IT Systems Do Not Equal IT Value

Many people in IT are confused about the term “IT service”. IT services are comprised of IT systems, and neither the IT system nor its components are of direct value to the consumer. Rather, it is the performance made possible by the IT system that produces a given value for the consumer and that value exists entirely in the perception of the consumer  therefore, by association, IT’s value exists entirely in the perception of the customer.

Consider humble email. Image a room with two rows of desks. The left-hand side of the room uses email to make the company money. The right-hand side of the room uses emails to place bagels and coffee outside of conference rooms before meetings. The value of email to each user group is vastly different yet, in many cases, IT delivers the same utility and warranty to both groups.

Essentially these IT managers believe that a functioning IT system (e.g., all systems operating) equates to customer satisfaction and IT value. In reality, this is often not the case. An emphasis on IT systems operation does not mean the performance meets customer expectations or needs.

The unique characteristics of services (intangible, perishable, heterogeneous, and inseparable) combine to present special management problems for IT service providers and IT system managers:

IT services are intangible since customers realize its value indirectly as the result of being able to accomplish something they otherwise could not. The value is in the accomplishment, made possible by the service and not in cost or worth of the resources combining into IT systems.

Services are time dependent, and the provider cannot “go back in time” to fix a defect. Thus, IT IT services are perishable. Failure to provide adequate service capacity, availability, or continuity can result in lost opportunities for both consumer and providers.

The interactions of all the systems coming together for even a “simple” log-on or webpage view are astronomically complex  protocols, routing options, memory locations, systems states, etc. For this reason IT services are heterogeneous and no two IT services or service encounters can ever be identical. Every service encounter is unique.

IT services are simultaneously produced and consumed and deliver their value on demand, making them inseparable, i.e., it impossible to separate IT service production and consumption. This also means that the service consumer (customer, user, etc.) is 50% of the service production equation.

These critical points regarding the true nature and the value of an IT service and its distinction from an IT system requires a shift in thinking on the part of IT managers away from operational status and onto value realized by the consumer.

Further, given the increasing standardization and stability of IT hardware and software resources, and the increasing dependency of laypersons and business on IT, the IT manager must focus on the consumer of the IT service in order to improve his or her decision making regarding the allocation of IT resources.

The IT manager must truly understand the social and other human activities the IT consumer desires to achieve using the IT service as a means. The IT manager must also examine IT staff members operating, supporting the IT systems required to deliver the IT service since these persons are instrumental in the delivery of a successful performance.

Hank Marquis is practice leader for Business Service Management at Global Knowledge. You can reach Hank at [email protected].