Build a Service Hierarchy

As an IT service manager, use this article to build a service hierarchy. You can manage services in a hierarchy with other investments including projects, assets, applications, products, services, and other work.
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As an IT service manager, use this article to build a service hierarchy. You can manage services in a hierarchy with other investments including projects, assets, applications, products, services, and other work.
Service Hierarchies
The financial hierarchy displays an aggregation of the planned cost, actual cost, and remaining cost for your investments. The time-varying values factor in the investment allocation percentages that you have defined.
The 
financial 
rollup and the 
effort 
rollup are hierarchical representations of the investments, services, and ideas that comprise your service. As you build your hierarchy, the planned costs for a child investment or service roll up to the parent service. These aggregated costs appear on the 
financial 
rollup. Similarly, the associated child investment or service aggregated work values roll up to the parent service on the 
effort
 rollup.
You can also share services between other investments, services, and ideas. For example, you can share a database server that supports two software applications. You could achieve the following goals:
  • Add the software applications as child investments to the database server investment hierarchy.
  • Edit the child investment or service cost allocation percentage and time segments.
Your service investment allocation percentage determines what portion of a service is allocated to another service, investment, or idea. All cost data in the investment hierarchy is based on the allocation percentages.
Define Parent Investments and Allocations
You can add one or more parent investments to a service. Under each parent, define the allocations for each child investment in the service hierarchy. Investment and service allocations can be split among more than one parent investment. The total combined allocation is always 100 percent.
Follow these steps:
  1. Open a service.
  2. Open the Hierarchy menu and click Parents.
  3. Click Add to select one or more investments that you want to designate as parent investments.
  4. In the Allocation field, enter the allocation percentage for the parent investment.
  5. To remove a parent, select the check box for the investment and click Remove.
  6. Save the changes.
Define Child Investments and Allocations
As a service owner or investment manager, define the allocations for each child investment and service in the hierarchy. When you add the first child investment to your service, its allocation is set to 100 percent. You can edit the allocation percentage for a child service, investment, or idea. Child investment cost totals are automatically aggregated in the parent service based on the investment allocation percentages.
Follow these steps:
  1. Open a service.
  2. Open the Hierarchy menu and click Financial Rollup.
  3. Select the check box next to the desired child service, and click Add Child.
  4. Select the check box next to the investments and click Add.
  5. Click Return.
  6. Click the allocation amount for the child investment.
    The set allocations page appears.
  7. In the Allocation field for your service, enter the child investment percentage that is allocated to the parent service or investment.
  8. Save the changes.
  9. To remove a child service from the financial rollup, select the check box for the service and click Remove.
  10. Click Return.
Examine the Effort Rollup for a Service
You can view the total work effort that was performed on the approved or unapproved investments, services, and ideas in the hierarchy.
Follow these steps:
  1. Open a service.
  2. Open the Hierarchy menu, and click Effort Rollup.
  3. To view each service including any parent or child services, expand or collapse the items in the hierarchy.
  4. Examine the aggregation of the child service labor-related information including the ETC, EAC, and actual work variances. The aggregation takes into account the child investment or service allocation percentages.
  5. Depending on the view you select in the hierarchy, the Self line item displays the work values or costs for the parent service. The line items below the Self line are for any child investments or services.
  6. To filter the list, select an option from the Status field.
  7. To adjust allocations to align with business goals, you can also add or remove child investments or services.
Examine the Financial Rollup for a Service
You can view financial data in a hierarchical list that shows your child investments, services, and ideas. All the child costs and benefits are rolled up to the parent service and appear on the parent service line item.
You can track the costs incurred to build, maintain, and support your service. You can also track the allocation percentages, planned costs, actual costs, remaining costs, planned benefits, planned ROI, and planned NPV. You can modify the service by adding or removing child investments.
Follow these steps:
  1. Open a service.
  2. Open the Hierarchy menu, and click Financial Rollup.
  3. Examine the parent and child services in the financial rollup including values for the following fields:
    • Planned Cost
      The planned costs for the investment including the costs rolled up from any child investments based on their allocation percentages.
    • Actual Cost
      The costs incurred from invoices. If the service is unapproved, the actual costs are also rolled up from the child investment or service. The costs are rolled up after the investment allocation percentage is factored in. That is, the service status is something other than 
      Approved
      .
    • Remaining Cost
      The difference between the planned costs and the actual costs.
    • Planned ROI
      The planned return on the investment and its child investments.
    • Planned NPV
      The net present value on the investment and its child investments.
    • Planned Benefit
      The sum of the planned benefit from the investment, service, or idea detailed budget. The planned benefit represents the anticipated future revenues for the investment.
    • TCO
      The total cost of ownership is the aggregated amount of costs derived from running or operating a service. Operating a service involves managing all supporting investments such as projects, applications, and ideas. The TCO metric tracks costs and shared allocations. Use TCO to manage a service budget and compare aggregated costs accrued from other investment types.
  4. To determine TCO, add one or more child investments to a service. View the aggregated cost and labor totals from the hierarchical bill of investments.
  5. To filter the list, select an option from the Status field.
    By default, the service financial and effort rollups display a list of approved and unapproved child investments.
  6. To adjust allocations to align with business goals, you can also add or remove child investments or services.