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Service strategy for the fish and chip shop


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ITIL Service Strategy demystified.
There has been feedback from itSMF members that the Service Strategy book is somewhat more theoretical or abstract than the “meat and potatoes” of Service Transition and Service Operation. However the basic concepts of Service Strategy have existed in service organisations throughout time. This presentation aims to demystify the concepts of ITIL Service Strategy by looking at the topic through the eyes of the fish and chip shop owner – here is Service Strategy as part of Service Management 101 – with the key concepts of Service Strategy explained using a familiar and non threatening metaphor.

This presentation was first delivered at itSMFA 2011 annual conference in Perth, WA.

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Service strategy for the fish and chip shop

  1. 1. Service Strategy for the Fish and Chip Shop Owner<br />Patrick Keogh<br />UXC Consulting<br /><br />
  2. 2. ITIL 2011<br />The Service Strategy book has undergone the most significant change/improvement of all of the core publications.<br />This presentation has been updated based on the ITIL 2011 improvements<br />
  3. 3. What is this presentation about?<br />Service Strategy book may appear theoretical or abstract<br />An example from day to day experience can make the ideas more concrete<br />IT service strategy isn’t all that different to any service strategy<br />“It all started several years ago when…”<br />
  4. 4. Backstory –ITIL Foundation Certificate course<br />Student taking early retirement “in a few weeks”.<br />What are you going to do? “We’ve got a place down the coast.”<br />“Not really ready forretirement, I want toopen some sort offoodbusiness.”<br />“Haven’t decided whator where.”<br />So…<br />
  5. 5. Conclusion…<br />This man needs a service strategy!<br />ITIL ServiceStrategy canprovide great guidance.<br />So on with the story…<br />
  6. 6. First of all, what is a service strategy?<br />Defining a strategy whereby a service provider will deliver services to meet a customer’s business outcomes<br />Defining a strategy for how to manage those services.<br />ITIL 2011 Service Strategy<br />
  7. 7. 4 P’s of Service Strategy<br />Perspective Describes the vision and direction of the organization. A strategic perspective articulates what the business of the organization is, how it interacts with the customer and how its services or products will be provided<br />Positions Describe how the service provider intends to compete against other service providers in the market. The position refers to the attributes and capabilities that the service provider has that set them apart from their competitors. <br />Plans Describe how the service provider will transition from their current situation to their desired situation. <br />Patterns Describe the ongoing, repeatable actions that a service provider will have to perform in order to continue to meet its strategic objectives.<br />ITIL 2011 Service Strategy<br />
  8. 8. Strategy Management for IT Services<br />Define the market<br />Develop the offerings<br />Develop strategic assets<br />Prepare for execution<br />
  9. 9. Key Concepts<br />How do these apply to the food service business?<br />
  10. 10. 1. Define the market<br />
  11. 11. The geography<br />Bawley<br />Point<br />Batemans<br />Bay<br />Narooma<br />
  12. 12. The Market Space<br />
  13. 13. The Customer Portfolio<br />What clientele would I be trying to attract?<br />What food services would this clientele use?<br />What would the competition be?<br />
  14. 14. 2. Develop the offerings<br />
  15. 15. Potential customers<br /><ul><li>Service preferences driven by age, income, background etc.</li></ul>What customer assets do they have?<br />Their own kitchen / crockery / fridge?<br />Somewhere to eat?<br />“Locals”<br />Weekenders/holiday residents<br />Passing trade<br />
  16. 16. What customer outcomes?<br />Somewhere quick to stop for lunch<br />
  17. 17. What customer outcomes?<br />Day to day staple foods<br />
  18. 18. What customer outcomes?<br />Somewhere fancy to go out for dinner<br />
  19. 19. What customer outcomes?<br />Somewhere to get family takeaway dinnerquickly and at low cost.<br />
  20. 20. What customer outcomes?<br />Morning coffee<br />or breakfast<br />or brunch.<br />
  21. 21. Different services for different customer outcomes<br /><ul><li>Each of these will require its own specific service model.
  22. 22. A customer willhave multiple outcomes.
  23. 23. May draw on multiple services with their unique service models in order to achieve their outcomes.</li></li></ul><li>Competitors<br /><ul><li>Indicate demand forspecific services
  24. 24. Reduce our marketshareHow many pubs can survive in a town of 3000</li></ul> people?<br /> Where is the under-served market space?<br />
  25. 25. 3. Develop Strategic Assets<br />
  26. 26. Can you see Strategic Assets?<br />
  27. 27. Can you see Strategic Assets?<br />
  28. 28. 4. Prepare for Execution<br />
  29. 29. Key Activities<br />Strategic Assessment<br />SWOT<br />Critical success factors<br />Business strategy and plan<br />Setting Objectives<br />Management strategy to ensure that objectives are met<br />Aligning Service Assets with Customer Outcomes<br />Explorebusiness potential, expansion and growth<br />
  30. 30. Service Economics<br />
  31. 31. Demand Management<br />Patterns of business activity<br />Summer boom, winter bust<br />What hours of the day (do people eat later or earlier when on holiday?)<br />Easter?<br />Long weekends?<br />What effect does weather have?<br />For peaky demand, how to manage resources?<br />
  32. 32. Demand Management<br />User profiles<br />Commonly acquired baskets of services<br />If we have a table of 4 how much do they spend and how long do they occupy the table? How about for a group of 8?<br />Do customers spend more at lunch than at dinner or vice versa?<br />On average how many customers with special dietary requirements will we get? Is it worth catering to vegans/special allergies etc.?<br />What about small children?<br />
  33. 33. Financial Management for IT Services<br />
  34. 34. Strategy and Organisation<br />Our organizational structure must align with our strategy:<br />Hours of service<br />Can we appoint managers that we can rely on?<br />Balance skills and resources between “front of house” and the kitchen.<br />
  35. 35. Service Management as a Strategic Asset<br />What is it that McDonalds sells?<br />Is it the best hamburger?<br />Or is it predictable, timely service delivered at a good price?<br />For McDonalds, Service Management is the business.<br />
  36. 36. So my allegory comes to an end: what can we learn?<br />Ideas and advice in ITIL Service Strategy are not new, and apply to all service organisations.<br />Business intuitively apply these practices to some extent anyway.<br />Make it real, make it concrete. It is about the customer and business viability.<br />
  37. 37. Recommendations<br />Take your service strategy seriously.<br />Strategy is not theoretical – it is real and practical. If our fish and chip shop owner can do it then so can you!<br />Remember the power of saying “No, we don’t do that”.<br />Treasure your service assets. It isn’t heroics that deliver service, it is service assets.<br />
  38. 38. Questions?<br />Patrick Keogh<br />UXC Consulting<br /><br />