From IT Cost to Business Value using Employee Experience

Pasi interviews Sami in his articles about changing the strategy in IT from Cost Reduction to providing Business Value.

Has the focus on IT support cost reduction really been the best option for CIOs and their senior management teams?

There has been a long-held view that the IT service desk is a “cost of quality,” i.e. it’s an additional and unnecessary cost that’s caused by a lack of quality in certain parts of the IT value chain. IT issues – or “incidents” to use ITIL terminology – are something that can be managed by better IT service design, transition, and delivery practices.

This cost-of-quality view has caused many organisations to consistently drive down the cost of their IT service desk and available budgets. This might have involved fewer, lower-paid staff or it might have involved the outsourcing of the service desk function in pursuit of lower costs (through economies of scale), higher quality (through best practice capabilities), and increased innovation – it’s the common outsourcing promise, or at least the organisational expectation of outsourcing.

But is this Really in the Best Interest of the Business?

Read the full article that Sami wrote, Refocus from cost to business value 


Pasi Nikkanen: Welcome to HappyToday podcast. This is a podcast for those who want to improve service experience of internal services. If you use ServiceNow or other enterprise service management system then this is for you.

Today we're talking about employee experience and how does that relate to IT as a cost unit, instead of proving what they do as a business value. So this is something that you talk a lot when you go out in the events. So you talk about the strategy changing from cost reduction to showing the business value. Why do you do it?

Sami Kallio: 
That's a good question. For me, when discussing with CIOs and discussing with people who are, let's say, owning the service desk as a service, it has become a kind of a very relevant thing for me by understanding that how long time we have been seen as only a cost unit and every year we have to reduce costs and reduce cost and reduce cost, and when thinking about that, that's not maybe the most motivating area to work for.

And by then on the other hand, when understanding that you can do it differently and focus more on the value what you are bringing and prove that to your business. I think that has been and still is very key of what I want to do and what I want our company to do, to help people to really make that huge transformation from the cost unit, to the business value unit. They want to be able to solve the value of what you are bringing to the rest of the organisation and that's about how you do things, how you run your own business. That is how you run your partners. That is about how you report to the business and so on.

Pasi Nikkanen: Yeah, that sounds really familiar, but how would you say that employee experience changes that though? How does employee experience relate to any of that?

Sami Kallio: Yeah, it sounds a very big change and it is a big change and it is a cultural change of the whole IT organisation, but the point there is that when you measure the end users happiness and then you also measure how much time is lost per each ticket, you start to be able to prove your point to the business and to the CFO because now in our happiness score, the lost work time per ticket is ranging from one hour to seven and half hours per ticket incident.

And if you really think about that, it is an enormous amount of money that some companies are losing for their business side. So when presenting this kind of happiness score data to the CFO and asking them if they are asking you to cut 10% of the support cost from next year, you should ask "Are you sure you want to do that? Maybe if we invest a bit more, we could save one hour per each incident ticket and that would make a huge difference for the business users."

Pasi Nikkanen: So in essence, you don't call as IT, explaining the business side that now we need to move to cloud. Now we need to kill our own exchange and actually put in Office 365. Then the business will ask you - "So what is it going to cost?" "Well, something like a million pounds."

Then they will say, "No, sorry. We don't have budget for that." But on the other hand, if you go explaining it that, "Hey now our employers they lose a lot of time with all these old technology. We have measured the productivity. We have recognised that they are spending so many times, they have so many issues. So we believe that moving to the cloud, we can actually make the employees more productive and bring you more value." Because I guess the business guys, the largest costs that they have is the salary of the employees.

Sami Kallio: Yeah. In many businesses at least.

Sami Kallio: And coming back to your question that what the value of employee experience is here? It should be the core of everything. What I mean by that is that if you think about typical organisations nowadays, end users are spread around the world and they are from certain business units or organisation parts, and then there is the director who is talking to the CIO, and then somewhere there is the IT and the agents of service desk. That really is such a long way to get the information about what the employees really need and what they truly want from the different partners. You should be having one place where you have all this experience data. So what people tell you about your services is in one place. The key word there is transparency.

