What does the term ‘value stream’ refer to in ITIL 4?

The term "value stream" in ITIL 4 refers to the sequence of activities needed to deliver a service. This concept emphasizes the importance of understanding how various activities combine to create value for stakeholders, particularly customers. Within the context of service management, a value stream outlines the steps an organization takes to transform input resources into valuable outputs, such as products or services, ensuring that every activity adds value.

By mapping out value streams, organizations gain insights into their processes, can identify areas for improvement, and optimize the flow of work to enhance service delivery. This is critical in achieving operational efficiency and aligning services with business goals. The focus on value streams supports ITIL’s principle of co-creating value with customers and stakeholders, reinforcing the need for continual improvement in the service lifecycle.

The other choices do not accurately capture the essence of value streams within the ITIL framework, as they pertain to specific elements of budgeting or financial analysis rather than the holistic process of delivering services.