service management and sla's for global customer support

8/13/2019 Service Management and SLA's for Global Customer Support www.bobpanic.com

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Service Management and SLA Standardisation Considerations - Manifesto for Local

and Global Customers by Bob Panic Whitepaper

Having a standard global service support, Service Level Agreement or SLA is an admirableaim.

You may soon find however that only 80 or 90% of a defined SLA can be consistent if youhave more than one office. This makes the creation and establishment of a set of globalSLAsfor an organisation that has a national or international footprint, a bit of a challenge.

In this whitepaper I make a case for specific, targeted SLAs and service offering dependingon business unit or vertical.

Businesses, in particular highly complex organisations, those who have many specificproducts or models, are now moving away from a centralised model towards a silo model.Silos, if done well, make a lot of sense from a business perspective.

However support and the provision of technical or business support needs to be centralised,running parallel or in an umbrella fashion (enterprise view) to business verticals.

However having a centralised business and technology support service does not mean thatyou can create one size fits allor cookie cuttergeneric solutions and service offerings.

Service provisioning is a service and as a service it must cater to specific, individual demandsof the business or key stakeholders, no matter the perceived pain points

You will need to factor in unique local issues and concerns: customs, laws, technology (or thelack off), latency, technology disparity, skills disparity etc.

Few key things to keep in mind:

Do not fall into the trap to set SLAs in isolation to the business, the business needs tobe involved in the entire support process in fact, the support agreements are ALLfor them!

Avoid the big bang approach to SLAs. More important to the implementation ofSLAs, is the effective use of them

Work with the business, work with your vendors, work with your management andwork with your operational support teams (the doers!)

Senior management support of SLAs is paramount! Penaltiesare the cornerstone of effective adoption of SLAs. If there are nopenalties

there may be no incentive for adoptionSLAs that biteare SLAs that matter!

SLAs mustbe measurable; if you cannot measure, you cannot ask for a service levelto be established! Human nature will resist change and even more so if we are forcedto comply to service levels that cannot be effectively managed or reported against

Challenge no.1:

The challenge is to measure customer satisfaction not just meeting of service levels.

This may need a 1 on 1 approach (Usually surveys or workshops)


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Service satisfaction workshops and web portal are also a great way to measure intangible

benefits of a functioning Service Centre and SLAs!

Thought leadership Question:

Think about SLAs in relation to every element of the business not just technology! Forexample: the outage of electricity in a branch is more serious than a IT or business systemsserver going down. Why? Servers and technology or business systems, in all probability,would be under your direct control. The biggest effects to the business are services orsystems that are outof our control.

I suggest therefore that effective service levels that are provided from a Service Centre (orcall centre/help desk), will need to take on Black Swanevents (Black Swan are reffered toas events that are highly improbable, unknown in nature and completely devastating to the

business).

I know that this borders on Disaster Recovery and Business Continuity discipline, but there isa strong link to service management and the management of service centres.

Some of the questions will be hard but I find that hard questions open discussions and that isone of the key success factors/elements of a successful requirements gathering workshop/s

Key questions and principles of Service Management:

What risks can we take? = What are acceptable risks to the business?

This is a great start to the SLA conversation and must occur with the entire business. Justbecause one part of the business is happy for a server to have an outage, someone else in theorganisation may have an application on that particular server that is critical to their work.So a holistic, enterprise view is needed before SLAs can be established.

In fact, sometimes, the most basic service, one that we never thought would be businesscritical can be one that is a literal life saver!

Example: Recently I did a Service Requirements Audit including understanding corebusiness and IT systems and services. I was surprised to learn that the most criticalapplication for a specific remote branch/office was the internet.

I asked the manager to qualify.

The office staff absolutely relied on the internet to access news services. Why was thisimportant? Being in a tropical area, the office would be regularly shut down due to deadlycyclones! The reliance on the internet was not business related, but was imperative for thehealth and wellbeing of office staff that had to evacuate the office before the storms hit!

Thought Leadership:There are NO stupid questions!

So you may need to ask out of the box questions, in particular from long standing

operational (front line staff) not just management.


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To identify acceptable risks, you need to know what are the Core Business Systems that thebusiness cannot live without. Post the question If I was to unplug server x or application y,

what effect would that have on you!

