Not quite sure what business service management entails, where it’s headed, or what benefits it offers? The CEO and founder of generationE Technologies explains how BSM works, how it’s evolving, and what your organization can gain from its implementation.

On a recent trip out to San Clemente, CA, I got the chance to sit down with Casey Kindiger, CEO and founder of generationE Technologies, to get his views on the future of business service management (BSM). He offered some practical explanations about the inner workings of this popular technology/business nexus-building strategy and how it relates to today’s corporate marketplace.

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1. Jeff: So Casey, to start us off, BSM is often described as the ability to see and use your technology infrastructure from a business perspective, rather than tools capability. How would you expand on that basic definition to describe what we’re talking about here?
Casey: The key to BSM is aligning technology investments to business operations by being able to track, monitor, manage, and view the financial side as well as the operational side of technology. So let’s say I’m an executive who knows nothing about the underlying mechanics of the technology infrastructure — the networking equipment, the laptops, the servers — what I do need is the ability to look at how those components and infrastructure are enabling and supporting my ongoing business processes.
2. Jeff: From an executive standpoint, then, it really comes down to minimizing or even making invisible the functional processes of the technology and focusing on what IT does in a business capacity?
Casey: Right. That is really the lynchpin and it’s also the key challenge — so that the executive can understand what the technology is doing without necessarily understanding all about the underlying technology itself. Most important, so that the executive can make informed business decisions, given that so much of today’s business operations are intertwined with the operation of the underlying technology.
3. Jeff: Well, as you know, there are several companies out there right now that are describing different offerings around business service management. What are the main differences between what some of these vendors are offering?
Casey: You have a category of vendors that focus on the business process layer, and they typically come out of a specific business vertical where they understand the business processes that drive that particular industry very well. Business Objects is a good example of that — they understand the business side of the equation.

Then you have a category of specialists who understand the technology side of the equation very well. They typically stay within technology silos, and their core philosophy is that the business starts with the application. People use applications to drive the business process. They have a whole suite of tools that simulate transactions and model business process performance based on transactional characteristics, which is adequate in certain situations.

And then you have another category that is trying hard to merge the two. To do that, they have to look across the technology silos that support and enable the business and they have to encapsulate the business process and bring those two together. I would call those the BSM integration players. So there are those going top-down, those going bottom-up, and those taking an integrated view and tackling both areas with an integration architecture. This is essentially the way we look at it.

4. Jeff: So in that third category, how many players would you say there are?
Casey: There are not many organizations taking that holistic view because of the complexity of addressing the problem that way. It’s highly complex to deploy BSM by modeling services at the business layer and even more complex at the technology layer. You don’t just figure out what set of technologies to plug into the BSM equation. Different technologies require different competencies within each silo. generationE has been focusing on this business-technology synergy for more than a decade. We started solving problems in the late 90s for large financial services organizations, and because the toolsets weren’t available, we built up a highly customized solution to attack the problem. That’s not the way we wanted to do it, but the industry just wasn’t there yet at the time. So it was a matter of necessity being the mother of invention.

Now over the last 10 years, our vendor partners have invested heavily in this area, and with just the right amount of integration expertise and an understanding of the business side of our customers, we can solve the same problem using primarily off-the-shelf commercial software.

5. Jeff: Once I’m ready to make that leap and say, okay, let’s start down the path to BSM, what should I plan to spend to do that?
Casey: Well, that’s a question that depends on two things — the size of your company and how far it wants to go with its BSM strategy. If you want to manage and monitor your entire business and all the applications and processes in a large enterprise, it could be a multi-year effort and it will have a significant cost. At the same time, as you go down that path, you’re going to be reducing ongoing operating expenses and making a positive impact on revenues. On the other hand, for any size organization, it’s relatively inexpensive to get started and model your key processes. To kick things off, you can estimate about a quarter-million dollar investment.
6. Jeff: It seems to me that a lot of the larger enterprise organizations are at least familiar with BSM — they know what it is and have some kind of plan in place. I’m hearing an emphasis now coming from software companies like IBM toward the medium-size businesses, so when you describe spending a quarter-million dollars, is that what you’re talking about?
Casey: We’re talking about quite a diverse spectrum of circumstances here, of course. If you’re just addressing getting the infrastructure started for a large organization in terms of buying software, architecting it, and the initial design and installation, that amount would launch the platform in a larger organization and show real value. For a midsize organization of fewer than a thousand users, you could also start to pick one or two of your key processes to pilot into a BSM infrastructure.
7. Jeff: Is the whole way of thinking about this BSM model or paradigm fairly well stabilized now or would you say it will be in a dynamic state for a while?
Casey: It will be dynamic. There’s nothing you can just plug in that is a BSM-activating tool. It’s really an architecture that at the moment requires a multidimensional understanding of both the technology infrastructure and business operations. So for the next five years, it’s going to continue to be very dynamic — not because the software companies aren’t investing heavily in it, but because the problem itself spans multiple layers of the technology stack.

