Why IT Organisations Fail: Can You Handle the Truth?: Challenging Conventional Wisdoms for Managing IT Services

By Gerry Flanagan

Why IT Organisations Fail: Can You Handle the Truth is a unique book providing candid and sometimes disturbing insights into the management of IT services. The twelve chapters examine the capabilities required to manage IT services and why conventional IT management wisdoms are the root cause of poor IT service delivery.

Why IT Organisations Fail: Can You Handle the Truth is challenging, inspiring, critical, praising, and sometimes humourous but always informative. It is a must-read for everyone who works in the IT industry. You don’t need to agree with its views, but you do need to read them. They will change the way you think about IT services.

The world is changing for IT organisations. Cloud technologies, everything-as-a-service, social media, and the sophistication of the customers are driving this change. IT organisations who don’t recognise the need to change are quickly becoming legacy IT organisations...

• Language: English
• Publisher: Lulu Publishing Services
• Release date: Dec 1, 2016
• ISBN: 9781483456485

Book preview

Why IT organisations fail:

can you handle the truth

challenging conventional wisdoms for managing IT services

gerry flanagan

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Copyright © 2016 Gerry Flanagan.

Website: www.gerryflanagan.com

Facebook: Why IT organisations fail

All rights reserved. No part of this book may be reproduced, stored, or transmitted by any means—whether auditory, graphic, mechanical, or electronic—without written permission of both publisher and author, except in the case of brief excerpts used in critical articles and reviews. Unauthorized reproduction of any part of this work is illegal and is punishable by law.

ISBN: 978-1-4834-5649-2 (sc)

ISBN: 978-1-4834-5648-5 (e)

Because of the dynamic nature of the Internet, any web addresses or links contained in this book may have changed since publication and may no longer be valid. The views expressed in this work are solely those of the author and do not necessarily reflect the views of the publisher, and the publisher hereby disclaims any responsibility for them.

Lulu Publishing Services rev. date: 9/7/2016

Contents

List of Figures

List of Tables

Acknowledgements

Preface

What you will get from this book

Understanding the terms used in the book

1: Thinking Like a Customer

Is process the new king?

Expectations are not needs

The collaborative imperative

From mass-production to make-to-order

A scintillating experience

Can’t get no satisfaction

Concluding comments

2: Services, Frameworks, SIAM and Stuff

What is an IT Service?

The emergence of SIAM

Implementing processes

Concluding comments

3: Is Governance a Legitimate Alternative to Work?

What is IT Service Governance?

IT Service Governance and IT Service Assets

Why IT Service Governance fails?

Concluding comments

4: Static Processes for Fluid Situations

Classifying IT Services

Failing 1: Senior Management

Failing 2: Incident Categorisations

Failing 3: Key Performance Indicators vs. Service Level Agreements

Failing 4: Process Alignment

Failing 5: Demand Amplification

Failing 6: Process Selection

Failing 7: Process Purists

Concluding comments

5: The Value of IT Service Information Reporting

The art of CRUSHCRAFT

Concluding comments

6: The Quality of Third Party Your Efforts Deserve

The origin of the issues

Addressing the issues

RFP: Reusing Failed Practices?

Changing the approach

You’ve got to pick-a-pocket or two

Who’s transforming who?

Making it work

Being a preferred client

Integrating service providers

Avoiding third party lock-in

Concluding comments

7: The Skilled Incompetence of Management

The Anti-Art of Compromise

Don’t let your biases make decisions

The goal of training is performance

The manager’s bloomers

Talking the talk

To-Be or not To-Be

In praise of managers

Be the manager you want your manager to be

Concluding comments

8: IT Organisation or Socio-technical System?

Determinism or Choice

The upside-down IT organisation

Family matters

DevOps or Dev-Ooops

And the winner is….

That which differentiates us from other animals

Of prestige and self-fulfilment

Concluding comments

9: Leadership - We Learn to Do by Doing

Setting the context

What is Leadership?

