At the 2013 ISG Sourcing Industry Conference in the Americas, Dave Tienstra and Lois Coatney of ISG spoke on service integration, it's evolution and solutions for tomorrow.

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Making it Work for Everyone
Service Integration Frustrations
September 10, 2013
Scott Bonneau, VP IT, Finance & Hosting Services, Dr Pepper Snapple Group
Dave Tienstra, Partner, ISG
Lois Coatney, Director, ISG

2. © 2013 Information Services Group, Inc. All Rights Reserved 2
o Introduction: Service Integration - Past, Present & Future
o Roundtable Participants Introduction
o Topics
o Lite or Heavy Service Integration – How Much Legislation is
Required?
o Incenting End to End Service Performance – Are Pain Sharing
SLAs the Answer?
o Who should be the Service Integrator?
o Tools – Yours, Mine or Ours?
o How do we Minimize Risk During Transition and Transformation?
o Others …..

3. © 2013 Information Services Group, Inc. All Rights Reserved
Service Integration Past, Present & Future
Introduction

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The Evolution of Outsourcing and Service Integration
As IT and outsourcing evolved so too did the Integration of IT Services:
The
evolution
of Service
Integration
ITIL first
published
IT is delivered
in-house
Large single-
source/ Prime
contractor
deals. (Provider
acts as
integrator)
ITIL v2 and 3
Early 2000s, SI
overlooked
Late 2000s SI
sourced as a
discrete
function
Global
awareness and
interest in
SIAM
SIAM models
mature and
vary
The
evolution
of
Outsourcing
Outsourcing
is a business
strategy
Outsourcing is
in vogue
Long duration
(~7-10 )
 Lift and shift
Diversification
of supply base
Drop duration
(~5 – 7)
Rise of Eastern
based Providers
Multi-sourcing
in vogue
Shorter
duration (~5
years)
1980s 1990s
Monolithic
2000s
Bipartisan
2010s
Pluralistic
2020s
Confederate
Focus on plug
& play,
flexibility,
scalability,
automation
Standard
interaction
model
Functional out-
tasking
New
technology
based players
Duration – 3
Years

5. © 2013 Information Services Group, Inc. All Rights Reserved 5
ISG’s Prediction: The Future of Sourcing
Multi-Sourcing and confederation brings new players, more automation, provides
room for XaaS solutions.
Internal Shared Services / Captives
Function
Function
Function
Function
Function
All Towers
OR
 Infrastructure
 ADM
 BPO Function(s)
Tower
Tower
Tower
Tower
Importance
of Labor Arbitrage
Importance
of Software, Platforms,
Labor Automation, & Scalability
Function
Social Media
Collaboration
Mobility BYOD
Analytics & Big Data
Cloud
Computing & Storage
Service Integration
Strategic & Selective Sourcing Multi-Sourcing Confederation
MARKET 5 – 10 YEARS AGO LAST 5 YEARS NEXT 3 TO 5 YEARS

6. © 2013 Information Services Group, Inc. All Rights Reserved 6
The Exponential Need for Service Integration
Integrated Demand – Supply Dynamics
Security
LAN / WAN
Collaboration
App Maintenance
Salary/Benefits
Workplace
Sales
Purchasing
Claims Processing
Service Integration
Distribution
...
Business
Services
Service Desk
Facilities
End User Equipment
...
Payment Processing
PM Services
Component
Services
Who will correlate
Service Levels?
Who will manage
cross-provider
incidents?
Who will ensure
capacity is meeting
demand?
Who will hold
Providers
accountable?
Who will assure
change
orchestration?
Who will drive end to
end continuous
improvement
Who will manage
cost to value?
New players, more automation, XaaS solutions … the ability to orchestrate services
becomes more complex.

7. © 2013 Information Services Group, Inc. All Rights Reserved 7
Transformation
Inevitable Solution: Service Integration
The ultimate goal of Service Integration is to provide business value to end users.
Evolved Multi-Sourcing Integrated Services
!!
Successful management of Multi-Sourcing or Confederation consists of the strategic
sourcing and integration of services from the optimal set of internal and external
Service Providers and Suppliers to fulfill business goals.