Key questions and principles of Service Management: the focus now turns on frontlinesupport, the Service Desk (if ITIL aligned) or call centre/help desk

Why/How is Service desk best-placed to manage them? = do we have capability, do we

have capacity, do we have the will?This is a fantastic question and is one of the first questions that you will need to answer.There is no point in going to the business and doing research on service requirements, only tofind a lack of capability to provide the service!

This may be harder to define and articulate that you may first think.

We ALL provide a service! This is the absolute truth to life. We are all servants to someone.We all serve. However some of us are better at it than others. That is partly due to training,experience, personal attitude, aptitude and just plain common sense. I believe all things can

be taught if there is a willingness to be educated. An audit can be performed on existingavailable skills and a compare can be made with the needed skills. Note: if the service centreis not currently coping with requests for service, new stricter SLAs will only highlight thoseservice gap capabilities! A great tip to see for yourself if a service desk is coping withrequests and how it is servicing those requests, try sitting quietly near the team and justobserveit is amazing what you may see, so be prepared to be shocked!

So how far we can, or should we go, to provide more structured services and ourpreparedness for being put under the spotlight if we dontdeliver.

- What can service desk warrant or guarantee? How / why?The simple truth of warranting and suppling a service is all around the simple ability to

provide what you CAN provide!

To offer less is a disservice.

To promise more and not deliver is the biggest failing that you can make! Under promiseand over deliver is the mantra that you should always start the day with. The reason why

business is constantly upset at IT, is that they are oversold services, they expect that levelof service day1! Business is sick of non-delivery of services. So do not promise what you donot have.

We need to be open and transparent in what we can do TODAY but with a commitment toprovide a higher level of service TOMORROW! You need to know what you can delivertoday, what you need to deliver to meet ITIL standards, and what you need to do, to complywith customer demands.

In my experience once you start to do an As Is audit (current state audit or current State ofthe Nation) and compare to ITIL requirements, you will notice that there is a lot of what I

call good practise by osmosis orput simply; human nature is such that in majority we will


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do the right things most of the time. The problems that I see are that we either do too muchgood will, or adversely, not enough good behaviour.

Too much good will is problematic if one individual is specifically doing more than needed,this Martyr complex causes issues when you define business processes or stipulate SLAs

that are perceived by the business as less that currently provided.

What people fail to recognise, is that individuals or teams can only be martyrs for so longbefore they suffer from burn out or they provide exceptional service to the customer but donot document their actions and resolutions in a central knowledge database. This isunacceptable from both a management perspective, from an ITIL perspective, and mostimportantly, from an Audit perspective!

Everything that we do needs to documentable, measurable and auditable. We need to storeand share knowledge.

The service desk being willing to warrant service needs to be part of their Service Charter.A Service Centre (or Help Desk) Service Charter should be created as this is a corecommitment by the Service Desk to provide services to the business.

The Why is a combination of understanding the nature and the extent of the Service Deskand its services, to the business. Whyis a commitment that the service desk makes to theorganisation to provide services, at agreed levels and therefore justifies its existence as a costcentre

What conditions or precedent must be satisfied in order for service desk to provide such

warranties or guarantees?The ability to satisfy a warrantee! Going back to my previous comments: Do not offer whatyou cannot deliver! Further comments below should provide some context around what weshould warrantee, who should provide the warrantee and to what extent.

What risks does the customer take?The ultimate risk that the client takes on is; if they do not fund a Service Desk of some kind,or some form of business and technology support, would mean that any issues will be dealtwith by happenstance (luck), the internal ability of available staff to resolve issues and thesimple goodwill or individuals and abilities of those individuals.

To understand this from a business perspective, no business investment would occur if aproduct or service is solely based around luck as the basis of financial return!

Can you imagine a board of directors allowing a $100 million investment on a project whosesole return is based around Luck, Goodwill and basic hope in uptake?

Business understands three basic truths:revenue, market share and profit!

Blind luck does not generate revenue, or builds market share nor generates profit.

The question to pose to the business is this: what would the cost to the business be, if you

DO NOT have an effective service desk policy or investment, who will support you then, andwhat is the potential cost of non-support? You can create $ figures to support your cause as


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In the past I have created a Service Desk Operations manual with the guiding principlesstated within the document.

My interpretation of Lean thinking is all about being efficient and effective. Being adaptiveto changing situations is also part of my interpretation of Lean thinking.

