IT Service Value: When IT doesn't "get it" neither does your business

I have several very good friends stateside whom, I would say, hold the stereo typical viewpoint of what IT is and what it does for the business. In my past life, I worked in the IT sector as a software educator in what I called “The Second Silicone Valley” of Orange County California. (Or, “The O.C. to those that have cable television). My wife and I both lived through the dot com bubble days and experienced the opulence of the era by way of a holiday party thrown by the IT company my wife worked for.

In Vegas.

At the Bellagio Hotel! (That’s the one with the dancing fountains)

AT NO COST TO US!

The organization in question flew their employees AND spouses to Vegas, put them up in the Bellagio hotel and had a raging (not to mention expensive) year end shindig.
Ahh….the good old days. But, I digress.

During that time IT organizations were pretty much given blank checks to make “the next big thing”. If you had .com in your name, it was assumed you would make a killing regardless of how ridiculous your idea was. (See this article for proof: http://www.cnet.com/4520-11136_1-6278387-1.html)
One BIG lesson out of the dot com disaster was more of a reminder than it was a lesson:

It doesn’t matter what clever name you have, how funny your marketing is, how much capital you’ve raised or how smart your people are. In the end if you don’t provide a quality service that provides value to your customers you are dead in the water. It doesn’t matter if your “service” is providing IT, delivering pizza’s or renting movies. Your customers want value for their money.

IT services are no different than any other service. Before we get into this, let’s set a baseline definition of what a “service” is using the ITIL (Information
Technology Infrastructure Library) definition:

“A service is a means of delivering value to customers by facilitating outcomes customers want to achieve without the ownership of specific costs and risks”

In ITIL a “customer” is the one who pays for the service. The end-user or user is the one that uses it. Customers can be end users (e.g. the HR director authorizes payment for the new HR system out of the HR budget and he/she also uses the HR system to run reports.) Now that we have established that, let’s talk about what they mean by “delivering value to customers”

In ITIL service value is broken down into two distinct aspects. Both of these must be present in order to create value. They are Utility and Warranty.
Utility is what the customer gets and Warranty is how it is delivered. Another way of saying it is:

Utility = Fit for purpose (what it does)

Warranty = Fit for use (how it is delivered)

Both utility and warranty must be present in order for a service to provided value.

The “facilitating outcomes” part speaks to the Utility aspect of value. The “outcome” being what the customer gets or what it does.

Now, let’s pick that aforementioned statement apart and apply it to our non-IT day-to-day lives.

“….facilitating outcomes customers want to achieve”

Have you ever gone to the movies? Have you ever rented a movie from the local rental place up the street? Have you ever ordered a movie from your cable provider from the comfort of your couch?

Guess what? You’ve had your outcome facilitated by a service provider!

In each of the examples given the “facilitated outcome” is the same:

You want to watch a movie.

Hence the movie theater, movie rental store and your cable television provider all “facilitate the outcome customers (you) want to achieve”.

Next let’s take a look at the rest of the statement:

“…without ownership of specific costs and risks”

This speaks to the Warranty aspect of service value or how the service is delivered. In order for you to watch that movie in the comfort of your home, or in the theatre, there are specific costs and risks that have to be taken into account in order to provide or deliver that service.

Do you care about how many staff need to be on hand at any given time? What hours the rental store or theater needs to be open? How many and what type of movies you need to stock? Big budget action films, drama, foreign? How much snacks and soda need to be on hand? The type of computer system needed to accept your cable TV order and allow you access to the movie using only your remote? Do you care about how movies get delivered to the theater, rental store or cable company?

No. You just want to pay X amount of dollars and watch a flick.

By the way, before you pick up your movie from the rental store you might pull into that a pizza place next door that facilitates the outcome of “I need something to eat”.

HR, Sales, Marketing, Procurement, Admin are all “customers” of the “services” that IT provides.

Each one of these business units have specific outcomes they need to achieve in accordance with the overall vision, mission and strategy of the business as a whole. All of these business units are (theoretically) working together to help the business achieve its objectives in the marketplace. The business sees value in IT only when IT can help the business achieve its business outcomes.

