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2 Faces of Demand Management

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As I continue my journey through the terminology difficulties of modern IT management, one issue that keeps coming up (as recently as this week’s IQPC IT Governance conference, where I spoke) is the question:

What is Demand Management?

There are actually TWO quite different interpretations:

  • Demand for new IT services
  • Demand upon existing IT services for (typically) increased transactional or storage capacity.

Consider this illustration, using my IT value chain:


Click to enlarge

So, where is this non-ITIL definition coming from, you ask? Why bother with it? I know it best from seeing a large outsourcer implement Mercury IT Governance (formerly Kintana, and now Mercury Project and Portfolio Management Center) at a former employer. If you are going to start extracting cash from an outsourcing engagement, one of the most critical things is distinguishing “base” from “incremental” expenditure, and the outsourcing team this firm brought in considered that to be demand management. They had clearly developed a whole set of practices and philosophies around it; it was not a casual usage of the term.

Increased demand for capacity increases existing services (the ITIL interpretation) was considered base and was of less interest to them; I think supporting that was baked into the contract and was not a margin opportunity.

I attended an excellent workshop put on by the folks from Swingtide and they also used demand management in this sense. (Topnotch IT finance folks if you are trying to figure out how to do IT chargeback based on activity based costing… but that’s another post.)

ITIL consider this flavor of Demand Management flavor to be Change Management; readers of this weblog will know that I don’t care for that definition. We have too many overloaded terms in enterprise IT and I think that disambiguating Change Management is preferable, especially since the project portfolio management vendors are calling it Demand Management. Let’s keep Change Management in the data center where it belongs. Or qualify it, e.g. “Organizational Change Management” or “Human Change Management.”

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Charles Betz is a Senior Enterprise Architect, and chief architect for IT
Service Management strategy for a US-based Fortune 50 enterprise. He is author of the forthcoming Architecture and Patterns for IT Service
Management, Resource Planning, and Governance: Making Shoes for the Cobbler’s Children (Morgan Kaufman/Elsevier, 2006, ISBN 0123705932). He is the sole author of the popular www.erp4it.com weblog.

2 Faces of Demand Management
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About Charles Betz
Charles Betz is a Senior Enterprise Architect, and chief architect for IT Service Management strategy for a US-based Fortune 50 enterprise. He is author of the forthcoming Architecture and Patterns for IT Service Management, Resource Planning, and Governance: Making Shoes for the Cobbler's Children (Morgan Kaufman/Elsevier, 2006, ISBN 0123705932). He is the sole author of the popular www.erp4it.com weblog. WebProNews Writer
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