What it takes to be a Leader

Leaders wear many hats

Concluding comments

Developing a Vision: An example

10: Improving on Improving

Dis-continual improvement

Follow the transformational process

Don’t rely on third parties to transform your IT services

Not falling into the pitfalls

Charging IT back

Concluding comments

11: Only Make Original Mistakes

The table of good counsels

The new conventional wisdoms

Concluding comments

12: For the Old Year Lies A-dying

The need for service-based thinking

The impact of service-based thinking

On a cloudy day…

Concluding comments

Words for the Wise

Words from the Unwise

To my wife Jill

List of Figures

Figure 1: Structure of IT Services

Figure 2: Positioning Business Relationship Management

Figure 3: The Collaborative Imperative

Figure 4: IT Service Assets

Figure 5: Components of value generation

Figure 6: SIAM builds on third party ITIL processes

Figure 7: The complexity of multi-source IT services

Figure 8: SIAM Model 1

Figure 9: SIAM Model 2

Figure 10: SIAM Model 3

Figure 11: SIAM Model 4

Figure 12: The SIAM Process Types

Figure 13: Diagram of a Feedback Loop

Figure 14: Process implementation approaches

Figure 15: Governance Capabilities

Figure 16: The IT Service Governance Pyramid

Figure 17: The McFarlan Strategic Grid

Figure 18: Customer Service Promise

Figure 19: Cause and effect lifecycle of IT budget cuts

Figure 20: The characteristics of good information

Figure 21: The IT Service Reporting Pyramid

Figure 22: Client Assessment Grids

Figure 23: The imbalance of the RFP process

Figure 24: The third party driven IT organisation

Figure 25: Strategic Grid for Client Assessment

Figure 26: My Wife and my Mother-in-Law

Figure 27: The Bad Ideas Board

Figure 28: The Managers Prayer

Figure 29: IT Service Assets in the IT Socio-technical Unit

Figure 30: Legacy IT Organisation Pyramid

Figure 31: Inverted IT Organisation Pyramid

Figure 32: The Service Family Photo

Figure 33: Example Service Family Construct

Figure 34: The DevOps Lifecycle

Figure 35: Expanding the Comfort Zone

Figure 36: Leaders & Managers

Figure 37: The 3 facets of Leadership

Figure 38: Achieving the Vision

Figure 39: The essence of Leadership

Figure 40: Continual Service Transformation Process

List of Tables

Table 1: IT Service Assets explained

Table 2: Typical SIAM Processes

Table 3: Components of IT Service Governance

Table 4: Terms of Reference attributes

Table 5: Critical Success Factors for IT Service Governance

Table 6: 12 Golden rules of the professional meeting goer

Table 7: The McFarlan Strategic Grid Quadrants

Table 8: Example operational levels timings

Table 9: Example operational levels breakdown

Table 10: Example of Service Credits breakdown

Table 11: Permitted downtimes for Availability service levels

Table 12: Adoption levels of individual ITIL v3 processes

Acknowledgements

It is often said that no endeavour of any value is achievable in isolation. So it was important for me to have this book initially reviewed by some people whose opinions I value. To that end there are a lot of people I need to thank for helping with this book. In particular I wish to thank the following people.

Firstly, I have to thank my wife Jill. When I started out to write this book, I didn’t quite realise the amount of time I would need to devote to the endeavour. Having a ‘day job’ meant that many evenings, late nights and weekends, in fact any free time I could arrange outside the day job, was consumed over many months. Jill’s patience and understanding gave me the space I needed to write this.

I also need to thank Lorraine Dowdall. Lorraine and I have worked together for over 20 years now. She is a colleague and long-time friend. We have both worked for the same company at times and more recently we have worked together on a number of client engagements, maturing their capability to manage their IT services. It was Lorraine who encouraged me to write this book in the first place. She was kind enough to proof read the manuscript (several times) and provide the encouragement, challenge, debates and consistent support I needed.

I need to thank Mick Furlong, Managing Partner at the Grey Matters Network. Mick was my boss at one time but is now a friend. I have learned a lot from Mick over the years and for that I am grateful. Mick, in his own inimitable and perfectionist way, brought a very critical eye to the book and provided some very valuable challenges and guidance which I was happy to take on board. The book would be a lesser product without his guidance.

I must thank Evelyn Murphy, B.Sc. MFTAI NAPCP. Evelyn was suggested to me by Lorraine as someone who could add value by reviewing the manuscript through a very different lens, which she certainly did. Evelyn’s feedback provided me with a completely different perspective on the book. During those few occasions where my enthusiasm for the project was starting to wane, reflecting on Evelyn’s feedback served to revive my commitment.

There are also a number of people who reviewed the manuscript and who, for good reasons, wish to remain anonymous. Their feedback is none the less valuable. Collectively their feedback was insightful, constructively critical, analytical, honest and intelligent. They know who they are and I thank them all.

