Enterprise Service Management: the (r)evolution of ITSM

IT & DATA MANAGEMENT RESEARCH,
INDUSTRY ANALYSIS & CONSULTING
Valerie O’Connell
Research Director
Enterprise Management Associates (EMA)
voconnell@enterprisemanagement.com
ESM: The (R)evolution of ITSM

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Featured Speaker
Valerie O’Connell, Research Director, EMA
Valerie came to EMA with decades of senior-level experience in the
effective marketing of technology. From strategic positioning with practical
go-to-market planning and compelling messaging, Valerie works with her
clients to drive business. She excels at making the value proposition of
complex products clear in crowded markets, and at equipping sales forces
to strike with precision. Valerie has enjoyed many years as an independent
practitioner, serving industry giants such as Microsoft and EMC, as well as
innovative startups.
Slide 3 © 2020 Enterprise Management Associates, Inc.

Sponsors

Research background
• “Automation, AI, and Analytics: Reinventing ITSM” 2019 EMA research
• ITSM growing in importance, reach, and function in enterprises
• Growth fueled by digital transformation and technology availability
• 87% have ESM at some level of deployment
• Results/outlooks varying greatly by maturity level and size of help desk
• Geography and industry made little difference
• “ESM: The (R)evolution of ITSM” March 2020 EMA research
A practical view of ESM as both a logical, evolutionary extension of ITSM and as a
revolutionary outgrowth of the digital transformation culture…(r)evolution

Agenda topics
• Demographics
• The ITSM context
• ESM findings
• Platform considerations
• Organizational impacts
• Conclusion/QA

INDUSTRY ANALYSIS & CONSULTINGSlide 7
Demographics

Respondents vetted for strategic ITSM and ESM vantage point
26%
35%
39%
C-level IT and non-IT
IT VP/director
IT management
53%
14%
16%
17%
Direct management
Part of team
Indirect
management/exec
Involved/not on team
Role of respondents in relation to ITSMManagerial level of respondents
75% North America, 25% Europe

Company size and role of automation
24%
27%
24%
27%
10,001+
5,001- 10,000
2,501- 5,000
1,000-2,500
59%
21%
12%
9%
Strategic
Focused
Departmental
Early stage
The strategic role of automationCompany size as determined by number of employees

The ITSM context

ITSM continues a consistent trend of growth
• Organizational reach
• Influence
• Services offered
• Stakeholders served
• Resources available
• Technologies in play
• Strategic role, center of innovation
Note: pre-crisis findings likely to hold;
ITSM importance is underscored in at-home paradigm

Anticipated ITSM growth in the next three years
2%
10%
18%
44%
17%
6%
3%
1%
Increased 75% or more
Increased 50%-74%
Increased 25%-49%
Increased 10%-24%
Increased less than 10%
Stayed the same
Decreased less than 10%
Decreased 10%-24%
57%
37%
6%
Substantial
growth
Modest
growth
No change
or decline
ITSM growth anticipated and budgeted
Follow the money: ITSM budgets are on the rise
74% had an increase of 10% or more this year
There was an even distribution across company size

ITSM team size
7%
49%
33%
12%
<20
21-50
51-100
100+
Note: Although larger organizations tend to have larger ITSM teams,
there is no absolute correlation between company size and the size of ITSM teams
ITSM team size is more predictive of behavior than is company size

ESM findings

ESM naming conventions
35%
59%
48%
28%
1%
ESM (enterprise service management)
By department name (for instance, "facilities
service" or "HR support")
By action or process, such as request for help,
fulfillment, information, or specific action (such as
being added to a list)
By a name specific to your company or brand
Other
Question asked: How does your organization refer to non-IT services supported through ITSM?
Note: many respondents chose two approaches

A sampling of names that ESM services and portals go by
• Sales Funnel
• Staff Portal
• The Box
• Halo
• Self-service
• ITHelp
• PEP
• ISM portal
• Prefer not to disclose
• It doesn’t have one, to be honest. We call it
portal.
• BAKER
• SOLV
• At your service
• MyRequest
• HelpU
• JEEVES
• Serv!
• DirectOne
• IT Service Portal
• Kalliope
• GET

