A Model for IT Service Strategy

A Model for IT Service Strategy

Neil McBride (De Montfort University, UK)
DOI: 10.4018/978-1-60566-008-0.ch020
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Abstract

This chapter describes a suggested model for developing a service strategy within IT services. It considers the context, the organization of IT services which might be appropriate for a service strategy. It discusses the content of an IT service strategy which it suggests should be presented as a portfolio of services. It reviews the process of developing the service strategy, suggesting a set of steps which may lead to the development of appropriate content within the right management structure. The example of hospital information systems is used to illustrate the strategic process. In order to set the scene for the strategic process, the state of information systems strategy research is discussed and set in the context of the developing service management research literature. The term service-centric is used and the difference between service-centric IT management and service-oriented architecture is clarified. A case is made for a migration from an IT strategy based primarily on the development of a portfolio of IT systems to a service-strategy based on the development of a portfolio of business services.
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Introduction

In the last decade there has been a significant shift in many IT departments. IT departments increasingly recognize that IT within an organization is a service which, like other services within organizations, aims to deliver value to the organization through the way that it supports the activities of the business. This has led to an increasing emphasis on the delivery of IT operations as a service which not only involves the building and delivery of the software and hardware, but also the execution of a wide range of activities around the technology.

The influences that have led to the realignment of IT as a service are complex. Economies, particularly in the West, are changing from a goods base to a service base (Rai & Sambamurthy, 2006). In terms of business models, many companies are repositioning themselves as service organizations. The technological products, which were previously the focus, become part of a larger service. The Volvo lorry is part of a logistics service and is seen in that context (Edvardsson, Gustafsson, Johnson & Sanden, 2000). A technological product is seen as a service waiting to happen. In addition to the manufactured goods being set in a service context, they are also surrounded by support services involving maintenance, replacement, and training.

In IT departments, the rise of outsourcing, the move from making software internally to buying it and the recasting of IT as a commodity has further aroused a service mindset. The service focus of these changes has particularly been around quality. In delivering services and IT products to clients, outsourcers had to work on the definition of what the service was that was being contracted by the client, how it could be measured and how it could be judged as being up to a mutually acceptable standard. Hence, outsourcing led not only to a focus on contracts, but to the development of service level agreements and to attention to the expectations and perceptions of the customer. It was not just the technology that mattered—its reliability, availability and security—but the customer-focused services around it. IT outsourcers were no longer judged by the number of bugs in their software and its usability, but by the empathy, adaptability, and competence of their staff. In IT, quality became a much more complex subject.

A third influence on IT departments has been ITIL which emerged in the 1980’s as a UK government response to the need to increase the efficiency and effectiveness of IT in the public sector. ITIL was taken up by many companies during the 1990’s and became the standard approach to running IT service operations. However, until the release of ITIL3 in 2007, the focus of ITIL was in service operations, and particularly in the support of information system applications. Strategy was not effectively addressed. This recent recognition in ITIL of the importance of IT as a service function and of the need for a service strategy has been recognized for some time in industry in IS management, and expressed in a central concern for alignment: alignment of strategy, alignment of operations, and alignment of culture. In ITIL3, the Service Strategy text (Iqbal & Nieves, 2007) recognizes that the purpose of IT, like any service organization, is to provide value to the customer. The service must ensure that the customer can use her assets effectively to achieve business outcomes which are produced by business processes. This suggests a massive shift away from IT as technical support to IT as a service organization delivering business value to its customers.

However, even ITIL3 is weak on the processes by which a service strategy is developed. This chapter proposes a set of steps that may be undertaken in developing a service strategy and develops an IT governance approach that complements the organizational structures suggested in ITIL3. It also draws from the management literature to suggest service strategy techniques.

