Is SIAM the Silver Bullet for Multi-Sourcing?

Stephen Chessell investigates SIAM as a solution to ongoing change in the IT landscape.

©iStock.com/scanrail 

©iStock.com/scanrail 

I was discussing the configuration of a Service Management tool with a customer recently, and they were concerned about a loss of control when managing external suppliers.

Client: When incidents and requests are allocated to a third-party supplier, can we pause the SLA?

Me: Yes, you can - but why would you want to?

Client: Hmm….

Me: Your customers don’t care who the record is assigned to – and aren’t they entitled to the same agreed level of service regardless of whether you’ve outsourced part or all of that service to someone else?

Service Delivery is Transforming

This is a symptom of the challenges we are currently facing. IT Departments are having to manage an increasing number of external suppliers while under pressure to maintain quality service delivery at reduced cost. And all this while delivering the rapid change that business demands, and with Shadow IT lurking around every corner presenting a range of support, security, and co-ordination issues. Market forces, such as Cloud (including PaaS and SaaS) only add to the complexity, accelerating the move away from the old centralised delivery model.

Customer expectations of IT are just like any other utility, it should work all the time, every time. They don’t care if you have assigned an incident or request to an outsourced supplier, they just want (and are entitled to) the agreed level of service.

IT leaders have a choice. Some will embrace these changes, and make the most of the opportunities they present. Unfortunately, many will fail to adapt and will lose the struggle to justify their relevance.

IT must redefine itself as not just another service provider, but as a broker that adds value by being able to supply efficient and effective services to meet business requirements. This requires the orchestration and integration of all services provided by external (and internal) providers.

Why you have to consider SIAM

For the past 20 years, service management best practice has been documented as a part of the IT Infrastructure Library (ITIL®). A key tenet of ITIL is to develop service management as a key organisational capability and as a strategic asset.

Service Integration and Management (SIAM) was developed following the failure of several large enterprise-wide outsourcing contracts in the early 2000s.

IT has always been multi-sourced, but that trend is continuing to increase dramatically.

SIAM seeks to manage IT in a consistent way, seamlessly integrating all services and providers to provide the end-to-end delivery which business demands.

Organisations often fail to consider the overhead associated with managing complex multi-supplier environments. This overhead is the integration work involved in coordinating, orchestrating and governing the service providers while still giving the picture to their customers that they are one IT provider.

This integration role is the essence of Service Integration and Management, and the effort it requires can be anywhere from 10-15% of the overall cost of providing IT services to the business. This is why you have to consider SIAM. For further reading on the question of ‘Why SIAM?’ check out my colleague Michael Billimoria’s piece SIAM: Transforming service delivery. The ‘new black’ for multi-sourcing.

What does SIAM look like in the real world?

The good news is that much of what is needed already exists and is within the close grasp of most IT leaders.

SIAM isn’t simply a concept. It is an actual function that bridges the gap between the business and multiple technology suppliers. The SIAM function can be either insourced, outsourced, or co-sourced. Its primary aims are to co-ordinate suppliers, manage service governance and ensure that supply and demand are optimised. To that end, it makes sense for the SIAM function’s performance to be measured not on the traditional service level (like response, resolution, availability etc.) but on business focussed outcomes related to service provision and customer satisfaction. This empowers the function to get the most out of suppliers.

The following diagram provides a high level view of what SIAM looks like.

Key Elements of SIAM

  • Service Management Strategy - a long term plan to implement the various elements required. Not all of this can be done at once.
  • Sourcing Strategy – a comprehensive plan including building internal capabilities, functions & roles to manage suppliers effectively.
  • A Service-Focussed Approach – organised around delivering the services required (Service Catalogue) at the level the business needs (Service Level Management) as well as the underpinning technology. Fostering a culture and environment where everyone can be successful.
  • A Lifecycle Approach – IT Departments have evolved from a purely Operational (and technology-based) focus. Transition, Service Design and Strategy and Continual Service Improvement are required for long-term Service Delivery planning.
  • Shared Goals and Targets – An alignment of purpose across all suppliers.
  • A common (or federated) Platform – Workable options to integrate all suppliers.
  • Service Co-ordination - A Service Management Office (SMO) that contains Service (including supplier) and Process Managers.
  • Governance – A common framework where all providers are assessed against their performance, measured for continuous improvement, and which addresses any changed requirements.
  • Data and Reporting – Reliable data and one source of truth for effective decision making.
  • Integrated Service Desk – A single point of contact and seamless experience for all customers.
  • Supplier Management – A rigorous approach to engagement (contracts), alignment (shared goals and targets) and management (effective governance).
  • Standards and Frameworks – Common processes and language embedded within supplier contracts. Based on frameworks such as ITIL, COBIT® and PRINCE2®.
  • Transition Capabilities – Ability to flexibly transition providers in and out as needed, with well documented ‘cookie-cutter’ processes.

How do you go about implementing SIAM?

For organisations that don’t have the in-house skills required, there are specialist partner organisations who can provide consulting support to build an internal SIAM function or others who can develop the function externally. A SIAM solution could be outsourced as a managed service or it could be established and then handed over once the organisation is comfortable with managing it themselves.

The ongoing use of multiple suppliers, and the increasing commoditisation of IT services, clearly isn’t going to go away. The requirement to coordinate supply and support efforts, and manage the complexity and interdependencies of IT services requires a concerted and formalised approach. SIAM provides a framework to take advantage of innovative and cost effective providers from the market place, while weaving them into the seamless IT services that the business needs.

There are a number of organisations that have recognised this and are implementing a SIAM approach and realising the benefits.

What is your organisation doing? 

About the Author

With nearly 35 years of experience in the IT Industry and 18 years in Service Management and Project Delivery, Stephen Chessell is an experienced IT Service Management Consultant, Practitioner, Manager and Trainer.

Stephen combines a wealth of knowledge in industry best practice frameworks (such as ITIL, PMI and PRINCE2) and related standards (ISO/IEC 9001, ISO/IEC 2000, and ISO/IEC 15504) with practical experience in delivering successful projects to guide organisations through implementing successful business change.