ESM maturity – ESM is mainstream, but still growing
How long have non-IT or business process workflows been deployed from your ITSM platform or team?
72%
28%
A year+
Less than a year
Sample Size = 198
Note: the more mature ESM is, the more of everything
the respondent is likely to select (capabilities,
automation, degree of service, metrics, results…)
This finding is consistent with previous EMA research.
ESM service quality increases with ESM maturity

ESM maturity and substantial growth of ITSM closely correlated
Projected ITSM growth by ESM maturity level
62%
32%
6%
46%
46%
7%
Substantial
Modest
No change or decline
A year+ Less than a year
Sample Size = 198

ESM areas: when unlimited, respondents averaged 7 selections
67%
52%
50%
49%
47%
46%
41%
41%
40%
40%
40%
39%
30%
25%
24%
22%
20%
19%
0%
0%
Cybersecurity
Human resources
Finance and accounting
Logistics
Training
DevOps
Project and portfolio…
Supply chain and vendor
Facilities and maintenance
Sales
Marketing
Enterprise…
Scheduling
Legal
Physical security
Transportation/fleet
Vertically specific functions
SIEM and SOAR
Other
None
Average 7 areas

When limited to one selection, HR is the primary ESM area
16%
12%
11%
10%
9%
8%
8%
7%
6%
5%
4%
4%
2%
1%
1%
Human resources
Logistics
Finance and accounting
Enterprise procurement/purchasing
Supply chain and vendor
Sales
Marketing
Project and portfolio management
Vertically-specific (retail operations, healthcare operations,…
SIEM and SOAR
Facilities and maintenance
Training
Physical security
Legal
Scheduling

Level of service in the primary ESM area
9%
48%
43%
Basic
Medium
Advanced
Sample Size = 200
• Basic was defined as self-service+
• Medium included virtual agents and chatbots
• Advanced used automation of complex processes
Note:
79% of teams that offer advanced ESM
services see substantial ITSM growth –
almost twice that of those offering medium
and basic levels.

ITSM-like capabilities offered in ESM
What capabilities and services are offered to the non-IT areas being served from your ITSM organization?
58%
57%
53%
47%
45%
43%
42%
38%
21%
0%
Self-service portal
Automated cross-departmental workflows
Dashboards tailored to interests of numerous…
Chatbots and virtual agents
Autonomous service through ML and AI-assisted…
Dashboards for executives only
Gap analysis provides feedback on areas that need…
Non-IT users can build their own workflows
Conversational NLU and NLP
Other Average: 4 selections per respondent
Sample Size = 200, Valid Cases = 200, Total Mentions = 806

ITSM use of people, processes, and automation in support of ESM
17%
42%
42%
Non-IT functions use an existing ITSM platform
and organization
Non-IT functions use a hybrid of ITSM and
departmental solutions
IT and non-IT functions are served from a
consolidated, enterprise-wide shared service
center
Sample Size = 200
53% tickets created, tracked, closed, reported in ITSM fulfilled in functional department
50% automated routing
43% track SLAs for ESM separate from ITSM SLAs
37% chargeback (on the increase)

ESM success rates are high
If more than one non-IT area is being served from your ITSM organization, which statement best
describes the levels of success (where success means the original goals are being met or exceeded)?
35%
34%
30%
2%
1%
All areas are successful
There are minor differences in
success
Some areas are much more
successful than others
Most are successful, but there is
one failure
Most are disappointing
Sample Size = 200
Note: For all practical purposes, 70% are successful;
30% have widely divergent levels of success
We asked, if there is a difference, what is the main reason …..

