How ITIL Service Management saves Europe from the recession October 1, 2009
Posted by ivankamenken in itil, itsm.Tags: customer service, IT Service Management, customer, itsm, service management, money, SLA, recession
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After spending many years in the ITSM / ITIL space I notice that everything in time becomes a best practice, good practice or bad practice example of IT Service Management.
This week’s example has to do with Demand Management, Service Level Management and Financial Management.
The scenario is like this: I traveled from Australia (where I live) to The Netherlands (where my family lives) for a short family holiday.
As part of being in The Netherlands I wanted to do some shopping (no need to analyse my PBA’s to figure that one out!). And I did go to the shops:
1) Shop nr. one – doesn’t accept credit cards at all (what the?! All I have is a credit card, what do I do now?)
2) Shop nr. two – DOES accept credit cards, but only when you have a pincode to go with it (??? yes, I am sure the bank sent me a pin number but I never use it in Australia so I completely forgot it…)
So far the holiday has been very cheap for me.. I WANT to spent money… I HAVE the money to spend and I know exactly what I want to spend it on… but I can’t spend it!
As a client I know what I want – the demand is there. And the demand management process has analysed my PBA … the appropriate shops are available for me to purchase the products and services that I want. What is missing is the combination between Financial Management and Service Level Management. I was not aware of the agreed service levels prior to me going to The Netherlands. And as a result I am an unhappy customer who feels ill-prepared, not able to receive the service levels that I want.
As IT organizations we can learn from this:
- Communicate our Services and Service Levels
- Understand what your customer wants and how they want the whole customer experience to happen.
- Make it as easy as possible for our customers to pay for our products and services (now that I can only pay cash, I definitely spend less)
- If you can’t offer the complete experience – communicate this very clearly to your clients.
To top it all off…
Yesterday I came prepared to the train station… I had a 50 euro bill to pay for my train ticket! Very proud moment, I felt extremely empowered. Went to the ticket machine and made it all the way through to the payment point where the machine asked me to enter 24 euro worth of COINS in the slot as the only available means of payment!
sigh…
Revenue is great, but cash is king! October 10, 2008
Posted by ivankamenken in business.Tags: business, Cash, creditor, crisis, economy, management, money, Sales
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For the past 18 months or so I have been trying to have ‘cash’ as our quarterly theme but for whatever reason, it didn’t really work. And to be honest, you don’t want staff members to be only money driven… so we came up with another solution! We didn’t start the business purely for the money, and clients would feel the shift in core values when the company turns to purely a money making machine…
To give you a bit of background: The Art of Service works with the ‘Rockefeller habits’ methodology and we try to have a Quarterly theme to help improve how the business is running. The last few quarterly themes were around internal processes (customer service and client relation) and teamwork. But really, when I look inside, as the owner of the business I know that at the end of the day it is really important to have enough cash in the bank to stay in business.
So a few months ago we started thinking about a cash based quarterly theme. You can’t ask people to just focus on money as that is NOT what we are about… we want to be the Framework educator of choice for IT Professionals. In order to do that we have a strong focus on customer service, on helping people to understand the frameworks and standards so they can grow professionally. The money is a result of this, but NOT the main focus!
So how do you increase cash without being in business for money alone? You look at your cash cycle (taken from the Rockefeller habits):
- How long does it take to close sales? And, how much money is involved in the sales process (COS – Cost of Sales)
- How long does it take to develop the product or deliver the service that was sold?
- How long does it take to receive the money AFTER you delivered the service (as most product sales will be Cash on delivery or pre-payment)
- The sales team is coming up with creative solutions to improve the conversion % and due to our improved relationship with the clients we better understand their procurement processes. We may not quote as early in the process so when we do, the conversion happens a lot quicker. We also looked at different sales channels that may improve the time it takes for people to buy/purchase.
- Our time to market is getting better and better! Being an expert in your field (and recognized as such) really helps with the ability to customize our product and service offerings to our clients in a really short time-frame. We also use different development tools and techniques to improve the overall time to market (think cloud computing, SaaS and web-presence)
- Accounts receivable and debt collection is not just a job for the finance department. Everybody is involved with coming up with ways to shorten the time it takes to get the cash in our bank. Current improvement projects are: correct invoicing, creative payment options, online sales (credit card payment), stricter follow up after payment terms have been exceeded.