One of the areas that requires focused attention is designing effective metrics to overlay the BSM platform. The value of the BSM investment relies heavily on our ability to define appropriate, actionable service performance metrics. One of my managers in a former life used to take every opportunity to use the axiom “What gets measured gets done.” I think there are two more pieces to that equation. First, we need to know what it is we want to do before we can decide what to measure. Then we have to baseline and collect the measures in a cost effective and accurate way. We’ve all been focused on developing the methods behind deploying a BSM infrastructure; now we have to focus a bit more on the content it will be delivering.

8. Jeff: What about in relation to specific industries — are there a couple areas of business where you see a greater value for implementing BSM?
Casey: Absolutely. The more technology-centric the company’s revenue model is and the closer the tie of the technology to the key business processes, the more it will come right to the top. Number one is obviously telecommunications service providers, many of whom made some early investments in this already. But there’s a lot of benefit to be had by taking another look at their service assurance layer for their OSS/BSS, and reinvesting in the service assurance portion of their infrastructure.

A second industry where the value is most readily demonstrated is financial services. It’s another highly information-centric industry, so the ability to manage their technology from a business perspective directly affects their revenue model. But I firmly believe that BSM is in the process of transforming IT strategy and operations across all industries. BSM is a critical step in the ongoing industrialization of business IT and has the power to make significant improvements on operational efficiencies and business agility.

9. Jeff: Let me take a step back and ask a question from an intrigued, but still tire-kicking customer standpoint. Is there one example that comes to mind for you where the customer stands out in terms of implementing business service management, where they’ve used it well and seen results, and they’re a good example of how it should be done?
Casey: I won’t name the customer but I’ll give you an example: the first time we were engaged to develop a BSM strategy and solution that spanned both the business layer and the technology layer. We had a direct relationship with the CIO and senior business leaders to drive the initiative. The approach was to extract the architecture technology piece from the business piece and focus on each one intently but independently. We designed an architecture that is flexible but takes into account the fact that the technology is going to change over the next 10 years, and there are going to be innovations this customer will want to take advantage of. They can plug in and pull out solutions that make up portions of the BSM architecture without affecting the overall viability of the system. So we focused hard on designing an architecture that is both functional today and flexible for the future.

So that’s one side of the equation. The other side is the business perspective, first modeling the key business processes and then building them into the architecture. The problem we faced is that once you launch the BSM solution, if you haven’t set up tools and techniques for new processes and new business services, you can’t adapt to the changes in the business. Building a rigid set of KPIs and static reports just doesn’t cut it. Business processes are dynamic, and companies continually expand, add new products and services, and improve and enhance. It was important that we enabled those changes on the business side over time. So those were two independent functions we had to address in this case, and because we could approach both with equal zest and zeal, it was a recipe for both short- and long-term success.

Let me give you one more recent example. We’re currently working with a company called Aircell that is putting the Internet on domestic airlines. They needed to be able to monitor their availability from a meta-perspective on multiple networks. One of our consultants came up with the idea of combining the monitoring functionality of the OMNIbus and Impact solutions with Google Earth to be able to track aircraft on the network in real time on an individual basis over 10,000 feet, and it worked out very well. This is a high-profile customer for us. They’re bringing the Internet to the air traveler, and of course we were glad to be selected and to be a part of such a significant technology development. As you can imagine, these are proprietary technologies. And of course the end user is the business focus and our experience in the telecommunications industry and with Netcool solutions allowed us to put those pieces together in a very robust solution.

10. Jeff: I’m sure that kind of recipe for success is what most companies are hoping to find. In closing, could you talk about why a company might be inclined to start a BSM initiative now rather than later?
Casey: Sure. To sum things up, I’d like to say that BSM really is a new area of focus for many companies, especially as they become more technology-driven and technology-dependent. There are still some individual, silo-based initiatives out there that are BSM-centric, but for most organizations, addressing this as a corporate competency is a new direction that offers a great deal of immediate value. Delaying the adoption of a BSM strategy, especially in an economy where service management can facilitate adaptability and operational improvements, could cost a lot more than getting started on it today. We are certainly looking forward to helping more organizations get to the next level with a complete BSM vision.