CHAPTER 1
INTRODUCTION
1 Introduction
Definition: Value
The perceived benefits, usefulness, and importance of something.
Service management is about co-creating value. Technology is used to support value co-creation, but defining value can be challenging in the IT industry. In the past, much of the focus has been on cost effectiveness, basic functionality, or innovation. Currently, however, speed and flexibility are the differentiators between valuable and less valuable services. This may shift in the future to areas such as security, human centricity, increased automation, etc. Moreover, as the definition of value is continually changing, it should be continually revised and clarified.
ITIL 4 takes a holistic approach to building and modifying technology-enabled services from demand to value. This publication is about utilizing service management, adapting and adopting best practices, and using the ITIL service value system (SVS) framework to facilitate value co-creation in organizations. The publication is a practical guide for those who work within the broad scope of technology-enabled services. It provides clear guidance on how to collaborate and coordinate efforts to design, build, and support integrated and effective products and services, building from ITIL Foundation.
ITIL 4 describes a service value chain of six activities. These activities can be combined in various ways to create value streams. This publication covers the integration of these activities in order to enable the creation, delivery, operation, and continual improvement of technology-enabled products and services. It is important to understand that there is no uniform approach to successful service delivery. Context, requirements, and resources vary across organizations. Success in service management requires pragmatism and creativity, not doctrine and dogma.
This publication describes not only how value streams can be built and managed holistically but how continual improvement iterations and feedback loops can be included in value streams. It explores areas such as development, testing, knowledge, customer and employee feedback, new technologies, sourcing, and ways of managing work. In so doing, it reflects new ways of approaching service management.
Previous knowledge regarding IT and service management processes does not need to be discarded. Much of this knowledge is still useful and can be refocused on the wider context of practices. In response to an evolving world, IT and service management need to be used appropriately, flexibly, and in new ways. Service management today requires an open mindset and more collaborative ways of working. As the practices and approaches for the co-creation of value are constantly evolving, IT, digital, and service professionals need to keep up to date by developing their skills, knowledge, and definitions of excellence. This publication therefore focuses on individual and team professionalism, culture, and service mindset, and will examine the value and methods for ensuring sustainability.
The ITIL story: Exploring new opportunities
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Henri: The world is changing. The speed of innovation, digitalization, and evolution of technologies, alongside increasing customer demand for faster and better services, creates opportunities and uncertainties for modern service providers. To remain competitive, Axle Car Hire must react with thoughtful solutions that look to the future. |
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Radhika: Right now, across the world, city centres are transforming modes of travel. Investment in infrastructure is impacting the demand for car hire in many of our locations. We are competing with innovations such as driverless public transport, bike lanes, and pedestrian-friendly city centres. |
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Henri: Our vision is to be the most recognized environmentally friendly car hire brand in the world. We are treating these potential threats as opportunities to expand our service offerings. We already have several green initiatives underway, and we are preparing for a future where every business is required to operate sustainably because of market forces or legislation. We are currently exploring modes of transport that utilize clean energy. |
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Radhika: Bike hire has become increasingly popular in Europe and across the US. We want to explore the demand for a new bike rental service at Axle. |
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Henri: Prior to any large investment, we always run a pilot to test the feasibility of the service. This helps us to identify whether Axle is ready for a full-scale implementation across all of its branches. Piloting a bike rental service will help to determine the potential value of this service for our customers and for Axle Car Hire. |
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Radhika: We developed a set of selection criteria to determine which Axle branch would work best for our pilot. Our selection criteria included the local infrastructure, such as the proximity of bike paths, and whether we had adequate physical space in each branch to house the bikes. |
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Henri: Staff culture was also a consideration. Our staff needed to be willing participants so we could achieve the outcomes from the pilot. |
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Radhika: Our branch in Montreux, Switzerland was perfect for the pilot. The region is well known for its love of cycling and the city already has a supporting infrastructure. Tourist numbers are on the rise and staff morale at the branch is high. |
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Solmaz: To accurately analyse the potential impacts to Axle’s existing services and uncover any unexpected results, we need a team with the right mix of skills and knowledge. I would like such a team to work collaboratively, focusing on how we can create value for our stakeholders. The team would gather feedback from our customers and record how they actually use the service. We would also need to identify potential pain points in our workflows; this approach would allow us to design the most suitable service. The pilot may require several iterations as we work out how to respond to customer demand. |
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Radhika: To better understand our customers’ motivations when they hire a bike and to discover how our customers perceive value, we started with a survey. The responses highlighted several findings, including: • over 70% of our customers prefer to hire a bike rather than own one • more than 30% would consider hiring a bike for their city commute, especially if it was an electric bike. This is something we hadn’t considered before • over 40% would consider hiring bikes as part of a car hire package when they go to the countryside • more than 50% don’t currently own a bike or have a bike for every family member • only 3% of customers own an electric bike or would consider investing in one themselves. From the findings, we were able to gain some valuable insights. For example, our customers would enjoy the option of an available bike, whether or not they already own one. Plus, a large percentage of respondents were worried about climate change and indicated a strong desire to reduce their carbon footprint. This fits perfectly with our vision for Axle Car Hire as the world’s leading environmentally friendly car hire company. |
