8 steps to modern service management 3071126

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8 Steps to ModernService Management ITSM as we know it is dead. SaaS helped kill it, and CIOs should

be thankful. Heres what comes next.

By Art Wittmann

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CONTENTS

TABLE OF

3 Authors Bio

4 Executive Summary

5 Service Management In A Cloudy,

Virtualized World

5 Figure 1: Making IT More Service-Oriented

6 SaaS On The Forefront

6 Figure 2: IT Service Management Maturity

7 Figure 3: Drawbacks to IT Service

Management

8 Figure 4: Use of Cloud-Based Enterprise

Applications

10 Figure 5: Satisfaction With Cloud-Based

Enterprise Applications

11 Figure 6: Primary Cloud Concern

14 Related Reports

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8 S t e p s t o M o d e r n S e r v i c e M a n a g e m e n t

Art Wittmann is an independent IT analyst and writer with 30 years of experi-ence in IT and IT journalism. Formerly, he was VP of InformationWeek Reports,and has served as editor of InformationWeek and editor in chief of NetworkComputing and IT Architect magazines. Prior to his time in business technologyjournalism, he worked as an IT director for a major university.

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Millions of dollars and countless hours converting IT into a service provider, often viaITSM and ITIL initiatives, did little to improve delivery of tech to the business. It certainlydidnt stop SaaS from rolling in the back door. Now, with business users sidestepping ITcompletely, must the CIO accept a new role as simply a service manager? No, but you do have to evolve. A hybrid environment, where IT delivers some services

augmented with external cloud and noncloud providers, is becoming the norm. In thisreport, we evaluate ITs role in the modern enterprise, explore some downsides of thisperception shift, and lay out an eight-step plan to regain the IT as a strategist and part-ner mantle.


reports 8 S t e p s t o M o d e r n S e r v i c e M a n a g e m e n t

EXECUTIVE

SUMMAR

Y

Table of Contents

May 2014 5

Service management in the IT world is dead,at least as we used to know it. Dont mournthe loss, celebrate the evolution.In InformationWeeks July 2013 Service-Ori-

ented IT Survey, a former manager at a majorITSM vendor said it perfectly: ITSM was criti-cal in the pre-cloud and pre-automation envi-ronments, but today its not well-aligned withAgile and DevOps adoption. Lets unpack that sentence. Before automa-

tion, when IT was slow to respond by defi-nition, that timeframe is before there werecloud options and IT was the only game intown the concepts and tools of IT servicemanagement were indispensable. Now that the business has options, and now

that IT can be more responsive to businessneeds, ITSM and its concepts are outmoded.All we can say is, Right! Lets move on.Though not universally so, its fair to say that

most organizations that adopted the IT Infra-structure Library, or ITIL, in all its splendor andglory ended up with the reputation of being

insanely expensive, slow, and unaligned to thebusiness. Why is that?First of all, ITIL is all about cataloguing what

you have. Its not about figuring out what youshould have and delivering that. At least in itsearly stages, its an inward-looking processthat doesnt give a damn about the needs of

the business. Build that catalogue and presentit to your users; put service assumptions inyour terms, not theirs; and force people tocome into your world dont venture intotheirs. These days, about the only professionals

who still get away with that mindset are doc-

Previous Next

Is your organization working toward making IT more service-oriented, where IT at the larger organization is consumed, priced, evaluated and paid for on a service level, rather than on an overall technology architecture or capital asset level?

17%

32%

51%

Making IT More Service-Oriented

Data: InformationWeek 2013 Service-Oriented IT Survey of 409 business technology professionals, July 2013 R7190713/1

R

Yes

No, and we have no plans to do so

Not yet, but we're considering it


Service Management In A Cloudy, Virtualized World

reports 8 S t e p s t o M o d e r n S e r v i c e M a n a g e m e n tTable of Contents

Figure 1

May 2014 6

tors, since theres not much alternative. For anenterprises IT needs, however, there areplenty of options. If you still think of your customers as users

and joke about how great your systems wouldbe if werent for people actually touching stuff,find a different line of work. IT going forwardis going to be a very frustrating experience foryou. Sure, most of us still love technology fortechnologys sake, but the customer is not theenemy, and now that customer has choices ones that can make your existence in the com-pany either ugly or superfluous. Its time tomake friends, walk a mile in their shoes, con-sider their needs first, and every other pro-cus-tomer clich you can think of.