In times of economic crisis… don’t stick your head in the sand but HEAD FOR THE CLOUD! October 2, 2008
Posted by ivankamenken in cloud computing.Tags: business, Cash, cloud computing, economy, money, SaaS
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It has become apparent to me that Australia is still very much the lucky country. Yes we like to complain about the economic situation and the fact that the interest rates are around the 8% at the moment but overall I think we’re still going strong!
Why am I saying this? Well, I have spent the last 4 days in Hawaii and have experienced firsthand that the situation in the US is much worse than what is happening in Australia. And it is not getting better either… it will get much worse!
The resorts on the Big Island are at approx. 15% capacity, where 60% is needed to break even; many restaurants, bars and resorts have already shut their doors and the big story on the news this week is that most of the commercial rents will double – if not triple- in the next few months. This will have a major impact on the overall economy of the state, after all: it’s main source of income is tourism…
Australia is fairly sheltered, we have a lot of resources in the ground and there is always somebody who finds it… last week in the BRW young rich list the number 1 person is 32 years of age, came from nowhere and has now accumulated approx. 440 million dollars in personal wealth in the last 12-18 months. How? By finding coal (I think it was coal, but really – it could have been anything) and selling it to China… nice little ‘backyard operation’ which will result in a nice income tax bill no doubt… which means more money in the government account to support the country etc.
So, what does this have to do with Cloud Computing? Well, not a lot at first glance and everything when you think about it.
I run my business with my husband and this morning over breakfast (CEO council ) we were discussing how to prepare the company for things to come; the importance of cash in the bank at the moment and the ability to change gears and directions very quickly. It also brought to light the importance of a ‘lean’ business model: outsourcing your non-core activities and avoid purchasing assets that don’t actively create revenue (example: IT systems and solutions). When we focus on the IT solutions: we still want it to be scalable and have the ability to support the company’s business processes – no matter where the business will take us!
This led us to discuss cloud computing and Software as a Service solutions. When offered professionally, SaaS solutions are probably the way to go in the near future. They offer IT products on a ‘pay per use’ basis without the upfront expenditure (and depreciation) of purchasing expensive software and IT assets.
However, before doing this you will need understand WHY you need the IT solution in the first place and you need answers to the following questions:
1. What is it supposed to do?
2. Which business process is it supposed to support?
3. How many people use this system and is the subscription per user or per concurrent user?
4. What is the maximum number of users they support?
5. What IT infrastructure is expected to be present in your offices to make the SaaS solution work best?
6. What IT knowledge is expected to be available in your office.
7. What type of support does the provider offer?
8. What happens if the software doesn’t work, or doesn’t do what you expect it to do?
All in all, I don’t think these are difficult questions to answer and it sure beats having a lot of your cash tied up in purchasing the software licenses upfront! You’re much better off spending that type of money at the things that you’re really good at: development of your products and services and making money with them!
Show me the money… please. September 8, 2008
Posted by ivankamenken in Uncategorized.Tags: business, cashflow, itil, money, Sales, the art of service
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Maybe I am a bit of a push-over but I hate saying “NO” to clients, employees and business partners. I still want everybody to be happy and to have a good feeling about doing business with me. But I have to learn when to draw the line; sometimes this is easy as it is very clear that the other party is wrong and I am right. (like the time when one of our resellers was caught cheating) That’s when I get very strong and NO comes easily.
However, in other cases it isn’t so easy. I try to have a personal relationship with most of the partners we work with and I enjoy dealing with them. That is what makes it sooooo difficult when one of them doesn’t pay their bills. I know deep down inside that I can’t carry their business and that entrepreneurship isn’t just about revenue but also cashflow. But it is so difficult! They email me with 500 different reasons why they can’t pay me this week and usually I go for it. Yeah, it’s OK.. next week is fine. But this time it is different – this time I am choosing for my company and my employees. When the partner doesn’t pay, I don’t have money in the bank so I can’t pay my employees. It’s as simple as that. (at least that’s what I keep telling myself in order to stay focused).
But what do you do when they play the “guilt” card….. “our clients won’t receive their exams and this will reflect badly on The Art of Service because your name is on the course materials. Can you please send the materials so the clients isn’t negatively affected? I promise that we will pay next week”. That is when it gets really hard as I like these people and don’t want to say no. I would hate for them to be in a situation where you have to go to your client to say that they won’t receive the materials because they haven’t paid the bill…
But I stay strong – No is No and I am NOT bending. The rules of the game are simple: you pay and you get your stuff, end of story!
Now all I need to do is practise that line until I am ready for the phone conference this afternoon… wish me luck!
Ivanka
