient attention to capacity.

"Availability Management is concerned with the design, implementation, measurement and management of IT services to ensure that the stated business requirements for availability are consistently met."

– OGC, Best Practice for Service Delivery, 12

"Capacity management aims to balance supply and demand [of IT storage and computing services] cost-effectively…"

– OGC, Business Perspective, 90

Integrate the three levels of capacity management

Successful capacity management involves a holistic approach that incorporates all three levels.

The C-suite cares about business capacity as part of the organization’s strategic planning. Service leads care about their assigned services. IT infrastructure is concerned with components, but not for their own sake. Components mean services that are ultimately designed to facilitate business.

A healthcare organization practiced poor capacity management and suffered availability issues as a result

CASE STUDY

Industry: Healthcare

Source: Interview

New functionalities require new infrastructure

There was a project to implement an elastic search feature. This had to correlate all the organization’s member data from an Oracle data source and their own data warehouse, and pool them all into an elastic search index so that it could be used by the provider portal search function. In estimating the amount of space needed, the infrastructure team assumed that all the data would be shared in a single place. They didn’t account for the architecture of elastic search in which indexes are shared across multiple nodes and shards are often split up separately.

Beware underestimating demand and hardware sourcing lead times

As a result, they vastly underestimated the amount of space that was needed and ended up short by a terabyte. The infrastructure team frantically sourced more hardware, but the rush hardware order arrived physically damaged and had to be returned to the vendor.

Sufficient budget won’t ensure success without capacity planning

The project’s budget had been more than sufficient to pay for the extra necessary capacity, but because a lack of understanding of the infrastructure impact resulted in improper forecasting, the project ended up stuck in a standstill.

Manage availability and keep your stakeholders happy

If you run out of capacity, you will inevitably encounter availability issues like downtime and performance degradation . End users do not like downtime, and neither do their managers.

There are three variables that are monitored, measured, and analyzed as part of availability management more generally (Valentic).

1. Uptime:

The availability of a system is the percentage of time the system is “up,” (and not degraded) which can be calculated using the following formula: uptime/(uptime + downtime) x 100%. The more components there are in a system, the lower the availability, as a rule.

1. Reliability:

The length of time a component/service can go before there is an outage that brings it down, typically measured in hours.

1. Maintainability:

The amount of time it takes for a component/service to be restored in the event of an outage, also typically measured in hours.

Enter the cloud: changes in the capacity manager role

There can be no doubt – the rise of the public cloud has fundamentally changed the nature of capacity management.

Vendors will sell you the cloud as a solution to your capacity/availability problems

Traditionally, increases in capacity have come in bursts as a reaction to availability issues. This model inevitably results in overprovisioning, driving up costs. Access to the cloud changes the equation. On-demand capacity means that, ideally, nobody should pay for unused capacity.

Reality check: even in the cloud era, capacity management is necessary

You will likely find vendors to nurture the growth of a gap between your expectations and reality. That can be damaging.

The cloud reality does not look like the cloud ideal. Even with the ostensibly elastic cloud, vendors like the consistency that longer-term contracts offer. Enter reserved instances: in exchange for lower hourly rates, vendors offer the option to pay a fee for a reserved instance. Usage beyond the reserved will be billed at a higher hourly rate. In order to determine where that line should be drawn, you should engage in detailed capacity planning. Unfortunately, even when done right, this process will result in some overprovisioning, though it does provide convenience from an accounting perspective. The key is to use spot instances where demand is exceptional and bounded. Example: A university registration server that experiences exceptional demand at the start of term but at no other time.

Use best practices to optimize your cloud resources

Even in the era of elasticity, capacity planning is crucial. Spot instances – the spikes in the graph above – are more expensive, but if your capacity needs vary substantially, reserving instances for all of the space you need can cost even more money. Efficiently planning capacity will help you draw this line.

Evaluate business impact; not all systems are created equal

Limited resources are a reality. Detailed visibility into every single system is often not feasible and could be too much information.

Simple and effective. Sometimes a simple display can convey all of the information necessary to manage critical systems. In cars it is important to know your speed, how much fuel is in the tank, and whether or not you need to change your oil/check your engine.

Where to begin?! Specialized information is sometimes necessary, but it can be difficult to navigate.

Take advantage of a business impact analysis to define and understand your critical services

Ideally, downtime would be minimal. In reality, though, downtime is a part of IT life. It is important to have realistic expectations about its nature and likelihood.

Info-Tech Insight

According to end users, every system is critical and downtime is intolerable. Of course, once they see how much totally eliminating downtime can cost, they might change their tune. It is important to have this discussion to separate the critical from the less critical – but still important – services.

Establish visibility into critical systems

You may have seen “If you can’t measure it, you can’t manage it” or a variation thereof floating around the internet. This adage is consumable and makes sense…doesn’t it?

"It is wrong to suppose that if you can’t measure it, you can’t manage it – a costly myth."

– W. Edwards Deming, statistician and management consultant, author of The New Economics

While it is true that total monitoring is not absolutely necessary for management, when it comes to availability and capacity – objectively quantifiable service characteristics – a monitoring strategy is unavoidable. Capturing fluctuations in demand, and adjusting for those fluctuations, is among the most important functions of a capacity manager, even if hovering over employees with a stopwatch is poor management.

Solicit needs from line of business managers

Unless you head the world’s most involved IT department (kudos if you do) you’re going to have to determine your needs from the business.

Demand: manage or be managed

You might think you can get away with uncritically accepting your users’ demands, but this is not best practice. If you provide it, they will use it.

The company meeting

“I don’t need this much RAM,” the application developer said, implausibly. Titters wafted above the assembled crowd as her IT colleagues muttered their surprise. Heads shook, eyes widened. In fact, as she sat pondering her utterance, the developer wasn’t so sure she believed it herself. Noticing her consternation, the infrastructure manager cut in and offered the RAM anyway, forestalling the inevitable crisis that occurs when seismic internal shifts rock fragile self-conceptions. Until next time, he thought.

"Work expands as to fill the resources available for its completion…"

– C. Northcote Parkinson, quoted in Klimek et al.

Combine historical data with the needs you’ve solicited to holistically project your future needs

Predicting the future is difficult, but when it comes to capacity management, foresight is necessary.

Critical inputs

In order to project your future needs, the following inputs are necessary.

1. Usage trends: While it is true that past performance is no indication of future demand, trends are still a good way to validate requests from the business.
2. Line of business requests: An understanding of the projects the business has in the pipes is important for projecting future demand.
3. Institutional knowledge: Read between the lines. As experts on information technology, the IT department is well-equipped to translate needs into requirements.

Follow best practice guidelines to maximize the efficiency of your availability and capacity management process

Understand how the key frameworks relate and interact

BA104: Manage availability and capacity

• Current state assessment
• Forecasting based on business requirements
• Risk assessment of planning and implementation of requirements

Availability management

• Determine business requirements
• Match requirements to capabilities
• Address any mismatch between requirements and capabilities in a cost-effective manner

Capacity management

• Monitoring services and components
• Tuning for efficiency
• Forecasting future requirements
• Influencing demand
• Producing a capacity plan

Availability and capacity management

• Conduct a business impact analysis
• Establish visibility into critical systems
• Solicit and incorporate business needs
• Identify and mitigate risks

Disaster recovery and business continuity planning are forms of availability management

The scope of this project is managing day-to-day availability, largely but not exclusively, in the context of capacity. For additional important information on availability, see the following Info-Tech projects.

• Develop a Business Continuity Plan

If your focus is on ensuring process continuity in the event of a disaster.

• Establish a Program to Enable Effective Performance Monitoring

If your focus is on flow mapping and transaction monitoring as part of a plan to engage APM vendors.

• Create a Right-Sized Disaster Recovery Plan

If your focus is on hardening your IT systems against major events.

Info-Tech’s approach to availability and capacity management is stakeholder-centered and cloud ready

Info-Tech offers various levels of support to best suit your needs

DIY Toolkit

“Our team has already made this critical project a priority, and we have the time and capability, but some guidance along the way would be helpful.”

Guided Implementation

“Our team knows that we need to fix a process, but we need assistance to determine where to focus. Some check-ins along the way would help keep us on track.”

Workshop

“We need to hit the ground running and get this project kicked off immediately. Our team has the ability to take this over once we get a framework and strategy in place.”

Consulting

“Our team does not have the time or the knowledge to take this project on. We need assistance through the entirety of this project.”

Diagnostics and consistent frameworks used throughout all four options

Availability & capacity management – project overview

Workshop overview

Contact your account representative or email Workshops@InfoTech.com for more information.

PHASE 1

Conduct a Business Impact Analysis

Step 1.1: Conduct a business impact analysis

This step will walk you through the following activities:

• Record applications and dependencies in the Business Impact Analysis Tool.
• Define a scale to estimate the impact of various applications’ downtime.
• Estimate the impact of applications’ downtime.

This involves the following participants:

• Capacity manager
• Infrastructure team

Outcomes of this step

• Estimated impact of downtime for various applications

Execute a business impact analysis (BIA) as part of a broader availability plan

1.1a Business Impact Analysis Tool

Business impact analyses are an invaluable part of a broader IT strategy. Conducting a BIA benefits a variety of processes, including disaster recovery, business continuity, and availability and capacity management

Info-Tech Insight

Engaging in detailed capacity planning for an insignificant service draws time and resources away from more critical capacity planning exercises. Time spent tracking and planning use of the ancient fax machine in the basement is time you’ll never get back.

Control the scope of your availability and capacity management planning project with a business impact analysis

Don’t avoid conducting a BIA because of a perception that it’s too onerous or not necessary. If properly managed, as described in this blueprint, the BIA does not need to be onerous and the benefits are tangible.

A BIA enables you to identify appropriate spend levels, continue to drive executive support, and prioritize disaster recovery planning for a more successful outcome. For example, an Info-Tech survey found that a BIA has a significant impact on setting appropriate recovery time objectives (RTOs) and appropriate spending.

Terms

No BIA: lack of a BIA, or a BIA bases solely on the perceived importance of IT services.

BIA: based on a detailed evaluation or estimated dollar impact of downtime.

Source: Info-Tech Research Group; N=70

Select the services you wish to evaluate with the Business Impact Analysis Tool

1.1b 1 hour

In large organizations especially, collating an exhaustive list of applications and services is going to be onerous. For the purposes of this project, a subset should suffice.

Instructions

1. Gather a diverse group of IT staff and end users in a room with a whiteboard.
2. Solicit feedback from the group. Questions to ask:

• What services do you regularly use? What do you see others using? (End users)
• Which service inspires the greatest number of service calls? (IT)
• What services are you most excited about? (Management)
• What services are the most critical for business operations? (Everybody)

Input

• Applications/services

Output

• Candidate applications for the business impact analysis

Materials

• Whiteboard
• Markers

Participants

• Infrastructure manager
• Enterprise architect
• Application owners
• End users

Info-Tech Insight

Include a variety of services in your analysis. While it might be tempting to jump ahead and preselect important applications, don’t. The process is inherently valuable, and besides, it might surprise you.

Record the applications and dependencies in the BIA tool

1.1c Use tab 1 of the Business Impact Analysis Tool

1. In the Application/System column, list the applications identified for this pilot as well as the Core Infrastructure category. Also indicate the Impact on the Business and Business Owner.
2. List the dependencies for each application in the appropriate columns:

• Hosted On-Premises (In-House) – If the physical equipment is in a facility you own, record it here, even if it is managed by a vendor.
• Hosted by a Co-Lo/MSP – List any dependencies hosted by a co-lo/MSP vendor.
• Cloud (includes "as a Service”) – List any dependencies hosted by a cloud vendor.

Note: If there are no dependencies for a particular category, leave it blank.

Example

ID is optional. It is a sequential number by default.

In-House, Co-Lo/MSP, and Cloud dependencies; leave blank if not applicable.

Add notes as applicable – e.g. critical support services.

Define a scoring scale to estimate different levels of impact

1.1d Use tab 2 of the Business Impact Analysis Tool

Modify the Business Impact Scales headings and Overall Criticality Rating terminology to suit your organization. For example, if you don’t have business partners, use that column to measure a different goodwill impact or just ignore that column in this tool (i.e. leave it blank). Estimate the different levels of potential impact (where four is the highest impact and zero is no impact) and record these in the Business Impact Scales columns.

Estimate the impact of downtime for each application

1.1e Use tab 3 of the Business Impact Analysis Tool

In the BIA tab columns for Direct Costs of Downtime, Impact on Goodwill, and Additional Criticality Factors, use the drop-down menu to assign a score of zero to four based on levels of impact defined in the Scoring Criteria tab. For example, if an organization’s ERP is down, and that affects call center sales operations (e.g. ability to access customer records and process orders), the impact might be as described below:

• Loss of Revenue might score a two or three depending on the proportion of overall sales lost due to the downtime.
• The Impact on Customers might be a one or two depending on the extent that existing customers might be using the call center to purchase new products or services, and are frustrated by the inability to process orders.
• The Legal/Regulatory Compliance and Health or Safety Risk might be a zero.

On the other hand, if payroll processing is down, this may not impact revenue, but it certainly impacts internal goodwill and productivity.

Rank service criticality: gold, silver, and bronze

Gold

Mission critical services. An outage is catastrophic in terms of cost or public image/goodwill. Example: trading software at a financial institution.

Silver

Important to daily operations, but not mission critical. Example: email services at any large organization.

Bronze

Loss of these services is an inconvenience more than anything, though they do serve a purpose and will be missed if they are never brought back online. Example: ancient fax machines.

Info-Tech Best Practice

Info-Tech recommends gold, silver, and bronze because of this typology’s near universal recognition. If you would prefer a particular designation (it might help with internal comprehension), don’t hesitate to use that one instead.

Use the results of the business impact analysis to sort systems based on their criticality

1.1f 1 hour

Every organization has its own rules about how to categorize service importance. For some (consumer-facing businesses, perhaps) reputational damage may trump immediate costs.

Instructions

1. Gather a group of key stakeholders and project the completed Business Impact Analysis Tool onto a screen for them.
2. Share the definitions of gold, silver, and bronze services with them (if they are not familiar), and begin sorting the services by category,

• How long would it take to notice if a particular service went out?
• How important are the non-quantifiable damages that could come with an outage?

Input

• Results of the business impact analysis exercise

Output

• List of gold, silver, and bronze systems

Materials

• Projector
• Business Impact Analysis Tool
• Capacity Plan Template

Participants

• Infrastructure manager
• Enterprise architect

Leverage the rest of the BIA tool as part of your disaster recovery planning

Disaster recovery planning is a critical activity, and while it is a sort of availability management, it is beyond this project’s scope. You can complete the business impact analysis (including RTOs and RPOs) for the complete disaster recovery package.

See Info-Tech’s Create a Right-Sized Disaster Recovery Plan blueprint for instructions on how to complete your business impact analysis.

Step 1.2: Assign criticality ratings to services

This step will walk you through the following activities:

• Create a list of dependencies for your most important applications.
• Identify important sub-components.
• Use best practices to develop and negotiate SLAs.

This involves the following participants:

• Capacity manager
• Infrastructure team

Outcomes of this step

• List of dependencies of most important applications
• List of important sub-components
• SLAs based on best practices

Determine the base unit of the capacity you’re looking to purchase

Not every IT organization should approach capacity the same way. Needs scale, and larger organizations will inevitably deal in larger quantities.

"Cloud capacity management is not exactly the same as the ITIL version because ITIL has a focus on the component level. I actually don’t do that, because if I did I’d go crazy. There’s too many components in a cloud environment."

– Richie Mendoza, IT Consultant, SMITS Inc.

Consider the relationship between component capacity and service capacity

End users’ thoughts about IT are based on what they see. They are, in other words, concerned with service availability: does the organization have the ability to provide access to needed services?

Service

• Email
• CRM
• ERP

Component

• Switch
• SMTP server
• Archive database
• Storage

"You don’t ask the CEO or the guy in charge ‘What kind of response time is your requirement?’ He doesn’t really care. He just wants to make sure that all his customers are happy."

– Todd Evans, Capacity and Performance Management SME, IBM.

One telco solved its availability issues by addressing component capacity issues

CASE STUDY

Industry: Telecommunications

Source: Interview

Coffee and Wi-Fi – a match made in heaven

In tens of thousands of coffee shops around the world, patrons make ample use of complimentary Wi-Fi. Wi-Fi is an important part of customers’ coffee shop experience, whether they’re online to check their email, do a YouTube, or update their Googles. So when one telco that provided Wi-Fi access for thousands of coffee shops started encountering availability issues, the situation was serious.

Wi-Fi, whack-a-mole, and web woes

The team responsible for resolving the issue took an ad hoc approach to resolving complaints, fixing issues as they came up instead of taking a systematic approach.

Resolution

Looking at the network as a whole, the capacity manager took a proactive approach by using data to identify and rank the worst service areas, and then directing the team responsible to fix those areas in order of the worst first, then the next worst, and so on. Soon the availability of Wi-Fi service was restored across the network.

Create a list of dependencies for your most important applications

1.2a 1.5 hours

Instructions

1. Work your way down the list of services outlined in step 1, starting with your gold systems. During the first iteration of this exercise select only 3-5 of your most important systems.
2. Write the name of each application on a sticky note or at the top of a whiteboard (leaving ample space below for dependency mapping).
3. In the first tier below the application, include the specific services that the general service provides.

• This will vary based on the service in question, but an example for email is sending, retrieving, retrieving online, etc.

Input

• List of important applications

Output

• List of critical dependencies

Materials

• Whiteboard
• Markers
• Sticky notes

Participants

• Infrastructure manager
• Enterprise architect

Info-Tech Insight

Dependency mapping can be difficult. Make sure you don’t waste effort creating detailed dependency maps for relatively unimportant services.

Dependency mapping can be difficult. Make sure you don’t waste effort creating detailed dependency maps for relatively unimportant services.

