I really hate seeing relationships filled with promise in the beginning go bad in the end.
I am currently on-course to take over 1000 client inquiries this year. 70% of my calls involve the replacement of IT operations management tools. The reality is that hearing about failed relationships and the subsequent breakups has become part of my daily routine. Breakups are inevitable, and it tends to happen when one party (usually the client) spends more time, money and resources towards making the relationship work than the other (usually the vendor). It’s a lose/lose situation, the client is back at square one and casts the vendor as an evil entity that has over-promised and under-delivered; and the vendor loses a customer and has their reputation sullied.
I see it all too often from my vantage point, where I&O organizations typically replace management tools every five years. Over the past five years, the total software revenue for IT operations management tools was $70 billion, and over the next five years, IT organizations will spend a forecast estimate of $100 billion — a number that does not take into account the hard and soft costs of a failed relationship.
The reality of the situation is that there are some organizations and some vendors who just don’t belong together. While they make a cute couple, that doesn’t mean that they are soul mates. The irony is that the breakups are not a result of a lack of features or functions, but because someone’s expectations were not met. Those expectations should be verbalized at the onset, but rarely ever are. This is where I stress to I&O organizations the importance of outlining key steps and questions to be answered to scope an IT service desk or IT service support management tool acquisition. These steps should not require long, complex analysis nor should they generate thick reports, but rather they should be a document that succinctly articulates the strategic parameters of the acquisition. In other words, I&O organizations have to be able to have honest answers to the following questions:
- Why are we purchasing a new tool in the first place?
- What can we do with a new tool tomorrow that we cannot do today?
Essentially, you want to understand if you need to enter into a new relationship in the first place. Failing to do so results in a combination of the following events:
- The tools are purchased for the wrong reason
- The tools are never implemented properly (likely because proper budget wasn’t set aside for professional services)
To reiterate, relationships fail because expectations aren’t met, partly because expectations are never clearly established. What nobody wants to hear is that the common denominator in all failed relationships is you.
This is a relatively solvable issue, and it doesn’t let the vendors off the hook. Yes, they can be horrible, and some flat out are, but I will say ITSM vendors tend to be the scapegoat more often than they should be. And yes, vendors should be held accountable when they promise capabilities that they or their partners fail to deliver. But as a virtue of human nature, it is easier to blame the tool for your organization’s inability to define and achieve a long-term I&O strategy that is in sync with the needs of the business. The real work — of developing well understood roles and responsibilities and maturing your day-to-day processes — takes effort, and contrary to popular belief does not come in a box. So in these cases, when the breakup occurs, I&O organizations have to say “it’s not you, it’s me” and mean it.
In breakup scenarios, I propose taking the following steps before getting back on the ITSM dating wagon to find a new relationship to dive into.
- Articulate your goals and objectives at the forefront of your search. Know who you are and what you bring to the table, and have an honest discussion about what process maturity gaps exist in your organization. In determining your value, and challenge potential vendors to align solutions to your roadmap, as opposed to just handing over a functional requirements list.
- Never compromise your goals or objectives to be with a vendor. A vendor has to recognize your path in terms of where you have been and where you are going to get you to your desired outcomes. Any vendor who tells you they can take you somewhere without knowing where you are trying to go is just trying to get in your portfolio. It’s one thing to tell you they will never treat you like your last vendor, it’s another thing for them to show you.
- Play the field and know your options. There are over 100 ITSM solutions available, almost over half of which are offered in a SaaS licensing model. The key to understanding how to leverage SaaS after a break up is to think beyond a licensing and financial model and more around SaaS as a delivery model. SaaS isn’t just the way something is paid for; it’s a means to reduce the cost of innovation. That’s why we are seeing customers extend the value of their ITSM solutions and create business solutions that affect the bottom line. SaaS licensing can be the means to let you date around, but can also be something you end up forging a lasting relationship with. Just be careful to recognize the fact that the initial costs can be lower than perpetual licensing, but more expensive over time.
- Talk to Your Friends/Talk to My Friends. Friends can be great in a break up, because they’ll call the vendor a jerk and tell you how you were way too good for them. Where they can be a detriment is where they don’t tell you all the things that you did wrong in the relationship. My analyst and industry friends don’t want to beat you up too bad, but we do want to give you an honest take on setting better goals and objectives with respect to constraints and organizational obstacles, and put you in a better position regardless of whichever vendor choice you ultimately end up making. While it may be therapeutic to put together “Do Not Date This Vendor” lists, you have to consider the roles and expectations of both parties in a relationship.
- Begin Again. Lastly, don’t bring the baggage from your old relationship to your new one, most often manifested in the customizations you made with your previous vendor. New selections should be based on how well the tool matches your requirements with as little customization as possible, and rarely should requirements change to conform to a tool’s inability to do something. Customizations require costs, time, resources and sometimes services, so in vendor evaluations build better requirements and re-evaluate whether or not customization is still required. For example, you may have customized your last instance because a function wasn’t provided or there was a unique business need for a specific integration. At the time it may have been difficult to do, but it’s likely that your potential new relationships have that missing function or have a wider range of APIs to leverage. Here, keeping a clean install and an open mind can be very important.
Even with some new relationship guidelines established, I still see a buying market where over 85% of organizations have yet to reach a Level 3 in I&O process maturity, and will continue to lean heavily on tools to carry them over the threshold. With SaaS licensing being a more viable option, I actually see a scenario where the average churn rate moves from 5 years to 3, primarily driven by lower switching costs.
Regardless of which vendors and licensing models you choose, I just want to see you in happy and healthy relationships. At the same time, I will still be your should to cry to on if and when another vendor breaks your heart.