Tom Limoncelli put together a list of questions that are essentially a cheat-sheet to creating and running a very effective IT team. He called it the Limoncelli Test (as a tribute to the Joel Spolsky‘s Joel Test) and it can be found at http://everythingsysadmin.com/the-test.html.
The only additional thing I would add to the list is to have a roadmap for the function you provide and ensure it is updated quarterly. A lot of teams spend a lot of time on what they do now, but don’t focus on what they “can” do. This is similar to IT functions spending more than 70% – 80% of their budgets on maintenance rather than innovating.