IT Service Management is a set of specialized organization capabilities for providing value to customers in the form of IT Services, through the use of industry best practices, for the improvement of business functions.
The goal of IT Service Management is to align services with current and future needs of the customer; to improve the quality of IT services - in whatever way the customer expresses "quality" and to reduce the long term cost of service provision.
The capabilities take the form of functions and processes for managing services over a lifecycle, with specializations in strategy, design, transition, operation and continual improvement. The capabilities represent a service organizations capacity, competency, and confidence for action. The act of transforming resources into valuable services is at the core of service management.
The ITIL® Framework is a source of good practice in Service Management, and is used by organisations worldwide to establish and improve Service Management providing a formal and universal standard.
Source: OGC ITIL® Version 3