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Appendix B: Supplementary guidance

B1 Description of asset types

B1.1 Management

Management is a system that includes leadership, administration, policies, performance measures and incentives. This layer cultivates, coordinates and controls all other asset types. Management includes idiosyncratic elements such as philosophy, core beliefs, values, decision-making style and perceptions of risk. It is also the most distinctive and inimitable type of asset deeply rooted in the organization.

The term organization is used here to refer the enterprise or firm rather than the organization asset type. The most likely manner in which management assets can be partially extracted from an organization is by the poaching of key individuals who were instrumental in defining and developing a particular management system.

Service management itself is a type of specialized management asset like others such as Project Management, Research and Development, and Manufacturing Management.

B1.2 Organization

Organization assets are active configurations of People, Processes, Applications and Infrastructure that carry out all organizational activity through the principles of specialization and coordination. This category of assets includes the functional hierarchies, social networks of groups, teams and individuals, as well as the systems they use to work together towards shared goals and incentives. Organization assets include the patterns that People, Applications, Information and Infrastructure deploy, either by design or by self-adaptive process, to maximize the creation of value for stakeholders. Some service organizations are superior to others simply by virtue of organization. For example, networks of wireless access points, storage systems, point-of-sale terminals, databases, hardware stores and remote backup facilities. Strategic location of assets by itself is a basis for superior performance and competitive advantage.

B1.3 Process

Process assets are made of algorithms, methods, procedures and routines that direct the execution and control of activities and interactions. There is a great diversity in Process assets, which are specialized to various degrees from generic management processes to sophisticated low-level algorithms embedded in software applications and other forms of automation. Process assets are the most dynamic of types. They signify action and transformation. Some of them are also the means by which Organization and Management assets coordinate and control each other and interact with the business environment. Process, People and Application assets execute them, Knowledge and Information assets enrich them, and Applications and Infrastructure assets enable them. Examples of Process assets are Order Fulfilment, Accounts Receivables, Incident Management, Change Management and Testing.

B1.4 Knowledge

Knowledge assets are accumulations of awareness, experience, information, insight and intellectual property that are associated with actions and context. Management, Organization, Process and Applications assets use and store knowledge assets. People assets store tacit knowledge in the form of experience, skills and talent. Such knowledge is primarily acquired through experience, observation and training. Movement of teams and individuals is an effective way to transfer tacit knowledge within and across organizations.44 Knowledge assets in tacit form are hard for rivals to replicate but easy for owners to lose. Organizations seek to protect themselves from loss by codifying tacit knowledge into explicit forms such as knowledge embedded in Process, Applications and Infrastructure assets. Knowledge assets are difficult to manage but can be highly leveraged with increasing returns and virtually zero opportunity costs.37 Knowledge assets include policies, plans, designs, configurations, architectures, process definitions, analytical methods, service definitions, analyses, reports and surveys. They may be owned as intellectual property and protected by copyrights, patents and trademarks. Knowledge assets can also be rented for use under licensing arrangements and service contracts.

B1.5 People

The value of People assets is the capacity for creativity, analysis, perception, learning, judgement, leadership, communication, coordination, empathy and trust. Such capacity is in teams and individuals within the organization, due to knowledge, experience and skills. Skills can be conceptual, technical and social skills. People assets are also the most convenient absorbers and carriers of all forms of Knowledge. They are the most versatile and potent of all asset types because of their ability to learn and adapt. People assets represent an organization’s capabilities and resources. If capabilities are capacity for action, People assets are the actors. From the capabilities perspective, people assets are the only type that can create, combine and consume all other asset types. Their tolerance of ambiguity and uncertainty also compensates for the limitations of Processes, Applications and Infrastructure. Because of their enormous potential, People assets are often the most expensive in terms of development, maintenance and motivation. They also are assets that can be hired or rented but cannot be owned. Customers highly value services that enhance the productivity or potential of People assets.

People assets are also resources with productive capacity. Units of cost, time and effort measure their capacity as teams and individuals. They are mobile, multi-purpose and highly adaptive with the innate ability to learn. Staffing contracts, software agents and customers using self-service options augment the capacity of people assets.

B1.6 Information

Information assets are collections, patterns and meaningful abstractions of data applied in contexts such as customers, contracts, services, events, projects and operations. They are useful for various purposes including communication, coordination and control of business activities. Information assets exist in various forms such as documents, records, messages and graphs. All asset types produce them but Management, Processes, Knowledge, People and Applications primarily consume them. The value of Information assets can vary with time, location and format and depreciate very quickly. Some services create value by processing information and making it available as needed by Management, Processes, People and Applications assets. The criteria of effectiveness, efficiency, availability, integrity, confidentiality, reliability and compliance can be used to evaluate the quality of Information assets.45

