Real-World Service Management: Ivor Macfarlane’s Thoughts from Las Vegas

Las Vegas is a unique microcosm of services—and service management

Service Management in Action

Sitting here getting ready for this year’s Pulse event in Las Vegas, I find myself looking back to my first visit to Las Vegas a few years ago.

Vegas is, to someone with a background in service management, an extraordinary place in many respects—a concentration of services, in terms of the intensity with which they're delivered and the experience of the consumer. It's all about more: bigger and gaudier hotels and casinos, bigger jackpots, and, of course, more money gambled, more quickly.

And beyond intensity, one could also say Vegas accelerates the evolution of service management in a local context. It's a microcosm in which different services rapidly emerge and flourish, or fail and are replaced with others. And because of that, Vegas also offers many useful lessons for those of us who work in service management.

I should admit, for the sake of fairness, that the Vegas experience is not entirely to my personal taste. First of all, from my cynical (and admittedly aging) British perspective, at first sight it all seemed too big and too plainly artificial. It lacks the natural, organic quality I associate with older, more established cities, which is not too surprising when you consider that Vegas has only been an incorporated city for one hundred years. Vegas did not gradually emerge in response to a growing population; it was deliberately and almost uniquely created for specific business purposes.

But I fairly quickly noticed that there are other valid views. There is, for instance, certainly a more colourful and romantic viewpoint: Las Vegas is about delivering dreams to people. True, not everyone I saw looked as if they were living out their favourite fantasy, but it did seem that people looked generally happier than they have in other casinos of my acquaintance. (In case you care, my personal award for the casino with the gloomiest faces goes—by quite some way—to Adelaide.)

But neither of these perspectives—Vegas as Artificially Gaudy Spectacle, and Vegas as Fantasy Island—is quite the truth, either. That must lie somewhere in between, although finding the truth in Vegas is harder than in more mundane locations. Compare Vegas, in a holistic sense, to the business world, which is characterized by clearly defined roles and succinctly-stated, precisely-measured business needs; it's obvious that Vegas is not nearly as tidy as that. (Although perhaps some of you are thinking that your business experience, come to think of it, isn’t so simple and certain—maybe you can’t nail down one neat set of service requirements? If so, that implies our work environment has more in common with Vegas than first sight implies.)

Extrapolating best practices, Vegas-style

"Within the IT service management field, we need to be looking at the total relationship of business services and IT. By this, I mean not just the potential negatives, in terms of damage from downtime, but also in terms of benefit—the compelling new possibilities that could emerge from taking that backward step in abstraction to see the bigger picture."

My next thought was to wonder why it was that some organisations got a better outcome than others. What were the rules in play? Could I extrapolate them based on what I saw?

One thing I noticed was that it seemed as if all the casinos offered essentially the same set of services: accommodation, food, drink, and gambling. None seemed to be creating a competitive distinction by doing a fundamentally different thing than the others.

That being the case, then, the success of one over the others would have to stem primarily from service quality—rendering these standard services in a better way—and, of course, service cost. And it is certainly true that in Vegas, as everywhere, organisations try to adjust these two variables of quality and cost to pair with customer demand.

The parallel with our everyday business environments, and particularly in the case of IT service management, seems very clear. We need to evaluate the range of services we provide—and could provide in the future—by using these same two basic metrics of service quality and service cost. They should both mirror and drive the business possibilities.

Of course, that will also mean understanding customer needs and interests; if we don't know what customers want, and how much they will pay for different versions of it, we can't respond appropriately. And this area of extrapolating customer interest levels is a very challenging area indeed, for which the tools and metrics we have at present aren't nearly as good as they should be.

That said, these rules of thumb occurred to me:

Now, granted these are just heuristics based on limited personal experience, and this is certainly not my own area of expertise. But I suspect that those who do work in this area will follow my rationale. And such thinking also opens the door to the related area of best practices—the underlying wisdom, gleaned from extensive real-world experience, that yields a better outcome.

What are the best practices for Vegas—or the entertainment industry generally? Are they formalised and accessible (like ITIL in our world)? Or are they perhaps secret, recorded in an arcane language and passed down from generation to generation—like magicians (or lawyers)?

In both IT and entertainment, there is a core of ideas that describes how best to align services with the specific needs and interests of customers. And the Vegas example also illustrates that a wide range of services is possible under generic headings (in that case, the generic heading is entertainment, and the services range from world-famous singers to magic acts to mind-reading and many others).

Defining and delivering services that match customer needs is key

What else can we deduce from Vegas about customer interests? Clearly different kinds of customers seek different things; it's probably also true that the same kinds of customers need different things on different days, or under different emotional conditions.

This might suggest corresponding possibilities for IT service management. For instance, it might be that we are so focused on how we deliver services that we lose sight of the customer experience of them. Would customers prefer a service that's simpler, and of lower quality, but also cheaper? Or would they prefer even higher service quality under the rubric of "you get what you pay for"—incurring higher support costs, if those costs could yield an even better business outcome? These questions must continually be asked and answered.

Furthermore, since customer interests change, their answers to those questions probably won't remain the same over time. This being so, is there any pattern that can help predict what the future answers will be?

In a holistic sense, there is, perhaps, less pressure on IT service management professionals than Vegas business owners to find the answers and drive change as a result. Although many of us feel these days that our jobs and professional futures are not secure, compared to many in Vegas, we are relatively safe; in Vegas you either deliver what people wish to pay for, or else you fail. It's only a question of how fast.

Innovation drives service evolution in the business world, and that's true in Vegas as well. Good ideas are always copied, yet with a twist—some extra added improvement to create an obvious distinction, avoid being labeled a knockoff, and ideally, leave the original innovator behind. This implies the need for continual service improvement for every player in the entertainment game.

In some cases, it's not entirely clear how a given service can evolve further, to suit customer needs more precisely, or increase the range of potential customers. (You might wonder what Gilley’s could do next to optimise entertainment. What could possibly be the natural evolution from live mudwrestling?)

I also remember, from that first trip to Vegas, that I heard a talk from a casino owner, and it really clarified many of these subjects for me. On the face of it, he spoke about how to be a survivor in the Vegas environment, but it was really about providing services—about matching the service and quality of service to what the customer can use and will pay for.

It was fascinating seeing someone take that step back in abstraction, past the talk of delighting the customer or meeting their wishes, to see the broader and longer-term situation. This casino owner's focus was on providing services to maximize what the customer might pay over the full business period: not a single trip to Vegas, but an entire year in which there might be multiple trips.

Similarly, within the IT service management field, we need to be looking at the total relationship of business services and IT. By this, I mean not just the potential negatives, in terms of damage from downtime, but also in terms of benefit—the compelling new possibilities that could emerge from taking that same backward step in abstraction to see the bigger picture.

So what are my conclusions? Among others:

  1. Keep your eye on the best practices, as determined by industry context—and always be ready to tailor those practices, as suggested by customer needs, to get a better result.
  2. Know what you are doing and why you are doing it. Don't lose sight of the big picture.
  3. Balance abstract guidance with the specific realities of your own environment. You are the world's leading authority on the subject of your job—and nobody is better equipped than you to understand how to create positive change.

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