considering the customer experience- providing enterprise services

Services from the Consumer Perspective

A common sense approach to IT/Business alignment

Copyright 2014 Thavron Solutions, LLC

Credentials

• Me: Nan Braun• CEO Thavron Solutions• [email protected]/ @thavronsol / http://thavron.com/blog• Corporate IT – many roles- “hands” on to BRM to architecture• CTO, ontological modeling • Director, TBM Practice

• You?


mailto:[email protected]/

Catalog & Asset

Management

Service Costing &

Billing

Product & Project

Management

Supplier / Vendor

Management

Service Portfolio

A Framework for Business Service Success


Financial LifecycleProduct Lifecycle

TM

Catalog & Asset

Management

Supplier / Vendor

Management

IT Service Management


IT Component CatalogIncident management

IT Service CatalogIncident Prevention

Business Service CatalogCustomer Experience Management

IT as a Service Provider


The Customer Experience : Then


IT ? Here there be Dragons…


The Customer Experience : Now


What does this mean for customer experience?


Service Costing mistakes that break the customer experience:

• Billing Consumers on actual costs when cost drivers are not scale-able

• Service units that are difficult to manage• IT Component Services vs. Business Services• Services with bad proxy allocations to the business• Pass Thru SLAs


COST MODEL DEPENDENCIES THAT DO NOT SCALE


Here is what the customer is expecting….


$750/month

Here is what the customer is expecting….


$600/month

So when this happens…...


$750/month

And then this happens.….


$650/month

This should not be a surprise.


How can this happen?


$650/month

$600/month

VS.

PC Service Cost Modeling


GL Account 6879099

GL Account 6879123

GL Account 6879224

Service Desk

OnSite Support

PCs

PCXX23PCXX34PCXX45PCXX56PCXX67



GL Account 6879099

GL Account 6879123

GL Account 6879224

Service Desk

OnSite Support

PCs


1: 1 per PC



GL Account 6879099

GL Account 6879123

GL Account 6879224

Service Desk

OnSite Support

PCs


1: every up to 10 PCs



GL Account 6879099

GL Account 6879123

GL Account 6879224

Service Desk

OnSite Support

PCs


Tickets of type “PC” spread evenly

Or This Can happen……


Joe’s Windows Server : $400/month

Sue’s Windows Server : $400/month

Pat’s Windows Server : $400/month

Or This Can happen……


Joe’s Windows Server : $600/month

Pat’s Windows Server : $600/month

TCO Service Costing:


GL Account 68790992

GL Account 68791234

GL Account 68792244

DataCenter

Storage

Server hardware

SoftwareGL Account 68792254

Physical Server TCO

Virtual Server:

AAJoe123AASue225AAPat334$1200

$400/each



GL Account 68790992

GL Account 68791234

GL Account 68792244

DataCenter

Storage

Server hardware

SoftwareGL Account 68792254

Physical Server TCO

Virtual Server:

AAJoe123

AAPat334$1200

$600/each

Exposing Actual Costs to Consumers is Dangerous

• Not all Cost components are on a 1:1 ratio• Unit rates are the most important number for a consumer• If you are doing showback or chargeback, calculate the

Consumer cost based on a fixed unit rate- not on actual costs. • Variance is for INTERNAL IT “run the business” decisions- not

for exposure to the external consumer.


SERVICE UNITS THAT ARE DIFFICULT TO MANAGE


Imagine if this happened……


You can’t beat the price. It is only $1503 /

Horsepower per minute

Please stop reporting/charging in units customer do not control…..

• Gigacycles• LPARs• PC CPUs• Compute cycles• luns• Etc…• Gb transmitted


How to deal with awkward consumption data:

• Unit conversion table in the model• Ignore the consumption data• Restructure the Service


IT COMPONENT SERVICES VS BUSINESS SERVICES


Non-TCO Service Costing:


GL Account 68790992

GL Account 68791234

GL Account 68792244

DataCenter

Storage

Servers

DatabaseGL Account 68792254

DataCenter

Storage

Servers

Database



GL Account 68790992

GL Account 68791234

GL Account 68792244

DataCenter

Storage

Servers

DatabaseGL Account 68792254

SAP

Email

TimeEntry

Sharepoint

Servers

Applications

SERVICES WITH BAD PROXY ALLOCATIONS


Not what you expect when shopping…


Shoe sale today: $5/Finger

If you have to use a Proxy for consumption:

• Make it related….• At least make it scale in the same ratio as expected

consumption…


PASS THRU SLAS


Subcontracting

• Not all IT Services are going to be provided by your in-house team

• There are a lot of times that it makes sense to buy, not build


Typical SLA scenario


Outsourced Service Provider

We can deploy new

Virtual Servers in 6

hours

What goes into the Service Catalog?

Virtual Servers: “We can deploy new Virtual Servers in 6 hours”

What it actually takes to deploy a Virtual Server


Business Request

Form

Request Received by BRM, vetted

Request Review by Architecture

Good ?No

Request put in Queue in Ops Team

OutSourced Service Provider Process

Virtual Server

Deployed6 hrs later

Yes

Bringing Business to the Center

• To align and enable the business, IT must bring the business back to the center of what they do.

• Put yourself in your customer’s shoes before releasing Service Definitions and costing to them

• Business Value = Bottom line – Business Value= Order to Cash experience + Usage Value


Discussion


Follow up questions? Nan Braun

[email protected] 765.252.4509 / http://thavron.com /@ThavronSol

Catalog & Asset

Management

Service Costing &

Billing

Product & Project

Management

Supplier / Vendor

Management

Service Portfolio

Leverage ITFM info: build your platform for Success


Financial LifecycleProduct Lifecycle

TM

considering the customer experience- providing enterprise services

Business

service management copyright

llc gl account

service provider copyright

scale copyright

slas copyright

dragons copyright

itbusiness alignment

service costing mistakes