Capacity Planning

Oct 2012

IT AS
4R Program

Background & Objective

Problem Statement
Lack of service demand forecasting in 4R Global IT AS results in
Un-utilized capacity when actual volume is less than planned volume
Conflict in prioritization of services when volume spikes beyond 5% level
Challenge in resource planning
Low morale of consultants

Best Practice
Demand management is a critical aspect of service management. Poorly managed demand is a source of risk because
of uncertainty in demand. Excess capacity generates cost without creating value (ITIL V3)

Proposal
Setup Service Demand process with
Forecast based on past volume trends, future visibility of projects and business changes (demand for changes
including Service requests)
Plan resource capacity based on projected demand
Track actual volume against the demand forecast
Setup a tactical governance to prioritize the services when volume fluctuates beyond the capacity

2011 SAP AG. All rights reserved.

SAP AG TCS Internal

Volume forecast mechanism

List of services

Efforts forecast at sub-Knowledge for each of the Services

Description

Efforts
Total
(in
Efforts
hours) (in hours)

Projected efforts per month

(based on past volume and known cyclical trends eg. QEC, YEC.)

Add: Expected increase in efforts

1500

- from future visibility of projects

125

- Business changes (including Service requests where applicable)

100

225

1725

Less: Expected efforts reduction due to

100
75

(175)

1550

- 1 level handover
st

- Problem Management activity including PIPs

Expected future efforts per month
* Data above is only a sample and not representing any Product

2011 SAP AG. All rights reserved.

SAP AG TCS Internal

List of Services and Capacity Planning template

Monthly Capacity Planning for all services at Sub-Knowledge area level:
(Per month)

Services
(at Product level)

Incidents (effort in hours)

ASA (efforts in hours)
B2R (efforts in hours)
CRs (efforts in hours)
PM (efforts in hours)
Early Build involvement (efforts in
hours)
Knowledge Up skilling (efforts in
hours)
Total

Efforts per Expected Expected

Expected
month
efforts out efforts out
efforts
(Based on of future
of
reduction
historical visibility of Business
due to 1st
data)
projects
changes
level hand
over
(A)

(B)

(C )

(D)

Expected
efforts
reduction
due to PM
activity
including
PIPs
(E )

(A+B+C-DE)

Note:
Services are arranged in priority of importance
Knowledge Up-skilling is TCS internal

2011 SAP AG. All rights reserved.

SAP AG TCS Internal

Future
expected
Efforts

Service Demand Process Flow

Service Demand Process Flow:
Roles

Service
Integrator

Service Lead
SAP Service
Manager

Process Steps ->

1.1) Service Integrator to
provide input based on
future visibility of projects
and business changes
1.2) Project the efforts
and prepare the capacity
plan & share with SAP SM

1.4) Update plan with

feedback comments

1.3) Review the plan and

provide feedback

Tactical
Governance
Team

1.5) Compare with actual

effort utilization

1.7) Manages to handle additional

activities, shift the capacity or Increase /
Decrease the capacity based on scenario

Scenario 3
1.6) Prioritize and advises
for shift the capacity
between services

Scenarios are explained in more detail in next slides..

2011 SAP AG. All rights reserved.

SAP AG TCS Internal

Capacity Scenario when incidents volume reduced

Capacity planned
Projected volume (incidents)

KU

Efforts in (hours)

EBE
PM
SR
B2R
ASA
Incidents

Month 1

Month 2

Month 3

Scenario 1: When incidents volume is less than the demand forecast, team will focus on future Service Requests,
B2R, PM, etc. to utilize the capacity.
Scenario 2: If the incidents volume reduction is permanent and no demand / visibility for any other services, capacity
will be reduced, if the trend continues for more than 2 months.
* ASA: Additional Support Activities, B2R: Build to Run Transition, CR: Change Requests, PM : Problem Management,
EBE: Early Build Engagement, KU : Knowledge up skilling

2011 SAP AG. All rights reserved.

SAP AG TCS Internal

Capacity Scenario when incidents volume increased

Capacity planned
Projected volume (incidents)

KU

Efforts in (hours)

EBE
PM
SR
B2R
ASA
Incidents

Month 1

Month 2

Month 3

Scenario 3: When incidents volume is high (during QEC / RD), refer tactical governance team to prioritize and shift the
capacity Movement of capacity from other services (eg. PM or KU) to Incidents handling
* ASA: Additional Support Activities, B2R: Build to Run Transition, CR: Change Requests, PM : Problem Management,
EBE: Early Build Engagement, KU : Knowledge up skilling

2011 SAP AG. All rights reserved.

SAP AG TCS Internal

Capacity Scenario when demand exceeds capacity

Capacity planned
Projected volume (incidents)

KU

Efforts in (hours)

EBE
PM
SR
B2R
ASA
Incidents

Month 1

Month 2

Month 3

Scenario 3: When Incidents and SR volumes has increased and total demand is more than capacity, refer tactical
governance team to prioritize the services.
Scenario 4: If the volume increase is consistent, additional capacity to be brought in. Minimum 3 months needed for
bringing in additional capacity.
* ASA: Additional Support Activities, B2R: Build to Run Transition, SR: Change Requests, PM : Problem Management,
EBE: Early Build Engagement, KU : Knowledge up skilling

2011 SAP AG. All rights reserved.

SAP AG TCS Internal

10

Advantages and Next Steps

Advantages of Demand forecasting process as part of New Operating Model:
Service Integrator in New Operating Model will help in:

In forecasting the volume better

Enabling team to Handle more SRs

Better work content for consultants

Next Steps:

Sign-off of Demand forecasting process

Create a Tactical layer to enable prioritization

Roll-out Demand forecasting process

2011 SAP AG. All rights reserved.

SAP AG TCS Internal

11

Thank You!