Business CapM IRM v2 0 05.26.2015

Solution Engineering Business Capacity Management Process Description Page 1 of 17
Business Capacity Management
Manual Transmittal
Effective Date
<Date, MM/DD/YYYY>
Purpose: This transmits a revised Business Capacity Management (BCapM) Process.
Material Changes
• Updated to current IPM template
Effect on Other Documents: IRM 2.144.2 dated October 10, 2014 is superseded..
Audience: The Business Capacity Management Process is applicable to all ACIO areas with
responsibility for Capacity Management.
Signature
Sri Rao,
Director, Solution Engineering
OS:CTO:ES:SE:EPM_Business-Capacity-Management_PD_V2.0_04272015

Change History
Version
Number
Version Date
Change Description/Purpose
Location Type Nature of Change(s)
V2.0 04/27/2015 All M Updated to current template
A - ADDED M - MODIFIED D - DELETED

Table of Contents
Introduction..............................................................................................................................................4
1.1 Administration................................................................................................................................4
Overview..................................................................................................................................................4
1.2 Process Description.......................................................................................................................4
1.3 Goal................................................................................................................................................4
1.4 Objectives......................................................................................................................................4
Workflow..................................................................................................................................................4
1.5 Main Process Diagram...................................................................................................................5
1.6 Inputs..............................................................................................................................................6
1.7 Outputs...........................................................................................................................................7
1.8 Activities.........................................................................................................................................8
1.9 Roles............................................................................................................................................10
Process Control.....................................................................................................................................11
1.10 Controls......................................................................................................................................11
1.11 Metrics........................................................................................................................................11
1.12 Policies.......................................................................................................................................12
1.12.1 Process Management.........................................................................................................12
1.12.2 People.................................................................................................................................12
1.12.3 Process................................................................................................................................12
1.12.4 Technology and Tools........................................................................................................12
1.13 Tailoring Guidelines...................................................................................................................13
Training..................................................................................................................................................13
Procedure..............................................................................................................................................13
1.14 Purpose of Procedure................................................................................................................13
1.15 BCapM 1.0: Business Capacity Management...........................................................................13
1.16 BCapM 2.0 Negotiate Service Level Agreements and Implement Changes............................14
1.17 BCapM 3.0 Review Component Performance...........................................................................14
1.18 BCapM 4.0 Develop the Capacity Plan.....................................................................................15
1.19 BCapM 5.0 Review the Capacity Plan.......................................................................................15
1.20 BCapM 6.0 Review the SLA and Service Catalog.....................................................................15
Appendix................................................................................................................................................15
1.21 Acronyms...................................................................................................................................15
1.22 Glossary.....................................................................................................................................16

Introduction
This document describes the formal process for implementing the requirements of the Business
Capacity Management process. It provides an operational definition of the major components of
the process and how to perform each step in the process. This document also describes the
logical arrangements of steps that are essential to successfully completing the process and
achieving its desirable outcome.
1.1 Administration
All proposed changes to this document must be submitted in writing, with supporting rationale, to
the Solution Engineering Organization
Overview
A process is defined as “A set of related of activities that accomplish a common goal”. The
process definition laid out in this document further breaks down these Activities into Tasks, each
of which have a complete set of attributes defined such as data and tool specifications and the
role(s) responsible for executing the tasks. The document also includes process goal and
objectives, metrics, role definitions, policies and other process related attributes.
1.2 Process Description
The Business Capacity Management (BCapM) process translates business needs and
plans into requirements for service and IT infrastructure, ensuring that the future
business requirements for IT services are quantified, designed, planned and implemented in a
timely fashion.
1.3 Goal
The process goal describes a specific purpose or achievement toward which the efforts of the
process are directed. Each process has a specific focus and when combined with the other
processes, forms a comprehensive framework for delivering and managing services.
• The goal of Business Capacity Management is to ensure that the capacity of IT services and
the IT infrastructure is able to deliver the agreed service level targets in a cost effective and
timely manner. Business Capacity Management considers all resources required to deliver the
IT service, and plans for short, medium and long term business requirements.
•
1.4 Objectives
Process objectives describe material outcomes that are produced or achieved by the process.
The following is a list of objectives for this process:
• To provide Capacity Service Level Targets and metrics to the Service Level Management
Process in order for them to be incorporated into Service Level Agreements and into a
Business Capacity Plan.
Workflow
A workflow consists of Activities and Tasks, Inputs and Outputs, Roles, and Flow Diagrams. It
describes the tasks, procedural steps, organizations or people involved, required input and output
information, and tools needed for each step of the process.

