4. The Key Concepts Of Service Management Flashcards
The amount of money spent on a specific activity
Cost
A person who defines the requirements for a service and takes responsibility for the outcomes of service consumption
Customer
A person or a group of people that has its own functions with responsibilities, authorities and relationships to achieve its objectives
Organization
A result for a stake holder enabled by one or more outputs
Outcome
A tangible or intangible deliverable of an activity
Output
A possible even that could cause harm or loss, or make it more difficult to achieve objectives; can also be defined as uncertain of outcome and can be used in the context of measuring the probability of positive/negative outcomes.
Risk
A means of enabling value co-creation by facilitating outcomes that customers want to achieve without the customer having to manage specific costs and risks
Service
A description of one or more services, designed to address the needs of a target consumer group; may include goods, access to resources, and service actions
Service Offering
Activities performed by an organization to consume services; includes the management of the consumer’s resources needed to use the service, service use actions performed by users, and may include the receiving (acquiring) of goods
Service consumption
A set of specialized organizational capabilities for enabling value for customers in the form of services.
Service Management
Activities performed by an organization to provide services; includes management of resources, configured to deliver the service, access to these resources for users, fulfillment of the agreed service actions, service performance management and continual improvement; may also include the supply of goods
Service Provision
Joint activities performed by a service provider and a service consumer to ensure continual value co-creation based on agreed and available service offerings
Service Relationship Management
A person or organization who authorizes budget for service consumption
Sponsor
A person who uses services
User
The perceived benefits, usefulness and importance of something
Value
A series of steps an organization undertakes to create and deliver products and services to consumers
Value stream
The functionality offered by a product or service to meet a particular need
Utility
Assurance that a product or service will meet agreed requirements
Warranty
To decide whether the service has “utility” and is therefore “fit for purpose” it must either.
- Support the performance of the consumer
- Remove constraints on the consumer’s actions
- It may do both of these
To decide whether the service has “warranty” and is therefore “fit for user”, it must be delivered to meet the level of service the consumer need.
- This may be captured in a service level agreement or contract
- It may be a marketing message or brand image
Warranty typically is concerned with areas such as:
- The availabity of the service and its capacity
- Level of security and continuity
Could be technology, the people and their skills, the best practices they follow in addition to other capabilities.
- Marketing
- Logistics
- Etc.
Organizational Capabilities
Service Providers are those who provide services:
- Internally, such as IT departments providing IT services to the staff of an organization
- Externally, where the customers of the service are not part of the provider’s organization
Organizations own, or have access to a variety of ______.
- People
- Information
- Technology
- Value streams
- Processes
- Suppliers
- Partners
Resources
A configuration of an organization’s resources designed to offer value for a consumer.
Products
Each product is created with a number of target customer groups in mind.
- Organizations use their resources to create products to offer to target customers that will satisfy a requirement that customer has
- Different customers will have different requirements, so products will be tailored accordingly
- The services that an organization provides are based on one or more of its products
Creating Value with Services:
- Value co-creation
- Organizations
- Service providers
- Consumers
- Stakeholders
- Outcomes
- Costs
- Risks
Purpose of any organization public or private sector is to create value for their stake holders.
- Perception of stakeholders
- Consumer or customer
- Service provider
Service providers used to “provide value” like a parcel:
- One one-way relation – provider to customer.
Value creation is more complex.
Value requires collaboration:
- Co-creation between providers and consumers
- Stakeholders take an active part in defining value
Value Co-Creation
Service Providers provision services:
o Internal
o External
Traditional ITSM:
o IT departments as internal service providers
o Oversimplified
Providers sell:
o Open Market
o Individual consumers
o Collaboratively
o Organization or individual in receipt
Service Consumer
The role that authorizes budget for service consumption
Sponsor
Difference of Outcomes and Outputs
Outcomes:
- Service providers need to understand the consumer outcome:
o Work with consumers for a collaborative definition of an outcome
o Provide standard services to support a defined outcome
o Create demand for an outcome through innovation (social media, smart networks in home)
Two types of cost in the consumer’s perspective
- Removed from the consumer by a service
- Imposed on the consumer by a service
Both types of cost will be used to assess service value:
- Service must be delivered within budget constraints
- Meet financial expectations of the organization
Two types of risk perceived by service consumers:
- Risks removed from a consumer by the service
- Risks imposed on a consumer by the service
Service providers must manage the level of risk on behalf of the consumer:
- A balance of what is important to the consumer and to the provider.
The consumer contributes to the reduction of risk through:
- Actively participating in the definition of the requirements of the service and the clarification of its required outcomes
- Clearly communicating the critical success factors and constraints that apply to the service
- Ensuring the provider has access to the necessary resources of the consumer throughout the service relationship
Utility and warranty have a significant impact on service value:
- Costs and risks
- Facilitation of consumer outcomes
Key Concepts of Service Relationships:
- Service offering
- Service relationship management
- Service provision
- Service consumption
A service offering may include:
- Goods
- Access to resources
- Service Actions
- Goods
o The goods of products are supplied to the consumer, who then owns them
The supplier offers a product at an advertised price
The consumer wants the product, so pays the supplier for it
The consumer then owns the product, and is responsible for it and its future use (other than any faults covered by the guarantee)
o Example: The purchase of a television from a store
- Access to resources
o The service offering is the granting of access to resources to a consumer under agreed terms and conditions
o The resource remain under the provider’s control and can be accessed by the consumer only during the agreed service consumption period
o Example: 12-Month membership of Netflix
- Service Actions
o Actions performed to address a consumer’s need (for example, user support)
o These actions are performed by the service provider according to the agreement with the consumer
o Example: The customer support offered by the satellite television supplier to deal with any technical issues the consumer experience during their contract
In order to create value:
- It is not enough to provide a service; organizations need to cooperate with the consumers in service relationships
o Consumers views on desired features should be sough
o Feedback should be analyzed and acted upon
Service Provision includes:
- The Configuration and management of the provider’s resources to deliver the service
- Providing access to these resources for users
- Carrying out the agreed service actions
- Service level management and continual improvement
Service provision may also include the supplying of goods.
Service Consumption includes:
- The management of the consumer’s resources needed to use the service
- Service use actions performed by users including:
o Utilizing the provider’s resources
o Requesting service actions to be fulfilled - Service consumption may also include the receiving (acquiring) of goods.
Organizations are usually
both providers of some services and consumers of others.
Consuming services improves an organization’s own resources
- This enables organizations to provide new or improved services to their current and potential customers in their role as a service provider
