Section 1: Key Concepts/Definitions

Question 1

Service Management

Answer 1

A set of specialized organizational capabilities for enabling value to customers in the form of services.

Specialized organizational capabilities are all the features that make a company special. They distinguishes the organization on the market.

Question 2

Value

Answer 2

The perceived benefits, usefulness and importance of something.
“Perceived” means that it doesn’t what you feel about the benefits, what matters is how your customers feel about them.

Question 3

Customer

Answer 3

Defines requirements for services.

Question 4

User

Answer 4

A person who uses the service.

Question 5

Sponsor

Answer 5

Authorizes budgets for services.

Question 6

Supplier

Answer 6

External partner who provides services to the organization.

Question 7

Organization

Answer 7

A group of people that has its own functions, responsibilities and authorities to achieve specific objectives. These could be teams, departments, or entire companies.

Question 8

Service

Answer 8

The means of enabling value co-creation by facilitating outcomes that customers want to achieve without the customer having to manage specific costs and risks.

Question 9

Product

Answer 9

A configuration of resources, created by the organization, that will be potentially valuable to customers.

Ex. software or hardware products.

Question 10

Service Offering

Answer 10

A specific mix of services and products sold to a specific customer.

=> Goods: ownership is transferred to customer.

=> Access to resources: customer is allowed to use it.

=> Service Actions: things the service provider does for the customer like handling tickets, and providing technical support.

Question 11

Output

Answer 11

A tangible or intangible deliverable of an activity.

Ex. scoring many goals in a soccer game.

Question 12

Outcome

Answer 12

A result for a stakeholder enabled by one or more outputs.

Ex. scoring many goals in a soccer game would lead to the team winning the match.

Question 13

Cost

Answer 13

Can be removed from the customer (part of value proposition) and can be imposed on the customer (price for service consumption.

Question 14

Risk

Answer 14

Uncertainty of outcome. Can be good (opportunity) or bad (hazard).

Question 15

Utility

Answer 15

Fit for purpose. Service does what it’s meant to do. Utility refers to functionality aspect of the service.

Question 16

Warranty

Answer 16

Fit for use. Service does this good enough according to the customer.

=> Availability, capacity, continuity, security good enough? All these things must be good enough on the right levels. Need to have what the customer needs.

=> Value = Utility + Warranty (+perception)

Question 17

Value Co-Creation

Answer 17

A joint venture in the production process that actively involves customers in creation value-added work and on-demand products. Value-added work consists of adding a product function to make it more purchasable. The info gained through co-creation effectively drives sales and consumer engagement in marketing.

Co-creation allows consumers to take part in the research and development process. It also involves customers in product innovation and production, making them feel part of the band.

Whereas, companies implement the ideas borrowed from consumers. It enhances collaboration. Thus, co-creation of value considers collaboration between the consumer and a brand from the development of a product till its purchase.

Question 18

VOIP

Answer 18

The internal factors that the service provider can influence. V is for value streams & processes, O is for organizations & people, I is for information & technology, and P is for partners & suppliers.

Question 19

PESTLE

Answer 19

External factors, that can’t be influenced by the service provider but need to be considered. We can leverage these factors to our advantage.

=> Political
=> Economical
=> Social
=> Technological
=> Legal
=> Environment

Question 20

Value Streams and Processes

Answer 20

One aspect of the 4 dimensions. All about the things the service provider needs to do to ensure value to our stakeholders. The activities that we execute to deliver actual value or co-create actual value.

• Activities the organization undertakes.
• Organization of these activities.
• Ensuring value to stakeholders.
• Exercise value stream mapping.

Question 21

Organizations and People

Answer 21

One aspect of the 4 dimensions. All about how we organize our people and human resources within the company to get the most benefits out of them.

Focuses on:
* Organizational structures: how teams and units are set up.
* Decision making habits
* Staffing and skill requirements
* Culture and leadership styles

Question 22

Information and Technology

Answer 22

One aspect of the 4 dimensions. All the info and tools we need to deliver co-create value to our customers. How the info is stored and managed. The tools and tech that are need to manage the info.

