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HOW TO DIGITALIZE YOUR SERVICE BUSINESS: TAKING A BUSINESS-DRIVEN APPROACH- PART 1.2

How to digitalize your service business: Taking a business-driven approach- Part 1.2

One of the results from our Drivers for Growth in Service research has shown that companies are struggling to design and implement an integrated digital platform to support their services business.

In this series of ‘Digitalisation of Service‘ blog posts we discuss the challenges that service organisations may have in getting started with the design of such a digital service platform, and will make suggestions on how to address those challenges.

In this blog we discuss why companies find it difficult to define what they need and how this can be overcome quickly and effectively.

In addition to reading this blog, we also encourage you to listen to the related podcast in which this topic is also discussed.

“You don’t know what you don’t know”

Companies often face many hurdles in getting started with creating a digital service platform. One such hurdle is that they are unable to understand and define what capabilities and functionalities are needed to achieve their business objectives. They also often fail to manage these requirements throughout the lifecycle of the digital service transformation.

To illustrate this, we recently helped a global diagnostics company to define their requirements for service. They were very proud of all the preparation work they had already completed, including asking several of their service staff what functionalities they required. It is of course beneficial to involve service staff in a transformation project, however, their list of ‘wishes’ was consequently not very useful. This is because:

  • each person that provided input had their own perception on what functionality would make their lives easier
  • there was no alignment and opinions were not based on a common operating model or terminology
  • the requirements were either very specific or very high level
  • there were many similar requirements, but worded in a different way
  • there were a lot of nice-to-haves but not many important or critical requirements. Requirements that really mattered or could make a difference were not included.
  • requirements were based on the existing system they were using and the current way of working.

One of the reasons that aforesaid list was not sufficient was due to “you don’t know what you don’t know”, i.e. if you don’t know what functionalities exist in the market, you won’t know what could be useful to your organisation.

So, by using the list of requirements they collected themselves, they would basically get a replacement of their current system and processes, rather than the functionalities needed to improve their business and support a common and improved way of working.

This is just one example, but unfortunately representative of what happens in many companies.

Business capabilities are key

So then, what is a better approach?

Defining the requirements for a digital service platform should instead be significantly more business-driven and based on the common operating model, which defines a common way of working in the service organisation.

Having a common operating model is important because if parts of your organisation work in a different way, you would need to implement the digital service platform for each or implement multiple variations. This takes longer and is more costly in terms of implementation and operations.

Also, if operating in different ways it is also difficult to monitor and compare the performance globally in the same way as each part of the organisation may have different KPI’s, different ways of calculating a KPI or different ways of capturing the required data at different times.

The need for a Common Delivery Model

If a company does not have a common operating model, then it is highly recommended to define it.

It should be noted that without the knowledge and experience in this space, a company will need to spend a lot of time and money to do it themselves. It is therefore quicker and more cost effective to review and design a service operating model based on service industry best practices. Best practices are proven and built by experts in service.

We have seen companies try to design a common operating model themselves without the help of a best practice model, and this resulted in endless discussions and a sub-optimal set of processes because each participant has a different or better view on how the process works currently or should work in their region or division.

Some software vendors or system integrators for those vendors also provide best practices; however, companies need to be aware that these are typically best practices for implementing their solution, the best practices are defined with their product in mind and may not be entirely suitable for a specific company. Also, it does often not cover the end-to-end service processes that are required. It is therefore strongly recommended to use an independent set of best practices.

Best Practices

At Noventum we have created a proven library of industry best practices that describes the business management, sales and delivery models for service.

This library, which is based on 20 years of experience and hosted in our digital Service Transformation Centre, consists of a complete collection of the business capabilities a service organization needs to have in place.

Some examples of service business capabilities are:

  • request management: how to receive and manage service requests
  • planning & scheduling: how to plan & schedule work orders
  • dispatch: how to dispatch a work order to a technician
  • parts order request management: how to order a part
  • work execution: how to execute a work order

A business capability has everything that is needed to be able to perform the core functions of this capability. It includes:

  • processes, that describes the activities and decisions that someone with a certain role needs to perform.
  • management practices which are common agreements or principles that needs to be agreed upon. For example, a common set of service levels, a severity scheme, a skills matrix, etc. The management practices are what makes the processes work, but also are needed to set up a service application.
  • role descriptions and the competencies people in different roles should have.
  • performance metrics which are used to measure and monitor the performance of the service organisation. A description, the data that needs to be captured and how the metric is calculated is provided.
  • master data model, which describes the data objects needed to support this capability. This can be used to determine which application is the master of which object and which applications use it. In addition, it can be used to determine how each role uses the data.
  • user stories that describe what a user expects from the system while executing a process. These user stories are application agnostic, and can be applied to any IT solution.
  • functional requirements that describe the functions and features a software product should provide in order to support the processes and management practices.

In short, the best practice library is basically a template on how to operate and support your service organization.

Example

The best practice model is used by Noventum as the starting point for designing a common operating model which is then adapted where required to make it specific for a customer’s situation.

We just completed a project with a global biotech company, where we designed the entire delivery model in less than three months. Due to the COVID-19 crisis we did this using 2.5-hour remote sessions with business representatives in 8 countries.

For each business capability we ran a session to explain the best practice process and to get and discuss initial feedback. We then delivered a variation of the best practices process but tailored it to their specific situation. Each country then evaluated this version of their best practice process.

In a second session we discussed feedback, suggested changes and agreed on the final version. This is a very effective way of designing the operating model, without taking up a business representative’s time.

In the end, only some minor changes were needed to make the best practice model suitable for this company.

The conclusion? By using a reference model such as our best practices model, companies can achieve results much faster and with higher quality.

What’s next?

When a common operating model is defined, this should then be used to define the functional requirements for a digital service platform.

In the next blog post about the ‘Digitalisation of Service‘ we will explain how that works.

Other blog posts in this series

Podcasts in this series


Start today! Discover your service transformation challenges and solutions in your own company by using the Digital Service Transformation Centre, do a self-assessment and discover your service transformation journey.

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