1.5 Main Process Diagram

1.6 Inputs
Process inputs are used as triggers to initiate the process and to produce the desired outputs.
Users, stakeholders or other processes provide inputs. The following is a list of inputs for this
process:
Name Description Supplier
Business
Information
Information about the business strategy,
plans and requirements.
Organization's
Business
Groups
Service &
Information
Technology (IT)
Component
Relationships
Information about the services, the
relationship to the business
requirements, and infrastructure
components needed.
Business and IT
Strategies,
Service
Strategy, IT
plans and
current budgets
Component
Performance
and
Capacity
Information
Capacity and Performance
specifications from the manufacturer or
developer; detailing expected
performance and thresholds.
Manufacturers
and
Suppliers
Service
Performance
Issues
Capacity related Incidents and Problems
plus service level breaches.
Incident and
Problem
Management
processes
Service
Information
Details of the Service Level
Requirements, Service Level
Agreements and data about the
performance and utilization of the
services.
SLM process
Financial
Information
Information about the cost of providing a
service. This will include, hardware,
software, Component costs, and support
and maintenance charges.
Financial
Management
process
Change
Information
(Request for
Change)
Capacity Management is responsible for
assessing the impact of all proposed
changes on the performance of
infrastructure and services being
provided.
Change
Management
process
Performance
Information
Current and historical performance and
utilization information for IT services and
IT infrastructure components.
Capacity
Management
Information
System (CMIS)
Configuration
Management
System (CMS)
Information
Configuration data on the components,
services and relationships.
Configuration
Management
System
(CMS)

Name Description Supplier
Workload /
Operational
Information
Information about job schedules,
operational tasks, and services
dependencies.
IT Operations
team
Patterns of
Business Activity
(PBA)
An analysis of the workload showing
how this varies according to demand.
Demand
Management
1.7 Outputs
Each process produces tangible outputs. These outputs can take the form of products or data
and can be delivered to a user or stakeholder, or, they can be used as inputs to other processes.
Outputs are measurable in terms of quantity and quality.
Name Description Recipient
Capacity
Management
Information
System (CMIS)
The data repository where performance
& utilization data is collected analyzed
and stored.
Enterprise wide
availability
Capacity Plan
The Capacity Plan details current
performance and utilization, future
requirements, Capacity projections,
capacity issues and plans for improving
performance and satisfying business
requirements. “Targets”
• CMIS
• Service
Manager
• Business
Stakeholders
• Operational
Manager
• Higher
Authority
Service
Performance
Information and
Reports
Reports on the performance and
utilization of Services using data in the
CMIS.
• BCapM
Manager
• Service
Manager
• Business
Stakeholders
• Operational
Manager
Component
Performance
Information and
Reports
Reports on the performance of
Components using data in the CMIS.
• BCapM
Manager
• Service
Manager
• Business
Stakeholders
• Operational
Manager

