Service Innovation - Manage your Service Portfolio

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AWhitepaperfromAnerian,LLC.

January

2010

LeadingThroughServiceInnovation

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FormoreinformationcontactNaomiStanford(naomi.stanford@anerian.com)

ExecutiveSummary

ServicesarethedominantdriveroftheUSeconomy.AccordingtotheBureauofLaborandStatistics,servicesmakeup80%ofoureconomyandthe10industrieswiththemostdramaticsalarygrowthareallinservice‐providingsectors.Manyorganizationsprovideservicestointernaland/orexternalcustomersbutfailtoeveridentifythemselvesasserviceorganizationsandthusmissopportunitiestoleadandinnovateintheirmarketspace.

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Although

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servicesrequirethesametreatmentasproducts:designanddevelopment,testingandmarketresearch,andrefinementovertime,organizationsrarelyhaveformalprocesses,rolesandpracticesfordeveloping,managingorinnovatingtheirservicesasaportfolio.

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Additionally,organizationsthatofferproductshaveintroducedandadoptedformal,fulllife‐cycledevelopmentprocessesforbringingtomarketnewproductsandimplementingnewtechnologies,whichserviceorganizationshave,forthemostpart,failedtodo.Asorganizationsbegintoviewthemselvesasdeliverersofservices,theneedforthesameformalitiesproductorganizationshavebecomesmoreapparent.Withoutaformal,fulllife‐cycledevelopmentprocessfortheirservices,organizationsfailtomaximizereturnoninvestment,infusedisciplineintothedevelopmentprocessandmanageexpectationsandcustomerneeds.Wehavefoundthatsuccessfulserviceorganizationsadoptafewkeypractices:

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ServicesPerspective

–understandtheirbusinessasacollectionofservices(aportfolio),andhaveaclearviewonwhatdrivesservicedevelopment

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Innovation

‐infuseinnovationpracticesthroughoutthelifecycletobuilduniqueofferingstomaximizeconvenience,loyaltyandvalue

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Portfolio

‐managetheirserviceofferingsasaportfolio,muchasITandproductportfoliosaremanagedwithcategories,criteria,andkeymetrics,

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Process

‐adoptafulllife‐cycleprocessforserviceofferingsfromconceptinnovationandbusinesscasesthroughcheckpointreviewsatkeymilestones

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Culturalreadiness

–investtimeandeffortintoensuringtheirculturecanadapttothechangesthatinnovationrequiresConsequentlytheseorganizations’innovativecapacityandthevalueoftheservicestheyofferdependsuponastrategicmindsetthattakesintoaccounttheclarityoffactorssuchastheaudience,intent,scale,actorsandexperiencepersonaprovidedbyaservice.Thegraphicbelowillustrateshowtheseelementscombinetobuildtheserviceinnovationstrategy.

LeadingThroughServiceInnovation

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Inconjunctionwiththeelementsoutlinedabove,successfulserviceprovidersareabletounderstandhowaportfolioofinwardandoutwardfacingservices,respondingtoexternalandinternalfactors,combinetodelivervaluetothecustomer.Asanorganization’sinnovativecapacityincreasessoalsocanthevalueprovidedbyaservice.Weconcludethatadoptingaserviceportfoliomodel,usingafulllife‐cycleprocessforlaunching/improvingservicesandmostimportantlyemployinginnovationtechniquesimprovesbusinessefficiency,increasesreturnoninvestment(ROI)andsustainsapositiveclientexperience.