8. © 2013 Information Services Group, Inc. All Rights Reserved 8
How do you Scope Service Integration?
S = ServiceP = Process
Demand(Business)
Supply
Service Integration and Management
Corporate Support Functions
LegalAudit Compliance Procurement Human
Resources
Finance
& Controlling
Communication
& Change Mgt.Risk
Service Strategy, Planning & Control
Service Portfolio
Management
P Project Portfolio
Management
P Sourcing Strategy
& Lifecycle Management
P Enterprise Architecture
Management
P Security Policy
& Standards
P
Business Value
Management
Demand Mgt. P
Request Mgt. P
Customer Satisf. Mgt. P
Pricing and Chargeback P
Service Catalog Mgt. P
Supplier Management
 Compliance & Deliverables
 Change Request &
Amendments
 Contract Interpretations
 Issue Mgt.
 Supplier Audit
 Governance Library
 Consumption Mgt.
 SW Compliance Mgt.
Contract Mgt. P
 Invoice Mgt.
 Performance Credits &
Earnbacks
 Contract Pricing Adjust.
 Value Assurance
 Financial Analysis &
Planning
 Spend Pool Mgt.
 Suppl. Intelligence Mgt.
Commercial Mgt. P
 Service Level Compliance
Mgt.
 Request Mgt. &
Authorization
 Benchmarking
 Supplier Risk Mgt.
 Consumption Mgt. –
Operational Compliance
Performance Mgt. P
 Governance Administration
 Customer Survey Mgt.
 Regulatory & Compliance
Mgt.
 Supplier Comm. Mgt.
 Supplier Program Mgt.
Relationship Mgt. P
Project Delivery
Program & Project Mgt. S
Systems Integration S
Cross-Functional
Service Design
 Design Coordination
 Service Level Mgt.
 Capacity Mgt.
 Availability Mgt.
 IT Service Continuity Mgt.
Service Transition
 Service Transition Planning
& Support
 Change Mgt.
 Change Evaluation
 Service Valid. & Testing
 Release & Deploy. Mgt.
 Knowledge Mgt.
 S. Assest & Config. Mgt.
Service Operations
 Incident Mgt.
 Problem Mgt.
 Request Fulfillment Mgt.
 Access Mgt.
 Event Mgt.
Service Improvements
 Continual Service
Improvement
 Quality Assurance
Service Lifecycle Mgt. P
Service Desk Services P

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How is Service Integration Delivered Successfully?
There are many dimensions of scope to be considered when providing a solution for
Service Integration.
Service
Desk
Service
Lifecycle
Management
Process
Advisory
&
Assurance
Supplier
Management
SecurityInfrastructure
Dashboard &
Reporting
Tools
Client Org
Change
Mgt
Independent
Service
Provider
Sourcing
Performing
Service
Provider

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Roundtable Participants Introduction

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How Much Legislation is Required?
Lite or Heavy Service Integration

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Lite or Heavy Service Integration – How Much Legislation is Required?
Integrated Demand – Supply Dynamics
Security
LAN / WAN
Collaboration
App Maintenance
Salary/Benefits
Workplace
Sales
Purchasing
Claims Processing
Service Integration
Distribution
...Business
Services
Service Desk
Facilities
End User Equipment
...
Payment Processing
PM Services
Component
Services
Who will correlate
Service Levels?
Who will manage
cross-provider
incidents?
Who will ensure
capacity is meeting
demand?
Who will hold
Providers
accountable?
Who will assure
change
orchestration?
Who will drive end to
end continuous
improvement
Who will manage
cost to value?
To ensure collaboration across Service Providers and integration of services, should
the delivery of services be heavily or lightly managed?
Standards
Assurance &
Reporting
Transactional
Management

13. © 2013 Information Services Group, Inc. All Rights Reserved 13

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o Lite or Heavy Service Integration – How Much Client Legislation is
Required to ensure Service Integration?
 ISG introduce the topic with some key definitions / background
 Question to a Client: How often do you get engaged during incidents
or changes to orchestrate actions between suppliers? … Is this what
you prefer?
 Question to a Supplier: Would you rather orchestrate incidents and
changes with other Service Providers in the environment without
client intervention? … If so, do you, or are there any barriers?
 Question: The Pros and Cons to a heavy or lite service integration
model. What model would yield the best result for both client and
Service Provider?
 Question: What mechanisms would you like to see in the
environment to better enable you to collaborate more effectively?
Topics to Discuss

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Are Pain Sharing SLAs the Answer?
Incenting End to End Service Performance

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Standard Service Level Framework
In order to be able to guarantee end-to-end SLAs, the service delivery chain needs
to be delineated across the different Suppliers and be supported by OLAs.
SLAs & OLAs
Four types of SLAs:
 Component Service Level
Agreements (SLAs) between
Client and every Supplier
 Operating Level Agreements
(OLAs) for hand-offs between
Suppliers – typically agreed by
Service Integrator
 End-to-End Service Levels
between Client and the
business – parts to be fulfilled
by Service Integrator
 Collaborative Service Levels for
shared Accountability across all
Suppliers
Commercial Framework
1
2
3
4
Interne Kunden (z.B. Segmente, Tochtergesellschaften)
Interne Kunden (z.B. Segmente, Tochtergesellschaften)
Multi-Supplier Governance
1
2
4
3
Contract
Supplier 1
X-Functional
EUC
Contract
Supplier 2
X-Functional
WAN/LAN
Contract
Supplier n
X-Functional
Service Desk
OLAs OLAs
OLA
IT SIAM*
SLAs SLAs SLAs
Business (Demand)
End-to-End SLAs