Name Description Recipient
Workload
Analysis and
Reports
Reports providing information about
workloads that can be used for modeling,
application sizing, and capacity planning.
• BCapM
Manager
• Service
Manager
• Operational
Manager
Ad Hoc
Capacity and
Performance
Reports
Performance and Utilization reports
generated on an as needed basis,
typically in response to capacity issues.
• BCapM
Manager
• Service
Manager
• Business
Stakeholders
• Operational
Manager
Forecasts and
Predictive
Reports
Reports used to plan capacity changes
and proactively identify potential capacity
issues.
• BCapM
Manager
• Service
Manager
• Business
Stakeholders
• Operational
Manager
1.8 Activities
An activity is a major unit of work to be completed in achieving the objectives of the process. A
process consists of a sequence of related activities that transforms inputs into outputs and
performed by the roles defined in the process. Identify the activities in the process and provide a
brief description. The activities must correspond with the high-level process flow diagram above.
ID Name Description
BCapM
1.0
Plan the Business
Capacity
Management
Strategy
The IT Strategic Plan lays the foundation for the Capacity
Management process. The plan reflects an understanding of
how IRS IT Projects utilizes IT Enterprise resources to
enable key processes. With an understanding of the
interrelationships among IT processes Capacity
Management will be in a good position to estimate capacity
needs. Capacity Management expresses business
requirements into capacity terminology i.e. services and
component needs and aggregates them with the common
Infrastructure in ways which identify commonalities and
areas where resources might be efficiently shared without
unacceptable risks.

ID Name Description
BCapM
2.0
Negotiate Service
Level Agreements
and implement
Changes
Service Level Agreements (SLAs) should include details of
the anticipated service throughputs and the performance
requirements. The purpose of this step is to provide Service
Level Management (SLM) with targets that have the ability
to be monitored and upon which the service design has
been based. Confidence that the service design will meet
the Service Level Requirements (SLR) and provide the
ability for future growth can be gained by using modeling.
BCapM
3.0 Review
Component
Performance
BCM ensures the monitoring of the utilization of underlying
components. All of the collected data is recorded, analyzed,
and reported. Therefore, the purpose of this step is to
ensure that the performance of the solution(s) meet the
business requirements.
BCapM
4.0
Develop the
Capacity Plan
The production and update of a Capacity Plan should occur
at pre-defined intervals. It is, essentially, an investment plan
and should therefore be published annually, in line with the
business or budget lifecycle, and completed before the start
of negotiations on future budgets. The purpose of the
Capacity Plan is to document what capacity is needed in the
future and at what cost. Also, the Capacity Plan forecasts
hardware upgrades or additional equipment needed to meet
future service level objectives and includes information on
sizing of any new systems proposed. The Capacity Plan
documents cost constraints and availability or reliability
requirements. The plan should discuss current utilization
rates and service performance. It should be based upon
business strategies and explicitly recognize business
strategic and operational plans and forecasts in its'
estimates of future requirements. Recommendations should
include estimates of necessary resources, relevant impacts,
associated costs and benefits, etc.
BCapM
5.0 Review the
Capacity Plan
The purpose of Capacity Plan review is to periodically re-
issue the updated plan to take into account changes in
business plans, to report on the accuracy of forecasts and to
make or refine recommendations.
BCapM
6.0
Review SLAs and
Service Catalog
Business Capacity Management assists SLM in
understanding the Customers' Capacity requirements, for
example in terms of required response times, expected
throughput and pattern of usage, including the terminal
population. The purpose of this Business Capacity
Management step is to facilitate the SLA negotiation process
by providing possible solutions to a number of scenarios.
For example, if the terminal population is less than 20 then
response times can be guaranteed to be less than two
seconds. If more than 20 Users connect then extra network
bandwidth is needed to guarantee the required response
time.