By facilitating these outcomes effectively (doing what we said we would), and efficiently (using minimal effort and time to do it), IT becomes a strategic asset for the business and the business achieves greater flexibility, better cost effectiveness, superior efficiency and greater market presence.

So, whether you are a 2 person company or a multi-million dollar agency, if you or your IT department don’t “get” services and service value, neither will your customers. If your customers don’t get it….you don’t get business. If you don’t get business….well…..

I think you get it.

The 3rd Law of ITIL Bushido: Benevolence

Benevolence:True goodness of the mind and spirit, the unbiased kindness to do good.

This is what ITIL is supposed to be about. Doing good for the business and doing good for the IT department. Each and every process can be used for good and for evil. Part of achieving ITIL benevolence is to always make negatives positive.

ITIL Samurai understand that not everything has to be profitable to make the business as a whole a success. Some times, from a "silo only view" IT departments can take a "loss" that ends up being beneficial to the entire organization. The key is to understand how this "plausible loss" helps the organization as a whole. If you are not benevolent in the way you think and only look at things with a finite view, you may miss some of the opportunities and wins this "loss" may provide.

Here's a clear example from Dr. W. Edwards Deming's book "The New Economics"

Another example in which one component operated at a loss for the good of the whole company, including the component that took the loss, comes from an observation that I made while doing some work years ago for the Detroit News. The food department of the Detroit News intentionally served food in the cafeteria so good and so cheap that employees ate their lunches in the company's cafeteria, attracted by quality and price. Employees thus spent far less time at lunch on the home ground and more time on the job, than if they had gone out of the building for lunch. As I understood it, the food department lost an average of .60 per lunch, but the company as a whole came out ahead, not merely because employees spent more time on the job, but also for their appreciation of good management.

By focusing on the whole of the business instead of the silo view of the cafeteria the Detroit News was able to increase productivity and morale of the employees while taking a "loss". Sure, they may have "lost" .60 on average on every meal but in total view of the business the benevolence of subsidizing the meals did more good for the organization than harm.

Likewise, as practitioner of the ITIL discipline you will find that you will have more success when keeping a benevolent attitude. Remember, ITIL is not about catching people and departments out and blaming them. It is about understanding what each person and department has to do in order to achieve the objective of the business as a whole.

Reality TV and ITSM???

I was going to predicate this blog entry with "You must know that ITIL Samurai HATES reality television" but the reality is, recently I've been hooked by a couple of shows that have me addicted. I'd love to go into the whole back story but we don't have time for that here.

One of the aforementioned shows appeals to me because in it I see huge amounts of process goodness in it. The name of the show is called "The Chopping Block" As it turns out the show is going to be re-done in the USA so many of you will be seeing it soon. If you can't wait for that you can watch old episodes at the above link.

ITIL Samurai look at the world with "process eyes". We undertand that a service, is a service is a service. The funny thing about ITIL is that it really has nothing to do with IT when you stop and think about it.

Whether it be IT, a retail store or a restaurant, they are all fundamentally doing the same thing. Providing you with a service. As ITIL defines a service they are all "facilitating outcomes you want to achieve without taking on the associated costs and risks."

Think about it for a second.

When you go to a restaurant you want food. Good quality food (most times). You will pay a certain price for a certain level of quality. Your "business outcome" is the finished product of the food. You don't want to take on the "associated costs and risks" of having to source fresh ingredients, hire and train the staff to take your order, hire the right chef and cooks for the kitchen, figure out what to put on the menu nor worry about how the order you give will be transmitted back to the kitchen. You just want to eat. For a certain cost within a certain time frame with a certain level of quality.

One of the competing restaurants last night had great wait staff but a not so good kitchen. The other had a fantastic chef but not great wait staff. Neither had a clue on the PROCESSES they needed to deliver a quality service to their customer. They all mistakenly think that it's just the food and the look of the place that gets the job done.

The PERFECT example last night was the eatery that had a chef that actually won chef of the year a few years back. One of the major problems they had was incompetent wait staff. His food was great but by the time it got to the customers, it was cold or worse yet, the wrong order entirely!