SaaS On The ForefrontMost everyone gets that IT has to be more

customer-oriented than we were just a fewyears ago. Some of the people who under-stand that best now work sales at software-as-a-service vendors. Theyve learned that theIT team is not their customer, particularly inpush sales. If a VP of IT comes to the vendor,

its almost always with a line-of-business execwhose group will actually use, and probablypay for, the service in question. While IT can sometimes veto an application

because it lacks integration capabilities orpresents a security risk, most of the time, line-of-business managers get their way. And theyselect new SaaS apps based on feature sets,not on how well a system plays within the ex-

isting IT infrastructure. What SaaS vendors know, and what IT pros

need to learn, is that customers respond to adiscussion of their needs. They expect thatapps are secure and available and performadequately and can be integrated with exist-ing systems. And while those tenets of previ-ous-gen ITSM must still be considered in to-days model, IT simply wont be judged by

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2013 2011

How would you classify the maturity of your organization, in terms of IT service management?

IT Service Management Maturity

We actively manage IT as a service

Some of our IT offerings are managed as services, others are not

We manage underlying components that make up IT services, but not the service, end to end

We do not manage IT services

Base: 409 respondents in July 2013 and 479 in July 2011Data: InformationWeek Service-Oriented IT Survey of business technology professionals

R7190713/3

25%25%

37%41%

30%27%

8%7%



Figure 2

May 2014 7

those metrics. Its a DevOps and Agile andscale-out world. Server uptime stats dontmean a thing, yet unfortunately, your ITSMtools are occupied worrying about everyserver being available when your architectureno longer depends on that, and at least partof your team is (or had better be) more wor-ried about getting the next must-have func-tion out the door.What really complicates things is that Dev -

Ops/Agile/scale-out is just a partial reality formost IT shops. If youre like most, you have: >> Legacy applications running on bare-

metal hardware. >> Legacy monolithic apps that are virtualized.>> High-transaction-rate apps that have

their own unique needs, whether virtualizedor not. >> Scale-out apps that are subject to Agile-

developed enhancements. >> SaaS-based apps that bring new features

and present performance characteristics thatyou cant control. >> Apps that are run by outsourcers, where

a change in customer needs can mean a re -

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What, if any, are the downsides of IT service management at your organization?

Drawbacks to IT Service Management

More bureaucracy

We invested in software that nobody uses anymore

Little to no improvement vs. before service management project

Some waste of money (hundreds of thousands)

Worse relationship between IT and customers

Lower morale

IT staff turnover based on skills mismatch

Significant waste of money (millions)

Other

None

Note: Multiple responses allowedBase: 208 respondents at organizations working toward making IT more service-orientedData: InformationWeek 2013 Service-Oriented IT Survey of 409 business technology professionals, July 2013

R7190713/18

46%

18%

17%

16%

15%

15%

13%

5%

6%

19%

R



Figure 3

May 2014 8

negotiation of the outsourcing deal. You could have the best service manage-

ment and service desk apps ever conceivedpaired with the most proactive, customer-friendly IT team ever assembled and youd stillhave trouble presenting what looks like a co-hesive, business-aligned application-servicestrategy. Never mind truly delighting users atevery turn.While we spent the first few paragraphs cas-

tigating old-school IT thinking, we admit thattech leaders arent totally to blame. Theres acertain painful futility in trying to keep IT inlockstep with business needs over the longhaul. Most IT pros arent outgoing, empatheticsocial animals. But they all want the peoplewho use what they create to be successful. Users have problems when they have them,

but the truculent software and belligerenthardware of the pre-virtualization, pre-webservices era left IT providing fixes in days,weeks, or even months. Meanwhile, ITs cus-tomers grew impatient, unhappy, and skepti-cal about whether big, fat IT budgets weremoney well spent.

ITs often-mocked bad attitude has been 40years in the making, as the cycle of customerempowerment followed by IT retrenchmentreplayed itself over and over, like an ironicGroundhog Day. In mainframe days, central ITheld all the cards. Minicomputers let certainend users break away from ITs unresponsive-ness and the unsuitability of mainframes forcertain tasks. Minis were hard to run, so backto IT they went. End users latched on to thePC, and IT lost a good bit of control. Client-

server apps and their access to business databecome important and IT was king again.Then SaaS showed up and gave dissatisfiedcustomers and just as often, overworked ITteams another option. For some organiza-tions, SaaS has changed ITs role drastically.For others, SaaS use is more tactical.While most IT leaders are keenly aware of

this cycle, many do not look at service-ori-ented management as the fix, or at least theydont call it that. In 2011, InformationWeeks

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2013 2012

Does your organization use any cloud-based (also known as software-as-a-service) enterprise applications (e.g., Microsoft Dynamics CRM, Salesforce.com, SAP SuccessFactors, Workday)?

