Welcome to our second edition of Third Sky "Insights". 2006 is an exciting time for IT Service Management. We are seeing strong adoption in North America. Organizations like itSMF and HDI are growing in attendance. We see more and more of our customers maturing their ITSM projects. We are even starting to see prospects come to us that already have a high level of ITSM and ITIL knowledge. ITIL's adoption as an ISO standard may help organizations who were waiting in the wings to embrace this now truly global framework.

2006 promises to be a good year for Third Sky. We have an established office in Boston, and newer offices in Dallas and San Francisco. Our team has been bolstered with recent additions that bring even more ITSM experience to the table. Our solutions are evolving with the market and we believe we are making a real impact with our customers.

With our newsletter we hope to share some of our experiences with you. We have covered education, process, and technology so we have a little bit for everyone. Through our newsletter, local industry events and user groups, national shows, publishing white papers, and articles, we are working hard to establish Third Sky as a household name in the field of IT Service Management. If you have requests for certain topics to be discussed or any feedback you'd like to share, please e-mail me at jbarrow@thirdsky.com.

I hope you enjoy this edition of "Insights" and I look forward to hearing from you.

Sincerely,

Joshua Sky Barrow
President and CEO
Third Sky, Inc.

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Where do I start? It's the most common question that our new ITIL/ITSM customers ask. Third Sky usually begins with a systematic assessment of our customer's process strengths and weaknesses, organizational readiness and a gap analysis of their tools and processes. Looking across the outcomes of our client assessments, we see some clear trends in where our clients are getting the most traction in adopting ITIL. Organizations begin their journey towards ITIL-compliance in one of the following three areas:

• Defining the Service Catalog
• Service Desk/Incident Management
• Configuration Management

Defining the Service Catalog

ITIL is more than just a change in process for IT departments; it is also a cultural change. IT departments traditionally viewed their responsibilities from a systems-oriented perspective. ITIL changes this perspective to a customer-focused approach based on the concept of "services". For example, describing IT's commitment to providing an "email service" resonates more strongly with internal customers than talking with them about "Microsoft Exchange servers". Customers are concerned with disruptions in their "email service", regardless of whether the disruption was caused by Microsoft Exchange or some other component of the IT infrastructure.

The exercise of defining the Service Catalog can be used to drive the cultural transformation from a systems-oriented IT department to a service-oriented IT department. This transformation can be quite difficult for some organizations necessitating significant consensus-building and education.

Third Sky has found that organizations that have undergone mergers or acquisitions readily realize the benefits of a service-oriented approach, by enabling them to maintain the focus on the quality of their service delivery, even while they are integrating disparate IT infrastructures Consider the example of two merging companies, each bringing with them their legacy ERP systems, Peoplesoft and Lawson. While the transition to a single ERP system will take some time, appropriate service levels needed to be defined immediately. By describing the service as "financial system support", which encompassed both Peoplesoft and Lawson, the company can focus on providing a single consistent service level across the merged units, and can allocate the appropriate resources and response times to meet that service level, regardless of the back-office implications or causes.

Third Sky will be conducting a webinar on Defining the Service Catalog in March 2006. If you are interested in this webinar, please email sales@thirdsky.com.

Service Desk/Incident Management

A recommended approach to implement ITIL is to start with processes within the organization that have matured over the years and align them with ITIL best practices. This strategy acknowledges that evolutionary change results in minimal resistance, improving the probability of success and building momentum for a more expansive ITIL initiative.

IT departments have provided Help Desks / Service Desks for many years and can be used as a foundation for starting your ITIL implementation. Implementing Incident Management as prescribed in ITIL can improve the effectiveness of the Help Desk / Service Desk. Many IT departments have not yet integrated the teams that provide second and third level support into the Incident Management process. Proactive communication to the customer about disruptions in service or the status of Incidents may be lacking. A greater commitment to meeting resolution service levels and the disciplined reporting of metrics may also be an opportunity for improvement.

The direct tie between incidents and services enables organizations to more directly associate the services being provided to the true cost of providing those services and the impact of outages in those services.

Configuration Management

The Configuration Management Database (CMDB) can be considered the sun around which the other ITIL Service Support processes revolve. If your continuous improvement efforts in Incident Management and Change Management have stalled, or if you need an octane boost to the effectiveness of Incident and Change Management, Configuration Management can be a good place to restart your efforts towards ITIL-compliance.

Focus your CMDB population strategy on solving specific pains in the other ITIL processes. If Change Management is the concern, e.g. too many unsuccessful changes due to poor impact analysis, then focus on populating the CMDB with the key Configuration Items (CIs) involved in these types of changes. Make sure you populate the relationships between CIs. Then, whenever a CI changes, you can systematically review these relationships to analyze the impact of change.

Other CMDB population strategies include starting where you have good control and/or where auto-discovery tools deliver the most value. IT departments have good control of IT infrastructure in data centers but may have less control of Configuration Items in the field. In some organizations, for example, business units and users may frequently change their own personal computers, personal software, peripherals, etc., without involving the IT Department. In this environment, the information in the CMDB for field equipment may age rapidly and quickly become less valuable. Hence, it makes sense to start cataloging the data centers first, since the environment is less dynamic and/or more controlled.

Auto-discovery tools can help you get a handle on the CIs in the field. However, once the CMDB baseline has been established, avoid overwriting the CMDB with the information collected from the auto-discovery tool without first inspecting what has changed. The inspection will help uncover unauthorized changes. These unauthorized changes should be escalated to the Change Manager. If the CMDB update process is automatic, you will miss the opportunity to discover these unauthorized changes.

Getting started with ITIL? Reinforce the tie between the business and the IT infrastructure that supports it by defining the service catalog. Update your Help Desk process to a Service Desk by transitioning to ITIL best practices for Incident Management. Prepare yourself for future value and greater delivery capability by defining your CMDB.

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Third Sky is pleased to announce a new offering, IPCC, a software-based IP Contact Center/VoIP (Voice-over-IP) product and related services to allow you to provide lower cost, highly functional phone capabilities to your customers and/or your service desk agents.

As contact centers play an increasingly critical role in customer transactions, many businesses are seeking tools and applications to generate new revenue during interactions with established customers, in essence making sales and service extensions of one another. Companies today have two objectives: service the needs of their customers (including internal ones) and turn every communication with their customers into a profitable or positive customer service contact.

With a converged network and the adoption of Voice-over-IP (VoIP) - a technology that carries voice as data - this new generation of contact centers provide significant advantages. In addition to connecting regular telephones, VoIP enables you to easily connect desktop computers, laptops, IP phones, and soft phones. Expansion is a snap because data networks are designed to scale with your company's needs. You can easily add and reduce staff based on seasonal sales cycles, and by implementing virtual private networks (VPNs), you can add remote agents as easily as you can add them in your corporate headquarters, without the need for special hardware or proprietary solutions.

To run a successful multi-channel contact center, you need a single-platform technology solution that can provide:

• Self-service applications allowing customers to do business with you when they want. Customers can complete transactions, initiate requests, check account balances and get status information without human assistance.
• Extend your network to include multiple sites and/or remote agents, so your customer relations follow the sun.
• Allow your customers more options to interact with your enterprise by communicating over email and the web by queue/route/handle all interactions, providing faster response times, and enhance the customer's personal experience.
• Seamlessly integrating your contact center solution with other customer information applications such as front- and back-end applications such as CRM, service management and ERP.

IP Contact Center also enables capabilities such as Screen Pops, Interactive Voice Response, Call Routing and Call Recording to enhance the experience of both your customers and your service desk agents.

Contact Third Sky at sales@thirdsky.com for more information.

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