1.9 Roles
Each process defines at least one role. Each role is assigned to perform specific tasks within the
process. The responsibilities of a role are confined to the specific process. They do not imply any
functional standing within the hierarchy of an organization. For example, the process manager
role does not imply the role is associated with or fulfilled by someone with functional management
responsibilities within the organization. Within a specific process, there can be more than one
individual associated with a specific role. Additionally, a single individual can assume more than
one role within the process although typically not at the same time.
Name Description
Business Capacity
Manager
• Ensures process procedures are followed
• Represents interests of Capacity Management at meetings
and functions
• Receives and acquires Higher Authority support as needed
• Verifies and adjusts parameters used in the planning
process
• Adds and reviews system life cycle performance design
criteria and production acceptance tests
• Recommends resource re-allocations
• Ensures that the Capacity Plan is current and that it tracks
business growth and trends
Business Capacity
Management Analyst
• Produces Capacity Plan with a forecast far enough ahead to
take account of changes in IT capacity that comply with
business plans and IT plans
• Documents the need for HW, SW and Component upgrades
or additional equipment, based on SLRs, cost constraints,
reliability and availability
• Produce regular management reports including current
usage of Components, expected trends and forecasts
• Responsible for Capacity Management documentation
Higher Authority
• Approve resources to meet capacity requirements
• Review and recommend capacity improvement
recommendations
• Review summary performance information describing
capacity
• Act as the final point of escalation for capacity issues
Operational Manager
• Provide ongoing maintenance of Configuration Items (CI)
which affects their operation and institute measures to keep
them operating at peak performance
• Assist in describing the service chains associated with
service provisioning
• Participate in discussions of capacity
• Meeting Operational Level Objectives and explaining
variances from targets.

Name Description
Business Stakeholders
• Negotiate capacity targets and sign-off on targets in
Operational and/or Service Level Agreements
• Review capacity performance against target and participate
in preparation and recommendation of any remedial actions
• Participate in preparation and review of Capacity Plan
• Provide information on capacity
Service Manager
• Ensures that services are operational
• Reviews Capacity Plans
Process Control
Activities involved in ensuring a process is predictable, stable, and consistently operating at the
target level of performance.
1.10 Controls
Process controls represent the policies and guiding principles on how the process will operate.
Controls provide direction over the operation of processes and define constraints or boundaries
within which the process must operate.
Name Description
Capacity Management
Policy
Business Capacity Management is a required activity
mandated by the IRS CTO.
Scope
Business Capacity Management process is limited to all ACIO
areas with responsibility for Capacity Management.
Process Metrics
Business Capacity Process Monitors will continuously verify to
what degree the Business Capacity Management Process is
being used.
1.11 Metrics
Metrics are used for the quantitative and periodic assessment of a process. They should be
associated with targets that are set based on specific business objectives. Metrics provide
information related to the goals and objectives of a process and are used to take corrective action
when desired results are not being achieved and can be used to drive continual improvement of
process effectiveness and efficiency.
Management will regularly set targets for process performance, gather quantifiable data related to
different functions of the Business Capacity Management process, and review that data in order
to make informed decisions and take appropriate corrective action, if necessary. All
Measurements will have a defined data dictionary, map to the organizational strategic goals, and
be documented in a Process Measurement Plan. The Process Measurement Plan template is
available in the IT PAL.

