Tuesday, December 31, 2013

The ITSM Value Proposition is Incomplete

Business value of IT services is often defined as a simple formula.
Value = Efficiency + Effectiveness
ITIL puts it this way.
Value = Utility + Warranty

Over the past few years I've come to believe that we are missing a key ingredient: Customer Experience. Customer service is not the same as customer experience, although they are related. Customer service is interested in making the customer as happy as possible, after a service impacting event has occurred. Customer experience is interested in how a consumer of a service interacts with the service through the life cycle of a service event.

If I order a laptop for a new employee, customer service wants me to feel good about the outcome of the request. Customer experience is concerned about how I go about making the request, and any interactions I have during the process. Can I check the status through a portal? How easy or difficult is that to do? Was I able to find what I wanted quickly and easily? Was the actual request easy, and comprehensive enough for me to feel comfortable that I will receive value for what I paid?

A recent experience got me thinking about the relationship between service efficiency, effectiveness, and customer experience.

My family ran into some problems at dinner several weeks ago. Two of our three entrees were wrong to the point of needing to have them sent back and re-made. The third entree was prepared below expectation, but not to the point where my wife was willing to send it back and wait. Considering the moderately upscale restaurant context, I expected better accuracy in the orders, and faster turnaround when the two entrees were re-made. The server did an admirable job in taking care of us after the errors, and she did not throw anyone else under the bus -- a good lesson for all service practitioners.

Then the bill came. It itemized our entire meal, including making the two incorrect entrees complimentary, or so I thought. It turns out that the two incorrect items were on the bill twice each. The comp entrees appeared a little further down. I asked the server, since it looked like they intended to comp the two entrees, but accidentally added them back in a second time. The server thought it was weird, too, and went to check with her manager. The manager stopped by (a loooooong time later) and explained that the bill was right. For inventory purposes they added each item that had been prepared, and simply removed the cost of the items we had returned. In other words, no comps. We simply didn't have to pay for the incorrect entrees that we returned. To keep the inventory accurate, they needed to add each item to the bill, subtract the returned items, and then add back in items we accepted.

To be fair, the manager did end up making our appetizer complimentary; but it made me think about efficiency, effectiveness, and customer experience.

As a customer, I would have been OK if the bill simply included the items we kept. Why did my bill need to reflect the items prepared but sent back and comped? The answer was inventory accuracy, but was that a good answer? Including the returned items was good for service efficiency. Depending on how the restaurant sees service effectiveness, it could be considered good or bad effectiveness. Customer experience, however, was negatively impacted by using this method of keeping inventory straight. I wouldn't have thought twice about it if the bill simply itemized the food that was accepted. My expectations changed when I saw that some items on my bill were comped. At that point I started to wonder why the entrees weren't comped or discounted.

Did the restaurant do themselves a disservice by making something irrelevant to the customer (accurate inventory levels) so clearly visible to the customer? This was a minor issue to me, but I wonder how often IT service providers do something similar in the name of process efficiency? Do we properly consider customer experience while designing and delivering services? I believe the answer is frequently "No".

This can be as simple as how we respond to a customer status inquiry. Which response provides a better customer experience?

  • Let me look up your tickets. I see that Bob updated the request 2 days ago, but I'm not sure what's happening now. He sometimes forgets to keep tickets updated, so I'll have him send you an update.
  • Let me check into this and get back to you. When is the best time to call you back?

It can also be more ingrained into service design. I come across many clients that ask their customer to fill in numerous, possibly confusing, fields looking for specific details during an initial request. It certainly is more efficient, and you could argue about effectiveness as well. I doubt, however, that it adds to a positive customer experience.

I once overheard an IT staffer comment, "We need to get these people to understand how to make a request we can work with". One goal the team identified was to reduce the number of incoming requests. Seriously. During the discussion it became clear that what they really wanted was to increase the value of each request. It was simply the difference between looking at it from an IT efficiency perspective versus looking at it from a business value perspective.

Business value of IT service is no longer just about utility and warranty. Customer experience is a crucial component of value. Nobody outside of IT is excited by the reduced hardware costs of virtualization, while the overall cost of IT continues to grow. That's no better than subtracting a line item from my bill, and then adding it back in a few lines later. There might be a good explanation, but the business customer doesn't care unless it adds to their experience.