While I was writing this book I did not consider the question of publication. My main focus was on content, on getting my views and ideas documented in book format. When I did need to consider what to do after the manuscript was drafted, the option of self-publication seemed the most attractive. In the developing world of Everything-as-a-Service it seemed to me to be the most obvious route. I wish to thank Justin, Nancy, Peter and their teams at LULU.COM for their help in turning my manuscript into a book. Their advice, guidance and expertise has brought the manuscript to life.

And lastly I would like to thank the managers and colleagues in the various companies, industries and countries I have worked with. I have learned from far too many people over the last 25 years to list them all here, even if I could. As my experiences have moved from episodic to semantic memory I have forgotten some of the names and places but their example, both good and bad, has influenced the views presented here. They have all unwittingly contributed to this book.

gerry flanagan

2016

Preface

Have you ever stopped to wonder why you have so many IT issues? You’ve hired third party service providers with vast experience and impeccable credentials. You have implemented market-leading tools. You produce enough reports annually to fill an Olympic-sized swimming pool. You’ve implemented every best practice process known to man or woman. The people you work with are smart and highly skilled. Even your IT consumers are relatively compliant and understanding.

So why is it that you have the same meetings, arguments, conversations and types of issues over and over again? The monthly reports are the same each month. The colours may move around the pages but the overall performance rating is the same. Projects are late, as usual. Business demand is immediate, as usual. Budgets are blamed for everything. You have no scope to think and no time to fix all the things you know need to be fixed. Try as you may, you just can’t get off the hamster wheel.

Conventional wisdom tells us to manage IT services in particular ways. The purpose of this conventional wisdom, one presumes, is the successful delivery of IT services. Why then after decades of this conventional wisdom do so many IT organisations struggle with IT service delivery?

For more than 20 years now I have been resolving IT service issues or advising IT organisations how to do it. Yet despite advances in technology, developments in best practices, the mountains of journals, books and white papers written on the subject, the same fundamental issues exist. It seems that none of the above address the core IT service issues in a way that resonates with IT service delivery practitioners.

I’ve been involved in delivering IT services in various capacities such as operations management, outsourcing, interim management and leading infused professional services teams. The common responsibility across all these roles has been to sustain IT service delivery while at the same time improving the services delivered.

From these experiences I have formed the opinion that many IT organisations are not in a position to deliver high-quality, reliable and sustainable IT services because they do not yet understand the basic tenets of delivering IT services.

I find it somewhat frustrating when I hear clients, colleagues, competitors and user groups debate subjects such as service levels, reporting metrics, governance, incident classifications, service management tools, etc. as though these debates will solve their IT service issues. Too often they miss the rationale for the existence of these- features of IT service.

In many cases IT practitioners have become purists, debating the finer points of process and dismissing the overall purpose; or they are charged with, and so focus on, their own responsibilities which are only a subset of broader IT organisational responsibilities; or in some cases these features are employed by a few as a defensive mechanism against negative feedback from the businesses they serve.

Cutting an elephant in two does not give you two smaller elephants.

To deliver IT services that are high-quality, reliable and sustainable, IT organisations need to focus on relationships, structures, interdependencies, vision and behaviours. Observable phenomena such as service outages and performance degradation are often investigated by reducing them down to their elementary parts. Breaking IT services down into their elementary parts and considering those parts in isolation is unlikely to produce the overall improvement in IT service delivery that is required.

A primary reason for this is that the behaviour of elementary parts is judged differently when investigated in isolation from each other than it is when investigated as part of a higher configuration of IT service assets. What is required is a more holistic consideration which adopts an IT service perspective of these observable phenomena. The IT organisation must engage in service-based thinking. But of course to do that we need a more complete understanding of what an IT service is.

This book is not an academic exercise. You won’t find the results of empirical research, quantifiable industry trends, analytics, and such like here. There are professional industry watchers and bodies of academia more capable than I of providing this. Besides, any industry data I included would be out of date by the time this book was published.

Nor is this book an instruction manual. Most, if not all of the topics covered must be assessed, considered, designed, pursued and reviewed for each IT organisation. There is no single procedure or process for delivering high-quality IT services. Having worked in manufacturing industries, financial service industries, utilities industries and Government departments, I know it to be an irrefutable fact that there is no one transformation plan which can be continually reused across IT organisations on the broader scale.

I’ve subtitled the book challenging conventional wisdoms for managing IT services because I believe that is what we need to do. Wisdom can be defined as the combination of knowledge, experience and judgement. Why then, with its collective knowledge of the issues and experience of poor IT service delivery, do IT organisations continue to make bad judgements and repeat the same mistakes time and time again?