Ride sharing cannot work, at least not at maximum effectiveness, without these constituent components. When one or more of these components are absent or degraded, the service will become unavailable. This example illustrates some challenges of capacity management; some of these components are necessary, but beyond the ride-sharing company’s control.

Leverage a sample dependency tree for a common service

Info-Tech Best Practice

Email is an example here not because it is necessarily a “gold system,” but because it is common across industries. This is a useful exercise for any service, but it can be quite onerous, so it should be conducted on the most important systems first.

Separate the wheat from the chaff; identify important sub-components and separate them from unimportant ones

1.2b 1.5 hours

Use the bottom layer of the pyramid drawn in step 1.2a for a list of important sub-components.

Instructions

1. Record a list of the gold services identified in the previous activity. Leave space next to each service for sub-components.
2. Go through each relevant sub-component. Highlight those that are critical and could reasonably be expected to cause problems.

• Has this sub-component caused a problem in the past?
• Is this sub-component a bottleneck?
• What could cause this component to fail? Is it such an occurrence feasible?

Input

• List of important applications

Output

• List of critical dependencies

Materials

• Whiteboard
• Markers

Participants

• Infrastructure manager
• Enterprise architect

Understand availability commitments with SLAs

With the rise of SaaS, cloud computing, and managed services, critical services and their components are increasingly external to IT.

• IT’s lack of access to the internal working of services does not let them off the hook for performance issues (as much as that might be the dream).
• Vendor management is availability management. Use the dependency map drawn earlier in this phase to highlight the components of critical services that rely on capacity that cannot be managed internally.
• For each of these services ensure that an appropriate SLA is in place. When acquiring new services, ensure that the vendor SLA meets business requirements.

In terms of service provision, capacity management is a form of availability management. Not all availability issues are capacity issues, but the inverse is true.

Info-Tech Insight

Capacity issues will always cause availability issues, but availability issues are not inherently capacity issues. Availability problems can stem from outages unrelated to capacity (e.g. power or vendor outages).

Use best practices to develop and negotiate SLAs

1.2c 20 minutes per service

When signing contracts with vendors, you will be presented with an SLA. Ensure that it meets your requirements.

1. Use the business impact analysis conducted in this project’s first step to determine your requirements. How much downtime can you tolerate for your critical services?
2. Once you have been presented with an SLA, be sure to scour it for tricks. Remember, just because a vendor offers “five nines” of availability doesn’t mean that you’ll actually get that much uptime. It could be that the vendor is comfortable eating the cost of downtime or that the contract includes provisions for planned maintenance. Whether or not the vendor anticipated your outage does little to mitigate the damage an outage can cause to your business, so be careful of these provisions.
3. Ensure that the person ultimately responsible for the SLA (the approver) understands the limitations of the agreement and the implications for availability.

Input

• List of external component dependencies

Output

• SLA requirements

Materials

• Whiteboard
• Markers

Participants

• Infrastructure manager
• Enterprise architect

Info-Tech Insight

Vendors are sometimes willing to eat the cost of violating SLAs if they think it will get them a contract. Be careful with negotiation. Just because the vendor says they can do something doesn’t make it true.

Negotiate internal SLAs using Info-Tech’s rigorous process

Talking past each other can drive misalignment between IT and the business, inconveniencing all involved. Quantify your needs through an internal SLA as part of a comprehensive availability management plan.

See Info-Tech’s Improve IT-Business Alignment Through an Internal SLA blueprint for instructions on why you should develop internal SLAs and the potential benefits they bring.

If you want additional support, have our analysts guide you through this phase as part of an Info-Tech workshop.

Book a workshop with our Info-Tech analysts:

• To accelerate this project, engage your IT team in an Info-Tech workshop with an Info-Tech analyst team.
• Info-Tech analysts will join you and your team onsite at your location or welcome you to Info-Tech’s historic Toronto office to participate in an innovative onsite workshop.
• Contact your account manager (www.infotech.com/account), or email Workshops@InfoTech.com for more information.

The following are sample activities that will be conducted by Info-Tech analysts with your team:

1.2

Create a list of dependencies for your most important applications

Using the results of the business impact analysis, the analyst will guide workshop participants through a dependency mapping exercise that will eventually populate the Capacity Plan Template.

Phase 1 Guided Implementation

Call 1-888-670-8889 or email GuidedImplementations@InfoTech.com for more information.

Complete these steps on your own, or call us to complete a guided implementation. A guided implementation is a series of 2-3 advisory calls that help you execute each phase of a project. They are included in most advisory memberships.

PHASE 2

Establish Visibility Into Core Systems

Step 2.1: Define your monitoring strategy

This step will walk you through the following activities:

• Determine the indicators you should be tracking for each sub-component.

This involves the following participants:

• Capacity manager
• Infrastructure team

Outcomes of this step

• List of indicators to track for each sub-component

Data has its significance—but also its limitations

The rise of big data can be a boon for capacity managers, but be warned: not all data is created equal. Bad data can lead to bad decisions – and unemployed capacity managers.

Your findings are only as good as your data. Remember: garbage in, garbage out. There are three characteristics of good data:*

1. Accuracy: is the data exact and correct? More detail and confidence is better.
2. Reliability: is the data consistent? In other words, if you run the same test twice will you get the same results?
3. Validity: is the information gleaned believable and relevant?

*National College of Teaching & Leadership, “Reliability and Validity”

"Data is king. Good data is absolutely essential to [the capacity manager] role."

– Adrian Blant, Independent Capacity Consultant, IT Capability Solutions

Info-Tech Best Practice

Every organization’s data needs are different; your data needs are going to be dictated by your services, delivery model, and business requirements. Make sure you don’t confuse volume with quality, even if others in your organization make that mistake.

Take advantage of technology to establish visibility into your systems

Managing your availability and capacity involves important decisions about what to monitor and how thresholds should be set.

• Use the list of critical applications developed through the business impact analysis and the list of components identified in the dependency mapping exercise to produce a plan for effectively monitoring component availability and capacity.
• The nature of IT service provision – the multitude of vendors providing hardware and services necessary for even simple IT services to work effectively – means that it is unlikely that capacity management will be visible through a single pane of glass. In other words, “email” and “CRM” don’t have a defined capacity. It always depends.
• Establishing visibility into systems involves identifying what needs to be tracked for each component.

Too much monitoring can be as bad as the inverse

In 2013, a security breach at US retailer Target compromised more than 70 million customers’ data. The company received an alert, but it was thought to be a false positive because the monitoring system produced so many false and redundant alerts. As a result of the daily deluge, staff did not respond to the breach in time.

Info-Tech Insight

Don’t confuse monitoring with management. While establishing visibility is a crucial step, it is only part of the battle. Move on to this project’s next phase to explore opportunities to improve your capacity/availability management process.

Determine the indicators you should be tracking for each sub-component

2.1a Tab 3 of the Capacity Snapshot Tool

It is nearly impossible to overstate the importance of data to the process of availability and capacity management. But the wrong data will do you no good.

Instructions

1. Open the Capacity Snapshot Tool to tab 2. The tool should have been populated in step 1.2 as part of the component mapping exercise.
2. For each service, determine which metric(s) would most accurately tell the component’s story. Consider the following questions when completing this activity (you may end up with more than one metric):

• How would the component’s capacity be measured (storage space, RAM, bandwidth, vCPUs)?
• Is the metric in question actionable?

Info-Tech Insight

Bottlenecks are bad. Use the Capacity Snapshot Tool (or another tool like it) to ensure that when the capacity manager leaves (on vacation, to another role, for good) the knowledge that they have accumulated does not leave as well.

Understand the limitations of this approach

Although we’ve striven to make it as easy as possible, this process will inevitably be cumbersome for organizations with a complicated set of software, hardware, and cloud services.

Tracking every single component in significant detail will produce a lot of noise for each bit of signal. The approach outlined here addresses that concern in two ways:

• A focus on gold services
• A focus on sub-components that have a reasonable likelihood of being problematic in the future.

Despite this effort, however, managing capacity at the component level is a daunting task. Ultimately, tools provided by vendors like SolarWinds and AppDynamics will fill in some of the gaps. Nevertheless, an understanding of the conceptual framework underlying availability and capacity management is valuable.

Step 2.2: Implement your monitoring tool/aggregator

This step will walk you through the following activities:

• Clarify visibility.
• Determine whether or not you have sufficiently granular visibility.
• Develop strategies to .any visibility issues.

This involves the following participants:

• Capacity manager
• Infrastructure team
• Applications personnel

Outcomes of this step

• Method for measuring and monitoring critical sub-components

Companies struggle with performance monitoring because 95% of IT shops don’t have full visibility into their environments

CASE STUDY

Industry: Financial Services

Source: AppDynamics

Challenge

• Users are quick to provide feedback when there is downtime or application performance degradation.
• The challenge for IT teams is that while they can feel the pain, they don’t have visibility into the production environment and thus cannot identify where the pain is coming from.
• The most common solution that organizations rely on is leveraging the log files for issue diagnosis. However, this method is slow and often unable to pinpoint the problem areas, leading to delays in problem resolution.

Solution

• Application and infrastructure teams need to work together to develop infrastructure flow maps and transaction profiles.
• These diagrams will highlight the path that each transaction travels across your infrastructure.
• Ideally at this point, teams will also capture latency breakdowns across every tier that the business transaction flows through.
  • This will ultimately kick start the baselining process.

Results

• Ninety-five percent of IT departments don’t have full visibility into their production environment. As a result, a slow business transaction will often require a war-room approach where SMEs from across the organization gather to troubleshoot.
• Having visibility into the production environment through infrastructure flow mapping and transaction profiling will help IT teams pinpoint problems.
  • At the very least, teams will be able to identify common problem areas and expedite the root-cause analysis process.

Source: “Just how complex can a Login Transaction be? Answer: Very!,” AppDynamics

Monitor your critical sub-components

Establishing a monitoring plan for your capacity involves answering two questions: can I see what I need to see, and can I see it with sufficient granularity?

• Having the right tool for the job is an important step towards effective capacity and availability management.
• Application performance management tools (APMs) are essential to the process, but they tend to be highly specific and vertically oriented, like using a microscope.
• Some product families can cover a wider range of capacity monitoring functions (SolarWinds, for example). It is still important, however, to codify your monitoring needs.

"You don’t use a microscope to monitor an entire ant farm, but you might use many microscopes to monitor specific ants."

– Fred Chagnon, Research Director, Infrastructure Practice, Info-Tech Research Group

Monitor your sub-components: clarify visibility

2.2a Tab 2 of the Capacity Snapshot Tool

The next step in capacity management is establishing whether or not visibility (in the broad sense) is available into critical sub-components.

Instructions

1. Open the Capacity Snapshot Tool and record the list of sub-components identified in the previous step.
2. For each sub-component answer the following question:

• Do I have easy access to the information I need to monitor to ensure this component remains available?

• What tool provides the information? Where can it be found?

Monitor your sub-components; determine whether or not you have sufficient granular visibility

2.2b Tab 2 of the Capacity Snapshot Tool

Like ideas and watches, not all types of visibility are created equal. Ensure that you have access to the right information to make capacity decisions.

Instructions

1. For each of the sub-components clarify the appropriate level of granularity for the visibility gained to be useful. In the case of storage, for example, is raw usage (in gigabytes) sufficient, or do you need a breakdown of what exactly is taking up the space? The network might be more complicated.
2. Record the details of this ideation in the adjacent column.
3. Select “Yes” or “No” from the drop-down menu to track the status of each sub-component.

For most mobile phone users, this breakdown is sufficient. For some, more granularity might be necessary.

Info-Tech Insight

Make note of monitoring tools and strategies. If anything changes, be sure to re-evaluate the visibility status. An outdated spreadsheet can lead to availability issues if management is unaware of looming problems.

Develop strategies to ameliorate any visibility issues

2.2c 1 hour

The Capacity Snapshot Tool color-codes your components by status. Green – visibility and granularity are both sufficient; yellow – visibility exists, though not at sufficient granularity; and red – visibility does not exist at all.

Instructions

1. Write each of the yellow and red sub-components on a whiteboard or piece of chart paper.
2. Brainstorm amelioration strategies for each of the problematic sub-components.

• Does the current monitoring tool have sufficient functionality?
• Does it need to be further configured/customized?
• Do we need a whole new tool?

Input

• Sub-components
• Capacity Snapshot Tool

Output

• Amelioration strategies

Materials

• Whiteboard
• Markers
• Capacity Snapshot Tool

Participants

• Infrastructure manager

Info-Tech Best Practice

It might be that there is no amelioration strategy. Make note of this difficulty and highlight it as part of the risk section of the Capacity Plan Template.

See Info-Tech’s projects on storage and network modernization for additional details

Leverage other products for additional details on how to modernize your network and storage services.

The process of modernizing the network is fraught with vestigial limitations. Develop a program to gather requirements and plan.

As part of the blueprint, Modernize Enterprise Storage, the Modernize Enterprise Storage Workbook includes a section on storage capacity planning.

If you want additional support, have our analysts guide you through this phase as part of an Info-Tech workshop.

Book a workshop with our Info-Tech analysts:

• To accelerate this project, engage your IT team in an Info-Tech workshop with an Info-Tech analyst team.
• Info-Tech analysts will join you and your team onsite at your location or welcome you to Info-Tech’s historic Toronto office to participate in an innovative onsite workshop.
• Contact your account manager (www.infotech.com/account), or email Workshops@InfoTech.com for more information.

The following are sample activities that will be conducted by Info-Tech analysts with your team:

2.2

Develop strategies to ameliorate visibility issues

The analyst will guide workshop participants in brainstorming potential solutions to visibility issues and record them in the Capacity Snapshot Tool.

Phase 2 Guided Implementation

Call 1-888-670-8889 or email GuidedImplementations@InfoTech.com for more information.

Complete these steps on your own, or call us to complete a guided implementation. A guided implementation is a series of 2-3 advisory calls that help you execute each phase of a project. They are included in most advisory memberships.

PHASE 3

Solicit and Incorporate Business Needs

Step 3.1: Solicit business needs and gather data

This step will walk you through the following activities:

• Build relationships with business stakeholders.
• Analyze usage data and identify trends.
• Correlate usage trends with business needs.

This involves the following participants:

• Capacity manager
• Infrastructure team members
• Business stakeholders

Outcomes of this step

• System for involving business stakeholders in the capacity planning process
• Correlated data on business level, service level, and infrastructure level capacity usage

Summarize your capacity planning activities in the Capacity Plan Template

The availability and capacity management summary card pictured here is a handy way to capture the results of the activities undertaken in the following phases. Note its contents carefully, and be sure to record specific outputs where appropriate. One such card should be completed for each of the gold services identified in the project’s first phase. Make note of the results of the activities in the coming phase, and populate the Capacity Snapshot Tool. These will help you populate the tool.

Info-Tech Best Practice

The Capacity Plan Template is designed to be a part of a broader mapping strategy. It is not a replacement for a dedicated monitoring tool.

Analyze historical trends as a crucial source of data

The first place to look for information about your organization is not industry benchmarks or your gut (though those might both prove useful).

• Where better to look than internally? Use the data you’ve gathered from your APM tool or other sources to understand your historical capacity needs and to highlight any periods of unavailability.
• Consider monitoring the status of the capacity of each of your crucial components. The nature of this monitoring will vary based on the component in question. It can range from a rough Excel sheet all the way to a dedicated application performance monitoring tool.

"In all cases the very first thing to do is to look at trending…The old adage is ‘you don’t steer a boat by its wake,’ however it’s also true that if something is growing at, say, three percent a month and it has been growing at three percent a month for the last twelve months, there’s a fairly good possibility that it’s going to carry on going in that direction."

– Mike Lynch, Consultant, CapacityIQ

Gather relevant data at the business level

3.1a 2 hours per service

A holistic approach to capacity management involves peering beyond the beaded curtain partitioning IT from the rest of the organization and tracking business metrics.

Instructions

1. Your service/application owners know how changes in business activities impact their systems. Business level capacity management involves responding to those changes. Ask service/application owners what changes will impact their capacity. Examples include:

• Business volume (net new customers, number of transactions)
• Staff changes (new hires, exits, etc.)

Input

• Brainstorming
• List of gold services

Output

• Business level data

Materials

• In-house solution or commercial tool

Participants

• Capacity manager
• Application/service owners

Gather relevant data at the service level

3.1b 2 hours per service

One level of abstraction down is the service level. Service level capacity management, recall that service level capacity management is about ensuring that IT is meeting SLAs in its service provision.

Instructions

1. There should be internal SLAs for each service IT offers. (If not, that’s a good place to start. See Info-Tech’s research on the subject.) Prod each of your service owners for information on the metrics that are relevant for their SLAs. Consider the following:

• Peak hours, requests per second, etc.
• This will usually include some APM data.

Input

• Brainstorming
• List of gold services

Output

• Service level data

Materials

• In-house solution or commercial tool

Participants

• Capacity manager
• Application/service owners

Leverage the visibility into your infrastructure components and compare all of your data over time

You established visibility into your components in the second phase of this project. Use this data, and that gathered at the business and service levels, to begin analyzing your demand over time.

• Different organizations will approach this issue differently. Those with a complicated service catalog and a dedicated capacity manager might employ a tool like TeamQuest. If your operation is small, or you need to get your availability and capacity management activities underway as quickly as possible, you might consider using a simple spreadsheet software like Excel.
• If you choose the latter option, select a level of granularity (monthly, weekly, etc.) and produce a line graph in Excel.
• Example: Employee count (business metric)

Note: the strength of this approach is that it is easy to visualize. Use the same timescale to facilitate simple comparison.

Manage, don’t just monitor; mountains of data need to be turned into information

Information lets you make a decision. Understand the questions you don’t need to ask, and ask the right ones.

"Often what is really being offered by many analytics solutions is just more data or information – not insights."

– Brent Dykes, Director of Data Strategy, Domo

Info-Tech Best Practice

You can have all the data in the world and absolutely nothing valuable to add. Don’t fall for this trap. Use the activities in this phase to structure your data collection operation and ensure that your organization’s availability and capacity management plan is data driven.