The show does a great job providing feedback by way of the food critic and one of Australia's number one chef's. The food critic always begins saying that all good restaurants have 3 basic things: Great food, great atmosphere and great service. The biggest thing missing in the show for me is that no one is there to help them manage all the processes needed to deliver these three "basic" things.

HOW do you get great food, great atmosphere and great service? Through definable, measurable processes. Many times after the 48 hours of renovations and changes to the menu the eateries still fail miserably in the service department. They have better food, better atmosphere but they still end up bumbling around come opening night because no one has bothered to show them how all the pieces fit together.

In one episode they had everything in order. The place looked great, the food was fantastic and then....the order machine broke down. The wait staff had to take orders by hand because the order tickets wouldn't print out in the kitchen. Guess what? Everything fell apart because the were not prepared for such a disaster. They didn't have a process for handling that situation. The wait staff, in a panic scribbled orders on paper. The kitchen couldn't read the orders. People started leaving the place because they would wait for an hour and not get served.

All because a single IT service provision failed and no one including the owners knew how to deliver their objectives without it. The one person who knew how to fix it was late for the new opening night. Again, they didn't really have a grip on the basic things you need to do in order to service your customers. They all relied on a tool to do it for them.

This illustrates the perfect scenario for the statement "process is paramount". In the absence of your IT tool, how do you continue to reach acceptable business outcomes? The tool is only there to make things faster and easier. You had business processes in place long before you bought that newfangled tool. Or in this case....maybe you didn't.

ITIL v3 predicates everything based off of delivering service value. Focusing on the outcomes your customers want to achieve. Whether they are internal or external it doesn't matter. Like the restaurants in the show The Chopping Block, many IT professionals wrongly believe that all they have to do is make sure they keep the machines running and everything will be okay. They have zero focus on business outcomes. They forget that it is the customers that keep them employed. Not focusing on business outcomes and therefore customer needs, they are in effect slowly putting themselves out of a job.

The world of IT is becoming more and more commoditized. Just like the food industry your internal and external customers have a choice. There are entire "emerging markets" out there ready and willing to take your job from you. So ask yourself. Why shouldn't your company outsource the whole IT department? What advantages do you provide? Do help the organization achieve the objectives it wants in its market space?

Why should your customers buy services from you?

They DO have a choice. What makes you different? What makes your customers stop and dine at your restaurant? In effect the food is just a product of several services. You have a "food preparation service" a "food delivery service" etc.

It's HOW you manage those services that makes the difference because in reality, just like a restaurant, you are all doing the same thing.

So what makes you better?

The Dunning-Kruger effect

ITIL Samurai found this little gem on the web and, due to the theme of the last blog, feels it is too good to not post. As you read it, think about some of the people you have come across in your IT career in regards to how the services are managed.

ITIL Samurai finds it painfully humorous. But, then again, ITIL Samurai knows everything ;-)

The Dunning-Kruger effect is the phenomenon wherein people who have little knowledge tend to think that they know more than they do, while others who have much more knowledge tend to think that they know less.

Dunning and Kruger were awarded a 2000 Ig Nobel prize for their work.

The phenomenon was demonstrated in a series of experiments performed by Justin Kruger and David Dunning, then both of Cornell University. Their results were published in the Journal of Personality and Social Psychology in December 1999.

Kruger and Dunning noted a number of previous studies which tend to suggest that in skills as diverse as reading comprehension, operating a motor vehicle, and playing chess or tennis, "ignorance more frequently begets confidence than does knowledge" (as Charles Darwin put it). They hypothesized that with a typical skill which humans may possess in greater or lesser degree,

1. Incompetent individuals tend to overestimate their own level of skill.
2. Incompetent individuals fail to recognize genuine skill in others.
3. Incompetent individuals fail to recognize the extremity of their inadequacy.
4. If they can be trained to substantially improve their own skill level, these individuals can recognize and acknowledge their own previous lack of skill.

They set out to test these hypotheses on human subjects consisting of Cornell undergraduates who were registered in various psychology courses.