17. © 2013 Information Services Group, Inc. All Rights Reserved 17

18. © 2013 Information Services Group, Inc. All Rights Reserved 18
o Incenting End to End Service Performance – Are Pain Sharing SLAs
the Answer?
 ISG introduce the topic with some key definitions / background
 Question to a Client: Do wish to or have you instituted cross-
service provider SLAs in your environment, and if so, in what
way?
 Question to a Supplier: Are there any barriers to accepting pain
sharing SLAs with other Service Providers?
 Question: What are other methods (other than penalizing SLAs)
that will incent proactive and collaborative end to end business
service management across Service Providers?
 Question: Are there any issues with all Service Providers in an
environment seeing each other’s performance to SLAs and Key
measures?
Topics to Discuss

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Service Integration Model Options
Who Should be the Service Integrator?

20. © 2013 Information Services Group, Inc. All Rights Reserved 20
Service Integration Model Options
The following options have been applied to manage the integration of multiple
Service Providers; whether internal, external, IT or non-IT.
Model 2: GuardianModel 1: Prime
Client
Single service provider with Service Integration
implicitly included
Model 4: In-house
The client retains accountability and responsibility for
Service Integration
Model 3: Independent
SIAM is discretely contracted for and delivered by the
provider of other services
Client
Client
A SIAM service is procured from a provider which
does not deliver other service towers
Applications
IT
Infrastructure
Business
Processes
IT Infrastructure Applications Business Processes
IT Infrastructure Applications Business Processes
SIAM
SIAM
Client
IT Infrastructure Applications Business Processes
SIAM

21. © 2013 Information Services Group, Inc. All Rights Reserved 21
How is Service Integration Delivered Successfully?
There are many dimensions of scope to be considered when providing a solution for
Service Integration.
Service
Desk
Service
Lifecycle
Management
Process
Advisory
&
Assurance
Supplier
Management
SecurityInfrastructure
Dashboard &
Reporting
Tools
Client Org
Change
Mgt
Independent
Service
Provider
Sourcing
Performing
Service
Provider

22. © 2013 Information Services Group, Inc. All Rights Reserved 22
o Who Should be the Service Integrator?
 Question to the Client: Would you rather be your own Service
Integrator, or hire a “soup to nuts” Service Integrator as a
Managed Services, or somewhere in between?
 Question to Suppliers: Do you see a conflict of interest or cause
you hesitation to work with another Service Provider as the
Service Integrator?
 What are the key components of Service Integration Delivery?
 Tools? OLAs? Consistent Processes? Cross Supplier Forums
to work through day to day delivery?
Topics to Discuss

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Tools – Yours, Mine or Ours?

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Tools – Yours, Mine or Ours?
Requirements of the future – Plug & Play, Flexibility, Scalability, Data Visibility,
Automation ….
Integrated Service Desk
Change & Request Management
IncidentManagement
ProblemManagement
...
CMDBKMDB
Events
(Monitoring)
Frontend
Services
Backend
Services
Resolver
Group 1
Resolver
Group 2
Resolver
Group n

Portal
Dashboard
Service Mgt
Tool
Reports

25. © 2013 Information Services Group, Inc. All Rights Reserved 25
o Tools – Yours, Mine or Ours?
 ISG introduce the topic with some key definitions / background
 Question to a Client: What are the biggest risks or issues you
have experienced with tools (yours or Service Provider tools)?
Do you prefer to have ownership or control of your own tools?
 Question to a Supplier : What are the determining factors in
determining if you use the client’s tool or interface with the
client’s tool?
 Question: Tool Integration tends to be the long pole of the tent.
What can we do minimize the risk?
Topics to Discuss

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How do we minimize during transition and transformation?
Risk

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How do we Minimize Risk during Transition and Transformation?
What are the imperatives during the first few months following contract signature?

28. © 2013 Information Services Group, Inc. All Rights Reserved 28
o The critical first few months – What is needed to minimize risk
during transition and transformation?
 ISG introduce the topic with some key definitions / background
 Question to a Client: How would you characterize transitions or
transformations within your environment? What were key
lessons learned?
 Question to a Supplier : What do you believe are the key critical
success factors to effective transition and transformation?
 What are some actions that could be done during the
transaction phase to reduce some of the risk across the
environment?
Topics to Discuss

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Information Services Group is a leading technology insights, market intelligence and advisory services company, serving more than 450 clients around the
world to help them achieve operational excellence. ISG supports private and public sector organizations to transform and optimize their operational
environments through research, benchmarking, consulting and managed services, with a focus on information technology, business process transformation,
program management services and enterprise resource planning. Clients look to ISG for unique insights and innovative solutions for leveraging technology,
the deepest data source in the industry, and more than five decades of experience of global leadership in information and advisory services. Based in
Stamford, Conn., the company has more than 800 employees and operates in 21 countries.
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