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Session 501 Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model Toolkit Class Exercise Group Presentations Closing Thoughts Q&A

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Page 1: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Session 501

Connecting All Your Dots: Creating Your

Service Management Operating Model

Agenda

Operating Model Overview

Operating Model Toolkit

Class Exercise

Group Presentations

Closing Thoughts

Q&A

Page 2: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Technology Is Exploding

Page 3: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Management Approaches Are Exploding

What Is An Operating Model?

No official definition

Tool used to tie disparate operating elements together (e.g.

technologies, people, processes, etc.)

Collection of diagrams, charts, tables

Shows the elements used to operate the business (e.g.

suppliers, assets, IT systems, etc.)

Focused on business value and how this is achieved via the

elements used

Aligned with the business strategy

Page 4: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

When Should You Use One?

Alignment issues across the business

People and projects are stepping on each others toes

About to implement a major business change

Operating issues are killing the business

Operating with high costs and many redundant activities

Undertaking a new business strategy

Majority of business investment is in overhead versus value

Where Does It Fit In?

Business Strategy Operating Model Transformation

Projects and

Improvements

The Operating Model makes the strategy become real

Page 5: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

One Example

Customer Demand

Mgt

Request

Management

Service Support

Service Delivery

Service Desk

Change Management,

Release Management

Problem Management

Configuration

Management

IT Financial

Management

Inventory

Management

Service Level

Management

Availability

Management

Capacity

Management

IT Service

Continuity

Management

Incident and

Enquiry

Management

Manage

Business

Performance

Business

Continuity

Management

Financial

Authority

Protect

Company

Assets

ProcurementBusiness

Strategy

Non IT processes

Design&

Build

Solution Delivery

Customer

Satisfaction

& Complaint

Handling

AnalysisTest &

AcceptDeployment

& Handover

I.T

Architecture

(Technical

Design

Authority)

Risk

Management

Standards &

Compliance

Partner

Relationship

Management

Programme

Management

Quality

Management

I.T

Organisation

and

Relationships

IT Strategy

Cust

omer

sUs

ers

Service

Analysis

Service

Design&

Build

Service

Test &

Accept

Service

Deployment

& Handover

Service Development

Another Example

Page 6: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Tool: Business Model Canvas

Can be used to quickly

describe the business

elements of a service or

product (or your

business)

Originally conceived by

Alexander Osterwalder

(Swiss business

theorist) based on his

earlier work on

Business Model

Ontology in 2008

Other variants exist

throughout the industry

Page 7: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Tool: Business Model Canvas Example

Tool: Operating Model Canvas

Value Chain of Activities

Suppliers Locations

Organization Information

Management System

• Captures model on one

page or 10 pages

• Objective is to capture

thoughts about how to

design operations and

organization that will

deliver a value proposition

Page 8: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Using The Canvas To Tie In Detail

Value Chain of Activities

Suppliers Locations

Organization Information

Management System

Org

Chart

Floor

Plans

Process

Flows

System

Specs

Supplier

Contracts

Location

Maps

Tool: Management Mesh

VeriSM tool for integrating the multitude of

frameworks, standards, methodologies,

management principles and philosophies that

are used to deliver value

Can be used to select core operating

elements that will be used

Integrates elements into an operating model

unique to your organization

Assures a focus on delivering value to the

consumer as well as provider

Page 9: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Tool: Strategy On A Page

Page 10: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Building Your Operating Model

• Break into small groups

• Select an example service or

product e.g.

Must be externally focused

Something you sell to

customers

A service you provide to

customers

• Be ready to present what you

are developing

Class Exercise

Step 1: Value Proposition

Class Exercise

TASK:

List several key value propositions

provided to end customers from your

service or product

HINTS:• What customer problems are solved?• What customer needs are satisfied?• Why would they buy?

EXAMPLES:• Superior product• Deliver anytime/anyplace• Personal customer service touch• Low cost• Easy financing

Page 11: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Step 2: Customer Segments

Class Exercise

TASK:

List several types of customers for the

markets you serve and what they might

see as value

HINTS:• What types of customers do we serve?• Who are our most important customers?• What would each customer type see as

value?• Geographic location impacts

EXAMPLES:• Business Executives• Low Income Individuals• Younger Individuals• Business Owners• Students• Sick People

Step 3: Delivery Channels

Class Exercise

TASK:

List several delivery channels used to

deliver your product or service

HINTS:• How do we reach our customers?• How do our competitors reach our

customers?• Which channels are the most cost

effective?• Which channels work best with how our

customers work?

