HCI-ITIL Video

Capacity Management

Hendershott Consulting Inc

Web Presence: www.hci-itil.comEmail: len.hendershott@rogers.com

Service Design Section 4.3Capacity Management

Service Design Section 4.3Ensures that cost justifiable IT capacity is matched to the current and future agreed needs of the business.Monitor patterns of business activity and service level and produce reports on service and component capacity and performanceComponent tuningAssess current and future demandsInfluence demand managementMaintain the Capacity PlanAssist with the identification and resolution of performance-related incidents and problemsProactive improvement of service or component performance wherever cost-justifiable and consistent with business directions

Capacity Management FocusService Design Section 4.3

CapacityBusiness StrategyBusiness ProcessesThe right capacityBy continually referencing developed business strategies and process Capacity Management seeks to ensure that the organization has sufficient capacity without overflowing3

Service Design Section 4.3CapacityBusiness StrategyBusiness ProcessesCostCapacityCapacity Management is a balancing actEnsure that capacity that is purchased is cost-justified according to business needs, and makes efficient use of resources.

Capacity Management Focus

Service Design Section 4.3CapacityBusiness StrategyBusiness ProcessesDemandSupplyCapacity Management is a balancing actEnsure that the available supply of IT services matches the demands made on it by the business, both now and in the future.

Capacity Management FocusIt is also the job of Capacity Management to provision sufficient capacity to meet business demand for it, both currently and over the period covered by the organziations strategic planning horizon.5Service Design Section 4.3Business StrategyBusiness Processes

DemandSupplyBusiness Capacity RequirementsCapacityExcess Capacity

Capacity Management FocusWhen capacity outstrips the business requirements for it the business is incurring unnecessary costs and IT operations may be a candidate for cost cutting measures.6Service Design Section 4.3Business StrategyBusiness Processes

SupplyDemandCurrent CapacityCapacityRequired Capacity

PerformanceGap

SupplyDemand

Capacity Management FocusWhen Demand is greater than current capacity the organization has a performance gap and is at risk of failing to meet performance expectations over the long term.7Service Design Section 4.3Business Strategy - LeadBusiness Processes

DemandSupplyBusiness Capacity RequirementsCapacityNew CapacityCapacity Management StrategiesAdding capacity in anticipation of an increase in demand.

There are three primary business strategies for managing capacity. The first approach is to add capacity in anticipation of an increase in demand. Leading is an aggressive strategy with the goal of luring customers away from the company's competitors. The possible disadvantage to this strategy is that it often results in excess inventory excess disk space, CPU performance, unneeded program capabilities , which is costly and often wasteful.8Service Design Section 4.3Business Strategy - LagBusiness Processes

DemandSupplyBusiness Capacity RequirementsCapacityNew CapacityCapacity Management StrategiesAdd capacity only to meet demand.

A Lagging strategy adds capacity only after the organization is running at full capacity or beyond due to increase in demand. This is a more conservative strategy. It decreases the risk of waste, but it may result in the loss of possible customers.9Service Design Section 4.3Business Strategy - MatchBusiness Processes

DemandSupplyBusiness Capacity RequirementsCapacityNew CapacityCapacity Management StrategiesAdds capacity in small amounts in response to changing demand in the market.

A Matching strategy adds capacity in small amounts in response to changing demand in the market. This is a more moderate strategy designed to make corrections to existing capabilities caused by environmental changes. It is supplimentary to the previous strategies.10Capacity Management Levels

Service Design Section 4.3

Business - translates business needs and plans into requirements for service and IT infrastructureService - control and prediction of the end-to-end performance and capacity of the live, operational IT services usage and workloadsComponent - control and prediction of the performance, utilization and capacity of individual IT technology componentsService StrategyService DesignService Operation

ITIL distinguishes three levels of Capacity Management, each involving distinct processes within the organization and each highlighted by their primary location in the ITIL service lifecycle.11Component Capacity Management

Service Design Section 4.3Component Capacity Management addresses the performance, capacity and utilization of each of the individual components within the technology used to support the IT services, including the infrastructure, environment, data and applications.