Second place goes to organizational issues of politics and process
8%
35%
16%
25%
10%
4%
2%
Technical (product)
Technical (integration and data issues)
Organizational (politics)
Organizational (workflows and processes)
Resources (budget and staffing)
Resources (vendor and skills available)
Other
Technical challenges top the list when allowed only one challenge

Technology challenges averaged just under 3 per respondent, while 10% noted none
40%
39%
38%
30%
29%
28%
23%
23%
21%
10%
Information security and compliance concerns
Integration requirements
Data access/availability
More customization needed than expected
Legacy/siloed systems
Inconsistent, incomplete, or inaccurate data
Siloed or uneven levels of automation
Unclear process definitions
Our ITSM platform wasn't as adaptable as we'd thought
None
Drilldown: technology challenges to ESM implementation

26%
63%
9%
3%
0%
Outstanding
Very effective
Average
Needs improvement
Not effective
24%
57%
15%
4%
1%
Outstanding
Very effective
Average
Could use
improvement
Not effective
Quality of service as delivered vs. Quality of service as perceived
Quality of ESM services (delivered and received) is high

57%
35%
33%
25%
22%
IT staff are embedded in the business
units or departments
A separate group is dedicated to fielding
non-IT issues
Non-IT staff are part of the ITSM team
Non-IT service support is outsourced
Non-IT departments are responsible for
all information given and actions taken
ESM staffing: Cross-pollination is the most common approach

Business analysts on the ITSM team and non-IT business stakeholders are major ESM resources
72%
47%
25%
23%
1%
0%
Business analysts on IT team
DevOps
Non-IT business stakeholder
Contractor
Not applicable
Other
Building out ESM services from ITSM – non-IT talent trumps DevOps

The level of effort required to support ESM is not trivial
27%
61%
13%
0%
High
Substantial
Light
Insignificant
33%
56%
11%
0%
High
Substantial
Light
Insignificant
Primary area All ESM areas
How would you characterize the additional workload this support places on your ITSM organization?

Platform considerations

ITSM platform time-in-place shows a mature installed base SM
How long has this ITSM platform been in operation?
3%
35%
44%
18%
Less than one year
1-2 years
3-5 years
More than 5 years
Sample Size = 200
Note:
• 62% 3 years or more ITSM platform in place
• 68% said extensibility for ESM use cases had
been a factor in selecting their ITSM platform
• Almost half are looking at new ITSM platforms

Factors that determine suitability of ITSM platform for ESM use
What factors are most important in making an ITSM platform suitable to non-IT uses?
51%
46%
45%
39%
39%
37%
36%
31%
30%
28%
27%
27%
24%
22%
21%
21%
19%
14%
14%
0%
Ease of integration
Analytics, dashboards, and reports
Ease of use (intuitive to ITSM team and users)
Integrated knowledge base
Collaboration capabilities
Scalability
Advanced automation
Service catalog
Virtual agents/chatbots
Availability of third-party add-ons
Unified service portals
Amount of administrative overhead needed
Simplicity or difficulty of scheduled updates
Native support or connectors to major systems
Low code/no code customization
Mobile-specific functionality
Predefined workflows available out of the box
ML and NLU/NLP
Omni-channel support options
Other
Sample Size = 200, Valid Cases = 200, Total Mentions = 1,130
Average 5.7 factors selected
Note: Respondents average 5.7 ITSM factors important for ESM use when they can choose all

Integration leads when respondents choose their top 3
What factors are most important in making an ITSM platform suitable to non-IT uses?
(Choose no more than three)
44%
31%
31%
25%
23%
17%
14%
12%
10%
10%
9%
9%
9%
9%
8%
8%
8%
7%
7%
0%
Ease of integration
Ease of use (intuitive to ITSM team and users)
Analytics, dashboards, and reports
Scalability
Collaboration capabilities
Advanced automation
Service catalog
Simplicity or difficulty of scheduled updates
Availability of third-party add-ons
Amount of administrative overhead needed
Unified service portals
Integrated KB
Predefined workflows available out of the box
ML and NLU/NLP
Virtual agents/chatbots
Low code/no code customization
Native support or connectors to major systems
Mobile-specific functionality
Omni-channel support options
Other

Adapting ITSM for ESM use
What has to be done to make ITSM suitable to non-IT uses?
53%
51%
44%
44%
40%
39%
35%
20%
19%
3%
0%
Training of users
Data integration
Workflows
Improved portal capabilities
Information security
Custom configuration
Provision self-service capabilities with non-IT…
Legal considerations
Vendor supplied out-of-the-box capabilities
None
Other
Average 3.5 selections/respondent