We confuse Management with Leadership, we report data rather than information. We take the best practice guidance and deconstruct it to the point that it becomes a nuisance. We treat third party service providers as if we should be thankful that they selected us. We persevere with the invincible frailty of management. We treat our customers as a necessary irritation and our teams as our reputational bodyguards.

When ITIL version 2 was being implemented into the company I worked for in the mid-nineties I initially disregarded it. I saw ITIL as introducing unnecessary bureaucracy to what we were already doing well in IT service delivery. Gradually I came to realise that in order to deliver consistent IT services we needed consistent ways of working and that ITIL has a place in any mature IT organisation. I then became an advocate of ITIL version 2 and later version 3.

However, working with clients and IT service providers over the last number of years I have come to further realise the inadequacies of ITIL in supporting multi-source IT services which are part of the IT landscape of the modern IT organisation. I also believe that more recent schools of IT service management such as SIAM and DevOps have yet to establish themselves as mature sets of disciplines and find their true application in delivering IT services.

But ITIL, the de facto standard for IT service management, and SIAM the new contender to the service management throne, are not enough to manage IT services. Adopting either will not resolve the difficulties in managing multi-source IT services. We need to consider a much broader range of activities to achieve this.

What I am trying to do in this book is to share with you some of the common pitfalls and misconceptions in delivering IT services which I continually encounter and to provide some alternative approaches. In many cases these pitfalls and misconceptions are perpetuated by professional services companies, so called ‘best practices’ IT consultants, and service management software vendors.

What you will get from this book

I’ve lost count of the number of times I’ve thought to myself ‘Why am I writing this’ and I’m still not sure of the exact reason, or even if there is an exact reason. Maybe it’s because I felt I had something to say and a different way of looking at conventional wisdom in delivering IT services.

It’s not that I set out to write a book. I started out thinking that I should document fundamental IT service delivery issues which I repeatedly come across and how these issues can be overcome. If I collated my thoughts and issues, I could share them with others, although I wasn’t sure who those others would be.

Given that my views are all interrelated it seemed sensible to put them together into a collection. So that is what this book is – a collection of challenges and observations to the conventional wisdoms for the management of IT services, gained over a long international career at the working end of IT operations.

The intention of this book is to provide you, the reader, with a detailed understanding of the disciplines needed to manage IT services. In describing the disciplines, I have tried to explain why our traditional approach to these necessary disciplines fails us by conspiring to undermine the quality of IT service delivery. In exposing the conventional wisdoms which characterise these traditional approaches and challenging them, we can refresh our thinking on managing IT services and create new conventional wisdoms.

There are some alternative approaches presented, but this book is not a solution. My hope is that this book, this collection of challenges and observations, inspires discussion and debate. Its purpose is not to teach but to challenge and consider. To make its readers stop and think. To lead to new management recipes for the new IT service delivery challenges of the future.

Understanding the terms used in the book

I am assuming that readers of this book will have some experience of managing IT services and will therefore be familiar with most, if not all of the terms and concepts I’m challenging.

However that are some specific terms I have used repeatedly which, for the sake of clarity and consistent understanding, I feel I should explain before proceeding.

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Figure 1: Structure of IT Services

Summary of topics covered in the book

This book need not be read from cover to cover, rather it is a collection of challenges to conventional IT wisdom which can be dipped into as required. However all chapters of the book are very closely related. They are all contributors to the same ultimate goal. The key topics covered in the book are summarised below.

Customers

The IT organisation’s customers, in the form of Business Relationship Managers, must be at the centre of every action and decision the IT organisation makes. They are not there to serve the IT organisation’s purpose, but rather the IT organisation is there to serve theirs. Customers should not be considered a nuisance but be recognised as the reason for the IT organisation’s existence.

Too often IT staff value their processes over the service they provide to their customers. This may be because of remote location, lack of understanding of business needs, or failure to take cognisance of the wide range of requirements from the different business units.

To maintain a focus on delivering IT service value, the IT organisation must develop and maintain close working relationships with the Business Relationship Managers. Together they must differentiate between agreed IT services and consumer expectations. A source of conflict may lie in a disconnect between the business services as they are agreed with the Business Relationship Managers, and what the IT consumers expect their experience to be.

This experience should be defined in a consumer service charter so that the Business Relationship Managers can articulate what the business services are, and how they will be delivered. Satisfaction surveys should then measure IT service delivery against the Service Catalogue definition and consumer experience of those services against the consumer service charter.