B1.7 Applications

Applications assets are diverse in type and include artefacts, automation and tools used to support the performance of other asset types. Applications are composed of software, hardware, documents, methods, procedures, routines, scripts and instructions. They automate, codify, enable, enhance, maintain, or mimic the properties, functions and activities of Management, Organization, Processes, Knowledge, People and Information assets. Applications derive their value in relation to these other assets. Process assets in particular commonly exist inside Applications. Applications assets consume, produce and maintain Knowledge and Information assets. They can be of various types such as general-purpose, multi-purpose and special-purpose. Some Applications are analogous to industrial tools, machinery and equipment because they enhance the performance of Processes. Others are analogous to office equipment and consumer appliances because they enhance the personal productivity of People assets. Examples of Applications are accounting software, voice mail, imaging systems, encryption devices, process control, inventory tracking, electronic design automation, mobile phones and bar code scanners. Applications are themselves supported by Infrastructure, People and Process assets. One of the most powerful attributes of Applications is that they can be creatively combined and integrated with other asset types, particularly other Applications to create valuable new assets.

B1.8 Infrastructure

Infrastructure assets have the peculiar property of existing in the form of layers defined in relation to the assets they support, especially People and Applications. They include information technology assets such as software applications, computers, storage systems, network devices, telecommunication equipment, cables, wireless links, access control devices and monitoring systems. This category of assets also includes traditional facilities such as buildings, electricity, HVAC and water supply without which it would be impossible for People, Applications and other Infrastructure assets to operate. Infrastructure assets by themselves may be composed mostly of Applications and other Infrastructure assets. Assets viewed as Applications at one level can be utilized as infrastructure at another. This is an important principle that allows service-orientation of assets.

B1.9 Financial capital

Financial assets are required to support the ownership or use of all types of assets. They also measure the economic value and performance of all types of assets. Financial assets include cash, cash equivalents and other assets such as marketable securities, and receivables that are convertible into cash with degrees of certainty and ease. Adequacy of financial assets is an important concern for all organizations including government agencies and non-profit organizations. The promise and potential of other assets is not realized in full without financial assets.

B2 Product managers

B2.1 Roles and responsibilities

Product Manager is a key role within Service portfolio management (Figure B.1). The role is responsible for managing services as a product over their entire lifecycle from concept to retirement through design, transition and operation. They are instrumental in the development of Service Strategy and its execution through the Service Lifecycle within a high-performing portfolio of services. Product Managers bring coordination and focus to the organization around the Service Catalogue, of which they maintain ownership. They work closely with Business Relationship Managers (BRMs) who bring coordination and focus to the Customer Portfolio.

Figure B.1 Product Managers have a key role under Service Portfolio Management

Product Managers are recognized as the subject matter experts on Lines of Service (LOS) and the Service catalogue (Figure B.2). They understand Service Models and their internal structure and dynamics to be able to drive changes and improvements effectively. They have a consolidated view of costs and risks across LOS, just as BRMs maintain a similar view across customers and contracts.

Figure B.2 Product Managers and Lines of Service (LOS)

Product Managers evaluate new market opportunities, operating models, technologies and the emerging needs of customers. They follow variety-based positions and seek new sources of demand for items in the Service Catalogue. They negotiate internal agreements with BRMs, who represent the underserved and unserved needs of customers. When solutions are not found in the Catalogue or Pipeline, Product Managers and BRMs work together on making a business case for new service development (NSD). They involve the Sourcing Management function when there is a need to integrate third-party services and other service components for a new or existing service. They hold a position within the Sourcing Organization. This requires Product Managers to be adept in integration projects and in holding internal and external suppliers accountable via formal agreements.

Product Managers provide leadership on the development of business cases, LOS strategy, new service deployment and Service Lifecycle management schedules. They perform financial analysis in collaboration with Service Design, Service Operation and Financial Management. This requires them to be good in negotiation, managing conflict and achieving consensus in order to achieve the organization’s strategic positions and financial objectives.

They bring the marketing mindset necessary for an outcome-based definition of services and effectiveness in value creation. They are able to manage conflict and constraints. They balance change and innovation in the Service Pipeline with stability, dependability and financial performance of the Service Catalogue. Product Managers are able to communicate LOS strategies effectively to senior leadership, develop partnerships with other groups within the organization and outside suppliers in order to satisfy customer needs. They must be able to plan new service development programmes in response to new market opportunities, assess the impact of new technologies, and guide the creation of innovative solutions. They market the development and implementation of services that incorporate new technologies or system development. This requires extensive cross-organization communications.

B2.2 Critical knowledge, skills and experience

Product Managers should have working knowledge of the market spaces with regards to industry applications, business trends, technologies, competitive scenarios, regulations, suppliers and vendors. They also should have demonstrated sustained performance in previous assignments, sound business judgment, negotiating skills and people skills. They should have excellent communications skills and the ability to accept challenges and manage the positive and negative aspects of risks, and develop solutions on time and within cost objectives.

Product management draws from multiple disciplines, bodies of knowledge and communities of practice:

 Businessstrategy, competitive analysis, and portfolio management