The most important question you’ve never asked. Service Vs Product?

28th November 2019 Advice 6 Minutes

SME's come in many shapes and sizes, just as true of an Accountancy Practice as an IT Provider. Whilst on the surface it appears there isn't much that separates two SMEs in the same sector, we all know that couldn't be further from the truth.

So, why am I writing this? I want to break down what we at bzb IT define as "Product vs Service", specifically how it can help you evaluate the value in what and how you buy.

Definition of a Service

Service is the time spent providing value, the more expertise the provider has the better both the experience and outcome will be but service always comes with a caveat, finite capacity.

Definition of a Product

The typical definition of a product is linked to a tangible good, something you can see and physically hold. With the advent of software products, in our view that definition is old hat.

We like to think of a product as anything purchased to either; reduce the amount of service time spent; improve the overall experience; or improve the outcome of the service.

The all important context

Okay, with the definitions done, let's frame this in a universal way. We outsource to a very good accountancy practice. Their service is brilliant, they spend X amount of time, proportional to our size, providing a service and we love it. They're friendly, helpful, understand our needs and cover expertise we don't have in house, ensuring we have all the bases covered - literally the definition of outsourcing.

But, is that, in of itself, enough? They (and we) think no. What makes them different is the tools they use to deliver the service. This results in a breadth of tangible benefits for us that otherwise wouldn't be available; bespoke reports detailing our business performance; strategic input as to what the next quarters look like; any important facts we should be aware of and much else.

It wouldn't be feasible for them to rely on doing this for every one of their accounts manually. Time is a limited resource and as that becomes scarce, human error starts to creep in, coupled together it makes the approach infeasible. Their solution - utilise tools that increase their expertise reach but maintain the same level of concentration. The advantage of doing something once, for the benefit of multiple independent businesses. Ingenious!

Let's frame that in an IT context

Finally, on to the point. It made sense for us to seek out an accountant with a similar ethos to us, we like to maximise value in what we buy too. But, what does this same problem look like to those of you evaluating IT services?

Well, for starters, if the value you place on your IT is, "when we call them, they fix our issues, most of the time", there's no doubt in my mind that you are buying a service.

I'm going to rattle off some questions that'll give you an idea of whether your IT provider is offering a service or a product;

  • Do you plan software and hardware refresh cycles before they are imminent?
    Our toolset gives us visibility of key metrics for all client operated assets - workstations and servers. It's the secret sauce in producing the high quality  bespoke reports used in our Quarterly Business Reviews. The reports highlight ageing assets, when and how they need to be replaced and what the impact is likely to be.

  • Are you asked to download a remote support tool for assistance?
    If you're asked to go to a page and download a tool or enter a code to get remote support, your provider doesn't know your machine exists. Be insistent in highlighting any performance issues or errors with your machine, they wont be able to see them otherwise!

  • Do you receive frequent reports detailing your infrastructure health?
    How many machines do you have? Which of your employees use each machine? When was the machine bought and when does the warranty expire? All great questions and frequently those you as the client are expected to answer, which is ludicrous. Our toolset allows us to produce daily reports which will give you an overview of ALL your assets and any metrics you need to be aware of.
  • Are routine tasks automated, documented or performed ad-hoc?
    In the world of ITIL, routine tasks are defined as Service Requests. Examples of these are; a request for new hardware; a user account creation or removal and a password reset request. When you have these requests, all businesses will, does the process result in the same result each time? Or, does it seem to depend on the direction of the wind as to whether you'll get the result you need?
  • Do you have access to your documentation?
    Documentation is clearly important, not every process can be automated and for those times it can't, it has to be documented to ensure a consistent result. Do you have visibility of the procedures unique to your organisation? We use a documentation portal which means all our clients can access their respective data, inclusive of any bespoke procedures we maintain on their behalf.  
  • Have they provided basic training on how to use their tools?
    Do you know how to use their helpdesk to complete service requests? Are you able to update incidents with relevant information (priority, impact, etc)? Whilst this one seems like a stretch, it's important you're involved in the provision of your services, otherwise they aren't tailored to your needs. We use our helpdesk to complete service requests. An example of this is, if our clients request a new user account, they fill out a quick online form that gives all the requisite information required.  Magnify this procedure across all service requests, it results in a massive productivity gain through effective communication, we always have all the information we need on first correspondence. 

Let's wrap this up

I really could list another 20 examples here but I believe those reading this post will get the point from the first few. So, to complete this post. Who am I to say whichever process is right. You may want a time exhaustive relationship with your service provider, getting value for your spend through the excess of time they spend on your account but as they grow and their skills / service dilutes, it's likely you'll face issues. 

That's just my two pennies worth on the topic. If it's something you've experienced, would love to hear your thoughts around how and why. Feel free to drop me a mail. 

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