Use of Cloud-Based Enterprise Applications

Yes, we are using SaaS applications

No, we are not currently using SaaS applications

Dont know

Base: 263 respondents in June 2013 and 268 in April 2012 with direct or indirect responsibility for enterprise applicationsData: InformationWeek Enterprise Applications Survey of business technology professionals

R7060813/7

46%38%

46%51%

8%11%



Figure 4

Research: Beyond IT Service Management

If the world wasnt changing, wemight continue to view IT purelyas a service organization, andITSM might be the most important focus for IT leaders.But its not, it isnt and it wont be at least not in its present form.

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May 2014 9

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Service-Oriented IT Survey found that 25% ofrespondents actively managed IT as a service,while 41% managed only some offerings thatway. Last year, the repeat of that survey foundthe same 25% actively managing IT as a ser -vice, while 37% partially did so. The surveyfound that, increasingly, underlying compo-nents were managed, but not the end serviceas a whole. That trend line looks like bad news for ITSM,

and perhaps it is. But to us, these respondentsjust sound pragmatic.Service management isan expensive and com-plex undertaking, so itshard to blame the plu-rality that doesnt godown that road forevery app and service.

Likewise, were not surprised to see a bump inthe percentage concentrating on perfectingthe infrastructure, since a move to a virtual-ized datacenter can have more impact onservice satisfaction that ITSM ever did. The other factor thats likely coming into

play is that departments are taking more con-trol over their IT-related spending. Say IT getsa business customer who doesnt want a SaaSapp; it will be right back into the project-by-project infrastructure that ITSM and cloud in-frastructures abhor.We absolutely arent recommending giving

up on the idea of service management. Butwe do believe that a lighter-weight, morefunctional approach is the best way to go.Here then are eight points to consider as youdevelop your own service management approach.1) Forget about SLAs. There really are only

two sets of people who like service-level agree-ments: lawyers and uninterested IT pros. WhenIT is on the receiving end of an SLA, it rarelyturns out to be a good indicator of the qualityof service youll actually receive, and the reme-dies for missed service are usually inadequate.Its always better to ask customers of a poten-tial provider if theyre happy with the servicetheyve received, regardless of the SLA. The same is true for internal customers. They

dont care about SLAs, they just want to use a

service to get their jobs done. If theyre un-happy and you hide behind your SLA ratherthan address the unhappiness, at best youllbe unpopular. At worst, the customer will gosomewhere else. 2) IT managers need to spend real timewith their customers. SLAs are usually builton metrics that mean more to you than yourcustomer. Haggling over definitions of usableor preferable service just aggravates business-people. Some of what we cover in SLAs is im-portant, like if you need certain downtimes, orto make the customer aware of other uniqueconditions. These things can be covered in asimple FAQ. If you want happy customers,walk some distance in their shoes. We dont mean the CIO sitting down with

the CMO (or others in management) and ask-ing how things are going. Your IT team needsto pound the pavement to understand howline-of-business teams do their work andwhere they get frustrated. Some of this infor-mation can come from surveys, but as SteveJobs famously said, its the not the customersjob to know what he wants next. You need to



Your IT team needs to pound the

pavement to understand how line-

of-business teams do their work

and where they get frustrated.

May 2014 10

have IT managers at all levels spend time withboth the end users of your services and yourhelp desk team. In the case of the latter,

weve heard time and againhow requests from customerservice reps for better toolsare ignored. If you make a pro-grammer actually do the jobof the customer service team,fixes happen pretty quickly.Sometimes enhancements totools, for end customers orcustomer service pros, aretrivial in terms of time and yetimprove the user experienceimmensely. So get your teamout there. Spend some qualitytime with your customers.Were talking a couple days amonth, not a couple hours.3) Work toward privateand eventually hybrid cloudinfrastructure. As we men-tioned above, one failure of

legacy ITSM is due at least in part to dealingwith systems that couldnt rapidly respond tochanging customer needs or even failure con-

ditions. Even if you spent the time to get yourITSM tools in place and applications fully in-strumented and thats a big if the best

you could hope for was a sys-tem that helped you respondto problems and determine aroot cause. At least in terms ofhardware errors, cloud infra-structures will help you avoidsingle points of failure, andtheyll make it easier to re-spond to varying load, shouldthat be an issue. But evenmore important is the abilityto rapidly deploy, test, and re-tire applications that make upservices. The trick to building your

own cloud isnt necessarilythe technology, althoughthere certainly is a learningcurve and an initial expense.Its convincing project ownersto invest in your cloud ratherthan what might be a pre-

Previous Next

Please rate your organization's satisfaction with the following aspects of cloud-based (software-as-a-service) applications, where 1 is very unsatisfied and 5 is very satisfied.

