The heart of Managed Services: People, Process and Trust
Christophe Derdeyn
Managing Director | Lean IT Practitioner | Operational Excellence | Globalist | Board Advisor | Mentor | Endurance Athlete
One small rule that breaks a contract
In one of the Application outsourcing engagements I was involved in, we did everything by the (ITIL) book and yet the engagement failed and the relation with the supplier terminated when we were just in the 2nd year of a 5+5y contract. Both organisations lost very significant sums (total exposure into millions of Euro's) while they really had all intent to make things work.
What we focused on was "Process" as this is what is really mainly what ITIL is about... processes and procedures on how to organise a services organization. We designed a contract that made sense to both parties at the start, but overlooked human behaviour in combination with unrelated (or so was believed) broader company policies.
The one, small rule, that I believe wrecked havoc and eventually broke the contract was this: "All assessments for projects OR changes to existing applications will be done Free Of Charge"
?? The result of this rule was that many people in the business would raise requests for assessing all sorts of changes but hardly ever push through with realising them... putting a massive burden on the Presales/scoping teams of the service provider while the actual delivery teams, driving revenu, were largely idle.
?? The service provider was contractually bound to deliver all these scoping documents & assessments, incurring significant cost for the teams responsible for this, while no revenue was generated from actual project work.
The broader company policy that focused on cost management & control inadvertently interfered with the "assess to build" concept of the managed services contract.
The result of the lack of conversion was that the service provider reduced the team-sizes for assessments once it became clear they were losing money, leading to reduced response times, frustrations on the business side, escalations, reductions in service delivery quality, loss of trust etc... things snowballed from there & ended with a separation.
After this debacle, we analysed, learned and did the exercise over, this time with a positive outcome.
Managed Services 101 - People & Process
The typical things anyone will look at when setting up a managed services organisation - outsourced or not - are basic things like:
1. Defining the services: This could include IT infrastructure management, Application management, cybersecurity, cloud services, helpdesk support, etc
2. Understand the needs of operations: Identify & understand the needs and pain points of the internal customers as well as the scope of work to be covered.
3. Define the value proposition: Ensuring to be able to clearly communicate the value the managed services organisation will provide to the broader organisation - this is crucial to get buy-in.
4. Build a talented team: Hire skilled professionals that fit the company culture & who are experienced in delivering managed services.
5. Technology enablement: tools and technologies to enable the new way of working and deliver efficient services.
6. Establish service level agreements (SLAs) and eXperience level agreements (XLAs): Define clear SLAs & XLA's with the internal clients outlining the scope of services, response times, and performance metrics and agree how these will be measured.
7. Focus on human relationships: Building strong relationships is essential for long-term success, especially with remote teams. Proactive communication, regular updates, and personalized support to foster trust and loyalty.
8. Maintain good security measures & instil a "Security first" mindset: The managed services organisation has to safeguard the companies' sensitive data - strong cybersecurity measures to protect against threats & the right mindset are required to remain safe & ensure compliance with relevant regulations.
9. Monitor and optimize performance: Continuously monitor the performance of your services and identify areas for improvement. Always ask if things can be done better or should be stopped since no longer relevant.
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10. Stay agile and adaptable: Be prepared to shift services offerings in response to changing market dynamics and organisational needs.
The Secret Sauce - Trust
Across all the engagements I've done, working with remote teams in a myriad of constellations and across different service offerings - managed services, projects or DevOps, I've realised that Trust is the secret sauce to make any organisation or setup successful.
It is required for the parties responsible for supply and demand to see each-other as human beings, not just as "Service Providers" or "the business". The human mind is always quick to make an abstraction of these umbrella terms, resulting in the human element being overlooked, leading to behaviour that results in a loss of trust, disrespect and eventually, failure.
To ensure Trust is established and maintained, following strategies and behaviours are crucial:
1. Transparency: Processes, capabilities, and any potential challenges should be subject to clear & regular communication. Transparency builds credibility and helps mitigate misunderstandings.
2. Expectation management: Agree in detail on scope of work, expectations, deliverables, timelines, and pricing before commencing work.
3. Qualified and trained delivery team: The team should consist of skilled professionals that exhibit the right behaviour & focus on customer experience.
4. Regular communication and updates: Maintain open and frequent communication. Effective communication nurtures trust and enables collaboration.
5. Cultural understanding and sensitivity: Recognize and respect cultural differences between offshore teams and clients. Invest in cultural awareness training to help your team navigate cultural nuances and communication styles effectively. Foster a culture of respect, inclusivity, and collaboration to strengthen relationships with clients.
6. Long-term partnership approach: Focus on building long-term partnerships based on trust, mutual respect, and shared goals. Create a context in the delivery team that drives long-term stability since this translates in service quality improvements, which results in an increase in trust.
7. Feedback and continuous improvement: Solicit feedback regularly to gauge satisfaction with the provided services and identify areas for improvement.
8. Integration: Where possible, setup a construct that enables occasional in-person meetings between key-stakeholders from the delivery organisation & those in the (internal) customer. These meetings often result in enduring bonds & humanisation of the parties to one-another, significantly improving chances of smooth operations.
Take-Away
General frameworks like ITIL are invaluable to help shape a services organisation, but without focus on the human element and ensuring that people get to know each-other, one cannot be successful.
Building trust through transparency, reliability, and consistent delivery of high-quality services is of course crucial. This involves setting realistic expectations, adhering to service level agreements (SLAs), and demonstrating accountability at every stage of the process.
Ensuring that key stakeholders on both sides know each-other personally is a critical success factor: When we know we deal with a human, a person we know, on the other end of the proverbial line, our behaviour often becomes more constructive and quite some tension is removed from relations and processes.
A common saying in sales is "people buy from people" - in Service Delivery we could similarly say "people really work best with people". Prioritising this fundamental aspect can enable organisations to not only meet but exceed client expectations and foster long-term partnerships.
From Corporate Suite to Entrepreneur - Empowering Next-Gen Leaders | Thought Leader, Speaker, Trainer, Mentor & Coach.
6 个月That is right on point. Managed Services in the Telecom space started with much hype in the early days. They were plagued with some issues, too. Assumptions and omissions early in the game can come to bite back later.
Your Sales Transformation Partner | Competency Assessment Expert | Founder | 22y+ Sales XP | Frequent Speaker
6 个月Great thoughts! For someone like me that has close to little knowledge about this, thanks! It reminds me a little bit of the 'Phoenix Project'