Analyze historical trends and track your services’ status

3.1c Tab 3 of the Capacity Snapshot Tool

At-a-glance – it’s how most executives consume all but the most important information. Create a dashboard that tracks the status of your most important systems.

Instructions

1. Consult infrastructure leaders for information about lead times for new capacity for relevant sub-components and include that information in the tool.

• Look to historical lead times. (How long does it traditionally take to get more storage?)
• If you’re not sure, contact an in-house expert, or speak to your vendor

This tool collates and presents information gathered from other sources. It is not a substitute for a performance monitoring tool.

Build a list of key business stakeholders

3.1d 10 minutes

Stakeholder analysis is crucial. Lines of authority can be diffuse. Understand who needs to be involved in the capacity management process early on.

Instructions

1. With the infrastructure team, brainstorm a group of departments, roles, and people who may impact demand on capacity.
2. Go through the list with your team and identify stakeholders from two groups:

• Line of business: who in the business makes use of the service?
• Application owner: who in IT is responsible for ensuring the service is up?

Input

• Gold systems
• Personnel Information

Output

• List of key business stakeholders

Materials

• Whiteboard
• Markers

Participants

• Capacity manager
• Infrastructure staff

Info-Tech Best Practice

Consider which departments are most closely aligned with the business processes that fuel demand. Prioritize those that have the greatest impact. Consider the stakeholders who will make purchasing decisions for increasing infrastructure capacity.

Organize stakeholder meetings

3.1e 10 hours

Establishing a relationship with your stakeholders is a necessary step in managing your capacity and availability.

Instructions

1. Gather as many of the stakeholders identified in the previous activity as you can and present information on availability and capacity management

• If you can’t get everyone in the same room, a virtual meeting or even an email blast could get the job done.

• Consider highlighting the trade-offs between cost and availability.

Input

• List of business stakeholders
• Hard work

Output

• Working relationship, trust
• Regular meetings

Materials

• Work ethic
• Executive brief

Participants

• Capacity manager
• Business stakeholders

Info-Tech Insight

The best capacity managers develop new business processes that more closely align their role with business stakeholders. Building these relationships takes hard work, and you must first earn the trust of the business.

Bake stakeholders into the planning process

3.1f Ongoing

Convince, don’t coerce. Stakeholders want the same thing you do. Bake them into the planning process as a step towards this goal.

1. Develop a system to involve stakeholders regularly in the capacity planning process.

• Your system will vary depending on the structure and culture of your organization.
• See the case study on the following slide for ideas.
• It may be as simple as setting a recurring reminder in your own calendar to touch base with stakeholders.

• Ensure stakeholders have reasonable expectations about IT’s available resources, the costs of providing capacity, and the lead times required to source additional needed capacity.

Input

• List of business stakeholders
• Ideas

Output

• Capacity planning process that involves stakeholders

Materials

• Meeting rooms

Participants

• Capacity manager
• Business stakeholders
• Infrastructure team

A capacity manager in financial services wrangled stakeholders and produced results

CASE STUDY

Industry: Financial Services

Source: Interview

In financial services, availability is king

In the world of financial services, availability is absolutely crucial. High-value trades occur at all hours, and any institution that suffers outages runs the risk of losing tens of thousands of dollars, not to mention reputational damage.

People know what they want, but sometimes they have to be herded

While line of business managers and application owners understand the value of capacity management, it can be difficult to establish the working relationship necessary for a fruitful partnership.

Proactively building relationships keeps services available

He built relationships with all the department heads on the business side, and all the application owners.

• He met with department heads quarterly.
• He met with application owners and business liaisons monthly.

He established a steering committee for capacity.

He invited stakeholders to regular capacity planning meetings.

• The first half of each meeting was high-level outlook, such as business volume and IT capacity utilization, and included stakeholders from other departments.
• The second half of the meeting was more technical, serving the purpose for the infrastructure team.

He scheduled lunch and learn sessions with business analysts and project managers.

• These are the gatekeepers of information, and should know that IT needs to be involved when things come down the pipeline.

Step 3.2: Analyze data and project future needs

This step will walk you through the following activities:

• Solicit needs from the business.
• Map business needs to technical requirements, and technical requirements to infrastructure requirements.
• Identify inefficiencies in order to remedy them.
• Compare the data across business, component, and service levels, and project your capacity needs.

This involves the following participants:

• Capacity manager
• Infrastructure team members
• Business stakeholders

Outcomes of this step

• Model of how business processes relate to technical requirements and their demand on infrastructure
• Method for projecting future demand for your organization’s infrastructure
• Comparison of current capacity usage to projected demand

“Nobody tells me anything!” – the capacity manager’s lament

Sometimes “need to know” doesn’t register with sales or marketing. Nearly every infrastructure manager can share a story about a time when someone has made a decision that has critically impacted IT infrastructure without letting anyone in IT in on the “secret.”

In brief

Imagine working for a media company as an infrastructure capacity manager. Now imagine that the powers that be have decided to launch a content-focused web service. Seems like something they would do, right? Now imagine you find out about it the same way the company’s subscribers do. This actually happened – and it shouldn’t have. But a similar lack of alignment makes this a real possibility for any organization. If you don’t establish a systematic plan for soliciting and incorporating business requirements, prepare to lose a chunk of your free time. The business should never be able to say, in response to “nobody tells me anything,” “nobody asked.”

Pictured: an artist’s rendering of the capacity manager in question.

Directly solicit requirements from the business

3.2a 30 minutes per stakeholder

Once you’ve established, firmly, that everyone’s on the same team, meet individually with the stakeholders to assess capacity.

Instructions

1. Schedule a one-on-one meeting with each line of business manager (stakeholders identified in 3.1). Ideally this will be recurring.

• Experienced capacity managers suggest doing this monthly.

• What are some upcoming major initiatives?
• Is the department going to expand or contract in a noticeable way?
• Have customers taken to a particular product more than others?

Input

• Stakeholder opinions

Output

• Business requirements

Materials

• Whiteboard
• Markers

Participants

• Capacity manager
• Infrastructure staff

Info-Tech Insight

Sometimes line of business managers will evade or ignore you when you come knocking. They do this because they don’t know and they don’t want to give you the wrong information. Explain that a best guess is all you can ask for and allay their fears.

Below, you will find more details about what to look for when soliciting information from the line of business manager you’ve roped into your scheme.

1. Consider the following:

• Projected sales pipeline
• Business growth
• Seasonal cycles
• Marketing campaigns
• New applications and features
• New products and services

Directly solicit requirements from the business (optional)

3.2a 1 hour

IT staff and line of business staff come with different skillsets. This can lead to confusion, but it doesn’t have to. Develop effective information solicitation techniques.

Instructions

1. Gather your IT staff in a room with a whiteboard. As a group, select a gold service/line of business manager you would like to use as a “practice dummy.”
2. Have everyone write down a question they would ask of the line of business representative in a hypothetical business/service capacity discussion.
3. As a group discuss the merits of the questions posed:

• Are they likely to yield productive information?
• Are they too vague or specific?
• Is the person in question likely to know the answer?
• Is the information requested a guarded trade secret?

Input

• Workshop participants’ ideas

Output

• Interview skills

Materials

• Whiteboard
• Markers
• Sticky notes

Participants

• Capacity manager
• Infrastructure staff

Map business needs to technical requirements, and technical requirements to infrastructure requirements

3.2b 5 hours

When it comes to mapping technical requirements, IT alone has the ability to effectively translate business needs.

Instructions

1. Use your notes from stakeholder meetings to assess the impact of any changes on gold systems.
2. For each system brainstorm with infrastructure staff (and any technical experts as necessary) about what the information gleaned from stakeholder discussions. Consider the following discussion points:

• How has demand for the service been trending? Does it match what the business is telling us?
• Have we had availability issues in the past?
• Has the business been right with their estimates in the past?

• E.g. how much RAM does a new email user require?

Input

• Business needs

Output

• Technical and infrastructure requirements

Materials

• Whiteboard
• Markers

Participants

• Capacity manager
• Infrastructure staff

Info-Tech Insight

Adapt the analysis to the needs of your organization. One capacity manager called the one-to-one mapping of business process to infrastructure demand the Holy Grail of capacity management. If this level of precision isn’t attainable, develop your own working estimates using the higher-level data

Avoid putting too much faith in the cloud as a solution to your problem

Has the rise of on-demand, functionally unlimited services eliminated the need for capacity and availability management?

Info-Tech Insight

The cloud comes at the cost of detailed performance data. Sourcing a service through an SLA with a third party increases the need to perform your own performance testing of gold level applications. See performance monitoring.

Beware Parkinson’s law

A consequence of our infinite capacity for creativity, people have the enviable skill of making work. In 1955, C. Northcote Parkinson pointed out this fact in The Economist . What are the implications for capacity management?

"It is a commonplace observation that work expands so as to fill the time available for its completion. Thus, an elderly lady of leisure can spend the entire day in writing and despatching a postcard to her niece at Bognor Regis. An hour will be spent in finding the postcard, another in hunting for spectacles, half-an-hour in a search for the address, an hour and a quarter in composition, and twenty minutes in deciding whether or not to take an umbrella when going to the pillar-box in the next street."

C. Northcote Parkinson, The Economist, 1955

Info-Tech Insight

If you give people lots of capacity, they will use it. Most shops are overprovisioned, and in some cases that’s throwing perfectly good money away. Don’t be afraid to prod if someone requests something that doesn’t seem right.

Optimally align demand and capacity

When it comes to managing your capacity, look for any additional efficiencies.

Questions to ask:

• Are there any infrastructure services that are not being used to their full potential, sitting idle, or allocated to non-critical or zombie functions?
  • Are you managing your virtual servers? If, for example, you experience a seasonal spike in demand, are you leaving virtual machines running after the fact?
• Do your organization’s policies and your infrastructure setup allow for the use of development resources for production during periods of peak demand?
• Can you make organizational or process changes in order to satisfy demand more efficiently?

In brief

Who isn’t a sports fan? Big games mean big stakes for pool participants and armchair quarterbacks—along with pressure on the network as fans stream games from their work computers. One organization suffered from this problem, and, instead of taking a hardline and banning all streams, opted to stream the game on a large screen in a conference room where those interested could work for its duration. This alleviated strain on the network and kept staff happy.

Shutting off an idle cloud to cut costs

CASE STUDY

Industry:Professional Services

Source:Interview

24/7 AWS = round-the-clock costs

A senior developer realized that his development team had been leaving AWS instances running without any specific reason.

Why?

The development team appreciated the convenience of an always-on instance and, because the people spinning them up did not handle costs, the problem wasn’t immediately apparent.

Resolution

In his spare time over the course of a month, the senior developer wrote a program to manage the servers, including shutting them down during times when they were not in use and providing remote-access start-up when required. His team alone saved $30,000 in costs over the next six months, and his team lead reported that it would have been more than worth paying the team to implement such a project on company time.

Identify inefficiencies in order to remediate them

3.2c 20 minutes per service

Instructions

1. Gather the infrastructure team together and discuss existing capacity and demand. Use the inputs from your data analysis and stakeholder meetings to set the stage for your discussion.
2. Solicit ideas about potential inefficiencies from your participants:

• Are VMs effectively allocated? If you need 7 VMs to address a spike, are those VMs being reallocated post-spike?
• Are developers leaving instances running in the cloud?
• Are particular services massively overprovisioned?
• What are the biggest infrastructure line items? Are there obvious opportunities for cost reduction there?

Input

• Gold systems
• Data inputs

Output

• Inefficiencies

Materials

• Whiteboard
• Markers

Participants

• Capacity manager
• Infrastructure staff

Info-Tech Insight

The most effective capacity management takes a holistic approach and looks at the big picture in order to find ways to eliminate unnecessary infrastructure usage, or to find alternate or more efficient sources of required capacity.

Dodging the toll troll by rerouting traffic

CASE STUDY

Industry:Telecommunications

Source: Interview

High-cost lines

The capacity manager at a telecommunications provider mapped out his firm’s network traffic and discovered they were using a number of VP circuits (inter building cross connects) that were very expensive on the scale of their network.

Paying the toll troll

These VP circuits were supplying needed network services to the telecom provider’s clients, so there was no way to reduce this demand.

Resolution

The capacity manager analyzed where the traffic was going and compared this to the cost of the lines they were using. After performing the analysis, he found he could re-route much of the traffic away from the VP circuits and save on costs while delivering the same level of service to their users.

Compare the data across business, component, and service levels, and project your capacity needs

3.2d 2 hour session/meeting

Make informed decisions about capacity. Remember: retain all documentation. It might come in handy for the justification of purchases.

Instructions

1. Using either a dedicated tool or generic spreadsheet software like Excel or Sheets, evaluate capacity trends. Ask the following questions:

• Are there times when application performance degraded, and the service level was disrupted?
• Are there times when certain components or systems neared, reached, or exceeded available capacity?
• Are there seasonal variations in demand?
• Are there clear trends, such as ongoing growth of business activity or the usage of certain applications?
• What are the ramifications of trends or patterns in relation to infrastructure capacity?

Compare current capacity to your projections

3.2e Section 5 of the Capacity Plan Template

Capacity management (and, by extension, availability management) is a combination of two balancing acts: cost against capacity and supply and demand.*

Instructions

1. Compare your projections with your reality. You already know whether or not you have enough capacity given your lead times. But do you have too much? Compare your sub-component capacity projections to your current state.
2. Highlight any outliers. Is there a particular service that is massively overprovisioned?
3. Evaluate the reasons for the overprovisioning.

• Is the component critically important?
• Did you get a great deal on hardware?
• Is it an oversight?

*Office of Government Commerce 2001, 119.

In brief

The fractured nature of the capacity management space means that every organization is going to have a slightly different tooling strategy. No vendor has dominated, and every solution requires some level of customization. One capacity manager (a cloud provider, no less!) relayed a tale about a capacity management Excel sheet programmed with 5,000+ lines of code. As much work as that is, a bespoke solution is probably unavoidable.

If you want additional support, have our analysts guide you through this phase as part of an Info-Tech workshop.

Book a workshop with our Info-Tech analysts:

• To accelerate this project, engage your IT team in an Info-Tech workshop with an Info-Tech analyst team.
• Info-Tech analysts will join you and your team onsite at your location or welcome you to Info-Tech’s historic Toronto office to participate in an innovative onsite workshop.
• Contact your account manager (www.infotech.com/account), or email Workshops@InfoTech.com for more information.

The following are sample activities that will be conducted by Info-Tech analysts with your team:

3.2

Map business needs to technical requirements and technical requirements to infrastructure requirements

The analyst will guide workshop participants in using their organization’s data to map out the relationships between applications, technical requirements, and the underlying infrastructure usage.

Phase 3 Guided Implementation

Call 1-888-670-8889 or email GuidedImplementations@InfoTech.com for more information.

Complete these steps on your own, or call us to complete a guided implementation. A guided implementation is a series of 2-3 advisory calls that help you execute each phase of a project. They are included in most advisory memberships.

PHASE 4

Identify and Mitigate Risks

Step 4.1: Identify and mitigate risks

This step will walk you through the following activities:

• Identify potential risks.
• Determine strategies to mitigate risks.
• Complete your capacity management plan.

This involves the following participants:

• Capacity manager
• Infrastructure team members
• Business stakeholders

Outcomes of this step

• Strategies for reducing risks
• Capacity management plan

Understand what happens when capacity/availability management fails

1. Services become unavailable. If availability and capacity management are not constantly practiced, an inevitable consequence is downtime or a reduction in the quality of that service. Critical sub-component failures can knock out important systems on their own.
2. Money is wasted. In response to fears about availability, it’s entirely possible to massively overprovision or switch entirely to a pay-as-you-go model. This, unfortunately, brings with it a whole host of other problems, including overspending. Remember: infinite capacity means infinite potential cost.
3. IT remains reactive and is unable to contribute more meaningfully to the organization. If IT is constantly putting out capacity/availability-related fires, there is no room for optimization and activities to increase organizational maturity. Effective availability and capacity management will allow IT to focus on other work.

Mitigate availability and capacity risks

Availability: how often a service is usable (that is to say up and not too degraded to be effective). Consequences of reduced availability can include financial losses, impacted customer goodwill, and reduced faith in IT more generally.

Causes of availability issues:

• Poor capacity management – a service becomes unavailable when there is insufficient supply to meet demand. This is the result of poor capacity management.
• Scheduled maintenance – services go down for maintenance with some regularity. This needs to be baked into service-level negotiations with vendors.
• Vendor outages – sometimes vendors experience unplanned outages. There is typically a contract provision that covers unplanned outages, but that doesn’t change the fact that your service will be interrupted.

Capacity: a particular component’s/service’s/business’ wiggle room. In other words, its usage ceiling.

Causes of capacity issues:

• Poor demand management – allowing users to run amok without any regard for how capacity is sourced and paid for.
• Massive changes in legitimate demand – more usage means more demand.
• Poor capacity planning – predictable changes in demand that go unaddressed can lead to capacity issues.

Add additional potential causes of availability and capacity risks as needed

4.1a 30 minutes

Availability and capacity issues can stem from a number of different causes. Include a list in your availability and capacity management plan.

Instructions

1. Gather the group together. Go around the room and have participants provide examples of incidents and problems that have been the result of availability and capacity issues.
2. Pose questions to the group about the source of those availability and capacity issues.

• What could have been done differently to avoid these issues?
• Was the availability/capacity issue a result of a faulty internal/external SLA?

Input

• Capacity Snapshot Tool results

Output

• Additional sources of availability and capacity risks

Materials

• Capacity Plan Template

Participants

• Capacity manager
• Infrastructure staff

Info-Tech Insight

Availability and capacity problems result in incidents, critical incidents, and problems. These are addressed in a separate project (incident and problem management), but information about common causes can streamline that process.

Identify capacity risks and mitigate them

4.1b 30 minutes

Based on your understanding of your capacity needs (through written SLAs and informal but regular meetings with the business) highlight major risks you foresee.

