The Future of IT Service Management in a World of Digital Transformation

Digital transformation is on top of every CIO’s agenda these days. However, the increasing level of complexity that accompanies the fast-paced, cloud-based world of digital requires going back to basics — that is, implementing a solid, modernized IT service management strategy (ITSM), in order to make sure that digital transformation coincides with operational excellence, customer satisfaction and IT agility.

Service management is a collection of capabilities and methodologies an IT organization uses to plan, build, deliver, and ensure the quality of the services they provide to customers both internal and external — in IT, this relates to everything from applications, to networks, to data to connectivity. While the concept existed for years before, it gained momentum in the late 1990s, as a formal practice with standards and frameworks, when the IT Infrastructure Library, or ITIL, was developed. While ITIL remains a popular set of guiding principles and a level-setting framework, the discipline has evolved as digital transformation has emerged and IT service management has become more complex, says KPMG’s Mitch Kenfield. 

“A solid ITSM strategy is so important for organizations to succeed at digital transformation because as they ‘build’ their digital engine, how do they make sure customers are happy?” he explains. “As those services change, whether in complexity or just the pace of change in applications and data and access, they can be harder and harder to manage — which requires a significant strategic shift.”

Even organizations that, in the past, were deemed mature in their service management disciplines are now stressed because the services they provide are changing, he adds, with quicker, more agile deployments and higher customer expectations for service. “What customers expected from their technology services 5 years ago is light years away from their expectations today, so the management of those services need to adapt and change,” he says. “But many of our clients haven’t necessarily been able to make that transition.” 

Four critical capabilities for today’s successful service management:

• Make sure your SM is right-sized for the organization. While issues related to people, process and technology are standard for developing service management capabilities, the most important aspect is to make sure they are right-sized for the needs of the organization, says Kenfield. “Service Management at a globally-distributed organization with technology services spread across multiple business units is very different that that at a centralized organization…service management has to be appropriate for specific environment.”

• Organizational change is critical. Service management is the glue, or the connective tissue of the organization, says Kenfield — when performed well, it connects organizational groups to a single end; delivering quality services. “The organization as a culture needs to be willing to change and adopt the right SM capabilities, processes and metrics,” he says.

• Use the right tools to automate ITSM. The right next-generation cloud-based automation platform and tools can help organizations better execute ITSM more effectively with better visibility and efficiency, says Kenfield, whether it’s a system that handles issues, requests, approvals, procurement or funding.  Well defined processes are the basis, but they are only effective when enabled by a well implemented ITSM platform.  “Many organization are hamstringed by their ITSM toolset.  Well defined processes become tough to execute with poor automation and little data to support”,” he says. “A mature ITSM solution is a must.”

• Don’t treat ITSM as having a beginning and end, but a rolling roadmap. Service management needs to be treated as a journey, says Kenfield — one that doesn’t require an endpoint to deliver progress. “SM strategy should focus on near-term advancement and foundations that keep getting measured and added to,” he explains. “Every year you can refresh or tweak it, as you would do to drive more value from any major business process, rather than having a ‘start-and-stop’ project-based attitude.” 

The future of service management: IT as transformation

There have been many waves in the evolution of IT service management, including the  adoption of process frameworks such as ITIL. Now, says Kenfield, organizations are riding a new wave, in which they realize Service Management is about more than process frameworks. “Service management needs to be a discipline, a change throughout the organization,” he says. “While the vast majority of IT organizations have implemented aspects of service management, I think most would say they didn’t get where they thought they would.”

This new wave, he explains, means truly enabling these practices, capabilities and disciplines so they are a constant part of the organization, not just a project to implement a framework. What companies are doing now is transforming ITSM to meet their digital transformation efforts, and even looking to expand the principles and benefits of Service Management into other business areas – HR, Finance, Legal and more.

“It’s a total transformation of service management capabilities — maybe an organizaiton perform some pretty well, others much better, or others they didn’t focus on at all,” he says. “Perhaps an extremely process-intensive manual process becomes automated, or an onerous governance process becomes simplified.” 

Many companies that are more mature on the IT service management transformation path, he adds, are implementing an ongoing ITSM center of excellence — with a governance capability that never goes away. Processes can be tweaked, new services can be adjusted when portfolios change, service structures can be adapted. “We are even seeing vice presidents of service management,” says Kenfield. “Before, it was often a capability that was thought of as shared and often minimized in the leadership structure,  but now someone is responsible for service management and it has a greater level of impact.”

This is a trend, he says, that IT organizations will see more and more of, just as the IT organization has a leadership position responsible for compliance and security.  As IT organizations look to position themselves to drive better business results in a world of digital transformation, they will look to improve their capabilities in all of the above-described areas — which requires enterprise-wide leadership and an ongoing service management strategy that is constantly analyzed and measured.

For more on how KPMG can help your organization with IT Service Management transformation please visit us at our website.