4 Steps from Boring Service to IT Innovation

customer perception of value animated gifSo you didn’t get in to IT to be a glorified butler or waiter?

Yet you find yourself in a reactive/passive environment with gazillions of dollars worth of IT stuff behind you — stuff that could power the organization ahead.

Part of the problem might be your, or somebody else’s, thinking. Listen to some of the words used about IT in your organization.

Is it a cost center? Does it play a support role? Line or staff? In short, is it a service?

The latter brings up visions of that damn butler again. But sometimes it is worthwhile to look beyond a word commonly understood to get a more focused definition.

According to the IT Infrastructure Library (ITIL), service is defined as:

A means of delivering value to customers by facilitating outcomes customers want to achieve without the ownership of specific costs and risks.

Costs and risks are a separate issue, and that dynamic in IT has been dealt with here.

But where does innovation and entrepreneurship fit in a statement like ITIL’s?

Speaking at Entrepreneurs Anonymous, Denis Breen (@profitpal_denis), MD of ProfitPal was very clear in his advice: Understand what your customer wants.

“What you are providing may be a stepping stone for what they are trying to achieve,” Breen said. Know where you fit in their plans.

Feeling feisty? Smack them in the kisser with your entrepreneurial flair.

So, the customer’s viewpoint is what tees you up for entrepreneurial IT. This is where you change your perspective — a strategic shift — from providing tech resources to “facilitating outcomes.”

Here’s are the four steps to doing that:

Establish the Reference Value. This is probably the toughest step. It tries to determine what the customer thinks the service is worth.

They could get this number from others who have acquired it, or it could be based on what they are paying already.

However, it may be vaguely defined. Either way, a lot of work, discussion and research will have to be done to determine the customer’s value.

Sell the Positive Difference: This is where you market or sell the customer on the value of your service. It is where you influence them the most.

Factors here are utility and warranty, in ITIL lingo. Grade and quality, in PMP project management lingo. Basically, what can you offer and how good is it?

So far, so good.

Negative Difference. Everything involves trade offs and dealing with a service provider is bound to have some. Quality, hidden costs, functionality, or response times versus an in-house arrangement could be some factors.

Fortunately, the service provider can influence perceptions here, too. Listening to the customer and addressing their main concerns will go a long way towards reducing the perceived negative difference.

The Economic Value of the Service is where we do the math(s), as they say.

Where a good service provider holds sway.

And the innovator/entrepreneur carries the day.

Gif made by yours truly based on ITIL methodology.

 

 

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  1. Pingback: The Business Value of Innovation | John P. Muldoon

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