Skip to main content

“Opportunity is missed by most people because it is dressed in overalls and looks like work.” – Thomas A. Edison

I first heard the term Chief Service Officer when I was working on a benchmark for one of America’s largest insurance companies. What’s a Chief Service Officer, I asked, and who is it?  “Oh, she heads up the enterprise service desk; she’s in charge of customer service for IT, claims, HR, payroll, facilities, and regulatory compliance.”  It was an ‘aha!’ moment for me, and one that changed my perspective on customer service forever.

Since then, corporations, non-profits, and government agencies, large and small, worldwide, have embraced the concept of enterprise service management.  Moreover, this global megatrend represents the greatest opportunity in a generation for the customer service and support industry.  If you’re a customer service professional and have longed to play a bigger role on a bigger stage, to make a significant impact on the success of your enterprise, I have great news for you.  That opportunity is finally here, and it’s called enterprise service management (ESM).

Please note that I make a distinction between enterprise service management, which is the broad discipline of managing your enterprise services using proven best practices, and the enterprise service desk, which is the organizational and functional entity that executes your ESM strategy.

Enterprise Services Defined

Imagine being able to call one number or click one button on your phone or computer to access any enterprise service.  Locked in the parking garage on the weekend?  Lose your ID badge?  Can’t get your computer to boot up?  Filing for a leave of absence?  There’s just one number to call.  And regardless of the nature of your issue – HR, IT, facilities, security, etc. – you receive prompt, consistent, high quality service.

Or imagine being a customer who needs immediate service, whose supply chain has been disrupted, or who has received a damaged shipment from your company.  Wouldn’t it be convenient to call a single number, send a single text message, or send just one email to resolve the entire issue?  Additionally, wouldn’t that improve the customer experience and lead to greater customer loyalty, repeat business, and market share?

And finally, would your suppliers benefit from the same one-stop-service that your employees and customers do?  Of course they would!  What I am describing is the burgeoning field of enterprise service management – a business discipline that incorporates best practices into a standardized model for fulfilling all enterprise services.  These services are most often delivered thorough a single point of contact (SPOC) enterprise service desk.  The enterprise service desk is not just a SPOC for the employees of your organization, it is a SPOC for all of your key stakeholders – employees, contractors, vendors, customers and others.  And it’s no longer just a hypothetical pipe dream.  It’s here…it’s happening…right now!

The Business Case for ESM

There are two primary drivers behind the global ESM megatrend: 1) economics, and specifically the lower cost of delivering services from an enterprise model, and 2) the maturity of IT service management (ITSM), and the applicability of ITSM principles to non-IT services.  Let’s first discuss the economics of ESM.

I have yet to see a credible economic justification for ESM.  Instead, what I hear are bromides and clichés about an improved customer experience, a streamlined process, and other subjective benefits of ESM.  While these subjective benefits may be real, I have always believed that if you cannot quantify the business case for doing something – particularly something as all-encompassing as ESM – you shouldn’t do it.  Fortunately, there is ample economic justification for embracing and adopting an ESM strategy within the enterprise.

You have probably heard the expression “Better, Faster, Cheaper”.  It’s a pithy way of describing any beneficial change, whether it be disruptive change (e.g., the advent of the internet) or the more incremental change known as continuous improvement.  It sounds like a cliché, but there’s truth behind this catchphrase.  Better means higher quality.  Faster means quicker fulfillment times.  And cheaper means lower costs per transaction.  Cost, quality, and cycle time are, in fact, the three dimensions of competition.  And any valid business case – including the adoption and implementation of ESM – must demonstrate measurable benefits in one or more of these three dimensions.

Enterprise service desks are being implemented worldwide, not just because there is a mature IT service management discipline that can be followed (more on this later), but because the economics of enterprise services make sense.  Numerous examples from my own experience, comparing the before and after for organizations that adopt ESM, provide compelling evidence of cost, quality, and cycle time benefits.

Some of the world’s largest corporations, including DXC Technologies, Siemens, and EMI Music Publishing have reported significant benefits from adopting ESM.  These include streamlined delivery of enterprise services, cost savings, and a dramatic improvement in the customer experience.  A survey conducted by HDI asked: “How has productivity changed since expanding service management outside of IT?” The majority of survey respondents stated that their organization had seen a productivity improvement, with:

  • 75% of organizations seeing an increase in productivity
  • 23% of organizations seeing no change
  • 2% of organizations seeing a decrease

Productivity is, of course, a proxy for cost.  So, as productivity improves, costs go down. One of the primary economic benefits of ESM is that it returns productive hours to your employees – it saves them time.  An effective IT service management discipline has been shown to return as much as 30 productive hours per employee per year.  Now multiply this across the numerous non-IT enterprise services, and it’s not unrealistic to expect ESM to return 50 or more hours of productivity to every employee in the enterprise.  This would be the equivalent of adding at least six work days to each employee – every year!

Since there are approximately 245 workdays per year, after netting out vacation and holidays, an increase of six business days of productivity is substantial.  It equates to a labor cost savings of 2.4%.  Sound small?  Think again.  With a net margin of just 6.9% in the S&P 500, an improvement in labor productivity of 2.4% can add substantially to the bottom line of any enterprise!

Moreover, this is just one quantifiable benefit of enterprise services.  Others, albeit more challenging to quantify, include improved customer loyalty and repeat business, positive word-of-mouth referrals, shorter supply chains and reduced supply chain errors, and quicker fulfillment times on customer orders.  So compelling is the business case for enterprise services that the question is no longer when are you going to embark on your enterprise service management journey, but rather why have you not already begun or even completed your transformation to ESM?

Join us next month for The Role of IT in Enterprise Services.

Jeffrey Rumburg

Jeff Rumburg is a co-founder and Managing Partner of MetricNet, where he is responsible for global strategy, product development, and financial operations for the company. As a leading expert in benchmarking and re-engineering, Mr. Rumburg authored a best selling book on benchmarking, and has been retained as a benchmarking expert by such well known companies as American Express, Hewlett-Packard, General Motors, IBM, and Sony. Mr. Rumburg was honored in 2014 by receiving the Ron Muns Lifetime Achievement Award for his contributions to the IT Service and Support industry. Prior to co-founding MetricNet, Mr. Rumburg was president and founder of The Verity Group, an international management consulting firm specializing in IT benchmarking. While at Verity, Mr. Rumburg launched a number of syndicated benchmarking services that provided low cost benchmarks to more than 1,000 corporations worldwide. Mr. Rumburg has also held a number of executive positions at META Group, and Gartner. As a vice president at Gartner, Mr. Rumburg led a project team that reengineered Gartner’s global benchmarking product suite. And as vice president at META Group, Mr. Rumburg’s career was focused on business and product development for IT benchmarking. Mr. Rumburg’s education includes an M.B.A. from the Harvard Business School, an M.S. magna cum laude in Operations Research from Stanford University, and a B.S. magna cum laude in Mechanical Engineering. He is author of A Hands-On Guide to Competitive Benchmarking: The Path to Continuous Quality and Productivity Improvement, and has taught graduate-level engineering and business courses.

Leave a Reply

Close Menu