ESM influence on the likelihood of ITSM platform change is mixed
What impact does ESM deployment have on the likelihood of your organization changing ITSM vendors?
37%
20%
35%
9%
Greatly increases the need to change
Greatly decreases the likelihood of change
No impact
Only increases licensing of existing platform
Sample Size = 200
No impact 44%*
Increase 37%
Decrease 20%
* Note: No impact 35% and only licensing 9% combine for 44%

Organizational impact

36%
27%
23%
9%
6%
It is a strategic initiative across the enterprise
There is an effort to standardize the type and level
of support services across IT and non-IT functions
Business stakeholders approach ITSM, a
department or function gets on board on an as-
requested basis
There is a formal, enterprise-wide shared services
center
The ITSM group reaches out to business functions
individually
Note: departmental/functional ESM initiative does not mean less important or valuable
ESM is increasingly considered a strategic enterprise initiative

CIO priority is an influential force, but the ITSM team drives specific initiatives
45%
28%
12%
10%
5%
ITSM team drives initiatives
CIO priority
Non-IT executive pressure on IT
Lines of business request it
End-user expectations for fast/excellent service
Organizational drivers of ESM – ITSM and executives

Managerial level oversight and budget are closely linked
34%
18%
42%
7%
CIO
VP
Director
Manager
33%
21%
39%
8%
CIO
VP
Director
Manager
Budget ownersMost senior level overseeing ESM initiatives

Main drivers for ESM initiatives – at 51% “evolution” leads
34%
31%
30%
28%
26%
23%
23%
22%
22%
18%
18%
14%
Ongoing digital transformation
Cost savings and efficiencies
Speed and agility of service
Leverage existing IT investments in automation and analytics
Self-service capabilities
Improved transparency and accountability
Natural extension of ITSM capabilities
Employee experience/satisfaction
Extend/demonstrate IT value across enterprise
Efficiencies from automated workflows
Reduced exposure to downtime and risk
Vertical/industry requirements or applications
Note: the combination of natural extension of ITSM capabilities and leverage existing IT investments in AI/ automation totals 51%
Average 3 drivers per respondent

45%
44%
44%
43%
40%
39%
37%
32%
Increased budget for ITSM
Wider range of services offered
Increased number and types of innovative…
Increased cross-functional workflows
High rate of adoption for self-service option
Improved SLA performance for enterprise…
Decreased costs
Increased headcount for ITSM
ESM benefits received map well to benefits sought

ESM has organizational implications that encourage change
42%
40%
34%
31%
30%
24%
23%
19%
18%
17%
2%
0%
Improved IT/business alignment
Greater collaboration across functions
Increased emphasis on employee experience
Process and policy standardization
Cross-functional teams become more common
Establishment of shared services center
New security issues/concerns are surfaced
Reduction in shadow IT projects in business units
Budgetary control and buying decisions are made…
Automation centers of excellence
None
Other
Organizational impacts as a result of ESM – only 2% had none

89% experience very positive impact on the relationship of ITSM/IT with the business
20%
42%
27%
10%
1%
1%
Transformational
Significant
Meaningful
Modest
Nonexistent: We have seen no impact on IT's
standing within the business from ESM
Negative: It has created friction between IT and
the business
ESM’s impact on the relationship between ITSM/IT and business

EMA conclusions
• ESM is early mainstream; its success acts as an ITSM accelerant
• Primary drivers of ESM are digital transformation and executive priorities
• Primary benefits of ESM are organizational improvements, cost savings, business
efficiencies, and end-user service/experience
• Returns on ESM investments are rapid, quantifiable, recurring/ongoing
• ESM is a natural extension of available technologies and ITSM people, processes,
and platforms (evolutionary)
• Subjective benefits significantly alter and improve IT/business alignment and cross-
functional collaboration – can be transformative (revolutionary)
ESM: the (r)evolution of ITSM

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