The need to define IT value

June 24, 2015
Written by Barclay Rae

Welcome to a new series of blogs that I am delighted to be delivering for Sunrise.

The focus of these blogs will be around the value of IT Services, particularly in relation to the various ways in which these are sourced and managed. So this will apply to buyers, sellers and practitioners of support services – how can they get better value, deliver better value for money, achieve more mutual success etc.

This initial blog sets out some of the key considerations for all parties involved in the service ‘supply chain’ and ‘value chain’. This will aim to improve understanding of what is being bought and delivered when someone buys an IT Service.

Let’s begin with is a simple question – what do we mean by ‘services’? It’s easy to use the term – sometimes interchangeably with ‘system’ – without the clarity required to really achieve success with Service Management. Indeed I’ve been at many conferences and events where the question has been asked of a room full of ITSM /ITIL experts and practitioners, but no one has come up with a suitable definition.

Traditionally, there are 2 simple types of IT ‘Service’ – technology services and business services:

Technology services are exactly what they sound like – bits of technology, software, hardware, networks – and importantly both the buying and selling parties need to be clear on that. In other words one party (usually also an IT organisation) knows that they (only) need to buy e.g. hardware and that’s what they buy from a company that sells hardware.

Business services on the other hand involve more than just technology components – they include packaging, value added services, people, processes and expectations around delivery. In particular they are bought and managed – consciously or otherwise – with the expectation that they are there to support another result – the delivery or activity of some business function.

So all those involved in the supply chains of delivery need to be aware of the greater goal or expectation around what is being delivered – without this there is the risk that, whilst each person or team will deliver their part, the total experience and delivery will be missed.

This seems fairly straightforward although the difficulty is knowing the difference between the 2 types of service. Also, although many buying decisions are seemingly made on the basis that they are technology services, the reality is that practically every pieces of technology needs some aspect of business service and support.

Many service delivery teams or agents may think that they are simply delivering IT services when in fact they are unknowingly part of a bigger ‘supply chain’ – and as such they are delivering business services. The key here is that at some point, someone needs to take ownership of the ‘value’ part of the supply chain – in other words the ‘value chain’*. This is usually the internal (retained) IT organisation but this is changing as more implementations and variations of SIAM (service Integration and Management) take hold.

SIAM Basically is a layer of ownership and governance across and above individual suppliers that ensures the end-to-end integration of all the elements in line with expectations. It can be useful to separate this out (certainly from delivery) but also from the management and ‘service’ ownership, in order to deliver successful results.

To some futurists in IT the notion of ‘services’ is itself flawed and dated – we should simply focus on customer experience and value in terms of the drivers for service and delivery. Others argue that ‘service’ itself is not a tangible thing – i.e. a noun. Instead it is simply an attribute and can only be expressed as an adjective – service request, service level, service experience etc.

I have some sympathy for both of these views although from a pragmatic perspective I see a need to use the concept of ‘services’ – and e.g. a service catalogue – as a useful stepping stone to move from the 20th to the 21st Century in terms of IT provision and customer engagement. This is also a tangible and practical route using the variety of ITSM tools and methodologies available rather than starting with a blank sheet of paper.

Suffice to say that for now we need to be clear that we are in a ‘supply chain’ industry – wherever we sit in IT. We need to be clear that – in most cases – what we do is a contributory factor to someone else’s success and goals. If we don’t understand at a personal or organisational level what these goals are then we are almost guaranteed to fail.

We also struggle to define what we mean by ‘value’ delivered by IT. Traditionally this has been highly focussed on the cost and impact of failure, with success represented or reported in terms of how well the IT organisation recovers from it – i.e. the SLA break/fix legacy.

We must move away from thinking that recovery from failure = value. 

Recovery from failure is one (important) aspect of what we do in IT, but it is not the one which ultimately defines whether we are doing a good job or not. This should relate more to what is provided and achieved through technology, like sales or financial transactions, or tasks completed, and not just how long our networks are available or how quickly we answered the phone and fixed a PC.

The point of all of this is that we need to have our priorities – and thus our pitch about what we do – absolutely clear in our strategy and policy. In other words our organisation – whether internal or external facing – needs to live and breathe the goals and objectives and values of our customers.

  • If we are an internal IT department we should know our business and feel part of it, not be a separate function.
  • If we are an external supplier or Managed Service Provider, we have to constantly engage and build our contacts and service monitoring and reporting, management, governance and success criteria all around what we understand to be the goals and success criteria of our customers.

As the world of IT constantly changes, there is less and less opportunity, profit and ultimately value to be had in simply providing technology services – we need to move up to support people and organisations…

In the next blog we’ll explore customer experience and how IT organisations and MSPs can manage and deliver it.

*Value chain means the supply chain (ie various activities involved in delivering a service) analysed and understood to appreciate the areas of cost and quality. So the delivery activities would involve processes, tasks, and physical technology, whereas the value is the list of benefits and costs associated.

 

About the Author 

Barclay Rae is an experienced ITSM mentor and business manager. He has worked on approximately 500 ITSM projects over the last 25 years, as well as starting life on the operations side of IT, setting up and running Help/Service Desks.

Barclay has worked for a number of ITSM organisations, and he delivers strategic ITSM consultancy, mentoring and business development, as well as media analyst services to the ITSM industry.

Barclay has created ‘ITSMGoodness’ – a set of practical steps and guidelines – simple practical and proven tips and tools – for successful ITSM. Visit www.itsmgoodness.com for details and free to air access – join the Twitter conversation at #ITSMGoodness and follow Barclay at @barclayrae.

Barclay is an associate of SDI, where he provides consultancy and auditing services – as he does with other organisations such as G2G3, MSS and Mozaic. He writes blogs and papers for a number of industry organisations, including itSMF, ITSM Review, Axelos and a variety of ITSM vendors.

He is also a regular speaker at conferences in the industry, in the UK and globally, including, SITS, SDI, itSMF, Pink Elephant, Fusion, UCISA, BCS and others. Details of forthcoming speaking engagements are on the Barclay Rae website. Barclay was voted ‘ITSM Contributor of the year’ in 2014 by his peers at the SITS show.

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