EXAMPLES:• Existing Customers• Internet• In-Store Shoppers• Mobile Devices• Newsletter/Email

Page 12: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Step 4: Customer Relationships

Class Exercise

TASK:

List several key activities done to get

grow and keep customers

HINTS:• How do we get and grow our customer

base?• How do we manage relationships within

our business?• How costly is it to maintain our

relationships?

EXAMPLES:• Personalized Service• Strong Online Presence• Marketing via Television/Social Media• Strong Brand Recognition• Incentives and Rewards• Long Term Agreements

Step 5: Revenue Streams

Class Exercise

TASK:

List several means by which revenue is

flowing into your business organization

HINTS:• What value will customers pay for?• What value are customers paying for

today?• How do we receive revenue?• What tactics do we use to recover our

costs and gain revenue?

EXAMPLES:• Direct Sales• Donations• Sales Contracts/Agreements• Licensing• Royalties

Page 13: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Step 6: Key Resources

Class Exercise

TASK:

List the most important assets used to

gain customers, build products, deliver

services in order to gain value

HINTS:• What key resources does our value

proposition require? E.g. people, skills, assets, etc.

• What key resources are critical to keep the business running? E.g. people, skills, assets, etc.

EXAMPLES:• Line Of Credit• Machines• Vehicle Fleet• IT Systems• Patents• Customer Lists• Software Engineers/Scientists• Teachers

Step 7: Key Partners/Suppliers

Class Exercise

TASK:

List key partners and suppliers used to

build and deliver your product or service

HINTS:• Who are our key partners?• Who are our key suppliers?• What resources do we acquire from

partners and suppliers?• What key activities are performed by our

partners and suppliers?

EXAMPLES:• Distributors• IT Outsourcers/Hosting/Cloud Providers• Volunteers• Joint Ventures• Partnerships• Parts/Maintenance Suppliers

Page 14: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Step 8a: Key Activities

Class Exercise

TASK:

List key activities used to build and

deliver your product or service that

provide value to your customers

HINTS:• Which activities are required for us to

deliver value?

EXAMPLES:• Sales• Marketing• Production• Design• Research• Publishing• Billing• Servicing• Manufacturing

Step 8b: Key Activities

Class Exercise

TASK:

List key activities used to manage,

administer, support the business and its

operations

HINTS:• Which activities are required for us to

keep the business running?

EXAMPLES:• Payroll• HR• Accounting• IT Support/Service Desk• Project Management• Supplies/Asset Management• Fleet Management

Page 15: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Step 9: Cost Structure

Class Exercise

TASK:

List key activities used to manage,

administer, support the business and its

operations

HINTS:• What are our most important costs? E.g.

value for money• What types of costs do we incur?• What are our most expensive resources?• What are our most expensive activities?

EXAMPLES:• Fixed Costs• Variable Costs• Cost Per Product or Customer• Overhead Costs• IT Costs• Capital/Non-Capital Costs

Step 10: Value Chain Map

Class Exercise

TASK:

Develop a Value Chain Map for your

service or product

HINTS:• Steal from Step 1• Steal from Step 8a (Not 8b)• Stay high level• Focus on customer value

EXAMPLES:• See left

Research Design Make Sell Support

• Customers

• Market

• Needs

• Blueprints

• Patents

• Legal Search

• Manufacture

• Parts

• Supplies

• Factories

• Customer Lists

• Advertising

• Sales Force

• Customer Service

• Repair Facilities

Page 16: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Step 11: Value Chain Map (Suppliers)

Class Exercise

TASK:

Develop supplier view for

your value chain

HINTS:• Steal from Step 7• Indicate with chevron which

process they support• Color code chevrons in RED

if there are issues/concerns

EXAMPLES:• See left

Research Design Make Sell Support

• Customers

• Market

• Needs

• Blueprints

• Patents

• Legal Search

• Manufacture

• Parts

• Supplies

• Factories

• Customer Lists

• Advertising

• Sales Force

• Customer Service

• Repair Facilities

Supplier View

Supplier 1

Supplier 2

Supplier 3

Etc…

= Okay

= Issues/Concerns Exist

Step 12: Value Chain Map (Locations)

