by Richard Sykes

Richard Sykes: Services at a crossroads

Jul 17, 20085 mins
IT LeadershipIT StrategyManufacturing Industry

Words are always at risk of being kidnapped by particular industries and applied to ever-larger contexts. Thus, in the world of IT, “services” has come to be applied to all the work that IT companies do that is not about the supply of hardware or software as such, but rather the wide diversity of work associated with their exploitation.

The consultants Ovum list IT services as including “consulting, systems integration, hosted services, IT staffing services, systems support and maintenance, managed services, business process outsourcing, infrastructure-led outsourcing, transformational services, and apps development and maintenance”.

India’s NASSCOM, in a similar vein, defines IT services as “a full range of engagement types that include consulting, systems integration, IT outsourcing/managed services/hosting services, training and support/maintenance”.

As a good catch-all of everything the IT industry offers to do other than supply hardware and software, it is difficult to challenge this use of the word “services”. The NASSCOM approach is useful, as it identifies the commonality of this diversity of activities with the words “engagement types”. These are services that require direct client/supplier engagement, and they are services that are, in the main, people-intensive – in fact, the business models of these services are mainly about putting “bums on seats”.

I read the word “services” in a different context. As ICI’s new group CIO in 1993, I inherited responsibility for a world-class datacentre in the north west of England. It ran software-enabled business processes such as accounting for ICI’s businesses; it delivered these processes as services; and when I outsourced the management of the datacentre to Origin, the ICI group continued to purchase, or source, the same business processes as services.

Fast-forward a decade or so, and now consider Google – a major business process outsourcing (BPO) player. When I joined ICI in 1973, my soon-to-be partner worked in ICI’s London HQ, in information services. She and her colleagues provided just that, operating from a substantial library and doing what Google’s search services now do infinitely more quickly and cost effectively: search for required information and present it to the user. Google Search is a clear example of contemporary BPO and it clearly delivers the search process as a highly automated service, accessed on demand over the web.

Businesses work and deliver through a multitude of processes, and operational and commercial success hangs on the ability to manage and deliver these processes effectively and efficiently. The language of business process management (BPM) and of BPO has developed out of this. Where these processes are created and managed in-house the talk is of business “processes”, but what is really delivered to the user is a service.

When these same processes are externally sourced, the talk is of having purchased business “services”. And when the sourcing world moves beyond the classic facilities management (FM) outsourcing model to directly sourcing on-demand services such as those offered by, then this use of the word “service” is seen as even more apposite.

In reality, whether created internally or sourced externally, we are talking about two sides of the same coin: a process exploited is a process; a process delivered for exploitation is a service. I call these business process services technology-enabled business services (TEBS).

Why all the fuss about a word? Because we are, as an industry, at a very significant point in time, and our use of the word “services” is about to change radically.

Our corporate IT legacies are of tightly integrated computing systems and tightly coupled business processes, requiring people-intensive work to create, develop and integrate anything new, as well as to maintain what is there. Thus, the classic IT service types listed above – “engagement types”, as NASSCOM calls them – have been to the fore.

Our future lies in the world of the virtual and the loosely coupled. The precedent set by the likes of Amazon and Google is for highly automated and standalone TEBS, delivered over the internet. The FM model of outsourcing is already starting to be replaced by a directly sourced services model.

The new, second-generation BPM tools and capabilities, built with architectures (SOA included) of the virtual and the loosely coupled, could perhaps now be better expressed as business services management tools and capabilities, as in essence their real impact now lies in their ability to flexibly order, reorder and reintegrate, in response to changing business needs, a blend of internally and externally sourced TEBS.

The days of systems integration, the expensive but profitable commerce of bums on seats, is to be replaced within five years by the significantly automated and far less costly capability of service integration. SI (systems integration) will die, long live SI (service integration)!

About the author

Richard Syles was vice president of IT at ICI in the 1990s and is now a consultant