Lesson 2: Organization, Customer, User and Sponsor

Where this level fits

Level 1 defined a service. This level identifies who is involved in one. These terms belong to the Key concepts area of the ITIL 4 Foundation syllabus, which carries 12.5% of the marks.

Reminders before you start:

• The exam has 40 multiple-choice questions, lasts 60 minutes and is closed book. You need 26 correct answers (65%) to pass.
• PeopleCert currently plans to retire the ITIL 4 exams on 31 December 2027. ITIL (Version 5) now exists.
• ITIL, its syllabus and the official book belong to PeopleCert. They are not attached or reproduced here. Get them from peoplecert.org, where you also buy the exam.
• This course is independent of PeopleCert and is not accredited. It does not promise a pass.

ITIL's wording. The definitions and purposes in this level are given in ITIL's own wording or close to it, because the exam asks you to recall them. That wording belongs to PeopleCert. The explanations and examples are this course's own.

Step 1: Learn what ITIL means by an organization

In everyday speech, an organization is a company. ITIL uses the word more widely.

An organization is a person or a group of people that has its own functions, with responsibilities, authorities and relationships, in order to achieve its objectives.

Note three points:

1. Size does not matter. A single freelance plumber is an organization. So is a multinational bank.
2. Legal form does not matter. A company, a charity, a government department or one team inside a company can each be treated as an organization.
3. Purpose matters. An organization exists to achieve objectives, and it arranges responsibilities and authority to do so.

Do this: When a question says "organization", do not assume a large company. Ask only: is this a person or group with its own objectives and responsibilities?

Step 2: Separate the service provider from the service consumer

Every service has two sides. An organization takes one of two roles in it.

• Service provider: the role an organization takes when it provides services to consumers.
• Service consumer: the role an organization takes when it receives services.

Everyday example: a gym provides fitness facilities. The gym is the service provider. A member who trains there is the service consumer.

These are roles, not permanent labels:

• The same gym is a service consumer when it pays a cleaning company to clean the changing rooms.
• Most organizations provide some services and consume others at the same time.
• Provider and consumer can be separate businesses, or two parts of one larger business. A company's IT department that supplies email to the sales department is a service provider. The sales department is its service consumer.

Do this: For any scenario, first name the service. Then ask who provides it and who receives it. The answer can change when the service changes.

Step 3: Split the service consumer into three roles

"Service consumer" is a general term. Inside it, ITIL identifies three more specific roles.

Worked example: a company arranges mobile phones for its sales team.

1. The sales manager decides the team needs phones with unlimited data and international calling, and is answerable for whether the phones help the team do its job. The sales manager is the customer.
2. The salespeople make calls and send messages every day. They are the users.
3. The finance director signs off the money for the contract. The finance director is the sponsor.

The mobile network company is the service provider. It is not one of the three roles, because those roles sit on the consumer side.

Step 4: Recognise that one person can hold several roles

The three roles describe what is being done, not job titles. They can be spread across different people or combined in one.

• Roles separated: the phone example above has three different people or groups.
• Roles combined: you choose a phone plan for yourself, pay for it from your own money and use the phone. You are customer, sponsor and user at once.
• Roles partly combined: a parent picks and pays for a child's phone plan. The parent is customer and sponsor. The child is the user.

Do this: Never assume three roles means three people. Match each action in the scenario to a role, then check whether the same person appears more than once.

Step 5: Apply a three-question check to any scenario

Use this procedure on every scenario question:

1. Identify the service and the service provider. Set the provider aside.
2. Ask: who defines what is required and is responsible for the outcomes? That is the customer.
3. Ask: who uses the service? That is the user.
4. Ask: who authorizes the budget? That is the sponsor.
5. Check whether any person holds more than one role.

Common errors to avoid:

• "The customer is whoever pays." In ITIL, authorizing the budget is the sponsor's role. The customer is defined by requirements and responsibility for outcomes.
• "The user decides what the service must do." Using a service and defining its requirements are different roles.
• "The provider is the sponsor because it runs the service." The provider is not a consumer role.

What the exam asks about this

Expect short, definition-based questions:

• Standard: "Which role authorizes the budget for service consumption?" Answer: sponsor.
• Missing word: a definition with the role name removed, such as "A [?] defines the requirements for a service and takes responsibility for the outcomes of service consumption." Answer: customer.
• Scenario: a few lines describing people, where you match one person to a role.
• Definition of organization: recognise the phrase "a person or a group of people".

The wrong options are usually the other two consumer roles, or the service provider. Learn the key verb for each role: the customer defines, the user uses, the sponsor authorizes.

Key takeaways

• An organization is a person or a group of people with its own functions, responsibilities, authorities and relationships to achieve its objectives. It can be one person.
• A service provider provides services. A service consumer receives them. Both are roles, and one organization can hold both for different services.
• Customer: defines requirements and takes responsibility for the outcomes.
• User: uses the service.
• Sponsor: authorizes the budget.
• One person can hold one, two or all three consumer roles at once.