How many suppliers does your IT organization use?

Again, one of the overall themes of the New Style of IT is the explosion of suppliers of IT services. Historically this could be as basic as internet connectivity and voice services complemented by some amount of outsourcing. Now SaaS choices, let alone public cloud alternatives, are expanding daily. What does this mean to the IT Service Desk organization?

 

First, the biggest wins to managing suppliers more effectively are likely on the contractual side as opposed to the ITSM or service desk side. But, any improvements should make life more manageable to the IT service desk team and ultimately better for end-users. The general industry rule of thumb is that 10% of a contract’s value is spent on managing the contract itself. As the number of IT related suppliers expands, reducing this by single point or two can have huge impacts on the overall budget. And, contract management best practices are only nominally covered in recommendations such as ITIL.

 

Second, this general topic is commonly known as multi-supplier service integration (MSI) or service integration and management (SIAM). And there is more to this than I will cover in a single blog post. I would also recommend watching a good 10 minute video that provides an overview of SIAM and the cloud. Note - this video does have an added bonus of talking about HP’s Cloud Service Automation (CSA) new capabilities!

 

Third, what does this mean to the service desk organization?  Here are some touch points:

 

  • Another rule of thumb. As an IT organization moves beyond 5 different suppliers, taking a more structured approach to managing suppliers correspondingly becomes more important and provides more benefits across the board.
  • Coordinating incident or problem management across multiple suppliers. Why is email down or a SharePoint slow? An end-user calls the central help desk dealing with a SaaS application issue that was procured by a Line of Business (LoB).
  • Request handling / fulfillment. This has many related items such as a consolidated service catalog regardless of where the service is sourced or its components delivered which then touches topics of multiple related catalogs. And,  IT wants to make a useful application generally available - that was originally procured a remote entity or LoB
  • Change management that results in required tasks be executed by one or more third party suppliers.
  • Service level management – contractual or implicit expectations across performance, availability, incident management, request fulfillment, change management execution, …

succeed in the cloud.jpg

Fourth, what do I recommend? The service desk organization needs to become informed. These topics are not new. MSI has been part of the outsourcer dialog for years. As IT becomes a service broker in addition to a service provider, these topics will become increasingly important. I have attached a great whitepaper on the overall topic which is interestingly titled Succeed in the cloud with service lifecycle management. Of all the different papers that I've come across regardless the source, this is one of the best. Read It! I would also recommend checking out the HP Service Integration and Management (SIAM) services page.

 

Lastly, over the last 3-4 months I have bumped into this general topic more and more. It feels foundational and part of so many ITSM discussions. I lean towards being skeptical on IT buzz and potential fads; however, I lay odds that this topic area will soon be part of the mainstream service desk dialog.

 

As always, comments/questions are welcomed!

 

Chuck Darst

 

 

Comments
HP Expert | ‎07-12-2013 03:52 PM

Great Stuff Chuck. 

 

To quote the line in My cousin Vinny  That is a  lucid, intelligent, well thought out objection  -- to IT business as usual. 

 

The content in this post is solid and the video and white paper contain solid insights for customers. 

 

One thing I will add is that customers should not assume a Multi-supplier Service Integration (MSI) solution is only for the biggest enterprise businesses. We are seeing customers of all sizes and shapes considering such external  service delivery as foundational to IT success and wondering how to ensure success of the delivery. 

 

Thanx for putting this out. 

 

Scott

Senior Product Manager

IT Service Management

chuck_darst | ‎07-12-2013 05:31 PM

Scott, Thanks for the comment. Well said. I was asked to present this topic to set of classic service desk folks of various sized orgs a few months ago. Not top level management or procurement or contract management people, and I was wondering what they would think. By the heads nodding and the comments afterwards, service desk people are feeling the associated pains today. 

 

After years of consolidation and rooting out non-sanctioned IT, the forces of entropy are back at work. Bring your own device and use your own app moves to secure your own infrastructure (via Amazon or whomever) and procure your own (departmental) app and so-on and so-forth.

 

Chuck

MaryRasmussen | ‎07-13-2013 12:21 PM

@Chuck – Any idea of the impact on service quality for organizations in these multi-vendor environments? I imagine there are different SLAs for different vendors and different escalation paths that besides being difficult to manage, could also impact customer expectations due to the inconsistencies. Must be challenging.

Michael Pott (michael_pott) | ‎07-15-2013 08:07 AM

Chuck,

 

this is a great post. While the  cloud comes with a lot of opportunities for automation - it has never been easier to to buy and use software/apps from the cloud - it raises a couple of challenges at the same. The business and users of IT more than ever before rely on clear and effective service processes which need to integrate and work across suppliers.

 

I am sure we will see more of this sort of discussion in the future.

 

Michael

chuck_darst | ‎07-15-2013 05:07 PM

Mary, Michael,

 

Thanks for the comments. Thinking of Mary and SLA's, part of MSI/SIAM "best practice" recommendations is to have a framework for providing some consistency across process areas (and contracts). It is interesting how this links up with the overall catalog topic - knowing such things before taking a service on. I remember having this conversation with David Cannon a couple of years ago. Doesn't mean that all suppliers need or should have similar agreements, let alone processes, but that this needs to be done thoughtfully. All part of the HP professional services SIAM dialog.

 

And Michael, I submit that there is a tops down dimension and then a bottoms up. Orchestrating SLAs and processes is part of the tops down. Automation is clearly a key enabling technology from the bottoms up. I agree with your comments about never being easier to buy cloud (or SaaS) based services. This makes it easier to bring on more external suppliers and raises expectations on internal services and the rise of the private cloud. Another key enabler - asset management particularly wrt software asset management entitlements and also chargeback/showback. Need to understand how much it really costs to deliver a service.

 

Chuck

chuck_darst | ‎07-18-2013 02:24 PM

I just came across a reference to an interesting HP blog post that talks about some of the same issues and challenges wrt governance, procurement, and integration - specifically from a cloud sourcing perspective.

 

http://h30507.www3.hp.com/t5/Cloud-Source-Blog/Respond-to-Shadow-IT-source-services-from-external-pr...

 

This is a nice complement to this overall discussion topic. I was thinking of the Shadow IT as part of my original post. I posted a comment to this blog asking about the author's views on MSI/SIAM alignment. Arguably a leading question.

 

Chuck

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HP IT Service Management Product Marketing team manager. I am also responsible for our end-to-end Change, Configuration, and Release Managem...
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