Business processes 1st

have to be defined and utilised and then as part of processimprovement process, looked into being made more Lean.

Until a process has been used consistently (discipline) can it can then be made more effective.

Establishing good working practice and discipline is more important than Lean processes, asa Lean process used ineffectively is not Lean at all, however an ineffective processesfollowed consistently can be quickly reviewed and a new Lean process can be established andfollowed and the discipline is there.

As a specialist in change my biggest hurdle is not establishing Lean or efficient processes, but

the problem is usually a human one, where individuals who are resistant to change refuse towork within the new framework.

Overcome the resistance to change and change will happen.

Establish good working behaviour and discipline and Lean Business processes will happen byosmosis

I touch again on incentives for better than expected service. Exceeding SLA s should becelebrated as it is a rare occurrence but one that should be more prevalent in the industry.There is significant comment on penalties in my manifesto, so much so that it might beconsidered by some as a manifesto in itself. So before I rip into service failure, I want totouch on the positives and rewards of great service

Should we seek incentives for delivering better than the SLAs, and / or penalties for

breaching them?

Penalties are the absolute core to effective service levels! I believe that without penaltiesthere can be no effective way to enforce SLAs other than goodwill and learned behaviour.

Business today cannot and should not function on the basis of goodwill, good learnedbehaviour and best efforts!

Service management will consistently fail Audits if effective penalties are not enforced andstipulated in contracts.

I have a saying if its not in the contract, it doesnt exist!

Incentives:Exceeding SLAs needs to be recognised by the provision of incentives.

Incentives need to be added to any SLA that has been exceeded by 10% (or by a % agreed toby the business/and service provider) and consistently excided i.e. it cannot be a one off

event, but a pattern of consistent and measurable improvement.


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Incentives can be in the form of recognition, monitory rewards (in particular for consistentlymeeting and exceeding SLAs). With regular review the bar for SLA incentives is raised tooperational capacity, so in time the incentives will dissipate as they become Business asUsual and part of the service DNA. It is then that the penalties that will really keep theservice level bar high as time goes on. And I have a lot to say about penalties!

The following is a seminal piece on penalties and my absolute belief that this topic is verymuch left on the back burner in service management discussions. We learn from ourmistakes. Penalties enforce those learnings by burning them into our collective memory.Though we do remember and celebrate success, it is basic human nature, perhaps a survivalmechanism, that we remember our failures. The key of course in remembering failure is toextract the learning and move forward. This is why I feel that penalties are rarely spoken off.The concern is that too much focus will be on finger pointing and not enough on lessonslearned. An impartial individual, company or auditor can assist in Lessons LearnedWorkshops keeping the focus on continual improvement not on continual blame

Penalties:Strangely enough penalties are my biggest focus as part of any of my service initiatives, in

particular penalties aimed at external vendors and service providers who provide services forwhich the business pays for.

Believe it or not, the majority of contracts that I have reviewed from both big players to smallsuppliers/vendors omit penalties.

Most dont even have SLAs either!

However even those who do stipulate SLAs, do not state what penalties are in place for non-conformance, and even if they do the penalties are minimal!

The service industry as a whole globally needs to do a lot more in relation to penalties, sothere might be an uphill battle.

However, I now have the GFC (Global Financial Crisis) to call upon. Business is tight andcompanies are now begging to do business with the companies I consult for, especiallycompanies like mining and utilities (essential services) that are still spending and spending

big!

At the end of the day your company always holds all the cards in contract negotiations,especially with offshore suppliers (i.e. from India). I am a master contract negotiator andhave worked on small contracts for supply to $100 million service IT contracts. We need toremember that we cannot just leave the contracts with Lawyer or the legal team; they aremore concerned with other features of the contract and rarely look at service penalties.

What is the point of penalties?

To give you context let me give you this scenario:A business is reliant on information technology to service their clients. They chose to do so

by the internet (SaaS based product), the product sits on a highly redundant servers with DR.


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However the SaaS solution is provided by a local software development house that usesresources in India. Your company services 1000 customers daily via their SaaS portalgenerating $100K per day in revenue.

The site is a global site and needs to be up 24x7x365, which is no problem as it is on a highly

redundant servers and infrastructure.