Chapter 1 provides an example of where process has ignored the best interests of customers. It describes the need for collaboration between the IT organisation, the Business Relationship Managers and its consumers and why the distinction between expectation and needs is necessary. It explores why IT organisations must consider themselves as competitors in the IT service provision marketplace and why satisfaction surveys do not drive superior IT service delivery.

Service Management

When people think of IT service management they invariably think of ITIL processes. ITIL is still the de facto standard in IT service management, although it is almost 10 years since the latest version was published. In recent years a new set of disciplines and processes has emerged based on ITIL.

SIAM, or Service Integration and Management, is evolving to address the issues of multi-source IT services which ITIL does not address. But in discussing IT service management, it is essential to have a clear understanding of what an IT service actually is.

Chapter 2 explains what IT Services are and the IT Service Assets they are comprised of. It explores why ITIL is no longer sufficient for the needs of a modern IT organisation and what gave rise to the emergence of SIAM. It also challenges the description of ITIL V3 as a lifecycle and explores challenges and approaches to implementing IT service management processes.

Governance

The key to the success of any IT organisation is the maturity of its IT Service Governance. IT Service Governance is the means by which the IT organisation assembles the right people to make the right decisions at the right time. It is not simply a schedule of meetings but a formal structured framework which drives performance, service delivery, cost and risk management, resource optimisation, etc. on behalf of the business. Without IT Service Governance the IT organisation operates on the basis of hope rather that capability.

Chapter 3 explains what IT Service Governance is and how it fits into overall Corporate Governance. It describes the three layers of the IT Service Governance Pyramid. It explains the relationship between IT Service Governance and IT Service Assets. It also looks at some of the common reasons why IT Service Governance fails.

Processes

Processes are predefined sets of desirable behaviours for specific situations. These processes are the means by which IT organisations operationalise IT service delivery. One of the main challenges for processes, is that IT services delivered by different IT organisations will consequently differ from each other and so a single process may be more or less appropriate for a given set of IT services.

Defining processes is a relatively easy task. Implementing and embedding them, on the other hand, can be extremely challenging for many reasons. It can be the culture of the IT organisation, it can be ‘best practice’ advice, it can be the implementation approach, or it can be a combination of all of these.

Processes are necessary to deliver consistent levels of IT services. Getting it wrong can have two main consequences. Firstly they do not achieve the intended outcome. Secondly, they create a process industry in the IT organisation where process compliance takes precedence over IT service quality.

Chapter 4 suggests a means to classify IT services so that processes can be designed to be effective for the different classifications. It also examines seven common causes of the failure of IT service management processes.

Reporting

IT Service Information Reporting is an essential tool for managing IT services. It is also the basis for IT Service Governance decision-making. A major mistake IT organisations make is to report metrics just because they can, regardless of the value of reporting those metrics or their relevance to the target recipients of the reports.

IT Service Governance decisions are made on the basis of information provided. Very often the quality of decisions is directly related to the quality of the information received. The vehicle for information is often reports. Therefore the quality of reporting directly influences the quality of decision making. Poor reporting equals poor decisions.

Chapter 5 explains the acronym CRUSHCRAFT to define the characteristics of good quality information. It describes the IT Service Reporting Pyramid and its alignment with the IT Service Governance Pyramid. It discusses operational, tactical and strategic reporting and what each type should consist of.

Third Parties

Most, if not all IT organisations now depend to some degree on third party service providers delivering technical services, which contribute to the delivery of business services to the business.

However, many outsourcing engagements fail to deliver on their commercial or value proposition. In order to realise a multi-source services model, IT organisations must rethink how they engage with third party service providers.

Chapter 6 examines where the outsource engagement begins to go wrong and how to avoid the causes. It explores common mistakes in Requests for Proposal (RFP) and explores an alternative to common practice which will set the engagement up for future success.

Using a fictitious company, Chapter 6 describes how an unscrupulous third party service provider might operate to their own advantage. It also describes how to approach integrating third party service providers and how to avoid being locked into any particular one.

Management

Management is a core competency of any IT organisation but too often managers can be the source of mistakes or poor performance. Compromise is considered by many to be a recognised skill of a manager, but compromise can have disastrous long term impacts on the IT organisation.

Managers, because of their position in the IT organisation, can be expected to be multi-disciplined yet they are often provided with insufficient training to meet these expectations. Because of the pressure they can be under, they are liable to make mistakes like everyone else. In recognising their mistakes, the causes and conditions for the mistakes must also be recognised.

Chapter 7 challenges the wisdom of compromise and explores the influencers on managers’ decision-making. It emphasises the lack of manager training and identifies some of the