Instructions

1. Make a chart with two columns on a whiteboard. They should be labelled “risk” and “mitigation” respectively.
2. Record risks to capacity you have identified in earlier activities.

• Refer to the Capacity Snapshot Tool for components that are highlighted in red and yellow. These are specific components that present special challenges. Identify the risk(s) in as much detail as possible. Include service and business risks as well.
• Examples: a marketing push will put pressure on the web server; a hiring push will require more Office 365 licenses; a downturn in registration will mean that fewer VMs will be required to run the service.

Input

• Capacity Snapshot Tool results

Output

• Inefficiencies

Materials

• Whiteboard
• Markers

Participants

• Capacity manager
• Infrastructure staff

Info-Tech Insight

It’s an old adage, but it checks out: don’t come to the table armed only with problems. Be a problem solver and prove IT’s value to the organization.

Identify capacity risks and mitigate them (cont.)

4.1b 1.5 hours

Instructions (cont.)

3. Begin developing mitigation strategies. Options for responding to known capacity risks fall into one of two camps:

• Acceptance: responding to the risk is costlier than acknowledging its existence without taking any action. For gold systems, acceptance is typically not acceptable.
• Mitigation: limiting/reducing, eliminating, or transferring risk (Herrera) comprise the sort of mitigation discussed here.
  • Limiting/reducing: taking steps to improve the capacity situation, but accepting some level of risk (spinning up a new VM, pushing back on demands from the business, promoting efficiency).
  • Eliminating: the most comprehensive (and most expensive) mitigation strategy, elimination could involve purchasing a new server or, at the extreme end, building a new datacenter.
  • Transfer: “robbing Peter to pay Paul,” in the words of capacity manager Todd Evans, is one potential way to limit your exposure. Is there a less critical service that can be sacrificed to keep your gold service online?

Input

• Capacity Snapshot Tool results

Output

• Capacity risk mitigations

Materials

• Whiteboard
• Markers

Participants

• Capacity manager
• Infrastructure staff

Info-Tech Insight

It’s an old adage, but it checks out: don’t come to the table armed only with problems. Be a problem solver and prove IT’s value to the organization.

Identify availability risks and mitigate them

4.1c 30 minutes

While capacity management is a form of availability management, it is not the only form. In this activity, outline the specific nature of threats to availability.

Instructions

1. Make a chart with two columns on a whiteboard. They should be labelled “risk” and “mitigation” respectively.
2. Begin brainstorming general availability risks based on the following sources of information/categories:

• Vendor outages
• Disaster recovery
• Historical availability issues

Input

• Capacity Snapshot Tool results

Output

• Availability risks and mitigations

Materials

• Whiteboard
• Markers

Participants

• Capacity manager
• Infrastructure staff

Info-Tech Best Practice

A dynamic central repository is a good way to ensure that availability issues stemming from a variety of causes are captured and mitigated.

Identify availability risks and mitigate them (cont.)

4.1c 1.5 hours

Although it is easier said than done, identifying potential mitigations is a crucial part of availability management as an activity.

Instructions (cont.)

3. Begin developing mitigation strategies. Options for responding to known capacity risks fall into one of two camps:

• Acceptance – responding to the risk is costlier than taking it on. Some unavailability is inevitable, between maintenance and unscheduled downtime. Record this, though it may not require immediate action.
• Mitigation strategies:
  • Limiting/reducing – taking steps to increase availability of critical systems. This could include hot spares for unreliable systems or engaging a new vendor.
  • Eliminating – the most comprehensive (and most expensive) mitigation strategy. It could include selling.
  • Transfer – “robbing Peter to pay Paul,” in the words of capacity manager Todd Evans, is one potential way to limit your exposure. Is there a less critical service that can be sacrificed to keep your gold service online?

Input

• Capacity Snapshot Tool results

Output

• Availability risks and mitigations

Materials

• Whiteboard
• Markers

Participants

• Capacity manager
• Infrastructure staff

Iterate on the process and present your completed availability and capacity management plan

The stakeholders consulted as part of the process will be interested in its results. Share them, either in person or through a collaboration tool.

The current status of your availability and capacity management plan should be on the agenda for every stakeholder meeting. Direct the stakeholders’ attention to the parts of the document that are relevant to them, and solicit their thoughts on the document’s accuracy. Over time you should get a pretty good idea of who among your stakeholder group is skilled at projecting demand, and who over- or underestimates, and by how much. This information will improve your projections and, therefore, your management over time.

Info-Tech Insight

Use the experience gained and the artifacts generated to build trust with the business. The meetings should be regular, and demonstrating that you’re actually using the information for good is likely to make hesitant participants in the process more likely to open up.

If you want additional support, have our analysts guide you through this phase as part of an Info-Tech workshop.

Book a workshop with our Info-Tech analysts:

• To accelerate this project, engage your IT team in an Info-Tech workshop with an Info-Tech analyst team.
• Info-Tech analysts will join you and your team onsite at your location or welcome you to Info-Tech’s historic Toronto office to participate in an innovative onsite workshop.
• Contact your account manager (www.infotech.com/account), or email Workshops@InfoTech.com for more information.

The following are sample activities that will be conducted by Info-Tech analysts with your team:

4.1

Identify capacity risks and mitigate them

The analyst will guide workshop participants in identifying potential risks to capacity and determining strategies for mitigating them.

Phase 4 Guided Implementation

Call 1-888-670-8889 or email GuidedImplementations@InfoTech.com for more information.

Complete these steps on your own, or call us to complete a guided implementation. A guided implementation is a series of 2-3 advisory calls that help you execute each phase of a project. They are included in most advisory memberships.

Insight breakdown

Insight 1

Components are critical to availability and capacity management.

The CEO doesn’t care about the SMTP server. She cares about meeting customer needs and producing profit. For IT capacity and availability managers, though, the devil is in the details. It only takes one faulty component to knock out a service. Keep track and keep the lights on.

Insight 2

Ask what the business is working on, not what they need.

If you ask them what they need, they’ll tell you – and it won’t be cheap. Find out what they’re going to do, and use your expertise to service those needs. Use your IT experience to estimate the impact of business and service level changes on the components that secure the availability you need.

Insight 3

Cloud shmoud.

The role of the capacity manager might be changing with the advent of the public cloud, but it has not disappeared. Capacity managers in the age of the cloud are responsible for managing vendor relationships, negotiating external SLAs, projecting costs and securing budgets, reining in prodigal divisions, and so on.

Summary of accomplishment

Knowledge Gained

• Impact of downtime on the organization
• Gold systems
• Key dependencies and sub-components
• Strategy for monitoring components
• Strategy for soliciting business needs
• Projected capacity needs
• Availability and capacity risks and mitigations

Processes Optimized

• Availability management
• Capacity management

Deliverables Completed

• Business Impact Analysis
• Capacity Plan Template

Project step summary

Client Project: Develop an Availability and Capacity Management Plan

1. Conduct a business impact analysis
2. Assign criticality ratings to services
3. Define your monitoring strategy
4. Implement your monitoring tool/aggregator
5. Solicit business needs and gather data
6. Analyze data and project future needs
7. Identify and mitigate risks

Info-Tech Insight

This project has the ability to fit the following formats:

• Onsite workshop by Info-Tech Research Group consulting analysts.
• Do-it-yourself with your team.
• Remote delivery via Info-Tech Guided Implementation.

Research contributors and experts

Adrian Blant, Independent Capacity Consultant, IT Capability Solutions

Adrian has over 15 years' experience in IT infrastructure. He has built capacity management business processes from the ground up, and focused on ensuring a productive dialogue between IT and the business.

James Zhang, Senior Manager Disaster Recovery, AIG Technology

James has over 20 years' experience in IT and 10 years' experience in capacity management. Throughout his career, he has focused on creating new business processes to deliver value and increase efficiency over the long term.

Mayank Banerjee, CTO, Global Supply Chain Management, HelloFresh

Mayank has over 15 years' experience across a wide range of technologies and industries. He has implemented highly automated capacity management processes as part of his role of owning and solving end-to-end business problems.

Mike Lynch, Consultant, CapacityIQ

Mike has over 20 years' experience in IT infrastructure. He takes a holistic approach to capacity management to identify and solve key problems, and has developed automated processes for mapping performance data to information that can inform business decisions.

Paul Waguespack, Manager of Application Systems Engineering, Tufts Health Plan

Paul has over 10 years' experience in IT. He has specialized in implementing new applications and functionalities throughout their entire lifecycle, and integrating with all aspects of IT operations.

Richie Mendoza, IT Consultant, SMITS Inc.

Richie has over 10 years' experience in IT infrastructure. He has specialized in using demand forecasting to guide infrastructure capacity purchasing decisions, to provide availability while avoiding costly overprovisioning.

Rob Thompson, President, IT Tools & Process

Rob has over 30 years’ IT experience. Throughout his career he has focused on making IT a generator of business value. He now runs a boutique consulting firm.

Todd Evans, Capacity and Performance Management SME, IBM

Todd has over 20 years' experience in capacity and performance management. At Kaiser Permanente, he established a well-defined mapping of the businesses workflow processes to technical requirements for applications and infrastructure.

Bibliography

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Herrera, Michael. “Four Types of Risk Mitigation and BCM Governance, Risk and Compliance.” MHA Consulting. May 17, 2013.

Hill, Jon. How to Do Capacity Planning. TeamQuest. 24 Oct. 2017. Web.

“How to Create an SLA in 7 Easy Steps.” ITSM Perfection. 25 Oct. 2017. Web.

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IT Service Criticality. U of Bristol. 24 Oct. 2017. Web.

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Build a Robust and Comprehensive Data Strategy

Key to building and fostering a data-driven culture.

ANALYST PERSPECTIVE

Data Strategy: Key to helping drive organizational innovation and transformation

"In the dynamic environment in which we operate today, where we are constantly juggling disruptive forces, a well-formulated data strategy will prove to be a key asset in supporting business growth and sustainability, innovation, and transformation.

Your data strategy must align with the organization’s business strategy, and it is foundational to building and fostering an enterprise-wide data-driven culture."

Crystal Singh,

Director – Research and Advisory

Info-Tech Research Group

Our understanding of the problem

This Research is Designed For:

• Chief data officers (CDOs), chief architects, VPs, and digital transformation directors and CIOs who are accountable for ensuring data can be leveraged as a strategic asset of the organization.

This Research Will Help You:

• Put a strategy in place to ensure data is available, accessible, well integrated, secured, of acceptable quality, and suitably visualized to fuel decision making by the organizations’ executives.
• Align data management plans and investments with business requirements and the organization’s strategic plans.
• Define the relevant roles for operationalizing your data strategy.

This Research Will Also Assist:

• Data architects and enterprise architects who have been tasked with supporting the formulation or optimization of the organization’s data strategy.
• Business leaders creating plans for leveraging data in their strategic planning and business processes.
• IT professionals looking to improve the environment that manages and delivers data.

This Research Will Help Them:

• Get a handle on the current situation of data within the organization.
• Understand how the data strategy and its resulting initiatives will affect the operations, integration, and provisioning of data within the enterprise.

Executive Summary

Situation

• The volume and variety of data that organizations have been collecting and producing have been growing exponentially and show no sign of slowing down. At the same time, business landscapes and models are evolving, and users and stakeholders are becoming more and more data centric, with maturing and demanding expectations.

Complication

• As organizations pivot in response to industry disruptions and changing landscapes, a reactive and piecemeal approach leads to data architectures and designs that fail to deliver real and measurable value to the business.
• Despite the growing focus on data, many organizations struggle to develop a cohesive business-driven strategy for effectively managing and leveraging their data assets.

Resolution

Formulate a data strategy that stitches all of the pieces together to better position you to unlock the value in your data:

• Establish the business context and value: Identify key business drivers for executing on an optimized data strategy, build compelling and relevant use cases, understand your organization’s culture and appetite for data, and ensure you have well-articulated vision, principles, and goals for your data strategy.
• Ensure you have a solid data foundation: Understand your current data environment, data management enablers, people, skill sets, roles, and structure. Know your strengths and weakness so you can optimize appropriately.
• Formulate a sustainable data strategy: Round off your strategy with effective change management and communication for building and fostering a data-driven culture.

Info-Tech Insight

1. As the CDO or equivalent data leader in your organization, a robust and comprehensive data strategy is the number one tool in your toolkit for delivering on your mandate of creating measurable business value from data.
2. A data strategy should never be formulated disjointed from the business. Ensure the data strategy aligns with the business strategy and supports the business architecture.
3. Building and fostering a data-driven culture will accelerate and sustain adoption of, appetite for, and appreciation for data and hence drive the ROI on your various data investments.

Why do you need a data strategy?

Your data strategy is the vehicle for ensuring data is poised to support your organization’s strategic objectives.

The dynamic marketplace of today requires organizations to be responsive in order to gain or maintain their competitive edge and place in their industry.

Organizations need to have that 360-degree view of what’s going on and what’s likely to happen.

Disruptive forces often lead to changes in business models and require organizations to have a level of adaptability to remain relevant.

To respond, organizations need to make decisions and should be able to turn to their data to gain insights for informing their decisions.

A well-formulated and robust data strategy will ensure that your data investments bring you the returns by meeting your organization’s strategic objectives.

Organizations need to be in a position where they know what’s going on with their stakeholders and anticipate what their stakeholders’ needs are going to be.

Data cannot be fully leveraged without a cohesive strategy

Most organizations today will likely have some form of data management in place, supported by some of the common roles such as DBAs and data analysts.

Most will likely have a data architecture that supports some form of reporting.

Some may even have a chief data officer (CDO), a senior executive who has a seat at the C-suite table.

These are all great assets as a starting point BUT without a cohesive data strategy that stitches the pieces together and:

• Effectively leverages these existing assets
• Augments them with additional and relevant key roles and skills sets
• Optimizes and fills in the gaps around your current data management enablers and capabilities for the growing volume and variety of data you’re collecting
• Fully caters to real, high-value strategic organizational business needs

you’re missing the mark – you are not fully leveraging the incredible value of your data.

Cross-industry studies show that on average, less than half of an organization’s structured data is actively used in making decisions

Organizational drivers for a data strategy

Your data strategy needs to align with your organizational strategy.

Main Organizational Strategic Drivers:

1. Stakeholder Engagement/Service Excellence
2. Product and Service Innovations
3. Operational Excellence
4. Privacy, Risk, and Compliance Management

“The companies who will survive and thrive in the future are the ones who will outlearn and out-innovate everyone else. It is no longer ‘survival of the fittest’ but ‘survival of the smartest.’ Data is the element that both inspires and enables this new form of rapid innovation.” – Joel Semeniuk, 2016

A sound data strategy is the key to unlocking the value in your organization’s data.

Data should be at the foundation of your organization’s evolution.

The transformational insights that executives are constantly seeking to leverage can be unlocked with a data strategy that makes high-quality, well-integrated, trustworthy, relevant data readily available to the business users who need it.

Whether hoping to gain a better understanding of your business, trying to become an innovator in your industry, or having a compliance and regulatory mandate that needs to be met, any organization can get value from its data through a well-formulated, robust, and cohesive data strategy.

According to a leading North American bank, “More than one petabyte of new data, equivalent to about 1 million gigabytes” is entering the bank’s systems every month. – The Wall Street Journal, 2019

“Although businesses are at many different stages in unlocking the power of data, they share a common conviction that it can make or break an enterprise.”– Jim Love, ITWC CIO and Chief Digital Officer, IT World Canada, 2018

Data is a strategic organizational asset and should be treated as such

The expression “Data is an asset” or any other similar sentiment has long been heard.

With such hype, you would have expected data to have gotten more attention in the boardrooms. You would have expected to see its value reflected on financial statements as a result of its impact in driving things like acquisition, retention, product and service development and innovation, market growth, stakeholder satisfaction, relationships with partners, and overall strategic success of the organization.

The time has surely come for data to be treated as the asset it is.

“Paradoxically, “data” appear everywhere but on the balance sheet and income statement.”– HBR, 2018

“… data has traditionally been perceived as just one aspect of a technology project; it has not been treated as a corporate asset.”– “5 Essential Components of a Data Strategy,” SAS

According to Anil Chakravarthy, who is the CEO of Informatica and has a strong vantage point on how companies across industries leverage data for better business decisions, “what distinguishes the most successful businesses … is that they have developed the ability to manage data as an asset across the whole enterprise.”– McKinsey & Company, 2019

How data is perceived in today’s marketplace

Data is being touted as the oil of the digital era…

But just like oil, if left unrefined, it cannot really be used.

"Data is the new oil." – Clive Humby, Chief Data Scientist

Source: Joel Semeniuk, 2016

Enter your data strategy.

Data is being perceived as that key strategic asset in your organization for fueling innovation and transformation.

Your data strategy is what allows you to effectively mine, refine, and use this resource.

“The world’s most valuable resource is no longer oil, but data.”– The Economist, 2017

“Modern innovation is now dependent upon this data.”– Joel Semeniuk, 2016

“The better the data, the better the resulting innovation and impact.”– Joel Semeniuk, 2016

What is it in it for you? What opportunities can data help you leverage?

GOVERNMENT

Leveraging data as a strategic asset for the benefit of citizens.

• The strategic use of data can enable governments to provide higher-quality services.
• Direct resources appropriately and harness opportunities to improve impact.
• Make better evidence-informed decisions and better understand the impact of programs so that funds can be directed to where they are most likely to deliver the best results.
• Maintain legitimacy and credibility in an increasingly complex society.
• Help workers adapt and be competitive in a changing labor market.
• A data strategy would help protect citizens from the misuse of their data.

Source: Privy Council Office, Government of Canada, 2018

What is it in it for you? What opportunities can data help you leverage?

FINANCIAL

Leveraging data to boost traditional profit and loss levers, find new sources of growth, and deliver the digital bank.

