Is Your Business Value in Color?

ITIL^® tells us that there are three components to business value:

• Business outcomes
• Customer perception
• Customer preferences

Once this has been successfully memorized for the ITIL Foundation Certification exam, most people then forget it. That’s a shame because it gives an insight into why customers might be less impressed with the services they’re getting than expected. In this blog, I’d like to take a look at how each of these concepts can help us get things right.

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Business Outcomes

IT service providers generally focus on what IT applications and IT infrastructure actually do – their outputs. But to deliver genuine value, we need to think in terms of outcomes – the end result for the customer and the organization as a whole. So, a service provider’s first challenge is to see beyond initial outputs from their IT services and understand the outcomes: how they influence the customer environment. That requires learning about the service in the customer environment, things like:

• What business services does your IT service support?
• Never mind what you meant, how is it actually used? (In fact, is it actually used at all?)
• How many of the features, which you got excited about building, are exciting to the business as well?

We can illustrate this by analogizing it to the difference between using a car and a requirement to travel. The outputs of owning a car are about driving; the outcomes might be the ability to get to work or the shops, or impressing the neighbors with what you can afford. Seeing the difference would help you choose the right car – or perhaps even suggest alternatives like traveling by bus or train.

Think about it. This is a serious and important jump for many in IT. It’s about seeing beyond the initial functionality, but it’s only a part of the challenge to real business-IT integration and customer satisfaction.

Perception and Preference

In order for a service (or that car) to deliver any value, the customer has to be in a position and a mindset to receive it. If not, then the best of all services will not be of any actual use.

Customer Perception

Let’s stay with cars a moment. I lent my car to a friend, who returned it remarking on how easy it was to drive. I agreed, commenting specifically on how useful the cruise control is. My friend reacted with: “Cruise Control? Where is that?” This proves my point – if you aren’t aware of something, then it’s impossible to get value from it.

That kind of scenario is repeated in an IT context every day around the world: “Wow, I didn’t know it could do that”, or “where did you learn that?” At home, a few of us know all the features of our TV, DVD player, or cable TV. We have reached a stage in the evolution of technology where the users of that technology rely on intuition rather than training, and so services must work in a way that is obvious without words. Unless it’s clear what a service can do, it will not get used, and the service provider’s efforts will not be appreciated – nor willingly rewarded.

And even knowing that the service is there at all can be a challenge without an easy-to-use and comprehensive service catalogue that the customers can reach – and feel is worth reaching and exploring.

Customer Preferences

This is an area that can really undermine the hard work put in by a service provider. Appreciation of value rests on the attitudes of the people you are supplying. And, just about always, people are the least predictable element of any organization or situation. No matter how well you think you know them, they can surprise you. Add to that the fact that IT services are typically supplied by IT folks to business folks, and you have a “disconnect” of preferences just waiting to cause troubles.

Once more, let’s use a car analogy: many years back, our family was searching for a new car, so my husband took me to see what he had found at a car dealer, confident he had found us the perfect solution. The car was strong and fast (as we specifically wished it would be), a model we knew, was in good condition and at a good price. So…no question for him, we should buy it. But I had to reject it…because it was white! Of course I didn’t want a white car, no matter how well-matched to our other needs it might be. How could he have not known that when it was already so clear and obvious to me ;)?

That kind of preference can look like bias, unreasonableness, or even bigotry. But even if it is, it is real, and a supplier must cope with it and deliver something that is acceptable.

For an IT service, the customers may have strong feelings about how the interface works, and reject one that doesn’t work “their way”. Or it may come from a source they disapprove of. Without establishing those preferences beforehand, once again IT service providers will be working hard to deliver something that will not be appreciated.

Knowing, Learning, and Matching

So, what I’m trying to say is – to be a successful service provider, it means getting out there and understanding not just what your customers need, but their attitudes, likes, and dislikes. In a large organization maybe you work with your business relationship team, or account managers, to help bridge the perception and preferences gap. Then again, there is no real substitute for getting out, talking, and listening to your customers yourself.

For more on this topic, I highly recommend you read Stuart Rance’s blog “What Value Are You Creating from Your IT Job?”