March 28, 2016

Why in-house SIAM typically fails to achieve its objectives

Manish Kumar

Head Offering Management & Customer Enablement Consulting, Tieto

In a world that's increasingly getting digitalized, companies feel the need to play in ecosystems and partner with multiple providers. The life of the IT management is getting tightly intertwined with business management and there is an ever-growing need for effectively orchestrating the complex ecosystems to help meet or even exceed business expectations from operational IT services.

Most companies intend to take on this challenge internally with their existing resources and capabilities. This way, they hope to get a quick start with their Service Integration and Management (SIAM) journey. However, in most cases organizations realize that they are falling behind on their business objectives for digitalization and speed of change. The main reasons for that can be summarised in three points as below:

  1. Underestimating the scope of SIAM

    In a lot of cases organizations, while embarking on their SIAM journey, fail to understand the full scope that it should cover. They focus mainly on tackling the burning issues of managing a multi-supplier ecosystem. They miss out on the full scope of SIAM, looking at all the levels - operational, tactical and strategic. Paying attention to the full scope of SIAM will help to exceed the basic expectations from IT management.

    The full scope of SIAM can be seen in the picture below. It is then a choice for each organisation to decide what to do in-house and what to outsource for best results. Click the picture to see it bigger. 

    See my brief video on the topic.
  2. Overestimating one´s own capabilities

    The second most common mistake is to overestimate one´s own capability to deliver the full scope of SIAM services. At the start, organisations do not realise the quantum of change involved in terms of skills, process detailing and tooling that's needed to create an effective SIAM operation. Most of the companies tend to realise this once they start to scale up the scope of SIAM and get into the zone where they are not able to meet the growing demand of business and fail to meet the expectations.

    Another practical challenge is cost. Managing some of the operational SIAM activities could cost much more than using a specialised service provider with near-shore capabilities.
  3. Inability to focus on business priorities

    The main challenge when taking SIAM activities in-house is the risk of not getting enough bandwidth to focus on business priorities. As organisations embark upon their digital journey, they expect increased support and business participation from their IT department. The future of business is IT and the IT departments need to take this challenge and be more involved in business decision making around IoT (Internet of things) initiatives or artificial intelligence led activities and other upcoming opportunities. Taking on the burden of SIAM decreases their ability to focus and pay attention to such business needs.

It is important for companies´ IT units to look for a win-win formula with the right kind of balance between business priorities and being involved in operational IT management. The Tieto Sustainable SIAM model provides such an alternative, guiding organisations to choose between things they should keep in-house and things they should outsource to a SIAM service provider. The result will be a more sustainable form of business development supporting the duality in the world of IT services.

Companies should look at keeping the Business Value management activities in-house as much as possible, and on the other hand, outsource as much as possible of the Operate and Run part of IT services. Other areas should be decided based on business need and internal bandwidth available.

If you would like to know more about Service Integration and Management (SIAM) and what it can bring to your business, please register to our SIAM Breakfast seminar in Helsinki. You will get to know the latest in the world of SIAM and what to do in order to better align IT with business.

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