In a series of studies, Kruger and Dunning examined self-assessment of logical reasoning skills, grammatical skills, and humor. After being shown their test scores, the subjects were again asked to estimate their own rank, whereupon the competent group accurately estimated their rank, while the incompetent group still overestimated their own rank. As Dunning and Kruger noted,
“ Across 4 studies, the authors found that participants scoring in the bottom quartile on tests of humor, grammar, and logic grossly overestimated their test performance and ability. Although test scores put them in the 12th percentile, they estimated themselves to be in the 62nd. ”

Meanwhile, people with true knowledge tended to underestimate their competence.

The 4 stages of competence

Are you incompetent? Harsh words I know. But when it comes to the way you are managing your IT services are you incompetent?

Type "define:incompetent" (no quotes) in google and one of the definitions that shows is:

Incompetent
incapable: not meeting requirements

Now stop and think about the delivery of IT services at your organization. Are you meeting your requirements? If so, are your customers and stakeholders happy??? Did you even design your services based on business outcomes or did you go the usual "just throw more boxes at the problem and it'll solve itself" route.

One of the common misconceptions of typical IT thinking is that even if you manage to meet the requirements, everyone will be happy. Just because you deliver something to your customer faster than anyone else means nothing if the customer was verbally abused or treated like an idiot in the delivery of that "something".

Last week, while attending my Toastmasters meeting, I had the pleasure of to our guest speakers he talked about the 4 stages of competence. As he spoke my ITIL brain immediately started to apply what he was saying to my experiences with IT organizations I've come across. As you read these next statements, I want you to think about your IT organization and were they are within the 4 stages.

THE 4 STAGES OF COMPETENCE

Stage 1: Unconscious Incompetence (ITSM??? What ITSM?? What's quality IT services?? ITIL? Is that a new cash register created by Apple???)

The individual neither understands or knows how to do something, nor recognizes the deficit or has a desire to address it.

ITIL Samurai says: This would be most organizations that have no idea what IT Service Management is. Many times organizations at this level spend their lives understaffed and fighting fires. They have high staff turnover and high stress. The focus of the organization is on "keeping the machines running" rather than delivering a quality service

Stage 2: Conscious Incompetence (Look! I have a ITIL Foundation Certification)

Though the individual does not understand or know how to do something, he or she does recognize the deficit, without yet addressing it.

ITIL Samurai says: This is what happens after someone in the organization stumbles across an ITIL article on the web or is told by a friend or member of the ITSM community. This is also the level that a Foundation Certification gives you. You know just enough about ITSM to be dangerous. You don't really know how to address the issue of going from where you are to ITSM excellence.

The problem is, many organizations still seem to think that this is all you need and foolishly try to self implement at this stage. Not realizing that the ITIL Foundation certification was only ever created to show that someone has a basic understanding of ITSM principles. IT wouldn't make sense to take take a beginning Algebra class and then try and tackle Calculus! However that is precisely what IT organizations do when they put people through the Foundation program and then attempt to self implement with a minimal level of understanding.

Satge 3: Consciously Competent (The application of a few ITIL processes. e.g. Incident Management, Problem Management, Service Level Management)

The individual understands or knows how to do something. However, demonstrating the skill or knowledge requires a great deal of consciousness or concentration.

ITIL Samurai says: Sadly, this is where people usually just give up! Now that you are running a few of the process and you can actually SEE the unintentional "incompetence" of the past, you now realize that you have a LOT of work to do and initially the same amount of staff to do it with!!!!!! The immediate future looks bleak as, being an IT professional you mistakenly think that you have to fix everything overnight or else it will be your gluteous maximus on a silver platter.

You suddenly forget that ITSM is all about business and IT alignment and out of fear you don't even bother to talk to the business about priorities and whether what you found out is even critical or important to the business. In your haste you forget that ITSM is about progress not perfection and through the power of meaningful metrics (% reduction in overall incidents, % of services that have service level agreements against them, % of services supported by underpinning contracts and operational level agreement), you can prioritize and whittle down the issues until they are non-existent.

Stage 4: Unconscious Competence (aka "ITSM Nirvana", Living, breathing, eating quality service)

The individual has had so much practice with a skill that it becomes "second nature" and can be performed easily (often without concentrating too deeply). He or she can also teach it to others.

