IT Services, Not Systems, Provide Value

CUNA’s E-Scan Website
July 20, 2010 | COMMENTS

Many people—even those in IT—are confused about the term "IT service," according to CIOupdate.com. While IT services are built on IT systems, neither the system nor its components are of direct value to the end user.

Rather, it's the performance made possible by the IT system that produces value for the end user, and value exists entirely in the perception of that customer.

Too often, IT managers believe that a functioning IT system—all systems operating—equates to customer satisfaction and IT value. In reality, this often is not the case. An emphasis on IT systems operation doesn't mean the performance meets customer expectations or needs.

The unique characteristics of IT services combine to present special management problems for service providers and system managers. IT services are:

Intangible. IT customers realize 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—not just in the resources combining into IT systems.

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

Unique. 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, and more. IT services are complex and dissimilar, and no two IT service encounters can ever be identical.

Inseparable. IT services are simultaneously produced and consumed. They deliver their value on demand, making it impossible to separate IT service production and consumption. This also means that both the IT provider and the consumer each represent one-half of the service equation.

The nature and value of an IT service —and its distinction from merely an IT system—require a shift in thinking on the part of IT managers away from operational status toward a focus on user value.

Further, given the increasing standardization and stability of IT hardware and software resources—and the increasing dependency of business operations on IT—the IT manager must focus on the consumer in order to improve the allocation of IT resources.

This article originally appeared on CUNA's E-Scan Online Research & Advice Portal. Reprinted with permission.