Class Exercise

TASK:

Develop location view for

your value chain

HINTS:• List locations in which you

operate• Indicate with chevron which

process they support• Color code chevrons in RED

if there are issues/concerns

EXAMPLES:• See left

Research Design Make Sell Support

• Customers

• Market

• Needs

• Blueprints

• Patents

• Legal Search

• Manufacture

• Parts

• Supplies

• Factories

• Customer Lists

• Advertising

• Sales Force

• Customer Service

• Repair Facilities

Location View

Location 1

Location 2

Location 3

Etc…

= Okay

= Issues/Concerns Exist

Page 17: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Step 13: Value Chain Map (Organization)

Class Exercise

TASK:

Develop organization view

for your value chain

HINTS:• List organizations you

operate with• Indicate with chevron which

process they support• Color code chevrons in RED

if there are issues/concerns

EXAMPLES:• See left

Research Design Make Sell Support

• Customers

• Market

• Needs

• Blueprints

• Patents

• Legal Search

• Manufacture

• Parts

• Supplies

• Factories

• Customer Lists

• Advertising

• Sales Force

• Customer Service

• Repair Facilities

Organization View

Department 1

Department 2

Department 3

Etc…

= Okay

= Issues/Concerns Exist

Step 14: Value Chain Map (Information)

Class Exercise

TASK:

Develop information and

information systems view for

your value chain

HINTS:• List the key information

systems you operate with• DR plans may help identify

which are critical• Indicate with chevron which

process they support• Color code chevrons in RED

if there are issues/concerns

EXAMPLES:• See left

Research Design Make Sell Support

• Customers

• Market

• Needs

• Blueprints

• Patents

• Legal Search

• Manufacture

• Parts

• Supplies

• Factories

• Customer Lists

• Advertising

• Sales Force

• Customer Service

• Repair Facilities

Information View

System 1

System 2

System 3

Etc…

= Okay

= Issues/Concerns Exist

Page 18: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

Step 15: Value Chain Map (Management Sys.)

Class Exercise

TASK:

Develop management

systems view for your value

chain

HINTS:• List the key management

systems you operate with• Steal from Step 8b• Indicate with chevron which

process they support• Color code chevrons in RED

if there are issues/concerns

EXAMPLES:• See left

Research Design Make Sell Support

• Customers

• Market

• Needs

• Blueprints

• Patents

• Legal Search

• Manufacture

• Parts

• Supplies

• Factories

• Customer Lists

• Advertising

• Sales Force

• Customer Service

• Repair Facilities

Management View

System 1

System 2

System 3

Etc…

= Okay

= Issues/Concerns Exist

Step 16: Fill Out Your Operating Model Canvas

Class Exercise

TASK:

Construct the operating

model from all work done to

this point as shown on the

left

Value Chain of Activities

Suppliers Locations

Organization Information

Management System

From

Step 10

From Step 11

(list on left

hand side)

From Step 12

(list on left

hand side)

From Step 13

(list on left

hand side)

From Step 14

(list on left

hand side)

From Step 15

(list on left

hand side)

Page 19: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model
Page 20: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model

What If You Work In A Really Large Company?

Can operate with multiple

models which can also be

hierarchical

WHQ

Region 1 Region 2 Region 3

Manufacturing Field Support

What Comes Next?

Conduct Gap Analysis

Identify Improvement

Actions

Prioritize Actions

Develop Roadmap

Execute, Monitor and

Evaluate

For each chevron that

was marked as RED,

summarize the issues

and problems that exist

Select technologies and

actions that will mitigate

the gaps found

Prioritize actions to be

taken based on benefit,

risks mitigated, ROI and

estimated effort

Assemble prioritized

actions into a roadmap

Execute the roadmap,

monitor activities and

outcomes and readjust

the operating model as

business needs change

Page 21: Session 501 Connecting All Your Dots: Creating Your ... · Connecting All Your Dots: Creating Your Service Management Operating Model Agenda Operating Model Overview Operating Model