Branimir Valentic How much does the ITIL or ISO 20000 implementation cost? This certainly belongs as one of the most interesting questions related to the implementation – particularly for your management. But, it’s also the most unpleasant one.
Why is that so? It’s because the answer to that question is one in which no one can be precise. There are many parameters and issues that influence implementation and related costs. Some of them are predictable, some of them are hard to estimate (in financial terms), and some of them are just estimations; i.e., they can’t be predicted in advance.
What kind of costs are there?
There are different sources i.e., kinds of costs. Depending on the implementation (whether you implement ITIL or ISO 20000), they could be significantly different. Additionally, costs are also dependent on the size of the organization. Generally, a smaller organization will have less complex processes and technology in place, so related costs will be lower.
But, let’s see what kinds of costs (and their origins, i.e., how they are incurred) there are, so you will better understand what I mean when I say that implementation costs can vary. ITIL and ISO 20000 have many common steps in their implementations. The difference occurs when we talk about the scope, but I’ll explain that a bit later.
So, the following are costs that you have to take into account for the ITIL/ISO 20000 implementation:
- Costs incurred before implementation – most probably, you will have some preparation before the implementation:
- Training – that’s an excellent way to gain knowledge in a short time. ITIL has a pretty well set educational path (read the article ITIL Certification Path – list of all available ITIL trainings, exams and certificates to learn more about trainings). ISO 20000 also has formal education for individuals, and that’s how you can gain needed knowledge in a short time. But be careful: training will give you knowledge of the standard, i.e., best practice, but practical experience will make you an expert on the subject (ITIL or ISO 20000).
- Literature/documentation – if (because of any reason) training is not an option, self-study will do. From my experience, it’s a much harder way, but it’s certainly an option. You will need to buy books and invest some time (I would say – a lot of time). That’s valid for both ITIL as well as ISO 20000. If you implement ISO 20000, you’ll need a copy of the standard as well. That’s another investment before the implementation begins. Processes (and functions, in the case of ITIL) need to be documented. The documentation set can be made inside the organization or purchased (to speed up the implementation).
- Scope-related costs – now, you have started the implementation. There is a difference according to whether you are implementing ITIL or ISO 20000. Namely, ITIL has 26 processes and 4 functions and does allow you to implement what you need; i.e., you are allowed to tailor the scope to your needs (e.g., if you need only Service Desk, Incident Management, Service Asset and Configuration Management and Change Management). On the other side, ISO 20000 implementation requires you to implement all that is required by ISO 20000-1. That includes many processes (no functions), but a significant difference from ITIL is the management system (section 4 of the standard). Whether you implement ITIL or ISO 20000, you will need:
- Internal resources – these are your employees and the time they will spend. As far as I can tell, companies quite often neglect this resource (and related costs) and take it for granted. The time of your employees is a costly resource. You would wonder, once you finished the implementation, about the amount of time (i.e., money) spent.
- External resources – these are, usually, suppliers and/or consultants. The point is that, particularly if you are dealing with ISO 20000 or ITIL for the first time, you will need help. Hiring someone can also speed up the implementation. But, that also increases (sometimes significantly) implementation costs.
- General costs – there are some costs that you will need to prepare for, no matter what your scope or whether you implement ITIL or ISO 20000:
- Technology – an ITSM (IT Service Management) tool will speed up the implementation, make it easier, and make the maintenance efficient. But, the fact is that it costs money (high-class tools, actually, cost a lot of money).
- Project management – to be efficient in your implementation you will need someone to be the project manager for the implementation. That could be someone from your organization, or an external resource.
- After-implementation costs – once you are done with implementation, you need to invest in maintenance of the ITSM or SMS (Service Management System, in case you are implementing ISO 20000). That will require people and their time, as well as an ITSM tool (e.g., you will need to pay for licenses, or there will be some changes that need to be implemented, etc.).
How do you handle the costs?
In a few words – be careful! Many issues will arise, many obstacles will get in your way, and you will need to put out fires on an (almost) daily basis. All those situations are “hiding” costs in the background. Analysis, discussions, and finding the best possible solutions will help you manage the costs.
Good preparation is the foundation on which you will build. That means that your team, as well as the scope of the implementation, has to be well prepared. For human resources, that means education and knowledge of your own organization and IT service landscape. Technology (the ITSM tool) needs to be prepared and adapted to your needs. And, last but not least, you need to have someone to lead (a project manager, prepared for the implementation) and a sponsor of the project (to authorize resources, i.e., costs and to push the project inside the organization).
When you are aware of all the costs related to the implementation and maintenance afterwards, you are ready to go. Once you start, do all that is needed to stay within the limits you defined, initiate cost control, and optimize. But, even more importantly, document the costs you create and compare to the predictions you made. That will be your continual improvement in the ITSM/SMS implementation and make you better, i.e., more cost efficient next time.
Use these free templates: Project proposal for ITIL/ISO 20000 implementation to see how to present the project to your top management.
