Internal Service Desks make Employees 47% More Productive with XLA?

Pasi gets hit with a watermelon! No seriously, an actual watermelon! In fact, the whole industry is getting hit with watermelons. In this episode Sami and Pasi discuss how Internal Service Desks make employees 22% happier and 47% more productive compared to Outsourced Service Desks.

Internal Service Desks make employees 22% happier and 47% more productive compared to Outsourced Service Desks, due to something known as the 'Watermelon Effect'. This is where companies are meeting the SLAs (the green of the watermelon) and everything seems fine, when actually employees are still encountering problems (the red).


Companies heavily focus projects on SLAs (service level agreements) which are the main reasons for the 'Watermelon Effect'. Instead, companies need to now focus on implement XLAs (experience level agreements) when measuring IT services.

SLAs focus heavily on completing an objective (i.e. tickets per hour) instead of focusing on the employee experience. If end-users tickets and problems aren’t being solved completely, then this will lead to a negative experience and a negative perception of IT. We explain more about the costs of a service desk ticket in this blog post.

This is due to IT working on attaining the KPI’s or SLAs, which are usually focused on how many tickets they can solve per hour or the amount of time spent on each individual ticket. This kind of metric may appear to be impressive, however they may not be solving the end-users case, leaving the end-user with a negative experience.

And this is where the differences in Internal and Outsourced Service Desks lie, in the metrics or measurement. Internal service desks do not focus on traditional SLAs and focus the experience (using XLAs) of the end-user, how they are solving the ticket and focusing on delivering a good service.

On the other hand, when you outsource your Service Desk, you need to have contracts in place. Within the contracts is what is getting measured, and that focuses on what is getting done (SLAs). It is much harder to measure the whole service experience, so instead, targets are set for you first line service desk, which are only responsible for some cases.

As well as this, from an agents perspective, there are sanctions in place that will impact the agent. If they do not achieve these stated metrics then there will be liability against them for not meeting the terms in the contract, for example paying back €50k.

Furthermore, if you have set an objective for your agent to complete 20 cases per hour, then you are effectively measuring how fast an agent is getting rid of their customers, which also leads to a decline in happiness for the agent.

“Lets stop the SLA games”

However, XLAs are only part of the solution. XLAs are made to increase happiness and productivity, as well as building cooperation and trust. In order to make your outsourced Service Desk better than an internal Service Desk, you need to work together to have a common team with common targets. Not trying to push the cost per sale on the vendor and try to make them take all the responsibility for everything.

XLAs, however, are complicated and there is not a one set answer to match all needs. But there are examples and cases out there showing that it can be done. In our previous episodes we covered a case on Wilhelmsen, who are constantly working with their outsourced vendor. As well as this, RB from the UK who also use an outsourced vendor, set their target solely on improving happiness for their employees and saw a huge improvement in monthly scores.

The basics of creating XLAs are very very simple – it is about measuring the experience and not focusing on the factual stuff that happened within the tool, such as time per ticket. However the challenging part is getting rid of the controlling feeling with agreements.

Data of this episode has been taken from the 'Happiness Score™ Report'. Download your copy of the Happiness Score™ Report.

Pasi Nikkanen: Welcome to Happy Today podcast. This is a broadcast for those who want to improve service experience of internal services. If you use Service Now or other enterprise service management system, then this is for you.

Pasi Nikkanen: Hey, welcome to this episode of Happy Today podcast. Today we are talking about internal versus external outsourced service desks. In an earlier episode we saw how happy our customers are making their employees and what kind of improvements they are making. But, today we are focusing on numbers. Internal compared to outsourced. And it seems that the internal service desks are making employees 22% happier and 47% more productive. Sami, what's going on? What are the numbers?

Sami Kallio: This was the first time we calculated this difference. So we did go through all our customers and checked which of them are having insourced, and which are having outsourced service desks and just comparing those numbers. So this is not how much better they have been with our product. That was the earlier episode. This is about guaranteed tuition, exactly now. So totally average numbers, but very big difference here. And I think the real right question here is, "What is causing this?"

Pasi Nikkanen: So Sami, is it caused by the watermelon effect?

Sami Kallio: (Watermelon hits Pasi in the head and exits) I think that was the easiest way to get rid of the watermelon, but yeah. The watermelon effect is hitting the whole industry. Now it just hit you, but it is hitting the whole industry.

Pasi Nikkanen: We talk a lot about the watermelon effect, but let's go through it. What do we mean with the watermelon effect? What is the green, what is the red?

Sami Kallio: So this whole watermelon effect, we have been using that for years. And when we started to use that was, when I was having discussions with different CIO's and they were telling me that I'm meeting those partners and we are checking those SLA's and everything is on green so we should be doing fine. Then they continued, but then I hear so much complaints from our end users, and our business units. That they are not satisfied at all. So I cannot understand what is going on. Everything should be fine. So SLA is green but still, employees, red.

Pasi Nikkanen: Yeah. And so the metrics and the KPIs are green, but still the experience and the perception of the employees is that I.T. sucks.

Sami Kallio: Yeah. Or at least that is what they are saying about it.

Pasi Nikkanen: Yeah. Okay.