Component Capacity Management addresses the molecules of the management processes the basic building blocks or base components of the IT infrastructure. How they are fit for use and purpose, their bandwidth, disk sizes, CPU speeds.12Service Capacity Management

Service Design Section 4.3Service Capacity Management addresses IT services, their use of resources, working patterns, peaks and troughs, to ensure that they meet established performance targets.

Service Capacity Management packages the component molecules into the DNA of service management, producing self-functioning service operations on behalf of business processes.13Business Capacity Management

Service Design Section 4.3Business Capacity Management addresses capacity planning activities over a strategic horizon so as to responsive to changing requirements for capacity demand.

Business Capacity Management uses the service molecules to form a business entity. More and more these entities constitute e-businesses that extensively utilize IT components and services for the purpose of selling or providing goods and services, servicing customers, and communicating with business partners.14Capacity Management

Service Design Section 4.3Demand PatternDelivery ScheduleBusinessProcessServiceProcessPatterns of Business Activity

Service Level RequirementsCapacity Management Plan

DemandManagementIncentives and penalties to influence consumption

This illustration represents ITILs depiction of a demand cycle. New and changing requirements may come to the attention of Capacity Management from many different sources and for many different reasons, but their primary origin will typically be the Pattern of Business Activity from Demand Management and the Service Level Packages produced for the Service Portfolio. These provide valuable information as future predictors of additional capacity requirements.15Capacity Management ExampleService Design Section 4.3Business Capacity

number of sites available.factors affecting the ability to get customers to the facilities.Lets look at a real life example. Many state and provincial governments are in the business of managing parks and recreational activities. Visits to natural parks offer visitors a holiday at a competitive fee. The goals of this operation are, no doubt, varied but will include revenue-generation, maintenance of the habitat and customer satisfaction. Business Capacity issues will include the number of sites available and the factors affecting the ability to get customers to the facilities.16Capacity Management ExampleService Design Section 4.3Business Capacitynumber of sites available.factors affecting the ability to get customers to the facilities.Service Capacitynumber of telephone operators on call.BandwidthContention arbitration

An important service for this operation is reservation. Often provided by a specialized vendor, the booking service provider will offer alternative methods to receive and log bookings, to manage them over their lifecycle and to provide information for performance and improvement initiatives. Capacity issues will include the number of telephone call lines and operators for telephone booking and bandwidth and the ability to arbitrate booking contentions for internet booking

17Capacity Management ExampleService Design Section 4.3Business Capacitynumber of sites available.factors affecting the ability to get customers to the facilities.Service Capacitynumber of telephone operators on call.BandwidthContention arbitration

Site request volumeDay

Patterns of business activity for the service are identified, codified, and shared. One or more attributes such as frequency, volume, location and duration describe business activity. They are associated with requirements such as security, privacy and latency or tolerance for delays18Capacity Management ExampleService Design Section 4.3Business Capacitynumber of sites available.factors affecting the ability to get customers to the facilities.Service Capacitynumber of telephone operators on call.BandwidthContention arbitration

AnnualSpikeRegularSpikeSite request volumeDay

This example demonstrates a monthly usage spike and an annual spike that is six times higher than any other period. Depending upon the organizations tolerance for this annual delay it may be uneconomic to build infrastructure to meet this demand. Instead, the organization may choose to bite the bullet and establish contingency actions to mitigate the worst effects of poor performance during this period.19Capacity Management ExampleService Design Section 4.3Business Capacitynumber of sites available.factors affecting the ability to get customers to the facilities.Service Capacitynumber of telephone operators on call.BandwidthContention arbitration

AnnualSpikeRegularSpikeSite request volumeDay

In Ontario such a situation happens on March 1 of every year. Campers can book sites five months ahead and the clock to permit booking on the internet site rolls forward a day at 7 am. March 1st is the earliest possible time to book for the August 1 week-end so the demand is higher due to the holiday week-end. What makes the day unique is that in rolling forward from Feb 28 to March 1 it encompasses a four-day period covering July 29, 30, 31 and Aug 1 meaning 4 times the regular number of camp sites become available. In many campgrounds the competition is intense to secure sites so that savvy campers are prepared to enter information as quickly as possible at 7 am. Every year the system grinds to a halt under peak load. Ten seconds is far too late to get a site, and the system locks up by one minute after seven.