• One bank used credit card transactional data (from its own terminals and those of other banks) to develop offers that gave customers incentives to make regular purchases from one of the bank’s merchants. This boosted the bank’s commissions, added revenue for its merchants, and provided more value to the customer (McKinsey & Company, 2017).
• In terms of enhancing productivity, a bank used “new algorithms to predict the cash required at each of its ATMs across the country and then combined this with route-optimization techniques to save money” (McKinsey & Company, 2017).

A European bank “turned to machine-learning algorithms that predict which currently active customers are likely to reduce their business with the bank.” The resulting understanding “gave rise to a targeted campaign that reduced churn by 15 percent” (McKinsey & Company, 2017).

A leading Canadian bank has built a marketplace around their data – they have launched a data marketplace where they have productized the bank’s data. They are providing data – as a product – to other units within the bank. These other business units essentially represent internal customers who are leveraging the product, which is data.

Through the use of data and advanced analytics, “a top bank in Asia discovered unsuspected similarities that allowed it to define 15,000 microsegments in its customer base. It then built a next-product-to-buy model that increased the likelihood to buy three times over.” Several sets of big data were explored, including “customer demographics and key characteristics, products held, credit-card statements, transaction and point-of-sale data, online and mobile transfers and payments, and credit-bureau data” (McKinsey & Company, 2017).

What is it in it for you? What opportunities can data help you leverage?

HEALTHCARE

Leveraging data and analytics to prevent deadly infections

The fifth-largest health system in the US and the largest hospital provider in California uses a big data and advanced analytics platform to predict potential sepsis cases at the earliest stages, when intervention is most helpful.

Using the Sepsis Bio-Surveillance Program, this hospital provider monitors 120,000 lives per month in 34 hospitals and manages 7,500 patients with potential sepsis per month.

Collecting data from the electronic medical records of all patients in its facilities, the solution uses natural language processing (NLP) and a rules engine to continually monitor factors that could indicate a sepsis infection. In high-probability cases, the system sends an alarm to the primary nurse or physician.

Since implementing the big data and predictive analytics system, this hospital provider has seen a significant improvement in the mortality and the length of stay in ICU for sepsis patients.

At 28 of the hospitals which have been on the program, sepsis mortality rates have dropped an average of 5%.

With patients spending less time in the ICU, cost savings were also realized. This is significant, as sepsis is the costliest condition billed to Medicare, the second costliest billed to Medicaid and the uninsured, and the fourth costliest billed to private insurance.

Source: SAS, 2019

What is it in it for you? What opportunities can data help you leverage?

RETAIL

Leveraging data to better understand customer preferences, predict purchasing, drive customer experience, and optimize supply and demand planning.

Netflix is an example of a big brand that uses big data analytics for targeted advertising. With over 100 million subscribers, the company collects large amounts of data. If you are a subscriber, you are likely familiar with their suggestions messages of the next series or movie you should catch up on. These suggestions are based on your past search data and watch data. This data provides Netflix with insights into your interests and preferences for viewing (Mentionlytics, 2018).

“For the retail industry, big data means a greater understanding of consumer shopping habits and how to attract new customers.”– Ron Barasch, Envestnet | Yodlee, 2019

The business case for data – moving from platitudes to practicality

When building your business case, consider the following:

• What is the most effective way to communicate the business case to executives?
• How can CDOs and other data leaders use data to advance their organizations’ corporate strategy?
• What does your data estate look like? Are you looking to leverage and drive value from your semi-structured and unstructured data assets?
• Does your current organizational culture support a data-driven one? Does the organization have a history of managing change effectively?
• How do changing privacy and security expectations alter the way businesses harvest, save, use, and exchange data?

“We’re the converted … We see the value in data. The battle is getting executive teams to see it our way.”– Ted Maulucci, President of SmartONE Solutions Inc. IT World Canada, 2018

Where do you stack up? What is your current data management maturity?

Info-Tech’s IT Maturity Ladder denotes the different levels of maturity for an IT department and its different functions. What is the current state of your data management capability?

Info-Tech Insight

You are best positioned to successfully execute on a data strategy if you are currently at or above the Trusted Operator level. If you find yourself still at the Unstable or Firefighter stage, your efforts are best spent on ensuring you can fulfill your day-to-day data and data management demands. Improving this capability will help build a strong data management foundation.

Guiding principles of a data strategy

Value of Clearly Defined Data Principles

• Guiding principles help define the culture and characteristics of your practice by describing your beliefs and philosophy.
• Guiding principles act as the heart of your data strategy, helping to shape initiative plans and day-to-day behaviors related to the use and treatment of the organization’s data assets.

“Organizational culture can accelerate the application of analytics, amplify its power, and steer companies away from risky outcomes.”– McKinsey, 2018

Build a Robust and Comprehensive Data Strategy

Follow Info-Tech’s methodology for effectively leveraging the value out of your data

Some say it’s the new oil. Or the currency of the new business landscape. Others describe it as the fuel of the digital economy. But we don’t need platitudes — we need real ways to extract the value from our data. – Jim Love, CIO and Chief Digital Officer, IT World Canada, 2018

Our practical step-by-step approach helps you to formulate a data strategy that delivers business value.

1. Establish Business Context and Value: In this phase, you will determine and substantiate the business drivers for optimizing the data strategy. You will identify the business drivers that necessitate the data strategy optimization and examine your current organizational data culture. This will be key to ensuring the fruits of your optimization efforts are being used. You will also define the vision, mission, and guiding principles and build high-value use cases for the data strategy.
2. Ensure You Have a Solid Data and Resources Foundation: This phase will help you ensure you have a solid data and resources foundation for operationalizing your data strategy. You will gain an understanding of your current environment in terms of data management enablers and the required resources portfolio of key people, roles, and skill sets.
3. Formulate a Sustainable Data Strategy: In this phase, you will bring the pieces together for formulating an effective data strategy. You will evaluate and prioritize the use cases built in Phase 1, which summarize the alignment of organizational goals with data needs. You will also create your strategic plan, considering change management and communication.

Info-Tech offers various levels of support to best suit your needs

DIY Toolkit

“Our team has already made this critical project a priority, and we have the time and capability, but some guidance along the way would be helpful.”

Guided Implementation

“Our team knows that we need to fix a process, but we need assistance to determine where to focus. Some check-ins along the way would help keep us on track.”

Workshop

“We need to hit the ground running and get this project kicked off immediately. Our team has the ability to take this over once we get a framework and strategy in place.”

Consulting

“Our team does not have the time or the knowledge to take this project on. We need assistance through the entirety of this project.”

Diagnostics and consistent frameworks are used throughout all four options.

Get Started With Customer Advocacy

Develop a customer advocacy program to transform customer satisfaction into revenue growth.

EXECUTIVE BRIEF

Analyst perspective

Customer advocacy is critical to driving revenue growth

Customer advocacy puts the customer at the center of everything your organization does. By cultivating a deep understanding of customer needs and how they define value and by delivering positive experiences throughout the customer journey, organizations inspire and empower customers to become evangelists for their brands or products. Both the client and solution provider enjoy satisfying and ongoing business outcomes as a result.

Focusing on customer advocacy is critical for software solutions providers. Business-to-business (B2B) buyers are increasingly looking to their peers and third-party resources to arm themselves with information on solutions they feel they can trust before they choose to engage with solution providers. Your satisfied customers are now your most trusted and powerful resource.

Customer advocacy helps build strong relationships with your customers, nurtures brand advocacy, gives your marketing messaging credibility, and differentiates your company from the competition; it’s critical to driving revenue growth. Companies that develop mature advocacy programs can increase Customer Lifetime Value (CLV) by 16% (Wharton Business School, 2009), increase customer retention by 35% (Deloitte, 2011), and give themselves a strong competitive advantage in an increasingly competitive marketplace.

Emily Wright
Senior Research Analyst, Advisory
SoftwareReviews

Executive summary

Your Challenge

Ad hoc customer advocacy (CA) efforts and reference programs, while still useful, are not enough to drive growth. Providers increase their chance for success by assessing if they face the following challenges:

• Lack of referenceable customers that can turn into passionate advocates, or a limited pool that is at risk of burnout.
• Lack of references for all key customer types, verticals, etc., especially in new growth segments or those that are hard to recruit.
• Lack of a consistent program for gathering customer feedback and input to make improvements and increase customer satisfaction.
• Lack of executive and stakeholder (e.g. Sales, Customer Success, channel partners, etc.) buy-in for the importance and value of customer advocacy.

Building a strong customer advocacy program must be a high priority for customer service/success leaders in today’s highly competitive software markets.

Common Obstacles

Getting started with customer advocacy is no easy task. Many customer success professionals carry out ad hoc customer advocacy activities to address immediate needs but lack a more strategic approach. What separates them from success are several nagging obstacles:

• Efforts lack funding and buy-in from stakeholders.
• Senior management doesn’t fully understand the business value of a customer advocacy program.
• Duplicate efforts are taking place between Sales, Marketing, product teams, etc., because ownership, roles, and responsibilities have not been determined.
• Relationships are guarded/hoarded by those who feel they own the relationship (e.g. Sales, Customer Success, channel partners, etc.).
• Customer-facing staff often lack the necessary skills to foster customer advocacy.

SoftwareReviews’ Approach

This blueprint will help leaders of customer advocacy programs get started with developing a formalized pilot program that will demonstrate the value of customer advocacy and lay a strong foundation to justify rollout. Through SoftwareReviews’ approach, customer advocacy leaders will:

• Enable the organization to identify and develop meaningful relationships with top customers and advocates.
• Understand the concepts and benefits of CA and how CA can be used to improve marketing and sales and fuel growth and competitiveness.
• Follow SoftwareReviews’ methodology to identify where to start to apply CA within the organization.
• Develop a customer advocacy proof of concept/pilot program to gain stakeholder approval and funding to get started with or expand efforts around customer advocacy.

What is customer advocacy?

“Customer advocacy is the act of putting customer needs first and working to deliver solution-based assistance through your products and services." – Testimonial Hero, 2021

Customer advocacy is designed to keep customers loyal through customer engagement and advocacy marketing campaigns. Successful customer advocacy leaders experience decreased churn while increasing return on investment (ROI) through retention, acquisition, and cost savings.

Businesses that implement customer advocacy throughout their organizations find new ways of supporting customers, provide additional customer value, and ensure their brands stand unique among the competition.

Customer Advocacy Is…

• An integral part of any marketing and/or business strategy.
• Essential to improving and maintaining high levels of customer satisfaction.
• Focused on delivering value to customers.
• Not only a set of actions, but a mindset that should be fostered and reinforced through a customer-centric culture.
• Mutually beneficial relationships for both company and customer.

Customer Advocacy Is Not…

• Only referrals and testimonials.
• Solely about what you can get from your advocates.
• Brand advocacy. Brand advocacy is the desired outcome of customer advocacy.
• Transactional. Brand advocates must be engaged.
• A nice-to-have.
• Solved entirely by software. Think about what you want to achieve and how a software solution can you help you reach those goals.

SoftwareReviews Insight

Customer advocacy has evolved into being a valued company asset versus a simple referral program – success requires an organization-wide customer-first mindset and the recognition that customer advocacy is a strategic growth initiative necessary to succeed in today’s competitive market.

Customer advocacy: Essential to high retention

When customers advocate for your company and products, they are eager to retain the value they receive

• Customer acts of advocacy correlate to high retention.
• Acts of advocacy won’t happen unless customers feel their interests are placed ahead of your company’s, thereby increasing satisfaction and customer success. That’s the definition of a customer-centric culture.
• And yet your company does receive significant benefits from customer advocacy:
  • When customers advocate and renew, your costs go down and margins rise because it costs less to keep a happy customer than it does to bring a new customer onboard.
  • When renewal rates are high, customer lifetime value increases, also increasing profitability.

Acquiring a new customer can cost five times more than retaining an existing customer (Huify, 2018).

Increasing customer retention by 5% can increase profits by 25% to 95% (Bain & Company, cited in Harvard Business Review, 2014).

SoftwareReviews Insight

Don’t overlook the value of customer advocacy to retention! Despite the common knowledge that it’s far easier and cheaper to sell to an existing customer than to sell to a new prospect, most companies fail to leverage their customer advocacy programs and continue to put pressure on Marketing to focus their budgets on customer acquisition.

Customer advocacy can also be your ultimate growth strategy

In your marketing and sales messaging, acts of advocacy serve as excellent proof points for value delivered.

Forty-five percent of businesses rank online reviews as a top source of information for selecting software during this (top of funnel) stage, followed closely by recommendations and referrals at 42%. These sources are topped only by company websites at 54% (Clutch, 2020).

With referrals coming from customer advocates to prospects via your lead gen engine and through seller talk tracks, customer advocacy is central to sales, marketing, and customer experience success.

✓ Advocates can help your new customers learn your solution and ensure higher adoption and satisfaction.
✓ Advocates can provide valuable, honest feedback on new updates and features.

“A customer advocacy program is not just a fancy buzz word or a marketing tool that’s nice to have. It’s a core discipline that every major brand needs to integrate into their overall marketing, sales and customer success strategies if they expect to survive in this trust economy. Customer advocacy arguably is the common asset that runs throughout all marketing, sales and customer success activities regardless of the stage of the buyer’s journey and ties it all together.” – RO Innovation, 2017

Positive experience drives acts of advocacy

More than price or product, experience now leads the way in customer advocacy and retention

Advocacy happens when customers recommend your product. Our research shows that the biggest drivers of likeliness to recommend and acts of customer advocacy are the positive experiences customers have with vendors and their products, not product features or cost savings. Customers want to feel that:

1. Their productivity and performance is enhanced and the vendor is helping them to innovate and grow as a company.
2. Their vendor inspires them and helps them to continually improve.
3. They can rely on the vendor and the product they purchased.
4. They are respected by the vendor.
5. They can trust that the vendor will be on their side and save them time.

Note that anything above 0.5 indicates a strong driver of satisfaction.
Source: SoftwareReviews buyer reviews (based on 82,560 unique reviews).

SoftwareReviews Insight

True customer satisfaction comes from helping customers innovate, enhancing their performance, inspiring them to continually improve, and being reliable, respectful, trustworthy, and conscious of their time. These true drivers of satisfaction should be considered in your customer advocacy and retention efforts. The experience customers have with your product and brand is what will differentiate your brand from competitors, drive advocacy, and ultimately, power business growth. Talk to a SoftwareReviews advisor to learn how users rate your product on these satisfaction drivers in the SoftwareReviews Emotional Footprint Report.

Yet challenges exist for customer advocacy program leaders

Customer success leaders without a strong customer advocacy program feel numerous avoidable pains:

• Lack of compelling stories and proof points for the sales team, causing long sales cycles.
• Heavy reliance on a small pool of worn-out references.
• Lack of references for all needed customer types, verticals, etc.
• Lack of a reliable customer feedback process for solution improvements.
• Overspending on acquiring new customers due to a lack of customer proof points.
• Missed opportunities that could grow the business (customer lifetime value, upsell/cross-sell, etc.).

Marketing, customer success, and sales teams experiencing any one of the above challenges must consider getting started with a more formalized customer advocacy program.

Obstacles to customer advocacy programs

Leaders must overcome several barriers in developing a customer advocacy program:

• Stakeholders are often unclear on the value customer advocacy programs can bring and require proof of benefits to invest.
• Efforts are duplicated among sales, marketing, product, and customer success teams, given ownership and collaboration practices are ill-defined or nonexistent.
• There is a culture of guarding or hoarding customer relationships by those who feel they own the relationship, or there’s high turnover among employees who own the customer relationships.
• The governance, technology, people, skills, and/or processes to take customer advocacy to the next level are lacking.
• Leaders don’t know where to start with customer advocacy, what needs to be improved, or what to focus on first.

A lack of customer centricity hurts organizations

12% of people believe when a company says they put customers first. (Source: HubSpot, 2019)

Brands struggle to follow through on brand promises, and a mismatch between expectations and lived experience emerges. Customer advocacy can help close this gap and help companies live up to their customer-first messaging.

42% of companies don’t conduct any customer surveys or collect feedback. (Source: HubSpot, 2019)

Too many companies are not truly listening to their customers. Companies that don’t collect feedback aren’t going to know what to change to improve customer satisfaction. Customer advocacy will orient companies around their customer and create a reliable feedback loop that informs product and service enhancements.

Customer advocacy is no longer a nice-to-have but a necessity for solution providers

B2B buyers increasingly turn to peers to learn about solutions:

“84% of B2B decision makers start the buying process with a referral.” (Source: Influitive, Gainsight & Pendo, 2020)

“46% of B2B buyers rely on customer references for information before purchasing.” (Source: RO Innovation, 2017)

“91% of B2B purchasers’ buying decisions are influenced by word-of-mouth recommendations.” (Source: ReferralRock, 2022)

“76% of individuals admit that they’re more likely to trust content shared by ‘normal’ people than content shared by brands.” (Source: TrustPilot, 2020)

By ignoring the importance of customer advocacy, companies and brands are risking stagnation and missing out on opportunities to gain competitive advantage and achieve growth.

Getting Started With Customer Advocacy: SoftwareReviews' Approach

1 BUILD
Build the business case
Identify your key stakeholders, steering committee, and working team, understand key customer advocacy principles, and note success barriers and ways to overcome them as your first steps.

2 DEVELOP
Develop your advocacy requirements
Assess your current customer advocacy maturity, identify gaps in your current efforts, and develop your ideal advocate profile.

3 WIN
Win executive approval and implement pilot
Determine goals and success metrics for the pilot, establish a timeline and key project milestones, create advocate communication materials, and finally gain executive buy-in and implement the pilot.

SoftwareReviews Insight
Building and implementing a customer advocacy pilot will help lay the foundation for a full program and demonstrate to executives and key stakeholders the impact on revenue, retention, and CLV that can be achieved through coordinated and well-planned customer advocacy efforts.