ITIL Samurai says: This is the end result of one who lives the disciplines of ITSM. Pure "ITSM Zen". The last part being the most important "He or she can also teach it to others". When new staff come on, the "old staff" an educate the newbies in the quality culture of the organization. They can teach them how this organizations main foucus is building value in the services provided by enabling the business to achieve its business objectives better, stronger, faster than they did before. Every single IT service is there for a purpose and that purpose is clear and transparent. E-mail allows the business to achieve these specific outcomes. The LAN? That allows the business to achieve these outcomes. These servers over here are part of our CRM solution which allows the business to do X. To ensure we can do X, we regularly monitor, analyze and tune our systems to ensure we minimize "surprises. When we find ways to improve, we send it on through to the Change process to get it implemented and more importanly to ensure that it will not cause an adverse effect on our business outcomes. Oh! And this is the coffee machine young Padawan. Use it wisely for the force of caffeine is a powerful one and must be used sparingly.

The 4 stages of competence are a natural progression that everyone goes through for virtually anything you've ever tried to learn. When I was child, I was unconsciously incompetent about cooking food. When I became an adult, I quickly learned the joys of being unconsciously competent; having the ability to make something grand out of a few seemingly meager ingredients in the fridge on a whim.

So when you look at your IT organization today, ask yourself what phase they are in. More importantly, ask yourself "In what ways can we make ourselves unconsciously competent"?

What is ITIL?: An economic analogy

It is no secret that ITIL can be and is a tough sell. Especially to those that have never heard of it. Even tougher still, is explaining it to people who "know" what it is but have been spun around by the vendor spin machine so much that they often don't even know why they bothered in the first place.

One of the biggest issues is it is not easy to explain in one sentence. Most people's attention "IT attention span" only lasts about 40 seconds. I ran into the same problem when I was in the software space. There is no quick way to explain "Field force automation". It's a marketing term and you have to assume the person you are speaking to knows what the heck "Field force" is.

Most think it's what keeps the Starship Enterprise from being hit by Klingon weapons systems.

The same goes for my passion for ITIL. I love the framework and all that it offers but I can't deny the frustration of trying to explain it sometimes

"It is a best-practice framework for IT Service Management"

The next thing you usually see in the eyes of the person you are speaking to is


After their brain reboots the next question is usually: "So what hardware/software does that run on?"

The reality of the situation is that ITIL is a concept. The best thing about it is that it doesn't run on any hardware or software. As one of my favourite bloggers the IT Skeptic once said

"You can do ITIL on post-it notes"

To explain ITIL to the uninformed without "GPFing" them I have developed a few analogies that sum up the concept of ITIL and give people something to relate it to. One is what I call the "Capitalism analogy" which is designed for those who are more politically/intellectually inclined.

It goes something like this:

Intellectual partygoer: So what do you do?

ITIL Samurai (smiling): I'm an IT Service Management consultant

Intellectual partygoer: What's IT Service Management?

ITIL Samurai: It's a system for ensuring quality IT services

Intellectual partygoer: So, it's hardware? Software?

ITIL Samurai: (Still smiling) Neither actually...........

Intellectual partygoer: (now with raised eyebrow confused look on face)

ITIL Samurai: The best way to describe it is like this......(dramatic pause).....do you mind if I use an analogy?

Intellectual partygoer: Sure! (confusion eyebrow still present)

ITIL Samurai: Your familiar with the idea of Capitalism correct?

Intellectual partygoer: You bet your bippy! I just make 4 million dollars last week with my Enron shares!

ITIL Samurai: Great! You see ITSM is like Capitalism. It's a concept. In order to have capitalism there are certain key things you need to have in place to say a country has "embraced capitalism". Market economy, private ownership, corporations to trade capital goods, stuff like that.

Intellectual partygoer: Yes. That's right.

ITIL Samurai: Well In order to get the best out of your IT organization, by “embracing ITSM” there are certain things you need to have in place to "manage" your IT "services". Capacity Management, Availability Management, Problem Management, Change Management etc. Now those things I just mentioned are come from a methodology called ITIL. ITIL is the method or way in which I help people get to that lofty concept of ITSM and perfectly managed services.

