This morning’s activity has been an offshoot of the Business Model research I’ve been working on. One of the possibilities of business models for Modern IT Portfolio Management is to create a “IT Service” as an addition to the advisory/consulting services that are under development. Currently I have an inventory of tools in the form of database applications, spreadsheets and word templates that I’ve created over the years. While I integrate these into a unified practice I continually think back to the consulting platform, B.A.S.E., I built decades ago. I had built it as a consultant’s workbench using MS Access V1, which operated much like SharePoint. The tool has data collection forms, analysis functions, and reports that enabled a consultant to use interview and other collected information as input to multiple forms of analysis. When I used it on several engagements it saved me days of collating, classifying, categorizing and sorting work enabling me to focus on analyzing, developing insights, brainstorming, and recommendations for my customer which is the true added value they hire a consultant for**.
A case for customer focus in ITSM
Today the need for knowledge worker augmentation is even more critical as management becomes aware of the cost of information overload to staff. Not only does it cause more stress on employees, but errors increase putting projects and companies at risk. The ability to manage information effectively as opposed to just efficiently has become a critical success factor. Corporations that fail to grasp that point are now suffering from these errors. The recovery time for these is longer than just the remediation time of the error. The costs go beyond that to reputation and trust. Once a corporation has lost trust with its customers is takes much longer to regain. Kotler points out that it cost more to acquire a new customer than retain and old. I would profess it takes double the cost of acquiring a new customer to reacquire an old customer that has lost trust with the company, and in many cases may never be required.
This bring me back to IT Service Management (ITSM). The first point, any IT Service works in a market whether a captive or open -if the IT Service is offered to external to the firm customers. While a captive market for IT Services appears to have less concerns, if the Service Manager and IT Executive Management look at the situation, they have more to be concerned about. In a free market situation both customer and provider are free to goes their separate ways. A customer can seek other providers, a provider can seek other customers. In a captive market customer and provider are joined together. However, if the customer is unhappy with the provider and proves the case to executive management that the service is not needed or the provider is not efficient and effective to the business; replacement or outsourcing becomes the order of the day. The IT Service staff are gone with no prospects of finding a new customer as the virtual firm has been dissolved or they are no longer a part of it.
The second point, while researching IT Service Management implementations around the global recently, it became obvious that most IT Functions: 1)View ITSM as a operations, mainly help desk, concern separate for the rest of the function. 2) Do not see ITSM as a strategy to design, build and grow the business. The first issue that ITSM is just helpdesk or operations suggests that IT organizations are still functioning as 1970s style product factories. Mass production of products and a possible focus on as designed quality (i.e., did not vary from design specifications). Product manufacturing companies that operate this way are shutting their doors every day. Despite the disposable society orientation of the market today, if a customer finds fault with the product they’ll return it and by from a competitor. These returns due to defects whether variance from design or various for from customer expectations –which is more important- cost the corporation significant funds. The ITSM equivalent means line of business down time or line of business rework, either is likely to generate a complaint to the CxO suite. The second issue, related to the first, using a systems engineering approach to design services is a new concept, but one that pays back several fold. Looking at not only the technical aspects of service delivery but the entire surround of that service is going to provide a higher quality, more cist effective service that provides a better customer experience which in the end results in a request for more services.
Management Consulting Models
**As noted in most management consulting books, a small army of entry level consultants are typically assigned to an engagement to do this data collection and organizing. While a productive way to onboard and develop consulting skills for new consultants, this often creates a bang/bust syndrome for the practice: Hire lots of new consultants for an engagement which results in a big bench (consultants waiting for work) at the end of the engagement. Immediate manager doesn’t wish to lay off staff as it: 1) Indicates poor business planning or sales skills on his/her behalf 2) Lowers perceived prestige as there are less people assign to be managed. If the firm does lay off and hire consultants in a repeated cycle it generates a poor image for the firm as well as a bad reputation with existing employees and potential candidates.