1.12 Policies
Policies outline a set of plans or courses of action that are intended to influence and determine
decisions or actions of a process. Policies provide an element of governance over the process
that provides alignment to business vision, mission and goals.
1.12.1 Process Management
Statement: The Business Capacity Management process will have a single Process Owner and a
separate Process Manager, responsible for implementation and ensuring adherence to the process.
The process will be reviewed regularly to ensure that it continues to support the business
requirements of the enterprise. The process will be designed and developed based on ROI to the
business. Process metrics will be focused on providing relevant information as opposed to merely
presenting raw data.
1.12.2 People
Statement: Roles and responsibilities for the process must be clearly defined and appropriately
staffed with people having the required skills and training. Upper management to the staff and
business customers of IT must clearly and regularly communicate the mission, goals, scope and
importance of the process. All IT staff (direct and indirect users of the process) shall be trained at the
appropriate level to enable them to support the process.
Rationale: It is imperative that people working in, supporting or interacting with the process in any
manner understand what they are supposed to do. Without that understanding Business Capacity
Management will not be successful.
1.12.3 Process
Statement: The Process Owner must approve modifications to the Business Capacity Management
process. The design of the process must include appropriate interfaces with other processes to
facilitate data sharing, escalation and workflow. The process must be capable of providing data to
support real-time requirements as well as historical/trending data for overall process improvement
initiatives. The process must be fully documented, published and accessible to the various
stakeholders of the process. The process will be reviewed on a periodic basis in order to ensure it
continues to support organizational goals and objectives (continuous improvement). The process
must include Inputs, Outputs, Controls, Metrics, Activities, Tasks, Roles and Responsibilities, Tool
and Data requirements along with documented process flows. The process will be kept straight
forward, rational, and easy to understand.
Rationale: The process must meet operational and business requirements.
1.12.4 Technology and Tools
Statement: All tools selected must conform to the enterprise architectural standards and direction.
Existing in-house tools and technology will be used wherever possible, new tools will only be
entertained if they satisfy a business need that cannot be met by current in-house tools. The
selection of supporting tools must be process driven and based on the requirements of the business.
Selected tools must provide ease of deployment, customization and use. The selected tools must
support heterogeneous platforms. Automated workflow, notification and escalation will be deployed
wherever possible to minimize delays, ensure consistency, reduce manual intervention and ensure
appropriate parties are made aware of issues requiring their attention.

The tools used by this process are the following:
• Capacity Management Information System (CMIS)
Rationale: Technology and tools should be used to augment the process capabilities, not become
an end themselves.
1.13 Tailoring Guidelines
The tailoring guidelines identify the allowable variations of the IT organization’s standard process
as needed for adjustments (adding, deleting, modifying) relative to specific operational or
functional needs of another organization. Process tailoring is about roles and procedures, not the
standard process or major activities defined in this process. All tailoring request, with supporting
rationale, must be submitted in writing to and approved by the Business Capacity Management
owner.
Training
Process training involves training all stakeholders about key processes that are crucial for an
organization to deliver business objectives. Training provides clarity to employees on a set of
procedures that needs to be carried out as part of the process and the best possible way to do
them. List below the training resources available for this process:
Capacity Management, ELMS Course #57752
Procedure
1.14 Purpose of Procedure
This document defines the step-by-step instructions on how to conduct the activities used to
implement the Business Capacity Management process in Solution Engineering. The purpose of
a procedure document is to institutionalize and formalize the preferred method of performing
tasks that staff is using. The objective is to have everyone using the same tools and techniques
and follow the same repeatable steps so that the organization can quantify how well the
procedure is working and train future staff members who may not currently know the routine.
Ensuring consistency is a critical component for ensuring optimum efficiency.
1.15 BCapM 1.0: Business Capacity Management
ID Task Name and Description Role RACI
BCapM
1.1
Review existing Capacity Plan • BCapM Manager
• BCapM Analyst
R
C
BCapM
1.2
Review approved RFC(s) • BCapM Manager
• BCapM Analyst
R
C
BCapM
1.3
Analyze Business Information • BCapM Manager
• BCapM Analyst
R
C

BCapM
1.4
Analyze Service Performance Issues • BCapM Manager
• BCapM Analyst
R
C
BCapM
1.5
Analyze Service Information • BCapM Manager
• BCapM Analyst
R
C
BCapM
1.6
Analyze Financial Information • BCapM Manager
• BCapM Analyst
R
C
BCapM
1.7
Analyze Performance Information • BCapM Manager
• BCapM Analyst
R
C
BCapM
1.8
Analyze CMIS Information • BCapM Manager
• BCapM Analyst
R
C
BCapM
1.9
Analyze Patterns of Business Activity • BCapM Manager
• BCapM Analyst
R
C
BCapM
1.10
Forecast Capacity demands • BCapM Manager
• BCapM Analyst
R
C
BCapM
1.11
Store Capacity Plan and supporting
material in CMIS
• BCapM Manager
• BCapM Analyst
R
C
1.16 BCapM 2.0 Negotiate Service Level Agreements and Implement Changes
BCapM
2.1
Review Capacity Plan review results • BCapM Manager
• BCapM Analyst
• Operations Manager
R
C
C
BCapM
2.2
Review SLA Performance • BCapM Manager
• BCapM Analyst
R
C
C
BCapM
2.3
Conduct impact analysis of recommended
SLA changes
• BCapM Manager
• BCapM Analyst
R
C
C
BCapM
2.4
Review recommendations for SLA
changes with SLM
• BCapM Manager
• BCapM Analyst
R
C
C
BCapM
2.5
Store artifacts in the CMIS as necessary • BCapM Manager
• BCapM Analyst
R
C
1.17 BCapM 3.0 Review Component Performance
BCapM
3.1
Review Capacity Plan Review results • BCapM Manager
• BCapM Analyst
R
C