Satisfaction With Cloud-Based Enterprise Applications

Note: Mean average ratingsBase: 122 respondents in June 2013 and 102 in April 2012 using cloud-based enterprise applicationsData: InformationWeek Enterprise Applications Survey of business technology professionals

R7060813/8

R

2013 2012

Serv

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Figure 5

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ferred configuration with an application ven-dor. This is less of a problem than it used to be,as vendors are now used to the idea of theirapps running on a virtualized cloud infrastruc-ture. However, these same vendors may be abit cagier about performance, stability, andavailability promises. The bottom line is thatyoull need to be convincing when it comesto performance assurance or even semi-savvyline-of-business managers wont buy in.4) Use synthetic transactions. The dy-

namic nature of virtualized apps and servicescan make instrumenting them for perform-ance monitoring tricky. Further, since youlikely have that mishmash of apps we men-tioned above, ranging from those running onbare metal to virtualized to SaaS-based, aboutthe only way to consistently measure theirperformance is via synthetic transactions. Synthetic transactions simulate end-user in-

teractions and track response times. For inter-nal services, you can often do this with script-ing tools or specialized software. For externalapplications, a variety of cloud-based serviceswill exercise your app from various points

around the world and using various end-userplatforms, including mobile devices. These areyour best shot at tracking the user experience

so you can be proactive about applicationperformance. Its not necessary to measure every applica-

Previous Next

Whats the biggest concern preventing your organization from embracing cloud-based (software-as-a-service) applications?

Primary Cloud Concern

Base: 141 respondents in June 2013 and 166 in April 2012 not using or who dont know whether or not they use cloud-based enterprise applicationsData: InformationWeek Enterprise Applications Survey of business technology professionals

R7060813/9

R

2013 2012

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Figure 6

May 2014 12

tion this way, but the critical ones should getsome form of simulated end-user testing ona regular basis. 5) Empower your help desk. There isnt a

ton to say here other than if you arent listeningto the requests of your help desk people, youremaking a big mistake. Its easy to look at themas the lowest paid and least skilled among yourIT cohort, and therefore least worthy of inputinto the customer satisfaction equation.Wrong. These people are your customer serviceface, and if they see repeated problems or cantget the information they need to quickly re-solve customer complaints, you have a cus-tomer relations issue. Listen to them.6) Choose the right tools for the environ-ments you have. Not so long ago, we mighthave suggested that you seek one tool tomanage all aspects of your service delivery.You know, one version of truth and that. Its agood story. The thing is, we havent seen manytools that are really good across all the waysthat IT shops currently provide applicationsand services. Further, not every application orservice needs proactive monitoring so that

youll know about problems before your usersdo. Attempting 100% coverage is expensiveand time-consuming. Some tools are betterfor legacy apps, others are better for cloud-based services. You do, however, need a way to benchmark

and normalize the results of what IT does sothat you can see where youre doing well andwhere theres room for improvement. But at-tempting it with just one tool is more workthan its worth, and youll likely miss specificmethods that are ideal for various types ofservices.7) Survey your customers regularly andact on the results. Spending time doingwhat business users do is important and canreveal opportunities for improvement thatyoud never otherwise find. But you still needto hear from customers in a way that allowsyou to identify trends. Their perception is theirreality, and thats what you need to deal with.In particular, surveys can reveal where cus-tomer training might be lacking or where theuse of service features are simply not intuitive.There are lots of ways to go about surveying

your customers. SaaS-based services can beused for external-facing apps, or a well-thought-out SurveyMonkey survey sent viaemail and with assurances of privacy ide-ally with some executive backing can be agreat way to find out what internal customersreally think.8) Review your teams performance. All

that good data needs to be shared. Whileplanning for service improvement may hap-pen at a meeting of IT directors, with actiontaken on a functional team level, the overallsuccess of the IT team should be shared witheveryone in IT. We think quarterly reports onthe overall performance of IT, along with call-ing out stellar performance and places for im-provement, are about right. Painstakingly cataloguing and presenting

services to customers, then managing thoseservices in the ITIL fashion is too static. Goingthrough that whole process is like paintingthe Golden Gate Bridge; it takes a long time,and once you finish, you need to start againat the other end. Problem is, todays IT environment is far less

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May 2014 13

static than the Golden Gate. By the time youget from one end to the other, users wontwant the same bridge, and most likely youwont able to buy that color paint. Processesneed to be quick to implement, quick to showresults, and highly reflective of what cus-tomers see. That still makes service manage-ment a challenge, but one thats manageablewith a little fresh thinking.

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8 steps to modern service management 3071126

Documents

o d e r n s e r

e n tmay

com8 s t e p s t o

e n tart wittmann

service management8

service manager

service provider

editor of informationweek