Sami Kallio: And the whole thing here is this, when comparing these to insourced or outsourced, our thinking in insourced service desk is that you are not so concentrated on meeting the metrics. So it's not about that the outsourced services at SAS would be worse. It is how we measure it, and how we force them to use the traditional SLA's and meeting those without really thinking about how we serve the people.

Pasi Nikkanen: So basically with internal service desks, it's much easier to leave the SLA's out and actually just try to do a really good job. And with the external ones, because you are buying pretty expensive outsourcing, you need to have contracts and what you put in the contracts is what gets measured, and what gets measured is what gets done. So that's really the- [crosstalk 00:03:17]

Sami Kallio: That is the the thing. And I think one of the things here is that, sadly it's not so simple to do an agreement that would be measuring the whole service experience. So you set those targets for your first line service desk, which is only responsable for some of the cases.

Pasi Nikkanen: True.

Sami Kallio: And then it's going to different vendors behind it and so on. So you in some cases even medicate those cases away from your targets and you start to throw targets and metrics that don't really matter.

Pasi Nikkanen: True.

Sami Kallio: And from the agents perspective, if you think about it, you're also having sanctions on your vendor. So if you don't meet these targets, there will be 50K euros or pounds that you have to pay back.

Pasi Nikkanen: Yeah. So, for example you see from the data that actually people are really happy with the password reset, but why wouldn't you now automate it? Think about it from the outsourced vendors point of view.

Sami Kallio: Yeah, this is really sad but true. That there are cases that we have heard where the vendor is just meeting the target of the SLA in end user satisfaction. And they know that 20% data or 30% of their cases are password resets, which is keeping them on the positive side. So they are not really motivated to automate those cases and they will then not meet the target, which would mean that they will be sanctioned and on it. So, the measurement is running the business, so you're not doing the wise things. And it's not that the vendors wouldn't know this. They know it really well that they are forced to do a bad job.

Pasi Nikkanen: Yes.

Sami Kallio: And if you think about that from an agent's perspective, you are forced to resolve 20 cases per hour. You're measured by that. What that really means, as an employee and an agent, you're measuring how fast you are getting rid of your customers. And that is causing them to not enjoy their job. And they will make sure, let's say for example email, you have the target in your SLA's that you have to answer the email in the first two hours. Yes, the agents will send some answer to the end user asking some questions and we have seen so, so many times in those emails responses, "Why did you ask me things that I already have written in the first email?" That is caused by the SLA's. That poor agent is forced to do that by the management and it's such that you're measuring things wrong. It's not that they must be, or would be responsible of it. It is the customer and their agreement that is running the thing.

Pasi Nikkanen: So do think that the experience level agreement would be an answer to this problem? People are talking about the XLA's and experience and the experience level agreements?

Sami Kallio: I think that is a part of it. But, still I would say that it's not going to be resolved by an agreement. XLA's are more like a way of cooperation and trust. So the only way to make outsourced service desk to be better than insourced is to work together and have a common team, with common targets. Not so that you are trying to push the cost per sale on the vendor and you try to make them take all the responsibility for everything and handle everything. They cannot.

Pasi Nikkanen: Yeah, and I think there're good examples. We have a couple of customers like that. I get bank guys out of RB in the UK who are also external outsourced vendor and they just set this happiness as their target and they are making now huge improvements monthly on their scores. So, they are now focusing on making the employees happier and more productive. Then we mentioned Willhelmsen case in one episode and there are so many more who are all the time working together with the vendor. And I think the whole experience level agreement thing, it's quite complicated. I don't think that there's currently one right answer to it.

Pasi Nikkanen: I think it's something that we'll explore in the episodes to come, maybe interview some customers, some providers of how they see it could work better. But it's definitely a trend because we had a happiness report webinar a few weeks ago, and they were 100 participants. There was one person who said that he didn't believe in experience level agreements. I would say there was 90% who said that they strongly believe it. And then the rest were kind of saying maybe, but with some doubts. So it seems to be that the consensus in the industry is that people are believing in this topic and they are now just thinking about how to solve it.

Sami Kallio: Yeah, the big question there is, the basics are very, very simple. It's about measuring the experience and focusing on the experience, not on factual stuff that happened in the [inaudible 00:08:08] tool. But the challenging part there is to get rid of that and get rid of that controlling feeling that the customer is having with that agreement. And, that needs to be kind of a cultural changing in that area from the customer side. That, "Okay, I will give you an option of six months. We forgot the old SLA's, we focus on this one, and we make the changes and after that we come back to the table if there was no success." But what we have seen in those cases where customers have done that, that they have said that, like version trades, "Let's stop the SLA games." I love that sentence from Dean Underwood. But it's the right way. It is games if you are just trying to meet the watermelon.

Pasi Nikkanen: All right. I think that's a good topic for this episode. And if people are interested more about XLA's, watermelons, you can go to So of course we try to help our customers to actually get to this maturity level. So, first get the transparency, get this trust ongoing and then setting those levels without even actually touching the SLA's. So, I think that the SLA's will have their place. They are like secondary metrics that might give you an indication of where we are going wrong. But then if you are wanting to learn how to set up these kind of experience level targets, we are happy to talk more on that. All right. Thank you for this episode and everybody on online, so stay happy.

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