ITIL Terminology - L to O


The various stages in the life of an IT service, configuration item, incident, problem, change, etc. The lifecycle defines the categories for status and the status transitions that are permitted. For example:

  • The lifecycle of an application includes requirements, design, build, deploy, operate, optimize
  • The expanded incident lifecycle includes detection, diagnosis, repair, recovery and restoration
  • The lifecycle of a server may include: ordered, received, in a test, live, disposed of, etc.

Line of Service (LOS)

A core service or service package that has multiple service options. A line of service is managed by a service owner, and each service option is designed to support a particular market segment.

Live Environment

A controlled environment is containing live configuration items used to deliver IT services to Customers.

Monitor Control Loop

Monitoring the output of a task, process, IT service or another configuration item; comparing this output to a predefined norm, and taking appropriate action based on this comparison.

Net Present Value (NPV)

A technique used to help make decisions about capital expenditure. It compares cash inflows with cash outflows. The positive net present value indicates that investment is worthwhile. 

Normal Service Operation

An operational state where services and configuration items are performing within their agreed service and operational levels.

Notional Charging

An approach to charging for IT services. Charges to customers are calculated, and customers are informed of the charge, but no money is transferred. Notional charging is sometimes introduced to ensure that customers are aware of the costs they incur, or as a stage during the introduction of real charging.


The outcomes required from a process, activity or organization to ensure that its purpose will be fulfilled. Objectives are usually expressed as measurable targets. The term is also informally used to mean a requirement.


Provision of services from a location outside the country where the customer is based, often in a different continent. This can be the provision of an IT service, or of supporting functions such as a service desk. 


Provision of services from a location within the country where the customer is based. 

Operational Level Agreement (OLA)

An agreement between an IT service provider and another part of the same organization. It supports the IT service provider’s delivery of IT services to customers and defines the goods or services to be provided and the responsibilities of both parties. For example, there could be an operational level agreement:

  • Between the IT service provider and a procurement department to obtain hardware in agreed times
  • Between the service desk and a support group to provide incident resolution at agreed times.

Opportunity Cost

A cost that is used in deciding between investment choices. Opportunity cost represents the revenue that would have been generated by using the resources in a different way. 


Using an external service provider to manage IT services.