BCapM
3.2
Review SLAs • BCapM Manager
• BCapM Analyst
R
C
BCapM
3.3
Review component performance, capacity
information and reports
• BCapM Manager
• BCapM Analyst
R
C
BCapM
3.4
Develop recommendations for changes to
components
• BCapM Manager
• BCapM Analyst
R
C
BCapM
3.5
Store artifacts in the CMIS as necessary • BCapM Manager
• BCapM Analyst
R
C
1.18 BCapM 4.0 Develop the Capacity Plan
BCapM
4.1
Produce or revise the capacity plan • BCapM Manager
• BCapM Analysts
R
C
1.19 BCapM 5.0 Review the Capacity Plan
BCapM
5.1
Review the Capacity Plan • BCapM Manager
• Business Stakeholders
R
C
C
BCapM
5.2
Approve the Capacity Plan • Higher Authority A
BCapM
5.3
Baseline the Capacity Plan in the CMIS • BCapM Manager R
1.20 BCapM 6.0 Review the SLA and Service Catalog
BCapM
6.1
Review SLAs • BCapM Manager
• BCapM Analysts
• Business Stakeholders
R
C
C
C
BCapM
6.2
Record review results • BCapM Manager R
BCapM
6.3
Store review artifacts in the CMIS as
necessary
• BCapM Manager
• BCapM Analysts
R
C
Appendix
1.21 Acronyms

Acronyms Definition
BCapM Business Capacity Management
CI Configuration Item
CMMI Capability Maturity Model Integration
CMIS Capacity Management Information System
ES Enterprise Services
IPM Integrated Process Management
IRM Internal Revenue Manual
IRS Internal Revenue Service
IT Information Technology
ITIL Information Technology Infrastructure Library
ITSM
Information Technology Service
Management
PAL Process Asset Library
PBA Patterns of Business Activity
PD Process Description
PMI Project Management Institute
RACI Responsible, Accountable, Consulted, and Informed
RFC Request for Change
SLA Service Level Agreement
SLM Service Level Management
SLR Service Level Requirements
1.22 Glossary
Term Definition
Business
Capacity
Management
A strategic capacity management process done when
decisions to expand or contract the infrastructure are
made due to expected changes in demand by the
business (addition of new applications, new
infrastructure, etc.).

Term Definition
RACI
The RACI model is based on the principle that people act
in one of four ways when executing a task. It accounts for
the fact that more than one role may be active in
performing a specific task while clearly defining specific
responsibilities for that role. While many roles may be
involved in a task only one is Accountable for the results.
The actions are: R Responsible for the action (may do
the task) A Accountable for the action (including
approval) C Required to be Consulted on the action I
Required to be Informed of the action If a task does not
have an Accountable role indicated then the Responsible
role is assumed to be accountable for the task.
Service Level
Agreement
A service-level agreement is part of a service contract
where the level of service is formally defined. In practice,
the contracted delivery time (of the service) or
performance.
Service Level
Management
A set of practices for IT service management
(ITSM) that focuses on aligning IT services with the
needs of business.
Service Level
Requirements
A statement from a customer to a service provider
describing their service expectations. It includes the
requirements of the customer from the service provider.

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