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service value chain

By AbhinavAnand25 Apr 25, 2014 589 Words

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Services are a means of delivering value to customers by facilitating outcomes customer want to achieve, without the ownership of specific costs or risks.

Outcomes are possible from the performance of tasks and they are limited by a number of constraints. Services enhance performance and reduce the pressure of constraints. This increases the chances of the desired outcomes being realized. Value is the core of the service concept. From the customer’s perspective, value consists of two core components: utility and warranty. Utility is what the customer receives, and warranty is how it is provided.


Service Provider

Transfer costs and Risks.

Takes on Costs and Risks.

Retains focus and accountability for

Responsible for the means of achieving

Service management is a set of specialized organizational capabilities for providing value to customers in the form of services

The service lifecycle consists of five phases. Each volume of the core ITIL books describes one of these phases. The related processes and functions are described in detail in the phase where they have the strongest association.

The five phases are:
1. Service Strategy- The phase of strategic planning of service management capabilities, and the alignment of service and business strategies. Processes and functions: − Financial management
− Service portfolio management
− Demand management
2. Service Design- The phase of designing and developing appropriate IT services, including architecture, processes, policy and documents; the design goal is to meet the current and future business requirements. Processes and functions:

Service catalogue management
Service level management
Capacity management
Availability management

− IT service continuity management
− Information security management
− Supplier management
3. Service Transition- The phase of realizing the requirements from previous stages, and improving the capabilities for the transition of new and modified services to production. Processes and functions:

Transition planning and support
Change management
Service asset and configuration management
Release and deployment management
Service validation and testing
Knowledge management

4. Service Operation- The phase of achieving effectiveness and efficiency in providing and supporting services in order to ensure value for the customer and the service provider. Processes and functions:

Event management
Incident management
Request fulfillment
Problem management
Access management
Monitoring and control
IT operations
Service desk

5. Continual Service Improvement- The phase of creating and maintaining the value for the customer by design improvement, and service introduction and operation. Functions and processes:
−The 7-step improvement process (CSI Improvement Process)
− Service reporting

In creating value chain for IT Enabled services we come across three already existing three industry standardsITIL: Information Technology Infrastructure Library eSCM-SP: eSourcing Capability Model for Service Providers

SCOR: Supply-chain operations reference
IT-enabled services can be combined in many areas of a company’s operations, the deliver process of the supplier can be connected to any other process of the company and could even

have some connections to the customers of the company. A classic example of this would be the outsourcing of call centers and help desk facilities. In this case, the third-party service providers’ delivery of help desk services could be chained with the delivery processes of the company’s own services and then link to the eSource services of the customer. Delivery of

company’s own
eSource by the
Delivery of call
centre service by
the supplier

Figure: Three-way (Supplier, Company, Customer) Relationship

Figure: Value chain diagram for IT enabled services as example

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