Focuses on:
* Information and tools needed
* Technologies and innovation
* Relationship between components
* Culture of knowledge management: are knowledge contained in certain individuals or shared freely among staff?

Question 23

Partners and Suppliers

Answer 23

One aspect of the 4 dimensions.

Focuses on:
* Relationship with external vendors
* Factors that influence suppliers strategies
* Service integration management
* Vendor selection procedures

Question 24

The Service Value System

Answer 24

Includes guiding principles, governance, service value chain (opportunity/demand, and value), practices, and continual improvement.

The system converts opportunity/demand by applying our service management processes into actual customer value.

Question 25

The Guiding Principles

Answer 25

Recommendations that guide organizations in any circumstances, even for implementing ITIL 4. These principles are applicable to any work or initiative. They represent well-proven, good practice and are neither prescriptive nor a must.

The principles can be applied stand-alone but are better in conjunction, and they have a strong relation to Lean-Agile thinking.

1. Focus on value: everything you do must be somehow (directly or indirectly) valuable to your stakeholders.
2. Start where you are: reuse existing resources whenever possible instead of reinventing the wheel over and over again.
3. Progress iteratively with feedback: don’t do everything at once, take baby steps instead. Learning by doing with lots of feedback.
4. Collaborate and promote visibility: involve the right people at the right time and gather factual data to make the right decisions.
5. Think and work holistically: nothing is ever alone, think about the effect of your initiative or work on other components. Consider whether the initiative is good for the entire company, not just the team or department. It’s good to have an understanding of the big picture without all the details.
6. Keep it simple and practical: don’t overcomplicate work. Use the least possible steps. Outcome-based thinking helps.
7. Optimize and automate: maximize the value of human work. Automate only after optimization. Apply DevOps.

Question 26

Service Value Chain

Answer 26

A part of the service value system. An operation model that uses value streams. The service value chain outlines activities needed to transform demand into value.

The SVC is universally applicable. It can be used for mapping Value Streams, and it includes all the practices in a specific sequence for the SVC activities. Each practice involves different sequences and activities from the SVC.

Question 27

Value Stream

Answer 27

A series of steps an organization takes to co-create value with customers or stakeholders. These steps can be mapped to the SVC in any combination. Value streams focus on mapping the needed steps and trying to find improvement opportunities within the steps. They try to find ways, eliminate ways, and optimize the flow of activities needed to achieve actual value.

E.g.: Handling incidents or developing new applications. All the steps needed in between are the value stream. Value streams are similar to processes.

Question 28

Activities within the Service Value Chain

Answer 28

PIEDOD.

P (Plan): Ensures shared understanding of vision, current status, and direction within the organization. Before starting a project or initiative, consider whether it aligns with the company’s vision.

I (Improvement): Continual improvement of products and services.

E (Engage): Understand stakeholder needs and demands. Often the first thing that occurs in a service value chain.

D (Design and Transition): Ensure services meet stakeholders’ needs.
Ensure that the services, in the end, meet the specifications delivered by the stakeholders.

O (Obtain and Build): Ensure components are available when needed. Components could be people, hardware, software, or licenses. Anything we need to build our initiative.

D (Deliver and Support): Ensure SLA conforms to service delivery. Ensure that incidents, service request problems, and all operational tasks are handled and our services are running according to the agreement with our customer.

Question 29

Value Stream Example

Answer 29

Blank Loan. Every value stream in a service value chain always has a trigger or starts with a demand, which in this case is a need for a loan.

We as a bank try to map the steps that are actually needed to transform the need for a loan into actual value for the customer and ourselves.

Attract Customer -> Quick Rate Quote -> Complete Loan Application -> Eligibility Check and Decision -> Award Loan -> Setup Payment Terms -> Repay Money -> Close Loan

Question 30

Practices

Answer 30

A practice is a set of organizational resources designed to perform work or accomplish an objective. The seven most important practices include:

General Management Practices:
* Continual Improvement

Service Management Practices:
* Change Enablement
* Problem Management
* Service Desk
* Service Level Management
* Service Request Management