However the point of failure in this scenario is the software developer, which is usingproprietary software solution and work from 9am to 5pm with minimal out of hours support,however in this instance they offered your company 24x7x365 service this is great

however the developers in India only work from 10am to 7pm Mon to Friday and arepotentially in a different time zone. This is where the biggest losses can (and do) occur

The application, if it has a considerable defect that causes severe service disruption and needsspecialist development expertise, and none of the local developers can help then it will needto go back offshore for the right resource to assist, chasing down that person could be

difficult.

Let me go further there is only one specialist resource that can help you it is now two

days that your system is down and $200k loss is the least of your problems as the user basehas dropped from 1000 to 800 and they are angry! and then it gets worse the singularspecialist and subject matter expert, who is located in India, all of a sudden is taken violentlyill and goes to hospital in a comayou are now without a specialist and the contract that youhave with your local supplier/vendor has no provisions inbuilt to service your needs in thisrespect and have a best efforts clause. In this instance even legal action is of little

consequence as they can prove that they have made every effort to resolve the issue (Thisscenario is based on a true experience that I had about 10 years ago and completely changedmy service management focus and business consultancy!!)

The art of service levels is to understand the underlying risk to the business of not providingthe service rather than setting service levels and reporting on them

It is of the most critical nature that you look at worst case scenarios for each service andfollow the trail of operational service to the actual individual performing the task (micro leveltask performance). Here in Australia for example there are many providers of cheaptelecommunication services, however there are only 3 telecommunication companies that

provide and own the physical infrastructure (letscall them wholesalers) who then sell their

services to the vendors you engage. It is not your vendor that actually provides the physicalcommunication service, they just on-sell them. This is great when it comes to the sell butis problematic when it comes to repairs and resolution of complex issues. It is these complexissues, especially in remote areas and suburbs in Australia that cost the most money to fix,cause the biggest delays and account for the largest losses in revenue and business goodwill.

Penalties also lead to questions of serviceability from vendors and questions if the vendor hasadequate insurance or funds to cover potential losses and legal action.

Penalties need to include losses incurred not just from revenue loss, but loss of goodwill, lossof market share, long term vs. short term losses etc quite a mine field


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However I have a motto any service level is better than none. Any penalty is better than

none you need to start somewhere and you need toinform the business of the potential risks.

As long as you have done this (in writing) and they (the Business) have accepted the risks (inwriting), then you have done the best that you can.

Sometimes for business to succeed they need to take risks, they need to engage up-and-coming companies who are young and dynamic and create services in an Agile way to be

first to market, so there is room for risk, including high risk; but it is always worth discussingthose risks and agreeing to the potential results of non-compliance of SLAs.

What processes do we want service desk/the customer to follow?The question should be more to what processes that we can establish that need to befollowed?

Business processes and service processes can be defined and agreed. This is a critical

learning. Do not create processes in isolation.

Dont just follow what ITIL says that you should do to in the context of a Service Centremanagement, ITIL should be a guide, ITIL should be a minimum and they should bemodified to specifically reflect your unique business drivers.If you and the business agree on a process, the expectation is that both parties will follow the

process. If this is found NOT to be the case, then the business process is not valid or notappropriate and should be re-developed.

Keep in mind that Change is the only constant and just because you have created a process

or defined a role or service that it is set in stone. My interpretation of lean processes is thatthe process itself does not become the blocker to getting things done.

I believe in Kinetic Principals of the Enterprise (or business)

1. Serve the individual customer2. Act in zero time

There are many sub elements of Corporate Kinetics, but they all point to the ability to be ableto adapt to change (be it business demands, market forces, forces beyond your control) andreact in an instant to those changing demands.

The process of defining and redefining SLAs never stops changing, it should NEVER stop

evolving and everyone involved both business and technology, need to accept that fact, andbe supportive and prepared, and understand that this is just the beginning of a long journey!

This journey concept needs to be sold to the business as they need to accept that for theservice they receive that allows them to do business, that there is an expense involved, and acommitment to them from a people availability perspective.

Most of my engagements for service levels and service support is all about talking to thebusiness what is it that we are trying to achieve from the service centre, that it is more than

just good customer (or improved) service it is a philosophy and discipline of support thatwe are providing to the business.


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Bob PanicPrincipal Consultant

Mob: +61 (0) 424 102 603 (24x7x365)

Email: [email protected]

Web:www.bobpanic.com

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service management and sla's for global customer support

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