A Business Logic of Services

A Business Logic of Services

Why Services Make Sense, If And When They Do

© 2014 Malcolm Ryder / archestra research

How to use this notebook

The following series of notes is not a fast read, not a slide show, and not an ebook.

The sequence of notes goes overa line of thought compiling

a range of empirical observations distinguishing services from

other business production resources.

No external citations are included or necessary in this notebook.

All text and images in the notebook are copyrighted.

©2014 Malcolm Ryder / archestra research

Who Cares?

Service Producers

• Services are the “product” offered by the service producer. The product acceptance and utilization must grow from successful relevance to the customer’s intent and from the customer’s product-enabled capability. The highest product value derives from it being used where it is needed, not merely where it is available.

Service Users• Industrial development, funding,

and competition all independently change and can separately or together modify the probability that existing operations can reliably create and defend the opportunities necessary for the business. The business must anticipate and coordinate those independent factors to exploit change and manage risk.

Why Services? Remove barriers to agility

Complexity Impermanence

Economy of Scope

Maintenance, Knowledge, Quality Expense, Conservation, Need

OpportunityCapacity

vs. vs.

vs. vs.

vs.

Service design Service availability


What is a service?Regardless of type, means or implementation, all services have the same distinguishing definition:

• A “service” is a set of outputs from an ongoing operation, that are available to a requester, on demand by the requester, under terms of agreement.

Operational outputs can occur continuously without ever acquiring accessibility, utility and manageability as a service.

Some outputs of an operation can be offered as a service while other outputs of the same operation may not be offered. A requester can be a person or a device.

A service offers a design, a vehicle, and a method of obtaining the operational outputs. But regardless of the form of the service – for example, being a technology, an activity, or a blend of the two – the qualifying definition of a “service” never changes.

Taxonomy and Semantics

DELIVER

PROVIDEFULFILL

SUPPLY

OUTCOMEOUTPUT

ENABLE

SUPPORT

REACTIVE

PROACTIVE

TACTICAL STRATEGIC

As shown in the matrix, the business logic of the varieties of service corrects a very common misperception.

The correction is that the four central activities are not “attributes” or “phases” of a service. Nor are they synonyms.

Instead, they are four different classes of services that can be offered, which immediately affects the services catalog.

SERVICE CLASS VARIATIONS


CONTRACTED

JOINEDSUBSCRIBED

ACQUIRED

OUTCOMEOUTPUT

ENABLE

SUPPORT

REACTIVE

PROACTIVE

TACTICAL STRATEGIC

Obtaining service implicitly includes a level of recipient underwriting that is distinguishable by levels of commitment.

The commitment is an investment in a blend of purpose and risk.

For the service client, the level of commitment usually corresponds to how much an opportunity cost is considered to be an investment.

SERVICE PROCUREMENT


PROTECT

PRODUCEMANAGE

COMPLY

OUTCOMEOUTPUT

ENABLE

SUPPORT

REACTIVE

PROACTIVE

TACTICAL STRATEGIC

Intended impacts correspond to designated responsibilities, which mainly identify roles in a relationship between the service vendor and the service client.

“Performance” criteria apply through the context of the responsibility.

SERVICE IMPACT


PREFERRED

ESSENTIALCRITICAL

ACCEPTED

OUTCOMEOUTPUT

ENABLE

SUPPORT

REACTIVE

PROACTIVE

TACTICAL STRATEGIC

The type and level of attraction of the service reflects a type of need behind a demand.

Proactive value has more required significance.

Reactive value has more discretionary significance.

Integration strengthens towards the proactive.

Adoption strengthens towards the strategic.

SERVICE VALUE


Parsing the Perspectives

Business Difference

Service is obtained to “make a difference” , with a calculated persistence, in an effectively managed way.

This requires the service introduction to cause a “change” to occur.

The executive concern:

Using the correct approach for solving the right problem

The four classes of services take on significance according to a variety of businessperspectives that test the propriety of the available service.

The perspectives examine the idea of what business change is most important, and what mode of change is most effective for that purpose.

Why change? Decision Factors

Perspective Options Adoption Importance Assurance

Subject choosing the offer

definingthe scope of change

incorporating the effort

targeting the effects

Variable service class results drivers roles

Issue selection risk investment stakes priority authorization solution management

Discussion points

commitment, responsibility, dependency

intention, development, goal

initiatives, demand, impact

intention, optimization, result

Available? Relevant? Compatible? Effective?

Client perspectives vet the service against the current state:


Objective Purpose Status Effect Requirement

Enable Outcomes Provide Joined Produce Essential

Support Outcomes Deliver Contracted Protect Critical

Enable Outputs Fulfill Subscribed Manage Preferred

Support Outputs Supply Acquired Comply Acceptable

Service Class Commitment Responsibility Dependency

Increasing fusion of

vendor-client business model

Service Selection (Business Options)


Objective Future State Business Effect Business Change Returns

Enable Outcomes Model Joint Production Innovation Advantage

Support Outcomes Performance Assured Reliability Progress Competency

Enable Outputs Position Secured Capacity Productivity ContinuityCompatibility

Support Outputs Resource Certified Quality Activity ComplianceReliability

Result Intended Developed Goal

Service Investment (Business Adoption)

Stakes are taken in accordance with the priority (importance @ urgency) of “intent”




Objective Goal Objective Action Change

Enable Outcomes Reduce competition for opportunities

Advantage Provide Innovation

Support Outcomes Maximize assets Competency Deliver Progress

Enable Outputs Minimize risk of status quo

Compatibility &Continuity

Fulfill Productivity

Support Outputs Raise baseline of acceptability

Compliance &Reliability

Supply Activity

Drivers Initiatives Demand Impact

Service Priority (Business Importance)

Clients will authorize internal and external organizations to prioritize objectives per the chosen goal




Objective Service Function Business Effect Business Scope Future State

Enable Outcomes Essential Provision Joint Production Structural Model

Support Outcomes Critical Delivery Assured Reliability Transactional Performance

Enable Outputs Preferred Fulfillment Secured Capacity Environmental Position

Support Outputs Acceptable Supply Certified Quality Procedural Resource

Role Intended Optimal Result

Service Management (Business Assurance)

Service results are planned “solutions” for leveraging opportunity




Consolidated View

Objective Business Scope + Future State

Change Scenario Improvement

Enable Outcomes Structural Model Innovation Market strategy Leverage

Support Outcomes Transactional Performance Progress Businessdevelopment

Brand

Enable Outputs Environmental Position Productivity Operations Scale

Support Outputs Procedural Resource Activity Procurement Quality

Opportunity + Result Impact Context Benefit

Value Hierarchy



Business is focused on recovery, maintenance, or upgrades of benefits


© 2014 Malcolm Ryder / archestra research

[email protected]