Why You Need BSM Now

By Hank Marquis

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A quick review of the 2009 crop of surveys shows that most U.S. companies spend between two percent and nine percent of their annual revenues on IT-related expenditures; making IT a huge investment. Companies are also demanding more than just cost effectiveness, they want competitive advantage from their IT investments. Unfortunately, however, some 45% of companies view their IT as "necessary"―as in a necessary evil―and fully two-out-of-three feel poor quality IT limits the business.

While most business executives agree that IT should be a contributor to cost effectiveness, two-out-of-three throughout North America, Asia-Pacific, and Europe say their businesses are constrained by IT's inability to quickly adapt to the changing business needs. The global recession and associated IT budget cuts are not helping the CIO's cause either.

At the same time spending is falling, the demand for IT services is increasing due to the confluence of three important trends: complexity, commoditization, and globalization. The dramatic increase in the complexity related to falling costs and accelerating pace of change is well known. Less understood is that businesses now have less and less tolerance for poor service quality due to their dependence on IT.

Making matters worse, today’s economic climate puts IT organizations under increased scrutiny and IT leaders under incredible pressure to deliver real and measurable results. Another trend that does not bode well for IT leaders is that businesses are uncertain about how they ought manage IT. Many businesses are de-emphasizing senior IT positions by having them report to finance.

The bottom line is that the perceived value and prestige of IT leadership is diminishing; and taking many hard-built careers along with it. Facing increasing demand for services, escalating technological complexity, withering scrutiny and declining budgets, how can IT leaders possibly hope to meet the changing demands of the business landscape, move beyond the image of IT as a cost center, and be seen as an innovator and business enabler?

Business service management (BSM) answers these questions. When done right, BSM moves beyond theory with explicit directions on how to develop targeted action plans that solve specific quality issues. To quote the pioneer of BSM, Peter Armstrong of BMC, "BSM is a mind-set, not a product-set." BSM is not primarily about new software. How you approach the management of IT is what is key.


The IT environment today is an ocean of uncertainty but there is also opportunity. The opportunity to provide tangible evidence of alignment and move beyond the image of IT as a cost center. The chance to be seen as an innovator and business enabler. You can use the principles of BSM to document customer needs in plain English, for example; measure existing service quality from a business point of view (avoiding technical jargon and operational metrics), analyze the results, and apply practical solutions that allocate your limited IT resources to overcome challenges, seize opportunities, and empower business success.

Many IT managers work under strained relations with their businesses. Many IT managers blame the business for lack of direction and shifting requirements but I believe the real reason we in IT are failing is simply because we do not:

Understand the expectations consumers have for the services we provide. Accurately capture these expectations and analyze them. Manage our resources in ways to match changing expectations. Deliver services that meet consumers’ needs and expectations.

Many so-called "customer satisfaction surveys" are used in an effort to determine IT service quality. These surveys are definitely a start in the right direction, indicating that the survey author understands that he or she needs to take into account the consumer of the service when measuring quality. Unfortunately, many of these customer satisfaction surveys are simply not effective and are soon discarded. The good news is that over the last 25 years the science of marketing has advanced dramatically. There are now statistically valid frameworks for measuring quality and ways to generate reliable and repeatable results. SERVQUAL and SERVPERF are excellent examples and well proven.

For perhaps the first time in the history of IT management we have at our disposal the tools and techniques to truly understand the quality of the IT services we provide. We can measure them, and perhaps more importantly, we can analyze them to understand specifically which characteristics of a service are meeting or not meeting consumer expectations and requirements.

Practitioners and managers often ask similar questions regarding the measurement of IT services. Many practitioners assume that, by examining the warranty surrounding the IT components that create a service, they can measure IT service quality. This does not work. Measuring warranty of individual components is at best predictive, and has been proven to be woefully inadequate in many instances.

Many common questions arise with regard to measuring services: What is customer delight? How do we exceed customer expectation? How do we under-promise and over-deliver? But these are not the right questions to ask. To measure service quality is to measure the expectation of the service user, and then position the IT organization within that expectation. It is not feasible to attempt to delight all customers or exceed customer expectations. In fact, attempting to do these things, more often than not, results in spectacular failures. This is why BSM is all about understanding what is needed and then meeting that need―no more, no less.

Hank Marquis is practice leader for Business Service Management at Global Knowledge. You can reach Hank at hank.marquis@globalknowledge.com.