ITIL - Introduction to Service Strategy Tutorial

Welcome to the second lesson of the ITIL Foundation tutorial (part of the ITIL® Foundation Certification Training).

In this unit, you will be introduced to the first phase of the IT Service Management lifecycle, which is service strategy.

Service Strategy

This chapter helps you to understand service strategy and its importance. It also explains how service strategy adds value to a business. This chapter also focuses on the classification of services based on the customer's requirement.


After completing this chapter, you will be able to:

  • Describe the purpose, objective, scope, and value of service strategy

  • Identify the four processes in service strategy

  • Explain the different types of services provided

Service Strategy-Overview

The service strategy phase provides a defined solution to a business problem. We will start with the purpose of service strategy and follow up with its objective, scope and value of the business.


The purpose of the service strategy phase is to define the perspectives, positions, plans and patterns that a service provider needs to execute to meet an organization’s business outcomes.


The objective of the service strategy phase is to:

  • Understand the strategies and identify the services and the customers.

  • Define value creation and how it is delivered.

  • Identify opportunities to provide services.

  • Design a clear service provision model.

  • Document and coordinate how service assets are used to deliver services and how to optimize their performance.

  • Set up processes to define the strategy of the organization.


The service provider should answer the following questions to define the scope of service strategy:

  • What services should be offered and to whom?

  • How to differentiate themselves from competing for alternatives?

  • How to create value for customers?

  • How to capture value for stakeholders?

The scope includes defining a strategy:

  • To deliver effective services to meet a customer’s business outcome

  • To manage the services provided to the customers.


The service strategy phase offers value to businesses in the following ways:

  • Support the activities performed by the service provider to facilitate outcomes for customers.

  • Enable the service provider to understand the types and levels of service that a customer requires.

  • Enable the service provider to respond quickly and effectively to changes in the business environment.

  • Support the creation and maintenance of a portfolio of quantified services.

  • Facilitate functional and transparent communication between the customer and the service provider.

Service Strategy Processes

The processes in service strategy include demand management, service portfolio management, financial management and business relationship management.

Demand Management

Demand management is the process of understanding the demands for services.

Service Portfolio Management

Service portfolio management refers to the complete set of services offered by a service provider.

Financial Management

Financial management provides an understanding of the opportunities associated with services in financial terms.

Business Relationship Management

Business Relationship Management ensures that the service provider understands the changing needs of the customer.

These processes are explained in detail later in this unit.

Types of Services

Let us now discuss the different types of services.

Services are classified based on the customer's requirement and the service provider's capabilities.

Broadly, services are classified into the core, enabling and enhancing services.

Core Services

Core services provide the basic results that a customer requires. They signify the value that a customer wants and for which they are keen to invest. Core services anchor the value proposition for the customer and provide the basis for their continued utilization and satisfaction.

Enabling Services

Enabling services are required to deliver a core service. They serve as basic factors enabling the customer to receive the core service. Customers do not perceive an enabling service as a service in its own right. This service may not be seen by the customers.

Enhancing Services

Enhancing services are the services added to a core service to make it more appealing to the customers. They are not vital to the core service delivery and are added to it as excitement factors. This encourages customers to use the core service often.

Let us take an example to understand these services.

Core Services - Example

Suppose a service provider’s core service is to provide Word Processing service for users. To use the core Word Processing service efficiently, certain enabling services such as download and installation of updates are required. To delight the customer, the service provider can strategize to provide professional print access to publish documents.

Now let us consider another example.

Enabling Services - Example

Suppose the employees of a company can monitor the status of their benefit, that is, health insurance. The company can come up with a portal that provides front-end access to the benefits tracking service. This is an enabling service.

Enhancing Services - Example

If the company can help the employees create and manage a fitness or weight loss programme, then such a facility is considered as an enhancing service.

Service Strategy-Customers and Users

Now we will focus on customers and users.

Customers and Users are defined as follows:

  • Customers are those who pay for services. They negotiate and agree to service level targets with service providers. Sometimes, customers also can be users.

  • Users are those who use the services on a day-to-day basis.

Curious about the ITIL Foundation course? Watch our Course Preview for free!


Let us summarize what we have learned in this chapter:

  • The service strategy phase provides a defined solution to a business problem.

  • Demand Management, Service Portfolio Management, Financial Management and Business Relationship Management are the processes in service strategy.

  • Services are classified into core services, enabling services and enhancing services.


Next, we will focus on the second chapter—Service Strategy Concepts.

  • Disclaimer
  • PMP, PMI, PMBOK, CAPM, PgMP, PfMP, ACP, PBA, RMP, SP, and OPM3 are registered marks of the Project Management Institute, Inc.

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