IT Service Strategy Part 2


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Developing a service strategy where customer introduced variability requires specific planning. IN this part, considerations for using reduction and accommodation strategies are covered. Part 1 is available here on SlideShare.

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IT Service Strategy Part 2

  1. 1. Developing an IT Service StrategyPart 2: Dealing With Variability<br />Jerry Bishop<br /><br />Creative Commons Attribution-ShareAlike 3.0 Unported License.<br />
  2. 2. Acknowledgements & References<br />This presentation was inspired by the work of Frances X. Frei, Professor Harvard Business School who has written extensively and very insightfully on managing service businesses.<br />Breaking the Trade-Off Between Efficiency Versus Service, HBR Nov 06<br />
  3. 3. Part 1 REcapservice Variability<br />5 categories of customer introduced variability<br />Developing an IT Service Strategy Part 1<br />
  4. 4. Arrival Variability<br />Customers do not want service at the same times which is not always convenient for the company.<br />
  5. 5. Request Variability<br />Customers’ wants and needs are not the same.<br />
  6. 6. Capability Variability<br />Some customers are more capable of assisting in the service while others require hand-holding.<br />
  7. 7. Effort Variability<br />When customers must perform a role in a service interaction, it’s up to them how much effort they apply to the task.<br />
  8. 8. Subjective Preference Variability<br />Customers’ opinions vary widely on what it means to get good service.<br />
  9. 9. Part 2: Dealing with variability<br />Dealing with variability will follow on and be posted to<br />
  10. 10. The Challenge<br />The challenge for service managers is how and how much to reduce or accommodate customer introduced variability in their service model<br />
  11. 11. Balancing Service with Efficiency<br />Services must support <br />Consistent and repeatable results<br />Achieving a clear value (cost – quality) target<br />Capable (How) of handling variability<br />Efficiency must provide<br />Boundaries to maintain the value target<br />Capacity (How Much) to handle variability<br />
  12. 12. Reality for Services Business<br />Customers introduce tremendous variability<br />You cannot drive out all variability since it is how many customers judge value and quality<br />Since customers are directly involved you can’t eliminate all variability even if you wanted to<br />
  13. 13. Conventional Wisdom<br />Variability = Cost<br />Faulty Conclusion<br />Accommodate customers various desires or reduce variability and risk customer satisfaction and defection<br />
  14. 14. Frie’s Alternative Perspective<br />Source: Harvard Business Review • Nov ‘06<br />
  15. 15. Reduction vs. Accommodation<br />Look for low cost options to accommodate more variability <br />Find ways to reduce variability without compromising the experience<br />
  16. 16. 5 Reduction Strategies for IT<br /><ul><li>Develop Service Catalogues (menus) to define the standard IT services, options, and tiered support
  17. 17. Create transparency for IT Service costing
  18. 18. “Show-back”, chargeback, allocation or metering
  19. 19. Reduce user rights on desktop in exchange for improved quality of experience and more options
  20. 20. Create incentives for users to complete training
  21. 21. Target users based on demand data from Problem Management</li></li></ul><li>5 Accommodation Strategies for IT <br /><ul><li>Incorporate power users in your service delivery model for broader support options</li></ul>Leverage automation strategically for a lower cost high touch staffing model<br />Selectively use self service where it will be perceived as a flexible or faster value-add<br />Use lower cost labor to expand capabilities including student workers <br />Use strategic sourcing solutions to increase capability or support coverage<br />
  22. 22. Which Strategy to Pursue<br />Organizations low end of competitive landscape must rely on strategies to reduce variability<br />Organizations under financial pressures must rely on reduction strategies<br />Markets which can support premium prices can rely more on accommodation strategies<br />
  23. 23. Questions<br />Jerry Bishop<br /><br />