A lot of marketing hyperbole is thrown around to quantify the justification for making investments in products (and how tojustify it to your boss).  We often here the terms ROI, TCO, TEC, etc.  Today instead of talking academic we go straight to the source with a interview withTony Sanders, Sr Director of the Business Solution Managers group here at BMCsoftware.

 

The ITSMguy;  BSMs for BSM, sounds redundant, but I’ll play along. What is the Business Solutions Manager Group? 

Tony Sanders: Well,it’s a name that is in transition to Business Value Consulting and is probably a better description.  When we look at customers we think internally and externally. Our internal customer is primarily BMC sales where we engage our external customer to help them understand the value of BMC’s solution, like ITSM and its components.  The next evolutionof this is how value is realized through defined metrics that are measured and tracked as implementation progresses and use cases are satisfied.

The ITSMguy: We talk a lot about Value Realization here at BMC, is this real or just some marketing fluff that I created? 

Tony Sanders: It’s very real but let me provide some history. For some number of years now we have been defining value in a business case.  Almost everyone needs this these days to justify a capital investment in a project.  Our process is, once we determine that our technology is fit for your purpose, we conduct a number of interviews to understand how your processes are done today, by whom, time allocation, gaps or processes that should be done but are not, etc…

With this customer data in hand we can build models defining the value of process improvement or instantiation of a process.  We’ve refined this model for risk adjustment,for example, we don’t assume the customer is starting from zero.  The process may be very manual, but it is being performed.  We also don’t assume the customer will get to 100% of the value. So the models tend to be very conservative and we cycle through this a number of times with the customer validating the numbers.  But this is building a business case and there is industry data to show that very few customers actually follow up and measure the value defined in the business case.

To me Value Realization is much more with many components that determine or influence customer value.  Such as, the customer may perceive value in how easy it is to do business with BMC contractually.  We’re not after that.  Our next wave we refer to as Benefits Realization and is the measure of value of the benefits defined within theBusiness Case.

So let’s take an example: Let’s say our business case identifies that a customer can reduce calls to the service desk by implementing a Service Request mechanism.  Then you have to understand the types of calls.  I had a customer tell me once that 60% of their calls were people calling in to check on the status of anexisting incident.  Now there are dollars associated with having to pick up the phone if the answer is “the work is inprogress”.  So we’ve identified a use case and quantified the benefit.  The next step then is to measure, track and report this so everyone agrees on how the benefit, (reduced call volume), is realized and translates to value achieved (time and money saved).

In any business case there will be multiple use cases defined.  The measurement and tracking  needs to illustrate value achieved – use cases complete, value in progress –use cases underway, and value potential – total value of the all use cases.

The ITSMguy:  Well that sounds very interesting, how does one going about learning more and taking advantage of this?

Tony Sanders: We engage with customers as part of the BMC consultative sales process. So as customers are engaging and going through their discovery and evaluation, we are available as a resource. 

Customers or prospective new clients should contact us through their BMCrepresentative.

The ITSMguy;  ThanksTony. For the masses, here are some key stats of in terms of value that has been realized by some of our customers;

  • A large global electronics manufacture experienceda significant % reduction in change related outages
o  Reduced downtime by 60% – $11M savings
  • A financial services company reduced their time in application release deployment
o  Reduced on average from 50 minutes to 50 seconds
  • A specialty retailer decreased spend  in asset costs
o  Decreased annual asset spend by $1.8M

IT organizations such as the City of San Antonio, China’sBank of Communication and NewYork City Health and Hospitals Corporation have all recently turned to BMC to modernize their IT support operations. 

By: ITSM Guy