So in the Capitalism analogy, you would drop me into third world countries and I would help them achieve capitalism by assisting them in setting up those things that are needed to achieve that. You can't go from third world to free market in a day! The beauty of what I do is that it is not hardware or software specific so after I understand a bit about my customers needs and culture, my customers can pick what hardware or software works best for their business instead of trying to force fit a solution into it! ITIL is concerned about the method. The hardware and software is just a tool to assist!

Intellectual partygoer: Ooooooh! I see. So each one of those managment thingies you just spoke of are ways to get to ITSM.

ITIL Samurai: Exactly!!!!

Intellectual partygoer: So who “makes” this ITIL stuff?

ITIL Samurai: Well that’s what’s so cool about it. ITIL stands for “Information Technology Infrastructure Library” In essence it is a set of books that were created by major and minor players in the IT industry. So it’s a variable cornucopia of “good-practice” based on the real world experiences of the greater geek community!

Intellectual partygoer: Variable cornucopia?


ITIL Samurai: Does anyone know how to reboot this guy??????

So there you have it!

Next time you are trying to explain what ITSM is.....don't! Help bridge the gap of understanding by relating what ITIL is to something everyone "understands but doesn't REALLY know". See? This stuff CAN be fun!

The 2nd Law of ITIL Bushido: Courage

Courage: the ability to confront fear, pain, risk/danger, uncertainty, or intimidation. Moral courage is the courage to act rightly in the face of popular opposition, shame, scandal, or discouragement.


ITIL Samurai are a courageous lot. They should be. For once the virtues of the ITIL framework have been implemented properly they know that there isn't much that they can't handle. They have the vision of foresight. Well set thresholds and alarms, monitoring, modeling, application sizing, demand management, outcome based Service Level Agreements and a battery of other tools given by the framework allow ITIL Samurai to not only predict and adapt to the future but they know that they are creating the future. This makes them courageous and fearless when making predictions and overcoming obstacles.

ITIL Samurai do not fear "negative metrics" and boldy present the "ugly side" of IT. They have the courage to not get involved in "blame game" politics for they know that at the end of the day, the customer doesn't care who's fault it was they want a solution not your petty, finger pointing groveling. ITIL Samurai always learn from these issues and look to ensure that they never happen again.

ITIL Samurai are not swayed by "vendor rhetoric" and understand that there is no such thing as an "ITIL Compliant" ANYTHING. They know that ITIL Certifies PEOPLE not Software or businesses. As such, when looking into buying a new tool to aid in the harmony of the infrastructure, they have enough moral courage to focus on the true needs of their business and weigh the software against thier own strict criteria to make sure it is a good fit before making a foolhardy decision that would disrupt the harmony of the organization.

ITIL Samurai laugh (HA!) at words like "discouragement" for they know that absorbing challenges and issues into the framework will allow them to seek more permanent holistic solutions. As such they see every issue that comes their way as an opportunity to shine and improve.

Example:
Capacity Management Goal: Ensure cost-justifiable IT capacity in all areas of IT always exists and is matched to the current and future agreed needs of the business

Through the constant constant monitoring and analysis of
Business Capacity
(e.g. How many more employees will we take on when we buy this smaller company?),
Service Capacity
(e.g. How many transactions per second does service X put through the LAN at peak times. How many people does it take to support this service?)
Component Capacity
(e,g, What is the % of CPU used per transaction type)

ITIL Samurai have foresight of vision when helping to meet the constant shifts of the business. This gives them tremendous courage in the face of adversity to tackle any challenges that come their way.

Other processes that build courage through better understanding:

Service Level Management
Availability Management
IT Service Continuity Management
Supplier Management
Financial Management

ITIL Samurai are courageous because they understand what it takes to deliver what their stakeholders want. If the stakeholders change direction, the ITIL Samurai does too making it seem effortless and painless.

The courage of ITIL Samurai is infectious. Not only to the members of IT but to the business as all throughout the organization the words "can we" are changed to "how will we".