Why your company isn’t so excited (but should be!) about ESM

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Enterprise Service Management (ESM) describes the use of service processes and technologies across an organization.  ESM also describes business management software which provides an integrated view into business practices. [1]

And what part of any organization doesn’t rely on the use of processes and technology for running its business?  None!

But organizations have traditionally taken a departmental or system-based approach to processes and technology.  Such an approach usually focuses on the needs of a specific department, or those directly impacted by the implementation of a system.  Rarely (if ever!) does this approach address the entirety of a value chain, or the movement of work and information from a point-of-origin through the point-of-consumption.  Value chains within an organization typically involve multiple departments.  But because of a disjointed approach to processes and technology, work efforts are usually disjointed, and the organization works as a collection of parts.

ESM could fix that, as a good ESM implementation would facilitate and integrate the flow of information and activities within an organization.

Why your company needs ESM

The idea of ESM is not new, but there is now a renewed focus on the need for ESM.  Why is ESM suddenly so important?  I would argue that the most compelling reason why ESM is so important is the customer – especially in the context of today’s digital world.

A challenge often encountered by customers today is that one part of the company is unaware of what the other parts are doing, much less how their activities impact or depend on those other parts.  As a result, departments within companies often tend to work in isolation without regard for any upstream or downstream processes.  Things simply fall through the cracks.

And in the digital age, customers simply will not deal with organizations that act in this manner.  They will quickly (and quietly) move along.

An effective ESM implementation can result in an organization acting and working as an integrated enterprise.   Done well, ESM enables a frictionless and differentiated customer experience, as it reinforces an enterprise-wide, process-oriented approach for providing value to a customer.  By underpinning an organization’s value streams, ESM:

• Can help identify and ensure that proper interfaces between individual systems are in place.
• Brings clarity to the organization and breaks down internal barriers and silos.
• Results in clearly defined and integrated value streams across the organization, not just within a department.
• Brings transparency, consistency, and measurability into the movement of work and information across the organization.
• Reflects the true picture of end-to-end service delivery.

Sounds great, right?  So why isn’t your company excited about ESM?

What is in the way of ESM?

ESM adoption has its own set of unique challenges.

• Success with ESM will require a change in organizational behaviors. The internal service provider/customer model utilized in many organizations must end.  The “customer” is outside of the organization, and all parts of the organization must collaborate to deliver products and services to that customer.
• Most organizational structures are hierarchical – which is a barrier to collaboration. A hierarchical organizational structure is typically pre-disposed to not collaborate with other parts of the organization.  This is because most organizational compensation and recognition schemes are focused inwardly on departmental goals and objectives and not enterprise goals.
• Organizations lack defined, enterprise-wide business processes. Business processes are typically defined only at the departmental or team level and tend to focus only on a particular domain or area.  How business processes interface is at best poorly defined, if defined at all.
• Technology has been used as a band-aid. Because organizations took a departmental approach to process and technology use, additional technology was often deployed to close the gaps between disparate systems within the enterprise.
• Lack of clarity regarding organizational value streams. No single part of an organization is independent of the rest of the organization; It takes all parts of an organization to deliver value to its customers.  But often, there is no clarity or ownership regarding value streams within an organization.

Don’t repeat the ITSM sins of the past with ESM

Some organizations have approached ESM as just an extension of their current IT Service Management (ITSM) implementations.  I would agree that many ITSM concepts, such as having a centralized service desk and taking a coordinated response to service requests and interruptions, are applicable across the enterprise.  But I would also argue that for many organizations, if the ESM implementation mimics the approach taken for ITSM implementation, ESM will fail.  Why?  Because many ITSM implementations just aren’t delivering on their potential.

• Many ITSM implementations only addressed operational issues and not the entire IT value stream. As a result, ITSM became a barrier, rather than an enabler, for working within IT.
• ITSM was driven as an IT initiative, not as a business initiative. Rather than identifying, promoting, and delivering business value, ITSM became an obstacle for getting IT to do any work for the business.
• IT services were defined as “things that IT does” and not in terms of business value and outcomes. As a result, there is no clear definition or shared understanding of how IT provides business value. To the rest of the organization, IT appears to be a cost center, not a value enabler.

Three things to do to get ready for ESM

To really make a positive impact, ESM must be more than just establishing an enterprise service desk or rolling out a self-service portal.  ESM has to reflect and support the true end-to-end delivery of products and services throughout the enterprise.  But ESM will require strong management commitment and an investment of time and resources.  It will not get done overnight.  So how do you get started?  Here’s my tips for getting ready for ESM:

• Work on getting your ITSM house in order. IT is one of the few organizations within an enterprise that has a true enterprise view of the organization.  If current ITSM processes are ineffective, or if services are poorly defined, now is the opportunity to improve and learn.  The knowledge and skills you gain from making those improvements will be valuable as your organization begins its ESM journey.  Your business colleagues will also notice the improvements as well – this is critical, because you’re going to need their support.
• Become an expert on the business of the business. This means learning the language of the business; what the business does to deliver value to the customer; understanding how the parts of the business interact to deliver that value to the customer.  Tools like COPIS (or “backward SIPOC”) diagrams are useful for capturing how value is delivered from the customer perspective back into the organization (in other words, from the outside-in).  This will also help you gain the support and credibility you’ll need from your business colleagues.
• Develop a strong, compelling business case. Perhaps the most important question to answer is “Why should your company implement ESM?”. How will the gains in effectiveness and efficiency from ESM adoption translate into bottom line impact across the enterprise?  Perhaps ESM will result in improvements in the cost per sale or unit.  Maybe ESM will result in the reduction of lead times for product or service delivery.  Whatever the impacts may be, your business case must articulate the clear value proposition in terms of increased revenues, decreased costs, improved productivity, company differentiation, or improved customer satisfaction.

The digital age demands that organizations execute as frictionless, integrated enterprises. But to do so will require many companies to rethink how they are organized and how they collaborate to deliver both customer and business value.  Done well, ESM will transform organizations from “collections of parts” to an integrated, customer-focused enterprises, providing both an outstanding customer experience and improvements in efficiency and effectiveness.

Worried that your ESM efforts will fall into the “bad ITSM” trap?  Want to make sure that your leverage, not abandon,  your ITSM investments as you expand  into ESM?  Let us introduce you to VeriSM – the service management approach for the Digital Age.   Tedder Consulting can help you leverage VeriSM to achieve ESM – contact us today!

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Picture Credit: Pixabay

[1] Wikipedia, retrieved May 30, 2018.

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