Customer advocacy benefits

Our research benefits customer advocacy program managers by enabling them to:

• Explain why having a centralized, proactive customer advocacy program is important.
• Clearly communicate the benefits and business case for having a formalized customer advocacy program.
• Develop a customer advocacy pilot to provide a proof of concept (POC) and demonstrate the value of customer advocacy.
• Assess the maturity of your current customer advocacy efforts and identify what to improve and how to improve to grow your customer advocacy function.

"Advocacy is the currency for business and the fuel for explosive growth. Successful marketing executives who understand this make advocacy programs an essential part of their go-to-market strategy. They also know that advocacy isn't something you simply 'turn on': ... ultimately, it's about making human connections and building relationships that have enduring value for everyone involved."
- Dan Cote, Influitive, Dec. 2021

Case Study: Advocate impact on sales at Genesys

Genesys' Goal

Provide sales team with compelling customer reviews, quotes, stories, videos, and references.

Approach to Advocacy

• Customers were able to share their stories through Genesys' customer hub GCAP as quotes, reviews, etc., and could sign up to host reference forum sessions for prospective customers.
• Content was developed that demonstrated ROI with using Genesys' solutions, including "top-tier logos, inspiring quotes, and reference forums featuring some of their top advocates" (Influitive, 2021).
• Leveraged customer advocacy-specific software solution integration with the CRM to easily identify reference recommendations for Sales.

Advocate Impact on Sales

According to Influitive (2021), the impacts were:

• 386% increase in revenue influences from references calls
• 82% of revenue has been influence by reference calls
• 78 reference calls resulted in closed-won opportunities
• 250 customers and prospects attended 7 reference forums
• 112 reference slides created for sales enablement
• 100+ quotes were collect and transformed into 78 quote slides

Who benefits from getting started with customer advocacy?

This Research Is Designed for:

• Customer advocacy leaders and marketers who are looking to:
  • Take a more strategic, proactive, and structured approach to customer advocacy.
  • Find a more effective and reliable way to gather customer feedback and input on products and services.
  • Develop and nurture a customer-oriented mindset throughout the organization.
  • Improve marketing credibility both within the company and outside to prospective customers.

This Research Will Help You:

• Explain why having a centralized, proactive customer advocacy program is important.
• Clearly communicate the benefits and business case for having a formalized customer advocacy program.
• Develop a customer advocacy pilot to provide a proof of concept (POC) and demonstrate the value of customer advocacy.
• Assess the maturity of your current customer advocacy efforts and identify what to improve and how to improve to grow your customer advocacy function.

This Research Will Also Assist:

• Customer success leaders and sales directors who are responsible for:
  • Gathering customer references and testimonials.
  • Referral or voice of the customer (VoC) programs.

This Research Will Help Them:

• Align stakeholders on an overall program of identifying ideal advocates.
• Coordinate customer advocacy efforts and actions.
• Gather and make use of customer feedback to improve products, solutions, and service provided.
• Provide an amazing customer experience throughout the entirety of the customer journey.

SoftwareReviews’ methodology for getting started with customer advocacy

Insight summary

Customer advocacy is a critical strategic growth initiative
Customer advocacy (CA) has evolved into being a highly valued company asset as opposed to a simple referral program, but not everyone in the organization sees it that way. Customer success leaders must reposition their CA program around growth instead of focusing solely on retention and communicate this to key stakeholders. The recognition that customer advocacy is a strategic growth initiative is necessary to succeed in today’s competitive market.

Get key stakeholders on board early – especially Sales!
Work to bring the CEO and the head of Sales on your side early. Sales is the gatekeeper – they need to open the door to customers to turn them into advocates. Clearly reposition CA for growth and communicate that to the CEO and head of Sales; wider buy-in will follow.

Identify the highest priority segment for generating acts of advocacy
By focusing on the highest priority segment, you accomplish a number of things: generating growth in a critical customer segment, proving the value of customer advocacy to key stakeholders (especially Sales), and setting a strong foundation for customer advocacy to build upon and expand the program out to other segments.

Always link your CA efforts back to retention and growth
By clearly demonstrating the impact that customer advocacy has on not only retention but also overall growth, marketers will gain buy-in from key stakeholders, secure funding for a full CA program, and gain the resources needed to expand customer advocacy efforts.

Focus on providing value to advocates
Many organizations take a transactional approach to customer advocacy, focusing on what their advocates can do for them. To truly succeed with CA, focus on providing your advocates with value first and put them in the spotlight.

Make building genuine relationships with your advocates the cornerstone of your CA program
"57% of small businesses say that having a relationship with their consumers is the primary driver of repeat business" (Factory360).

Guided Implementation

What does our GI on getting started with building customer advocacy look like?

Build the Business Case

Call #1: Identify key stakeholders. Map out motivations and anticipate any concerns or objections. Determine steering committee and working team. Plan next call – 1 week.

Call #2: Discuss concepts and benefits of customer advocacy as they apply to organizational goals. Plan next call – 1 week.

Call #3: Discuss barriers to success, risks, and risk mitigation tactics. Plan next call – 1 week.

Call #4: Finalize CA goals, opportunities, and risks and develop business case. Plan next call – 2 weeks.

Develop Your Advocacy Requirements

Call #5: Review the SoftwareReviews CA Maturity Assessment Tool. Assess your current level of customer advocacy maturity. Plan next call – 1 week.

Call #6: Review gaps and pains in current CA efforts. Discuss tactics and possible CA pilot program goals. Begin adding tasks to action plan. Plan next call – 2 weeks.

Call #7: Discuss ideal advocate profile and target segments. Plan next call – 2 weeks.

Call #8: Validate and finalize ideal advocate profile. Plan next call – 1 week.

Win Executive Approval and Implement Pilot

Call #9: Discuss CA pilot scope. Discuss performance metrics and KPIs. Plan next call – 3 days.

Call #10: Determine timeline and key milestones. Plan next call –2 weeks.

Call #11: Develop advocate communication materials. Plan next call – 3 days.

Call #12: Review final business case and coach on executive presentation. Plan next call – 1 week.

A Guided Implementation (GI) is series of calls with a SoftwareReviews Advisory analyst to help implement our best practices in your organization. For guidance on marketing applications, we can arrange a discussion with an Info-Tech analyst. Your engagement managers will work with you to schedule analyst calls.

Customer Advocacy Workshop

Contact your account representative for more information.
workshops@infotech.com
1-888-670-8889

Get started!

Know your target market and audience, deploy well-designed strategies based on shared values, and make meaningful connections with people.

Phase 1
Build the Business Case

Phase 2
Develop Your Advocacy Requirements

Phase 3
Win Executive Approval and Implement Pilot

Phase 1: Build the Business Case

Steps
1.1 Identify your key stakeholders, steering committee, and working team
1.2 Understand the concepts and benefits of customer advocacy as they apply to your organization
1.3 Outline barriers to success, risks, and risk mitigation tactics

Phase Outcome

• Common understanding of CA concepts and benefits
• Buy-in from CEO and head of Sales
• List of barriers to success, risks, and risk mitigation tactics

Build the business case

Step 1.1 Identify your key stakeholders, steering committee, and working team

Total duration: 2.5-8.0 hours

Objective
Identify, document, and finalize your key stakeholders to know who to involve and how to get them onboard by truly understanding the forces of influence.

Output

• Robust stakeholder list with key stakeholders identified.
• Steering committee and working team decided.

Participants

• Customer advocacy lead
• Identified stakeholders
• Workstream leads

MarTech
None

Tools

• Executive Presentation Template

1.1.1 Identify Stakeholders
(60-120 min.)

Identify
Using the guidance on slide 28, identify all stakeholders who would be involved or impacted by your customer advocacy pilot by entering names and titles into columns A and B on slide 27 "Stakeholder List Worksheet."

Document
Document as much information about each stakeholder as possible in columns C, D, E, and F into the table on slide 27.

1.1.2 Select Steering Committee & Working Team
(60-90 min.)

Select
Using the guidance on slides 28 and 29 and the information collected in the table on slide 27, identify the stakeholders that are steering committee members, functional workstream leads, or operations; document in column G on slide 27.

Document
Open the Executive Presentation Template to slides 5 and 6 and document your final steering committee and working team selections. Be sure to note the Executive Sponsor and Program Manager on slide 5.

Tips & Reminders

1. It is critical to identify "key stakeholders"; a single missed key stakeholder can disrupt an initiative. A good way to ensure that nobody is missed is to first uncover as many stakeholders as possible and later decide how important they are.
2. Ensure steering committee representation from each department this initiative would impact or that may need to be involved in decision-making or problem-solving endeavors.

Consult Info-Tech's Manage Stakeholder Relations blueprint for additional guidance on identifying and managing stakeholders, or contact one of our analysts for more personalized assistance and guidance.

Stakeholder List Worksheet

Customer advocacy stakeholders

What to consider when identifying stakeholders required for CA:
Customer advocacy should be done as a part of a cross-functional company initiative. When identifying stakeholders, consider:

• Who can make the ultimate decision on approving the CA program?
• Who are the senior leadership members you need buy-in from?
• Who do you need to support the CA program?
• Who is affected by the CA program?
• Who will help you build the CA program?
• Where and among who is there enthusiasm for customer advocacy?
• Consider stakeholders from Customer Success, Marketing, Sales, Product, PR & Social, etc.

Customer advocacy working team

Consider the skills and knowledge required for planning and executing a customer advocacy pilot.

Workstream leads should have strong project management and collaboration skills and deep understanding of both product and customers (persona, journeys, satisfaction, etc.).

Build the business case

Step 1.2 Understand key concepts and benefits of customer advocacy

Total duration: 2.0-4.0 hours

Objective
Understand customer advocacy and what benefits you seek from your customer advocacy program, and get set up to best communicate them to executives and decision makers.

Output

• Documented customer advocacy benefits

Participants

• Customer advocacy lead

MarTech
None

Tools

• Executive Presentation Template

1.2.1 Discuss Key Concepts
(60-120 min.)

Envision
Schedule a visioning session with key stakeholders and share the Get Started With Customer Advocacy Executive Brief (slides 3-23 in this deck).

Discuss how key customer advocacy concepts can apply to your organization and how CA can contribute to organizational growth.

Document
Determine the top benefits sought from the customer advocacy program pilot and record them on slides 4 and 12 in the Executive Presentation Template.

Finalize
Work with the Executive Sponsor to finalize the "Message from the CMO" on slide 4 in the Executive Presentation Template.

Tips & Reminders

Keep in mind that while we're starting off broadly, the pilot for your customer advocacy program should be narrow and focused in scope.

Build the business case

Step 1.3 Understand barriers to success, risks, and risk mitigation tactics

Total duration: 2.0-8.0 hours

Objective
Anticipate threats to pilot success; identify barriers to success, any possible risks, and what can be done to reduce the chances of a negative pilot outcome.

Output

• Awareness of barriers
• Tactics to mitigate risk

Participants

• Customer advocacy lead
• Key stakeholders

MarTech
None

Tools

• Executive Presentation Template

1.3.1 Brainstorm Barriers to Success & Possible Risks
(60-120 min.)

Identify
Using slide 7 of the Executive Presentation Template, brainstorm any barriers to success that may exist and risks to the customer advocacy program pilot success. Consider the people, processes, and technology that may be required.

Document
Document all information on slide 7 of the Executive Presentation Template.

1.3.2 Develop Risk Mitigation Tactics
(60-300 min.)

Develop
Brainstorm different ways to address any of the identified barriers to success and reduce any risks. Consider the people, processes, and technology that may be required.

Document
Document all risk mitigation tactics on slide 7 of the Executive Presentation Template.

Tips & Reminders
There are several types of risk to explore. Consider the following when brainstorming possible risks:

• Damage to brand (if advocate guidance not provided)
• Legal (compliance with regulations and laws around contact, incentives, etc.)
• Advocate burnout
• Negative advocate feedback

Phase 2: Develop Your Advocacy Requirements

Steps
2.1 Assess your customer advocacy maturity
2.2 Identify and document gaps and pain points
2.3 Develop your ideal advocate profile

Phase Outcome

• Identification of gaps in current customer advocacy efforts or activities
• Understanding of customer advocacy readiness and maturity
• Identification of ideal advocate profile/target segment
• Basic actions to bridge gaps in CA efforts

Develop your advocacy requirements

Step 2.1 Assess your customer advocacy maturity

Total duration: 2.0-8.0 hours

Objective
Use the Customer Advocacy Maturity Assessment Tool to understand your organization's current level of customer advocacy maturity and what to prioritize in the program pilot.

Output

• Current level of customer advocacy maturity
• Know areas to focus on in program pilot

Participants

• Customer advocacy lead
• Key stakeholders

MarTech
None

Tools

• Customer Advocacy Maturity Assessment Tool
• Executive Presentation Template

2.1.1 Diagnose Current Customer Advocacy Maturity
(60-120 min.)

Diagnose
Begin on tab 1 of the Customer Advocacy Maturity Assessment Tool and read all instructions.

Navigate to tab 2. Considering the current state of customer advocacy efforts, answer the diagnostic questions in the Diagnostic tab of the Customer Advocacy Maturity Assessment Tool.

After completing the questions, you will receive a diagnostic result on tab 3 that will identify areas of strength and weakness and make high-level recommendations for your customer advocacy program pilot.

2.1.2 Discuss Results
(60-300 min.)

Discuss
Schedule a call to discuss your customer advocacy maturity diagnostic results with a SoftwareReviews Advisor.

Prioritize the recommendations from the diagnostic, noting which will be included in the program pilot and which require funding and resources to advance.

Transfer
Transfer results into slides 8 and 11 of the Executive Presentation Template.

Tips & Reminders
Complete the diagnostic with a handful of key stakeholders identified in the previous phase. This will help provide a more balanced and accurate assessment of your organization’s current level of customer advocacy maturity.

Develop your advocacy requirements

Step 2.2 Identify and document gaps and pain points

Total duration: 2.5-8.0 hours

Objective
Understand the current pain points within key customer-related processes and within any current customer advocacy efforts taking place.

Output

• Prioritized list of pain points that could be addressed by a customer advocacy program.

Participants

• Customer advocacy lead
• Key stakeholders

MarTech
None

Tools

• Executive Presentation Template

2.2.1 Identify Pain Points
(60-120 min.)

Identify
Identify and list current pain points being experienced around customer advocacy efforts and processes around sales, marketing, customer success, and product feedback.

Add any gaps identified in the diagnostic to the list.

Transfer
Transfer key information into slide 9 of Executive Presentation Template.

2.2.2 Prioritize Pain Points
(60-300 min.)

Prioritize
Indicate which pains are the most important and that a customer advocacy program could help improve.

Schedule a call to discuss the outputs of this step with a SoftwareReviews Advisor.

Document
Document priorities on slide 9 of Executive Presentation Template.

Tips & Reminders

Customer advocacy won't solve for everything; it's important to be clear about what pain points can and can't be addressed through a customer advocacy program.

Develop your advocacy requirements

Step 2.3 Develop your ideal advocate profile

Total duration: 3.0-9.0 hours

Objective
Develop an ideal advocate persona profile that can be used to identify potential advocates, guide campaign messaging, and facilitate advocate engagement.

Output

• Ideal advocate persona profile

Participants

• Customer advocacy lead
• Key stakeholders
• Sales lead
• Marketing lead
• Customer Success lead
• Product lead

MarTech
May require the use of:

• CRM or marketing automation platform
• Available and up-to-date customer database

Tools

• Executive Presentation Template

2.3.1 Brainstorm Session Around Ideal Advocate Persona
(60-150 min.)

Brainstorm
Lead the team to prioritize an initial, single, most important persona and to collaborate to complete the template.

Choose your ideal advocate for the pilot based on your most important audience. Start with firmographics like company size, industry, and geography.

Next, consider satisfaction levels and behavioral attributes, such as renewals, engagement, usage, and satisfaction scores.

Identify motivations and possible incentives for advocate activities.

Document
Use slide 10 of the Executive Presentation Template to complete this exercise.

2.3.2 Review and Refine Advocate Persona
(60-300 min.)

Review & Refine
Place the Executive Presentation Template in a shared drive for team collaboration. Encourage the team to share persona knowledge within the shared drive version.

Hold any necessary follow-up sessions to further refine persona.

Validate
Interview advocates that best represent your ideal advocate profile on their type of preferred involvement with your company, their role and needs when it comes to your solution, ways they'd be willing to advocate, and rewards sought.

Confirm
Incorporate feedback and inputs into slide 10 of the Executive Presentation Template. Ensure everyone agrees on persona developed.

Tips & Reminders

1. When identifying potential advocates, choose based on your most important audience.
2. Ensure you're selecting those with the highest satisfaction scores.
3. Ideally, select candidates that have, on their own, advocated previously such as in social posts, who may have acted as a reference, or who have been highly visible as a positive influence at customer events.
4. Knowing motivations will determine the type of acts of advocacy they would be most willing to perform and the incentives for participating in the program.

Consider the following criteria when identifying advocates and developing your ideal advocate persona:

Phase 3: Win Executive Approval and Implement Pilot

Steps
3.1 Determine pilot goals and success metrics
3.2 Establish timeline and create advocate communication materials
3.3 Gain executive buy-in and implement pilot

Phase Outcome

• Clear objective for CA pilot
• Key metrics for program success
• Pilot timelines and milestones
• Executive presentation with business case for CA

Win executive approval and implement pilot

Step 3.1 Determine pilot goals and success metrics

Total duration: 2.0-4.0 hours

Objective
Set goals and determine the scope for the customer advocacy program pilot.

Output

• Documented business objectives for the pilot
• Documented success metrics

Participants

• Customer advocacy lead
• Key stakeholders
• Sales lead
• Marketing lead
• Customer Success lead
• Product lead

MarTech
May require to use, set up, or install platforms like:

• Register to a survey platform
• CRM or marketing automation platform

Tools

• Executive Presentation Template

3.1.1 Establish Pilot Goals
(60-120 min.)

Set
Organize a meeting with department heads and review organizational and individual department goals.

Using the Venn diagram on slide 39 in this deck, identify customer advocacy goals that align with business goals. Select the highest priority goal for the pilot.

