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March 20, 2005

Service-Oriented IT: From Metaphors to Reality

In my line of work, I get to talk to dozens of IT executives each month.  At companies large and small, across all industry verticals, the challenges these IT leaders are facing are surprisingly similar: how to make their IT organization more efficient in the face of the shrinking budgets, more nimble in the face of rapidly changing market pressures, more responsive to customer needs.

Over time, I began noticing that, while the challenges are similar across industries, the way of communicating them has been strikingly industry-specific.

  • An IT executive at a manufacturing company talked about the challenge of having his “IT Factory” easily usable by his “internal consumers”: with standardized deliverables, well-defined Bills of Materials, intricate scheduling, and workflow-driven fulfillment.
  • A telecom service provider executive said he wished he could offer “IT as a Service” to his “internal customers” just like the telecom services are offered to the company’s external customers: with flexible options, transparent pricing, clear delivery commitments, and an integrated “quote-to-cash” fulfillment process.
  • The IT Operations head of a large package delivery company used the analogy of Fleet Management and complained that, while he has at his fingertips the exact location, destination, and inventory of every company truck worldwide, it is still largely a mystery to him what IT resources are out there, who is using them, and for what.

In the last couple of years, as the volume of “IT as…” analogies swelled dramatically and started flooding the industry press, so did the market confusion.   IT as a Business? Utility? Factory? Service? Portfolio? Fleet? – who can make sense of it all!  Yet a clear pattern is emerging: all these metaphors point to the same general struggle of an IT executive trying to reconcile the business-centric view of IT (service offerings, pricing, service level commitments) with the nuts-and-bolts under-the-hood reality (assets, incidents, systems monitoring).

Bridging the gap

The emerging industry consensus is that the first step in bridging this gap is to develop an actionable service catalog.  Indeed, an “IT Service” cannot be efficiently delivered without a clearly defined process to guide business users toward the appropriate IT service offering based on their identity, role, and location – which an actionable Service Catalog is designed to enable. Similarly, an “IT Fleet” cannot be properly managed without knowing what IT services are being offered, to whom they are assigned, and what resources they are relying on – all of which is information that a well-designed Service Catalog can keep.  And of course, an “IT Factory” cannot function until one establishes a clear definition of the IT offerings that the factory is “manufacturing,” along with the corresponding Bills of Materials and a standardized “manufacturing process” – all of which are modeled in the Service Catalog also. 

This point was recently driven home for me by the CIO of a large food manufacturing concern.  He likes to think of his IT delivery model as an Oreo cookie.  One half of the cookie is customer-facing: services that IT offers, processes for engaging IT for delivering these services, metrics that ensure the transparency of the IT organization.  The other half of the cookie is internally-facing: servers, networks, outsourcing partners, incidents, alerts, and systems management tools.  But the “magic” is in the famous Oreo cookie filling, which joins the business-facing side with the IT-facing side and makes the whole experience so compelling.  (Lovers of trivia may want to know that the Oreo cookie is coming up on its centennial, having been introduced in 1912, and that its recipe is essentially unchanged since – a product of uncommon resiliency indeed!)

So what is the Oreo filling made of? 

The industry is quickly converging on the recipe.  Forrester’s Julie Giera recently declared that “Service Catalogs are the heart of IT service delivery; in fact, they are (or should be) the heart of any service delivery organization within the enterprise.”  META Group analyst Dan Vogel agrees: “By 2004, lines of business will require their IT groups to deliver IT product/services catalogs that… facilitate service use.”  And all the best-practice IT management frameworks (such as ITIL) that have emerged as the old asset-centric view of IT is being replaced by the service-centric model recognize that actionable Service Catalogs are central to making the transition toward service-oriented IT delivery.

So whether you think of your IT shop as a Service, a Factory, a Utility, a Business, or an Oreo cookie, an actionable Service Catalog is the key to customer-centric, efficient, accountable IT delivery.  Or, as the VP of IT Operations at a global car manufacturing company recently remarked to me, managing an IT organization without an actionable Service Catalog will soon be as unheard-of as running a factory without an assembly line – or, indeed, as preposterous as having an Oreo cookie without that delicious creamy filling!

Posted on March 20, 2005 | Permalink

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