Not so excited about ESM

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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7 thoughts on “Why your company isn’t so excited (but should be!) about ESM”

  1. Great article, Doug! So far, it’s been few organizations who have seen ITSM as a road to ESM. Hope to see more in the years to come.

    1. Thanks for reading the article Chuck, and for your comments. Like you, I do think that ITSM – done well – can be a road to ESM. However, one of the obstacles for many organizations using ITSM as a road to ESM is that the existing ITSM implementation only focused on operational aspects. Frankly, there is little incremental value in repeating that ITSM approach for ESM. Those organizations simply extending such an “operations only” ITSM implementation to ESM will still encounter the same “glass ceilings” that their ITSM implementations hit. ITSM leaders in these organizations need to “up their game”, think and act holistically, and clean up their ITSM implementations before trying to extend concepts into the enterprise.

  2. Good article, Doug – thank you! I have been an avid ITSM/ESM supporter, promoter and implementer for many years, and almost everything you noted in your article precisely highlights our current challenges. We have made great headway, but it’s been long and difficult AND it’s been limited to IT. We have a customer mindset in the forefront, but we still haven’t reached the point that’s needed.

    I think that the willingness of IT leadership to go from ITSM to ESM is one of maturity. I’d like to think that this evolution simply happens “organically”, but so far, it hasn’t. While it’s not completely to blame, I think that part of the problem is the WIIFM factor. After many long, critical incidents that have significantly impacted revenue, IT leaders will (eventually?) see the value of ITSM and take action; however, ESM is another milestone that’s not-as-easy. Any recommendations as to how to influence senior IT leadership in their adoption of ESM (beyond just the “Hey, if we do this, things could really be GREAT!” factor)?

    Thanks again …

    1. Hello Craig – Thanks for reading the post and for your insightful comments. I’m currently working on a whitepaper that should answer many of the WIIFM questions about the need to move to ESM – the most prevalent reason, in my opinion, is driving a differentiated consumer experience. If organizations continue to act as collections of parts, with each of the parts working within its own silo, the consumer feels that (for example, either the consumer is forced to talk to multiple entities within an organization to resolve an issue, or because the organization is so siloed, an organization creates an advocacy function whose sole purpose is to chase an issue through all of the siloes of an organization on behalf of a consumer). So far, companies are getting away with this – but this will change in the digital economy, where the consumer is “always on, always connected”, and the store is “always open”. Companies that have adopted an ESM approach will be better enabled to provide a seamless, frictionless experience to the digital consumer; those that have not will lose consumers. Consumers will simply move to the path of least resistance – companies that provide a seamless, frictionless consumer experience.

  3. I agree with many of the conclusions in this article. It seems to me, however, that we should start with the exact definition of what the ESM is. If this is not the dissemination of ideas, principles, methods, approaches and tools for ITSM on enterprise management, then it is difficult to explain why, once an enterprise produces products and services, it must pay special attention to service management , but not the management of products. What exactly is the ESM – a business services management model, a service-oriented business management model, or the use of ITSM’s overall enterprise management?

    1. Thanks for your comments, Alexander. While I think that ESM can encompass and leverage many ITSM concepts and constructs, ESM also has to consider and use concepts and constructs found from the “business” perspective as well. This could include things like the business portfolio, enterprise value streams, regulations, industry standards and guidelines, and more. To me, its more about making ITSM part of ESM, not necessarily rolling out an ITSM process into the enterprise.

  4. Thanks Doug, this is a great, clear article. Your point on Becoming an Expert on the business of the Business is crucial when it’s IT taking a lead or innovative role to deliver ESM for non-IT areas.
    I first started transitioning from ITIL/ITSM to ESM (and now excited about VeriSM) about 13 years ago when as part of IT I was on an evaluation committee for a new Workplace Health and Safety system. Immediately I saw a connection in process between Incident, Problem & Change VS Accident, Investigation & Remediation. My eyes opened and ESM came alive. Then for several years I tried to make square holes rounder to adapt the available ITSM tools to manage non-IT processes such as WHS, Drafting/Surveying, HR, Facilities etc. Fortunately the ESM platforms are here and it’s now OOTB instead of me with a hammer and chisel.
    I couldn’t pick a negative thing about your article and feel it’s good reading (and great starting point) for those wanting to understand or deliver in ESM.

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