Check that the goal aligns with benefits sought or addresses pain points identified in the previous phase.

Document
Document the goals on slides 9 and 16 of the Executive Presentation Template.

3.1.2 Establish Pilot Success Metrics
(60-120 min.)

Decide
Decide how you will measure the success of your program pilot using slide 40 in this document.

Document
Document metrics on slide 16 of the Executive Presentation Template.

Tips & Reminders

1. Don't boil the ocean. Pick the most important goal that can be achieved through the customer advocacy pilot to gain executive buy-in and support or resources for a formal customer advocacy program. Once successfully completed, you'll be able to tackle new goals and expand the program.
2. Keep your metrics simple, few in number, and relatively easy to track

Connect customer advocacy goals with organizational goals

List possible customer advocacy goals, identifying areas of overlap with organizational goals by taking the following steps:

1. List organizational/departmental goals in the green oval.
2. List possible customer advocacy program goals in the purple oval.
3. Enter goals that are covered in both the Organizational Goals and Customer Advocacy Goals sections into the Shared Goals section in the center.
4. Highlight the highest priority goal for the customer advocacy program pilot to tackle.

Customer advocacy success metrics for consideration

This table provides a starting point for measuring the success of your customer advocacy pilot depending on the goals you've set.

This list is by no means exhaustive; the metrics here can be used, or new metrics that would better capture success measurement can be created and tracked.

When selecting metrics, remember:
When choosing metrics for your customer advocacy pilot, be sure to align them to your specific goals. If possible, try to connect your advocacy efforts back to retention, growth, or revenue.

Do not choose too many metrics; one per goal should suffice.

Ensure that you can track the metrics you select to measure - the data is available and measuring won't be overly manual or time-consuming.

Win executive approval and implement pilot

Step 3.2 Establish timeline and create advocate communication materials

Total duration: 2.5-8.0 hours

Objective
Outline who will be involved in what roles and capacities and what tasks and activities need to completed.

Output

• Timeline and milestones
• Advocate program materials

Participants

• Customer advocacy lead
• Key stakeholders
• Sales lead
• Marketing lead
• Customer Success lead
• Product lead

MarTech
None

Tools

• Executive Presentation Template

3.2.1 Establish Timeline & Milestones
(30-60 min.)

List & Assign
List all key tasks, phases, and milestones on slides 13, 14, and 15 in the Executive Presentation Template.

Include any activities that help close gaps or address pain points from slide 9 in the Executive Presentation Template.

Assign workstream leads on slide 15 in the Executive Presentation Template.

Finalize all tasks and activities with working team.

3.2.2 Design & Build Advocate Program Materials
(180-300 min.)

Decide
Determine materials needed to recruit advocates and explain the program to advocate candidates.

Determine the types of acts of advocacy you are looking for.

Determine incentives/rewards that will be provided to advocates, such as access to new products or services.

Build
Build out all communication materials.

Obtain incentives.

Tips & Reminders

1. When determining incentives, use the validated ideal advocate profile for guidance (i.e. what motivates your advocates?).
2. Ensure to leave a buffer in the timeline if the need to adjust course arises.

Win executive approval and implement pilot

Step 3.3 Implement pilot and gain executive buy-in

Total duration: 2.5-8.0 hours

Objective
Successfully implement the customer advocacy pilot program and communicate results to gain approval for full-fledged program.

Output

• Deliver Executive Presentation
• Successful customer advocacy pilot
• Provide regular updates to stakeholders, executives

Participants

• Customer advocacy lead
• Workstream leads

MarTech
May require the use of:

• CRM or Marketing Automation Platform
• Available and up-to-date customer database

Tools

• Executive Presentation Template

3.3.1 Complete & Deliver Executive Presentation
(60-120 min.)

Present
Finalize the Executive Presentation.

Hold stakeholder meeting and introduce the program pilot.

3.3.2 Gain Executive Buy-in
(60-300 min.)

Pitch
Present the final results of the customer advocacy pilot using the Executive Presentation Template and gain approval.

3.3.3 Implement the Customer Advocacy Program Pilot
(30-60 min.)

Launch
Launch the customer advocacy program pilot. Follow the timelines and activities outlined in the Executive Presentation Template. Track/document all advocate outreach, activity, and progress against success metrics.

Communicate
Establish a regular cadence to communicate with steering committee, stakeholders. Use the Executive Presentation Template to present progress and resolve roadblocks if/as they arise.

Tips & Reminders

1. Continually collect feedback and input from advocates and stakeholders throughout the process.
2. Don't be afraid to make changes on the go if it helps to achieve the end goal of your pilot.
3. If the pilot program was successful, consider scaling it up and rolling it out to more customers.

Summary of Accomplishment

Mission Accomplished

• You successfully launched your customer advocacy program pilot and demonstrated clear benefits and ROI. By identifying the needs of the business and aligning those needs with key customer advocacy activities, marketers and customer advocacy leaders can prioritize the most important tasks for the pilot while also identifying potential opportunities for expansion pending executive approval.
• SoftwareReviews' comprehensive and tactical approach takes you through the steps to build the foundation for a strategic customer advocacy program. Our methodology ensures that a customer advocacy pilot is developed to deliver the desired outcomes and ROI, increasing stakeholder buy-in and setting up your organization for customer advocacy success.

If you would like additional support, contact us and we'll make sure you get the professional expertise you need.

Contact your account representative for more information.
info@softwarereviews.com
1-888-670-8889

Related SoftwareReviews Research

Measure and Manage the Customer Satisfaction Metrics That Matter the Most
Understand what truly keeps your customer satisfied. Measure what matters to improve customer experience and increase satisfaction and advocacy.

• Understand the true drivers of satisfaction and dissatisfaction among your customer segments.
• Establish process and cadence for effective satisfaction measurement and monitoring.
• Know where resources are needed most to improve satisfaction levels and increase retention.

Develop the Right Message to Engage Buyers
Sixty percent of marketers find it hard to produce high-quality content consistently. SaaS marketers have an even more difficult job due to the technical nature of content production.

• Create more compelling and relevant content that aligns with a buyer's needs and journey.
• Shrink marketing and sales cycles.
• Increase the pace of content production.

Create a Buyer Persona and Journey
Get deeper buyer understanding and achieve product-market fit, with easier access to market and sales.

• Reduce time and resources wasted chasing the wrong prospects.
• Increase open and click-through rates.
• Perform more effective sales discovery.
• Increase win rate.

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"Brand Loyalty: 5 Interesting Statistics." Factory360, Jan. 2016. Accessed 2 Nov. 2021.

Brenner, Michael. "The Data Driven Guide to Customer Advocacy." Marketing Insider Group, Sept. 2021. Accessed 3 Feb. 2022.

Carroll, Brian. "Why Customer Advocacy Should Be at the Heart of Your Marketing." Marketing Insider Group, Sept. 2017. Accessed 3 Feb. 2022.

Cote, Dan. "Advocacy Blooms and Business Booms When Customers and Employees Engage." Influitive, Dec. 2021. Accessed 3 Feb. 2022.

"Customer Success Strategy Guide." ON24, Jan. 2021. Accessed 2 Nov. 2021.

Dalao, Kat. "Customer Advocacy: The Revenue-Driving Secret Weapon." ReferralRock, June 2017. Accessed 7 Dec. 2021.

Frichou, Flora. "Your guide to customer advocacy: What is it, and why is it important?" TrustPilot, Jan. 2020. Accessed 26 Oct. 2021.

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Huhn, Jessica. "61 B2B Referral Marketing Statistics and Quotes." ReferralRock, March 2022. Accessed 10 March 2022.

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Kettner, Kyle. "The Evolution of Ambassador Marketing." BrandChamp.io, Oct. 2018. Accessed 2 Nov. 2021.

Landis, Taylor. "Customer Retention Marketing vs. Customer Acquisition Marketing." OutboundEngine, April 2022. Accessed 23 April 2022.

Miels, Emily. "What is customer advocacy? Definition and strategies." Zendesk Blog, June 2021. Accessed 27 Oct. 2021.

Mohammad, Qasim. "The 5 Biggest Obstacles to Implementing a Successful B2B Customer Advocacy Program." HubSpot, June 2018. Accessed 6 Jan. 2022.

Murphy, Brandon. "Brand Advocacy and Social Media - 2009 GMA Conference." Deloitte, Dec. 2009. Accessed 8 June 2023.

Patel, Neil. "Why SaaS Brand Advocacy is More Important than Ever in 2021." Neil Patel, Feb. 2021. Accessed 4 Nov. 2021.

Pieri, Carl. "The Plain-English Guide to Customer Advocacy." HubSpot, Apr. 2020. Accessed 27 Oct. 2021.

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"The Complete Guide to Customer Advocacy." Gray Group International, 2020. Accessed 15 Oct. 2021.

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"The Winning Case for a Customer Advocacy Solution." RO Innovation, 2017. Accessed 26 Oct. 2021.

Tidey, Will. "Acquisition vs. Retention: The Importance of Customer Lifetime Value." Huify, Feb. 2018. Accessed 10 Mar. 2022.

"What a Brand Advocate Is and Why Your Company Needs One." RockContent, Jan. 2021. Accessed 7 Feb. 2022.

"What is Customer Advocacy? A Definition and Strategies to Implement It." Testimonial Hero, Oct. 2021. Accessed 26 Jan. 2022.

Prepare for Post-Quantum Cryptography

It is closer than you think, and you need to act now.

Analyst Perspective

It is closer than you think, and you need to act now.

The quantum realm presents itself as a peculiar and captivating domain, shedding light on enigmas within our world while pushing the boundaries of computational capabilities. The widespread availability of quantum computers is expected to occur sooner than anticipated. This emerging technology holds the potential to tackle valuable problems that even the most powerful classical supercomputers will never be able to solve. Quantum computers possess the ability to operate millions of times faster than their current counterparts.

As we venture further into the era of quantum mechanics, organizations relying on encryption must contemplate a future where these methods no longer suffice as effective safeguards. The astounding speed and power of quantum machines have the potential to render many existing security measures utterly ineffective, including the most robust encryption techniques used today. To illustrate, a task that currently takes ten years to crack through a brute force attack could be accomplished by a quantum computer in under five minutes.

Amid this transition into a quantum future, the utmost priority for organizations remains data security, particularly safeguarding sensitive information. Organizations must proactively prepare for the development of countermeasures and essential resilience measures to attain a state of being "quantum safe."

Alan Tang
Principal Research Director, Security and Privacy
Info-Tech Research Group

Executive Summary

Your Challenge

• Anticipated advancements in fault-tolerant quantum computers, surpassing existing encryption algorithms and cryptographic systems, are expected to materialize sooner than previously projected. The timeframe for their availability is diminishing daily.
• Data that is presently deemed secure faces potential vulnerability due to the emergence of harvest-now-decrypt-later strategies.
• Numerous contemporary security controls, including the most robust encryption techniques, have become obsolete and offer little efficacy.

Common Obstacles

• The complexity involved makes it challenging for organizations to incorporate quantum-resistant cryptography into their current IT infrastructure.
• The endeavor of transitioning to quantum-resilient cryptography demands significant effort and time, with the specific requirements varying for each organization.
• A lack of comprehensive understanding regarding the cryptographic technologies employed in existing IT systems poses difficulties in identifying and prioritizing systems for upgrading to post-quantum cryptography.

Info-Tech's Approach

• The development of quantum-resistant cryptography capabilities is essential for safeguarding the security and integrity of critical applications.
• Organizations must proactively initiate their transition toward quantum-resistant encryption to ensure data protection.
• Ensuring the security of corporate data assets should be of utmost importance for organizations, with special emphasis on those possessing highly critical information in light of the advancements in quantum technology.

Info-Tech Insight

The advent of quantum computing (QC) is closer than you think: some nations have demonstrated capability with the potential to break current asymmetric-key encryption. Traditional encryption methods will no longer be sufficient as a means of protection. You need to act now to begin your transformation to quantum-resistant encryption.

Evolvement of QC theory and technologies

Info-Tech Insight

The advent of QC will significantly change our perception of computing and have a crucial impact on the way we protect our digital economy using encryption. The technology's applicability is no longer a theory but a reality to be understood, strategized about, and planned for.

Fundamental physical principles and business use cases

Unlike conventional computers that rely on bits, quantum computers use quantum bits or qubits. QC technology surpasses the limitations of current processing powers. By leveraging the properties of superposition, interference, and entanglement, quantum computers have the capacity to simultaneously process millions of operations, thereby surpassing the capabilities of today's most advanced supercomputers.

A 2021 Hyperion Research survey of over 400 key decision makers in North America, Europe, South Korea, and Japan showed nearly 70% of companies have some form of in-house QC program.

Three fundamental QC physical principles

1. Superposition
2. Interference
3. Entanglement

Info-Tech Insight

Organizations need to reap the substantial benefits of QC's power, while simultaneously shielding against the same technologies when used by cyber adversaries.

Percentage of Surveyed Companies That Have QC Programs

• 31% Have some form of in-house QC program
• 69% Have no QC program

Early adopters and business value

QC early adopters see the promise of QC for a wide range of computational workloads, including machine learning applications, finance-oriented optimization, and logistics/supply chain management.

Info-Tech Insight

Experienced attackers are likely to be the early adopters of quantum-enabled cryptographic solutions, harnessing the power of QC to exploit vulnerabilities in today's encryption methods. The risks are particularly high for industries that rely on critical infrastructure.

The need of quantum-safe solution is immediate

Critical components of classical cryptography will be at risk, potentially leading to the exposure of confidential and sensitive information to the general public. Business, technology, and security leaders are confronted with an immediate imperative to formulate a quantum-safe strategy and establish a roadmap without delay.

Case Study – Google, 2019

In 2019, Google claimed that "Our Sycamore processor takes about 200 seconds to sample one instance of a quantum circuit a million times—our benchmarks currently indicate that the equivalent task for a state-of-the-art classical supercomputer would take approximately 10,000 years."
Source: Nature, 2019

Why You Should Start Preparation Now

• The complexity with integrating QC technology into existing IT infrastructure.
• The effort to upgrade to quantum-resilient cryptography will be significant.
• The amount of time remaining will decrease every day.

Case Study – Development in China, 2020

On December 3, 2020, a team of Chinese researchers claim to have achieved quantum supremacy, using a photonic peak 76-qubit system (43 average) known as Jiuzhang, which performed calculations at 100 trillion times the speed of classical supercomputers.
Source: science.org, 2020

Info-Tech Insight

The emergence of QC brings forth cybersecurity threats. It is an opportunity to regroup, reassess, and revamp our approaches to cybersecurity.

Security threats posed by QC

Quantum computers have reached a level of advancement where even highly intricate calculations, such as factoring large numbers into their primes, which serve as the foundation for RSA encryption and other algorithms, can be solved within minutes.

Threat to data confidentiality

QC could lead to unauthorized decryption of confidential data in the future. Data confidentiality breaches also impact improperly disposed encrypted storage media.

Threat to authentication protocols and digital governance

A recovered private key, which is derived from a public key, can be used through remote control to fraudulently authenticate a critical system.

Threat to data integrity

Cybercriminals can use QC technology to recover private keys and manipulate digital documents and their digital signatures.

Example:

Consider RSA-2048, a widely used public-key cryptosystem that facilitates secure data transmission. In a 2021 survey, a majority of leading authorities believed that RSA-2048 could be cracked by quantum computers within a mere 24 hours.
Source: Quantum-Readiness Working Group, 2022

Info-Tech Insight

The development of quantum-safe cryptography capabilities is of utmost importance in ensuring the security and integrity of critical applications' data.

US Quantum Computing Cybersecurity Preparedness Act

The US Congress considers cryptography essential for the national security of the US and the functioning of the US economy. The Quantum Computing Cybersecurity Preparedness Act was introduced on April 18, 2022, and became a public law (No: 117-260) on December 21, 2022.

Purpose

The purpose of this Act is to encourage the migration of Federal Government information technology systems to quantum-resistant cryptography, and for other purposes.

Scope and Exemption

• Scope: Systems of government agencies.
• Exemption: This Act shall not apply to any national security system.

"It is the sense of Congress that (1) a strategy for the migration of information technology of the Federal Government to post-quantum cryptography is needed; and (2) the government wide and industry-wide approach to post- quantum cryptography should prioritize developing applications, hardware intellectual property, and software that can be easily updated to support cryptographic agility." – Quantum Computing Cybersecurity Preparedness Act

The development of post-quantum encryption

Since 2016, the National Institute of Standards and Technology (NIST) has been actively engaged in the development of post-quantum encryption standards. The objective is to identify and establish standardized cryptographic algorithms that can withstand attacks from quantum computers.

NIST QC Initiative Key Milestones

Four Selected Candidates to be Standardized

NIST recommends two primary algorithms to be implemented for most use cases: CRYSTALS-KYBER (key-establishment) and CRYSTALS-Dilithium (digital signatures). In addition, the signature schemes FALCON and SPHINCS+ will also be standardized.

Info-Tech Insight

There is no need to wait for formal NIST PQC standards selection to begin your post-quantum mitigation project. It is advisable to undertake the necessary steps and allocate resources in phases that can be accomplished prior to the finalization of the standards.

Prepare for post-quantum cryptography

The advent of QC is closer than you think: some nations have demonstrated capability with the potential to break current asymmetric-key encryption. Traditional encryption methods will no longer be sufficient as a means of protection. You need to act now to begin your transformation to quantum-resistant encryption.

Insight summary

Overarching Insight

The advent of QC is closer than you think as some nations have demonstrated capability with the potential to break current asymmetric-key encryption. Traditional encryption methods will no longer be sufficient as a means of protection. You need to act now to begin your transformation to quantum-resistant encryption.

Business Impact Is High

The advent of QC will significantly change our perception of computing and have a crucial impact on the way we protect our digital economy using encryption. The technology's applicability is no longer a theory but a reality to be understood, strategized about, and planned for.