There is no additional revenue to be obtained from establishing capacity to meet this peak demand. The number of camp sites at these parks is fixed resource and will be entirely utilized. Like a sports team that has a monopoly in a market with demand several times the supply there is no incentive to improve the product beyond those levels which are purely economic.20Capacity Management ExampleService Design Section 4.3Business Capacitynumber of sites available.factors affecting the ability to get customers to the facilities.Service Capacitynumber of telephone operators on call.BandwidthContention arbitration.Component CapacityDevice failuresUtilization ratesResponse timesDatabase usage Index usage Hit rates Concurrent user numbers Network traffic rates.

Component Capacity Management is focused on the IT infrastructure that underpins service provision. All components within the IT infrastructure that have finite resource are monitored and measured, and that the collected data is recorded, analysed and reported. This is an activity generally carried out through monitoring and control within Service Operation.21Determining CapacityService Design Section 4.3Demand ManagementApplication SizingModelling and Trending

Short-term Demand Management may occur when there has been a partial failure of a critical resource in the IT infrastructure. Capacity Management should be aware of the business priority of each of services, know the resource requirements of each service and then be able to identify which services can be run while there is a limited amount of resources available.

Long-term Demand Management may be required when it is difficult to cost-justify capacity. In our example, peak demand occurred for only one hour over the course of the year. Within this periods, available bandwidth and/or server resources appeared to be overloaded . For most of the rest of the time bandwidth and server capacity very lightly loaded and the components are under-utilized. Is it possible to justify the cost of an upgrade to provide additional capacity for only one hour per year? Or might it possible to influence the demand and spread the requirement for resource across several days around March 1st, thereby delaying or avoiding altogether the need for excess resource capacity?

Application Sizing estimates the resource requirements to support a proposed change to an existing service or the implementation of a new service in order to ensure that it meets required service levels. Or application sizing may be affected by resilience aspects that may be built into the design of new services.

Modeling is an activity that can be used to beneficial effect in any of the sub-processes of Capacity Management. It seeks to better assess future capacity needs through trending or other modelling techniques.

22Capacity ManagementService Design Section 4.3

CapacityManagement

Short-term Demand Management may occur when there has been a partial failure of a critical resource in the IT infrastructure. Capacity Management should be aware of the business priority of each of services, know the resource requirements of each service and then be able to identify which services can be run while there is a limited amount of resources available.

Long-term Demand Management may be required when it is difficult to cost-justify capacity. In our example, peak demand occurred for only one hour over the course of the year. Within this periods, available bandwidth and/or server resources appeared to be overloaded . For most of the rest of the time bandwidth and server capacity very lightly loaded and the components are under-utilized. Is it possible to justify the cost of an upgrade to provide additional capacity for only one hour per year? Or might it possible to influence the demand and spread the requirement for resource across several days around March 1st, thereby delaying or avoiding altogether the need for excess resource capacity?

Application Sizing estimates the resource requirements to support a proposed change to an existing service or the implementation of a new service in order to ensure that it meets required service levels. Or application sizing may be affected by resilience aspects that may be built into the design of new services.

Modeling is an activity that can be used to beneficial effect in any of the sub-processes of Capacity Management. It seeks to better assess future capacity needs through trending or other modelling techniques.

23Hendershott Consulting Inc

Email: len.hendershott@rogers.comITIL process site: hci-itil.com

Service Design Section 4.3