Tag Archive: IT Industry


As IT industry is going through its churning stage to find a new growth path, there is a lot of buzz around “How to Move Up the Value Chain?”.  Concept of Service Productization offers new avenue. But, I scratched my head on this a lot and could come out with my 101 notes on Service Productization.

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What is Productization?

  • Productization is a practical and systematic methods to implement product-like features and characteristics into a service and package it into a more manageable and understandable object.

What is Service Productization (SP)?

  • It is packing a Service offerings into a product bundle to deliver a domain solution with better cost, lesser time, better quality and higher predictability than Pure Service model. It is a complete domain solution full of methodology, framework, accelerators to

What are the Differences between Service Productization and Service Model? 

  • Based on configuration rather than customization.
  • Loaded with features rather than requirement gathering.
  • At end, Not a project model but a product.

What are main Characteristics Productized Service?  

  • A pre-defined and clear offering or deliverable
  • A consistent standard delivery methodology
  • Supporting tools and templates for executing the service
  • Consistent knowledge and skills required to deliver the service
  • Quantifiable costs and demonstrable value

Why should we productize services?

  • Sophisticated client base demands constant proof of repeatable and demonstrable value. Fixed-time, fixed fee and shared-risk engagements represent about half of all the work performed by Project
  • Executive Group nowadays. Therefore it becomes increasingly important for us to structure our work in a way that offers clear deliverables with pre-defined scope, methods, skills, time and cost.
  • A standard service methodology delivers significant improvement in revenue, pipeline size and utilization.

Why is it called Blueprinting of Services? 

  • Yes, it is a blueprint of end to end domain solution using services. If compared with Template, it is just about time and resources. But, Blueprints is about adding additional views of complete guides, deliverables, required authorizations, historic effort and other critical information.

What are critical success parameters of a successful SP? 

  • To Build a successful productized service, it has to address following two aspects:
    • Commercialization – A SP has to offer both most common and most appealing demand but in this, it should not loose sight on Cost Structure. It have to show one big price for full offerings but allows flexibility to change it by configurations based on customer requirements.
    • Standardization – Success of SP is purely based on standardization of each service in its portfolio. Surely, this comes with experience, but a model can be placed to keep it standard across offerings.
  • To Win in Marketplace, it is required to come with flying colors on following parameters as well.
    • Customer expectation -In this, It will be about Ability to size the Customer expectations and ability model in SP offering is critical to success.
    • Ability to deliver – Having modeled a fantastic SP, delivering it on promise is second most critical factor for continuation of success.
    • Service proposition – Should continued to have its Service flavor to it to provide Customization flexibility.

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Can any domain problem be consider for SP? 

  • No, bear in mind, that SP is only beneficial in solution domain where there is high volume of work from multiple clients.

References: 

IT companies are in process of reinventing themselves to adjust new scenario of competition. Traditionally, volume based growth was the only way to grow linearly, but with changing dynamics of market, where customer asking for value add, scarcity Good technical resource and competitive price pressure, are forcing companies to think “Alternatively Growth Plan”. That is about non-linear growth which can come from re-modeling existing business model around platform, product, Intellectual property and Automate processes. After refering few news articles, here are few offerings which could potentially drive new revenue growth.

  • Differentiated Service Offering
    • Using intellectual properties or domain expertize to solve client’s technology, business or operational challenge
  • Productized Solution
    • Platform or product into niche area to address replicable solutions across multiple customers.
  • Flex Delivery Models
    • Leveraging economy of scale by consolidating similar work across the clients through a well defined process, tools, interfaces and centralized scalable team.
  • Lifecycle Accelerators
    • Pre-developed software that automates particular business problem or an aspect of product development to reduce 30% to 70% of the code can be reused across clients
  • Alternate Commercial Models
    • Outcome based pricing models that ensure that client pay only for service which delivers business value. This allows IT companies to transform client relationship from mare technology partner/vendor to strategic business relationship.
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