It's a Collaborative Effort

Embedding quantum resistance into systems during the process of modernization requires collaboration beyond the scope of a Chief Information Security Officer (CISO) alone. It is a strategic endeavor shaped by leaders throughout the organization, as well as external partners. This comprehensive approach involves the collective input and collaboration of stakeholders from various areas of expertise within and outside the organization.

Leverage Industry Standards

There is no need to wait for formal NIST PQC standards selection to begin your post-quantum mitigation project. It is advisable to undertake the necessary steps and allocate resources in phases that can be accomplished prior to the finalization of the standards.

Take a Holistic Approach

The advent of QC poses threats to cybersecurity. It's a time to regroup, reassess, and revamp.

Blueprint benefits

Info-Tech Project Value

Get prepared for a post-quantum world

The advent of sufficiently powerful quantum computers poses a risk of compromising or weakening traditional forms of asymmetric and symmetric cryptography. To safeguard data security and integrity for critical applications, it is imperative to undertake substantial efforts in migrating an organization's cryptographic systems to post-quantum encryption. The development of quantum-safe cryptography capabilities is crucial in this regard.

Phase 1 - Prepare

• Obtain buy-in from leadership team.
• Educate your workforce about the upcoming transition.
• Create defined projects to reduce risks and improve crypto-agility.

Phase 2 - Discover

• Determine the extent of your exposed data, systems, and applications.
• Establish an inventory of classical cryptographic use cases.

Phase 3 - Assess

• Assess the security and data protection risks posed by QC.
• Assess the readiness of transforming existing classical cryptography to quantum-resilience solutions.

Phase 4 - Prioritize

• Prioritize transformation plan based on criteria such as business impact, near-term technical feasibility, and effort, etc.
• Establish a roadmap.

Phase 5 - Mitigate

• Implement post-quantum mitigations.
• Decommissioning old technology that will become unsupported upon publication of the new standard.
• Validating and testing products that incorporate the new standard.

Phase 1 – Prepare: Protect data assets in the post-quantum era

The rise of sufficiently powerful quantum computers has the potential to compromise or weaken conventional asymmetric and symmetric cryptography methods. In anticipation of a quantum-safe future, it is essential to prioritize crypto-agility. Consequently, organizations should undertake specific tasks both presently and in the future to adequately prepare for forthcoming quantum threats and the accompanying transformations.

Quantum-resistance preparations must address two different needs:

Reinforce digital transformation initiatives

To thrive in the digital landscape, organizations must strengthen their digital transformation initiatives by embracing emerging technologies and novel business practices. The transition to quantum-safe encryption presents a unique opportunity for transformation, allowing the integration of these capabilities to evolve business transactions and relationships in innovative ways.

Protect data assets in the post-quantum era

Organizations should prioritize supporting remediation efforts aimed at ensuring the quantum safety of existing data assets and services. The implementation of crypto-agility enables organizations to respond promptly to cryptographic vulnerabilities and adapt to future changes in cryptographic standards. This proactive approach is crucial, as the need for quantum-safe measures existed even before the complexities posed by QC emerged.

Preparation for the post-quantum world has been recommended by the US government and other national bodies since 2016.

In 2016, NIST, the National Security Agency (NSA), and Central Security Service stated in their Commercial National Security Algorithm Suite and QC FAQ: "NSA believes the time is now right [to start preparing for the post-quantum world] — consistent with advances in quantum computing."
Source: Cloud Security Alliance, 2021

Phase 1 – Prepare: Key tasks

Preparing for quantum-resistant cryptography goes beyond simply acquiring knowledge and conducting experiments in QC. It is vital for senior management to receive comprehensive guidance on the challenges, risks, and potential mitigations associated with the post-quantum landscape. Quantum and post-quantum education should be tailored to individuals based on their specific roles and the impact of post-quantum mitigations on their responsibilities. This customized approach ensures that individuals are equipped with the necessary knowledge and skills relevant to their respective roles.

Leadership Buy-In

• Get senior management commitment to post-quantum project.
• Determine the extent of exposed data, systems, and applications.
• Identify near-term, achievable cryptographic maturity goals, creating defined projects to reduce risks and improve crypto-agility.

Roles and Responsibilities

• The ownership should be clearly defined regarding the quantum-resistant cryptography program.
• This should be a cross-functional team within which members represent various business units.

Awareness and Education

• Senior management needs to understand the strategic threat to the organization and needs to adequately address the cybersecurity risk in a timely fashion.
• Educate your workforce about the upcoming transition. All training and education should seek to achieve awareness of the following items with the appropriate stakeholders.

Info-Tech Insight

Embedding quantum resistance into systems during the process of modernization requires collaboration beyond the scope of a CISO alone. It is a strategic endeavor shaped by leaders throughout the organization, as well as external partners. This comprehensive approach involves the collective input and collaboration of stakeholders from various areas of expertise within and outside the organization.

Phase 2 – Discover: Establish a data protection inventory

During the discovery phase, it is crucial to locate and identify any critical data and devices that may require post-quantum protection. This step enables organizations to understand the algorithms in use and their specific locations. By conducting this thorough assessment, organizations gain valuable insights into their existing infrastructure and cryptographic systems, facilitating the implementation of appropriate post-quantum security measures.

Inventory Core Components

1. Description of devices and/or data
2. Location of all sensitive data and devices
3. Criticality of the data
4. How long the data or devices need to be protected
5. Effective cryptography in use and cryptographic type
6. Data protection systems currently in place
7. Current key size and maximum key size
8. Vendor support timeline
9. Post-quantum protection readiness

Key Things to Consider

• The accuracy and thoroughness of the discovery phase are critical factors that contribute to the success of a post-quantum project.
• It is advisable to conduct this discovery phase comprehensively across all aspects, not solely limited to public-key algorithms.
• Performing a data protection inventory can be a time-consuming and challenging phase of the project. Breaking it down into smaller subtasks can help facilitate the process.
• Identifying all information can be particularly challenging since data is typically scattered throughout an organization. One approach to begin this identification process is by determining the inputs and outputs of data for each department and team within the organization.
• To ensure accountability and effectiveness, it is recommended to assign a designated individual as the ultimate owner of the data protection inventory task. This person should have the necessary responsibilities and authority to successfully accomplish the task.

Phase 3 – Assess: The workflow

Quantum risk assessment entails evaluating the potential consequences of QC on existing security measures and devising strategies to mitigate these risks. This process involves analyzing the susceptibility of current systems to attacks by quantum computers and identifying robust security measures that can withstand QC threats.

Risk Assessment Workflow

By identifying the security gaps that will arise with the advent of QC, organizations can gain insight into the substantial vulnerabilities that core business operations will face when QC becomes a prevalent reality. This proactive understanding enables organizations to prepare and implement appropriate measures to address these vulnerabilities in a timely manner.

Phase 4 – Prioritize: Balance business value, security risks, and effort

Organizations need to prioritize the mitigation initiatives based on various factors such as business value, level of security risk, and the effort needed to implement the mitigation controls. In the diagram below, the size of the circle reflects the degree of effort. The bigger the size, the more effort is needed.

QC Adopters Anticipated Annual Budgets

Source: Hyperion Research, 2022

Hyperion's survey found that the range of expected budget varies widely.

• The most selected option, albeit by only 38% of respondents, was US$5 million to US$15 million.
• About one-third of respondents foresaw annual budgets that exceeded US$15 million, and one-fifth expected budgets to exceed US$25 million.

Build your risk mitigation roadmap

2 hours

1. Review the quantum-resistance initiatives generated in Phase 3 – Assessment.
2. With input from all stakeholders, prioritize the initiatives based on business value, security risks, and effort using the 2x2 grid.
3. Review the position of all initiatives and adjust accordingly considering other factors such as dependency, etc.
4. Place prioritized initiatives to a wave chart.
5. Assign ownership and target timeline for each initiative.

Input

• Data protection inventory created in phase 2
• Risk assessment produced in phase 3
• Business unit leaders' and champions' understanding (high-level) of challenges posed by QC

Output

• Prioritization of quantum-resistance initiatives

Materials

• Whiteboard/flip charts
• Sticky notes
• Pen/whiteboard markers

Participants

• Quantum-resistance program owner
• Senior leadership team
• Business unit heads
• Chief security officer
• Chief privacy officer
• Chief information officer
• Representatives from legal, risk, and governance

Phase 5 – Mitigate: Implement quantum-resistant encryption solutions

To safeguard against cybersecurity risks and threats posed by powerful quantum computers, organizations need to adopt a robust defense-in-depth approach. This entails implementing a combination of well-defined policies, effective technical defenses, and comprehensive education initiatives. Organizations may need to consider implementing new cryptographic algorithms or upgrading existing protocols to incorporate post-quantum encryption methods. The selection and deployment of these measures should be cost-justified and tailored to meet the specific needs and risk profiles of each organization.

Governance

Implement solid governance mechanisms to promote visibility and to help ensure consistency

• Update policies and documents
• Update existing acceptable cryptography standards
• Update security and privacy audit programs

Industry Standards

• Stay up to date with newly approved standards
• Leverage industry standards (i.e. NIST's post-quantum cryptography) and test the new quantum-safe cryptographic algorithms

Technical Mitigations

Each type of quantum threat can be mitigated using one or more known defenses.

• Physical isolation
• Replacing quantum-susceptible cryptography with quantum-resistant cryptography
• Using QKD
• Using quantum random number generators
• Increasing symmetric key sizes
• Using hybrid solutions
• Using quantum-enabled defenses

Vendor Management

• Work with key vendors on a common approach to quantum-safe governance
• Assess vendors for possible inclusion in your organization's roadmap
• Create acquisition policies regarding quantum-safe cryptography

Research Contributors and Experts

Adib Ghubril
Executive Advisor, Executive Services
Info-Tech Research Group

Erik Avakian
Technical Counselor
Info-Tech Research Group

Alaisdar Graham
Executive Counselor
Info-Tech Research Group

Carlos Rivera
Principal Research Advisor
Info-Tech Research Group

Hendra Hendrawan
Technical Counselor
Info-Tech Research Group

Fritz Jean-Louis
Principal Cybersecurity Advisor
Info-Tech Research Group

Bibliography

117th Congress (2021-2022). H.R.7535 - Quantum Computing Cybersecurity Preparedness Act. congress.gov, 21 Dec 2022.
Arute, Frank, et al. Quantum supremacy using a programmable superconducting processor. Nature, 23 Oct 2019.
Bernhardt, Chris. Quantum Computing for Everyone. The MIT Press, 2019.
Bob Sorensen. Quantum Computing Early Adopters: Strong Prospects For Future QC Use Case Impact. Hyperion Research, Nov 2022.
Candelon, François, et al. The U.S., China, and Europe are ramping up a quantum computing arms race. Here's what they'll need to do to win. Fortune, 2 Sept 2022.
Curioni, Alessandro. How quantum-safe cryptography will ensure a secure computing future. World Economic Forum, 6 July 2022.
Davis, Mel. Toxic Substance Exposure Requires Record Retention for 30 Years. Alert presented by CalChamber, 18 Feb 2022.
Eddins, Andrew, et al. Doubling the size of quantum simulators by entanglement forging. arXiv, 22 April 2021.
Gambetta, Jay. Expanding the IBM Quantum roadmap to anticipate the future of quantum-centric supercomputing. IBM Research Blog, 10 May 2022.
Golden, Deborah, et al. Solutions for navigating uncertainty and achieving resilience in the quantum era. Deloitte, 2023.
Grimes, Roger, et al. Practical Preparations for the Post-Quantum World. Cloud Security Alliance, 19 Oct 2021.
Harishankar, Ray, et al. Security in the quantum computing era. IBM Institute for Business Value, 2023.
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Mateen, Abdul. What is post-quantum cryptography? Educative, 2023.
Moody, Dustin. Let's Get Ready to Rumble—The NIST PQC 'Competition.' NIST, 11 Oct 2022.
Mosca, Michele, Dr. and Dr. Marco Piani. 2021 Quantum Threat Timeline Report. Global Risk Institute, 24 Jan 2022.
Muppidi, Sridhar and Walid Rjaibi. Transitioning to Quantum-Safe Encryption. Security Intelligence, 8 Dec 2022.
Payraudeau, Jean-Stéphane, et al. Digital acceleration: Top technologies driving growth in a time of crisis. IBM Institute for Business Value, Nov 2020.
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Rotman, David. We're not prepared for the end of Moore's Law. MIT Technology Review, 24 Feb 2020.
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Shorter., Ted. Why Companies Must Act Now To Prepare For Post-Quantum Cryptography. Forbes.com, 11 Feb 2022.
Sieger, Lucy, et al. The Quantum Decade, Third edition. IBM, 2022.
Sorensen, Bob. Broad Interest in Quantum Computing as a Driver of Commercial Success. Hyperion Research, 17 Nov 2021.
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SoftwareReviews — A Division of INFO~TECH RESEARCH GROUP

Optimize Software Pricing in a Volatile Competitive Market

Leading SaaS product managers align pricing strategy to company financial goals and refresh the customer price/value equation to avoid leaving revenues uncaptured.

Table of Contents

Optimize Software Pricing in a Volatile Competitive Market

Leading SaaS product managers align pricing strategy to company financial goals and refresh the customer price/value equation to avoid leaving revenues uncaptured.

EXECUTIVE BRIEF

Analyst Perspective

Optimized Pricing Strategy

Product managers without well-documented and repeatable pricing management processes often experience pressure from “Agile” management to make gut-feel pricing decisions, resulting in poor product revenue results. When combined with a lack of customer, competitor, and internal cost understanding, these process and timing limitations drive most product managers into suboptimal software pricing decisions. And, adding insult to injury, the poor financial results from bad pricing decisions aren’t fully measured for months, which further compounds the negative effects of poor decision making.

A successful product pricing strategy aligns finance, marketing, product management, and sales to optimize pricing using a solid understanding of the customer perception of price/value, competitive pricing, and software production costs.

Success for many SaaS product managers requires a reorganization and modernization of pricing tools, techniques, and data. Leaders will develop the science of tailored price changes versus across-the-board price actions and account for inflation exposure and the customers’ willingness to pay.

This blueprint will build your skills on how to price new products or adjust pricing for existing products. The discipline you build using our pricing strategy methodology will strengthen your team’s ability to develop repeatable pricing and will build credibility with senior management and colleagues in marketing and sales.

Joanne Morin Correia Principal Research Director SoftwareReviews

Executive Summary

SoftwareReviews Insight

Product leaders will price products based on a deep understanding of the buyer price/value equation and alignment with financial and competitive pricing strategies, and they will make ongoing adjustments based on an ability to monitor buyers, competitors, and product cost changes.

What is an optimized price strategy?

SoftwareReviews Insight

An optimized pricing strategy establishes the “best” price for a product or service that maximizes profits and shareholder value while considering customer business value vs. the cost to purchase and implement – the total cost of ownership (TCO).

Challenging environment

Pricing skills are declining

Key considerations for more effective pricing decisions

New product price approach

Is Your Pricing Strategy Optimized? With the right pricing strategy, you can invest more money into your product, service, or growth. A 1% price increase will improv revenues by: Price monetization will almost double the revenue increases over customer acquisition and retention. (Pricing Strategies, Growth Ramp, March 2022)	DIAGNOSE PRICE CHALLENGES Prices of today's cloud-based services/products are often misaligned against competition and customers' perceived value, leaving more revenues on the table. Do you struggle to price new products with confidence? Do you really know your SaaS product's costs? Have you lost pricing power to stronger competitors? Has cost focus eclipsed customer value focus? If so, you are likely skipping steps and missing key outputs in your pricing strategy.
OPTIMIZE THESE STEPS ALIGNMENT Assign Team Responsibilities Set Timing for Project Deliverables Clarify Financial Expectations Collect Customer Contacts Determine Competitors BEFORE RESEARCH, HAVE YOU Documented your executive's financial expectations? If "No," return. RESEARCH & VALIDATE Research Competitors Interview Customers Test Pricing vs. Financials Create Pricing Presentation BEFORE PRESENTING, HAVE YOU: Clarified your customer and competitive positioning to validate pricing? If "No," return. BUY-IN Executive Pricing Presentation Post-Mortem of Presentation Document New Processes Monitor the Pricing Changes BEFORE RESEARCH, HAVE YOU: Documented your executive's financial expectations? If "No," return.
DELIVER KEY OUTPUTS Sponsoring executive(s) signs-offs require a well-articulated pricing plan and business case for investment that includes: Competitive features and pricing financial templates Customer validation of price value Optimized price presentation Repeatable pricing processes to monitor changes REAP THE REWARDS Product pricing is better aligned to achieve financial goals Improved pricing skills or professional development Stronger team reputation for reliable price management

Key Insights

1. Gain a competitive edge by using market and customer information to optimize product financials, refine pricing, and speed up decisions.
2. Product leaders will best set software product price based on a deep understanding of buyer/price value equation, alignment with financial strategy, and an ongoing ability to monitor buyer, competitor, and product costs.

SoftwareReviews’ methodology for optimizing your pricing strategy

Insight summary

Modernize your price planning

Blueprint deliverables

Guided Implementation

A Guided Implementation (GI) is a series of calls with a SoftwareReviews analyst to help implement our best practices in your organization.

A typical GI is 4 to 8 calls over the course of 2 to 4 months.

What does a typical GI on optimizing software pricing look like?

SoftwareReviews Offers Various Levels of Support to Meet Your Needs

Desire a Guided Implementation?

• A GI is where your SoftwareReviews engagement manager and executive advisor/counselor will work with SoftwareReviews research team members to craft with you a Custom Key Initiative Plan (CKIP).
• A CKIP guides your team through each of the major steps, outlines responsibilities between members of your team and SoftwareReviews, describes expected outcomes, and captures actual value delivered.
• A CKIP also provides you and your team with analyst/advisor/counselor feedback on project outputs, helps you communicate key principles and concepts to your team, and helps you stay on project timelines.
• If Guided Implementation assistance is desired, contact your engagement manager.