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Table of Contents
Foreword
Wim Van Grembergen
Preface
Aileen Cater-Steel
Acknowledgment
Aileen Cater-Steel
Chapter 1
Sherrena Buckby, Peter Best, Jenny Stewart
This chapter introduces current and prior IT governance literature across five key focus areas being strategic alignment of business and IT systems... Sample PDF
The Current State of Information Technology Governance Literature
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Chapter 2
Junghoon Lee, Changjin Lee
Domestic and global companies are increasingly using information and communication technologies as a means of delivering their strategic visions and... Sample PDF
IT Governance-Based IT Strategy and Management: Literature Review and Future Research Directions
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Chapter 3
David Musson
This chapter reviews the IT governance literature. It proposes that there are three different concepts that are grouped together as IT governance.... Sample PDF
IT Governance: A Critical Review of the Literature
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Chapter 4
Jyotirmoyee Bhattacharjya, Vanessa Chang
This chapter introduces key IT governance concepts and industry standards and explores their adoption and implementation in the higher education... Sample PDF
Adoption and Implementation of IT Governance: Cases from Australian Higher Education
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Chapter 5
Lynne Gerke, Gail Ridley
This chapter examines the potential to use an audit program based on the Control Objectives for Information and related Technologies (CobiT)... Sample PDF
Tailoring CobiT for Public Sector IT Audit: An Australian Case Study
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Chapter 6
Tony C. Shan, Winnie W. Hua
This chapter defines a methodical approach, named Comprehensive Architecture Rationalization and Engineering (CARE), to effectively manage the... Sample PDF
Comprehensive Architecture Rationalization and Engineering
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Chapter 7
Junghoon Lee, Jungwoo Lee, Ja Young Lee
Research has recently begun to place greater emphasis on the strategic application of IT in seeking to integrate firms’ IT infrastructures and... Sample PDF
A Comparative Case Study of Three Korean Firms: Applying an IT Governance Framework
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Chapter 8
Breanna O’Donohue, Graeme Pye, Matthew J. Warren
This chapter focuses upon the Australian Standard for the Corporate Governance of Information and Communication Technology (ICT) AS8015 (Standards... Sample PDF
The Impact of ICT Governance within Australian Companies
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Chapter 9
Mark Toleman, Aileen Cater-Steel, Brian Kissell, Rob Chown, Michael Thompson
Acting upon the recommendations of a review of information and communications technology (ICT) governance and services at USQ, a major restructure... Sample PDF
Improving ICT Governance: A Radical Restructure Using CobiT and ITIL
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Chapter 10
Brian Cusack
Security is a subprocess that affects all processes within an organization structure. The control frameworks of CobiT and ITIL provide a mapping of... Sample PDF
Managing IT Security Relationships within Enterprise Control Frameworks
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Chapter 11
Michael A. Borth, Randy V. Bradley
This chapter discusses the overall importance of both corporate and IT governance, and demonstrates that IT governance is a very important... Sample PDF
Unexplored Linkages between Corporate Governance and IT Governance: An Evaluation and Call to Research
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Chapter 12
Alea Fairchild, Martin Smits, Piet Ribbers, Erik van Geel, Geert Snijder
This document summarizes the initial findings of the I-Fit research project that started in August 2006 as a joint activity of a regional ICT... Sample PDF
I-Fit: Optimizing the Fit between Business and IT
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Chapter 13
Tobias Kollmann, Matthias Häsel
This chapter articulates the knowledge and skills required by IT professionals in young Internet-based firms. Building on the general IT governance... Sample PDF
Competence of Information Technology Professionals in Internet-Based Ventures
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Chapter 14
G. Philip Rogers
This chapter assesses what role maturity models can play in enterprise IT governance. Frameworks that are well known in the IT industry, such as the... Sample PDF
The Role of Maturity Models in IT Governance: A Comparison of the Major Models and Their Potential Benefits to the Enterprise
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Chapter 15
Yael Dubinsky, Avi Yaeli, Yishai Feldman, Emmanuel Zarpas, Gil Nechushtai
Governance is the exercise of control and direction over a subject such as a society, an organization, processes, or artifacts, by using laws and... Sample PDF
Governance of Software Development: The Transition to Agile Scenario
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Chapter 16
Anne C. Rouse
This chapter considers the governance issues raised by the increasing use of external parties to supply IT resources (including packaged enterprise... Sample PDF
The Governance Implications When it is Outsourced
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Chapter 17
Muralidharan Ramakrishnan
This chapter is intended primarily for managers who are preparing to implement portfolio management concepts in an organization and students of IT... Sample PDF
IT Portfolio Management: A Pragmatic Approach to Implement IT Governance
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Chapter 18
Andrew Dowse, Edward Lewis
With the cost, complexity and risk associated with IT systems, the approach to IT governance and service management in many organizations is to... Sample PDF
Applying Organizational Theories to Realize Adaptive IT Governance and Service Management
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Chapter 19
Jon Iden
This chapter presents and analyzes a real life ITIL project, and it is based on a longitudinal case study. The purpose is to illustrate how the ITIL... Sample PDF
Implementing IT Service Management: Lessons Learned from a University IT Department
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Chapter 20
Neil McBride
This chapter describes a suggested model for developing a service strategy within IT services. It considers the context, the organization of IT... Sample PDF
A Model for IT Service Strategy
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Chapter 21
Manuel Mora, Ovsei Gelman, Rory O’Connor, Francisco Alvarez, Jorge Macías-Luévano
This chapter develops a descriptive-conceptual overview of the main models and standards of processes formulated in the systems engineering (SE)... Sample PDF
An Overview of Models and Standards of Processes in the SE, SwE, and IS Disciplines
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Chapter 22
Claus-Peter Praeg, Dieter Spath
This chapter introduces an IT-Service management framework for the use of quality management concepts in the context of the life cycle phases of... Sample PDF
Perspectives of IT-Service Quality Management: A Concept for Life Cycle Based Quality Management of IT-Services
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Chapter 23
Chee Ing Tiong, Aileen Cater-Steel, Wui-Gee Tan
This study reviews literature related to financial metrics that organizations could use in measuring the return on investment from their adoption of... Sample PDF
Measuring Return on Investment from Implementing ITIL: A Review of the Literature
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Chapter 24
Dirk Malzahn
This chapter describes how models for software development and service delivery can be integrated into a common approach to reach an integrated... Sample PDF
Integrated Product Life Cycle Management for Software: CMMI1, SPICE, and ISO/IEC 20000
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