In 2017, will you be a service management leader or a laggard?

In 2017, will you be a service management leader or a laggard?

Lean and kanban service management enter the mainstream

At the start of the year we make predictions about the main features of the near future. I predict that the control approach to service management will become the domain of laggard organizations. In its place, lean and kanban service management will start to enter the mainstream. What do I mean by this and why will this happen?

The control approach is of limited value

The control approach to service management is implicit in frameworks such as ITIL and explicit in frameworks such as CobiT. The control approach looks like an example of the Deming Cycle: you plan how you will control your services; you implement controls according to that plan; you measure the effectiveness of those controls; and you make adjustments in those controls to improve their effectiveness. Note that the cycle is all about controlling services, rather than delivering services.

Our “traditional” frameworks emphasize the need to develop strategies to decide what services to deliver, to whom and how. Those frameworks speak of the importance of designing those services to fufill those strategies. But what is the reality of how most organizations typically use those frameworks? They focus on fixing services when they break, rather than making services anti-fragile. They focus on adding layers of administration and control to detect and correct errors during changes, rather than finding ways to make changes in an error-free, poka-yoke way.

The control approach is cumbersome and expensive

The result of the control approach to service management is a cumbersome and expensive management system of very limited value. That value is limited for two main reasons. The most commonly mentioned reason only touches the surface of the issue, however. I am talking here about  all the issues in misunderstanding the nature and purpose of a practice framework, such as ITIL, and the disappointing results in organizations where their expectations and implementation methods are not aligned with the purpose and intentions of the framework. We are familiar with the many misguided attempts, with hallmarks such as :

  • the tool will force us to adopt best practices
  • we adopt a framework without first analyzing the problems we want to solve
  • we think that training and certification is all we really need to get everyone aligned with a new way of working

The second reason for the limited value of the control approach is much more fundamental. Let us think of our services from the perspective of the value customers obtain from using those services. Surely this is the basis for offering services, our customers’ reason for using our services. The issue is that the at least 95% of the value the customers obtain is due to the delivery of the service itself. Only a tiny fraction of that value is the result of service management controls. So, in the best of cases, activities such as incident management and change management (as practiced by organizations basing themselves on traditional frameworks) can only increase the value of services by a few percentage points. 

 

The lion's share of customer value comes from delivering services, not from traditional service management

 

The lion's share of customer value comes from delivering services, not from traditional service management

Let me say this in a different way. Doing a good job of resolving incidents will never be the reason a customer uses your services. At best, it can only be a reason why a customer does not abandon using your services. Put yourself in your customers shoes. Which service provider would you prefer? The one from whose services you obtain a lot of value, but the service provider has middling performance in resolving incidents, or the one whose service provide little value, but they are good at resolving incidents?

Lean and kanban service management leverages the real value of services

This is the basis for my prediction that lean and kanban service management will enter the mainstream. The lean and kanban approaches to management focus on the service activities that provide 95% of the value. But not only do they put the management emphasis on the activities that really count. They have been shown to provide huge improvements in effectiveness and efficiency of the services themselves. Thus, we can call lean and kanban a value-centered approach to service management, rather than a control approach.

Let’s look at the experiences of organizations using these two approaches. A common complaint of customers is the length of time it takes to deliver changes. When using the control approach, we take a situation where changes take weeks or months to deliver, we probably slow that down a little due to the extra layers of control, and the best we can achieve is to reduce the number of incidents our changes provoke. We do nothing in this approach to ensure that our customers obtain more value from our services. 

Compare this to the value-centered approach. Using lean and kanban we can reduce the time required to deliver changes to hours or days, rather than weeks or months. This enables the service consumers to obtain the value of many more changes, and obtain that value much more quickly. At the same time, lean and kanban helps the service provider to not only reduce the number of defects in the services, but to reduce the impact of those defects.

 

Lean and kanban can amplify service value by several orders of magnitude

Lean and kanban can amplify service value by several orders of magnitude

Don’t be a laggard

In 2017, the mainstream of service management will focus on making significant increases in the value of services, rather than focussing on limiting the destruction of that value. If, during 2017, you are concerned with the value your customers obtain from your services, you will start to use methods that leverage the lion’s share of the value obtained from your services. You will start to use a value-centered approach based on the lean and kanban methods. Lean and kanban can be implemented using either a bottom-up or a top-down approach. You will identify the key influencers and deciders and you will have them trained in using the lean and kanban methods. You will start using these methods, radically increase the value of your services, implement continual improvement of your services and delight your customers. Or, you will continue to use a control approach to management, show little added value to your customers, and become a member of the organizational laggards.

 

 

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Alejandro Debenedet (20/01/2017)

Thank you Robert Falkowitz for joining the list of our active columnists.  

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