Sami Kallio: So you have to have that data continuously available for everybody. Another monthly report continuously available and everybody meaning agents from the old perspective, service owners, tool owners, country managers or partners, CIO, even businesses.

Sami Kallio:  One of our clients has 6,000 people in their organisation. They gave the right to use our tool and see all feedback to all employees. Not just IT, but all 6,000 employees can access the data. I don't think many of them have had done that. But it is about giving transparency.

Let's take an easy example. You are transparent as a customer to your outsource services provider.You have the same data continuity available for both. Then you will start to understand what works and what doesn't.

So transparency creates trust.

Now together you are able to discuss, "Okay that is our problem. Our problem."

Let's take an example - the portal is not working for our end users. It's not making them happy. We are losing more time than in email. So let's together solve that one. And that is when you will get results. So it is a cultural change for everyone.

Pasi Nikkanen: And I think also in transparency because I think the business managers, they might be thinking that IT is always doing a bad job. But actually with transparency it is showing that there is plenty of positive feedback. So actually your employees are really happy with the service provided. So now you encourage and then kind of invest more to make them even more productive and even happier.

Sami Kallio: Yeah, and that's true. When we are calculating our Happiness Score™, we are calculating that in the same way that the most common consumer metrics, net promoter score is calculating score. Meaning that the score we are having can be compared to consumer worth. If we do that, the average score in our benchmark to happiness score is +65.

If that would be a consumer services, that is a really high score. Even the average score is high.

Pasi Nikkanen: True.

Sami Kallio: So the reputation of IT support services is bad, but the reality is it's much better. So being able to show that to the business, kind of changes the reputation of IT support in their eyes, which will help you too again, work together.

Pasi Nikkanen: So Sami, now I'm a believer. What do I need to do? What are the three steps to happiness? That's why we have the converse here, today. Which three steps do I need to take?

Sami Kallio: We have only two shoes but you can take three steps in those. The first one is that start to measure, don't be afraid of measuring the real end user experience for all contact points that you have. So all tickets, all requests and everything.

Pasi Nikkanen: And I think for that point, we also have a have an episode, our podcast episode on our website where we learn more about how to start, why to start them and when to start.

Sami Kallio: Yeah and you typically say that some people who are hesitant, they want to do something else before starting to make sure end users are happy. But if you really think about it, you've said that it doesn't help. They already have that bad experience and it's already spreading around the organisation even though you don't know it.

Pasi Nikkanen: Yeah, exactly.

Sami Kallio: So once you get that information on the table, you will start to understand it.

Pasi Nikkanen: All right.

Sami Kallio: And when you start to understand where you have some pain points, that is when you be transparent. The second step is definitely being transparent. You can do that in steps, you can do it first inside your service desk organisation with agents in order to learn, then you take your partners in, they will learn and then you can start to be able to make common decisions.

Pasi Nikkanen: Yeah, and I would say that based on the customer cases, our customer success people have been going through our customers and it seems like that the customers who have had the biggest impact are the ones who put the metrics in real time on screen at the offices or where everybody has access to it. Where the results are common and employees are getting them all the time and many times, also coming from top to bottom as well. So the C level managers, the senior managers, they are all talking about this employee experience.

Sami Kallio: Yeah, and I think you kind of already started to step three.

Pasi Nikkanen: Okay.

Sami Kallio: Meaning that definitely step three is to change the communication that you do with your business units.

Pasi Nikkanen: True.

Sami Kallio: To be about the things they care about. They don't care about technology updates, they don't care about your escalates. They don't care about how many tickets you resolved per month.

Pasi Nikkanen: They don't even care if your IT project was late.

Sami Kallio: If it has value.

Pasi Nikkanen: If it has value and it brings results.

Sami Kallio: Yeah, and that's challenging the way how you communicate, but in an overall I think the whole thing, changing your strategy from cost reduction or to be a cost unit to really be a business value unit, it's about the transparency and it's about communication. And the communication inside IT in all projects and but mainly with the business and the organisation.

Pasi Nikkanen: Cool. All right. And if you want to learn more, we have this whole article. Basically like two articles that you have written in different views on our website. I'll add those links also. Also this video, but thanks Sami, it was really insightful.

Sami Kallio: Hopefully.

Pasi Nikkanen: Talk to you later in the next episode.


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