Technology Services Offerings Demystified: Technology Services offerings or custom SOW?

The Technology Services business has been around for as long as there were products. But it is only recently, I’ve seen companies started emphasizing the importance of Services offerings.

What are services offerings? Services offerings are created to provide specialized services to clients that require specific technological expertise in an easily repeatable and consumable way. These offerings can include a wide range of services such as installation and configuration of products, systems integration, use case design and implementation, cloud computing, cybersecurity, even building out entire solutions. The key to these offerings is the repeatable nature. These are not typically custom work or first of a kind (FOAK) engagements.

Why are they needed? We know technology is an increasingly critical part of business operations and in some instances, the specialized expertise needed to create, manage, and maintain the applications and infrastructure can not keep up with the demand from the business or infrastructure. But why go through the trouble of creating services offerings if Services can be delivered under a Custom Statement of Work (SOW)?

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1. Scalability: With custom work, each project is unique and requires a different level of effort, planning, and negotiation. On the other hand, services offerings are pre-packaged, standardized and can be more easily replicated. They allow the services organization to deliver solutions to common problem statements and use cases more easily and thereby serving more customers.
2. Efficiency: Since the offerings are standardized, there is a repeatable process for pitching, selling, transacting, and delivering the service, which can save time and reduce costs. For example, a custom SOW could require weeks of negotiations between the legal departments on both the Terms and Conditions (T&Cs) and the scope of the work, while the offerings can bypass that step altogether because it is “product”.
3. Specialization: Offerings can provide differentiation between the different areas of expertise and allow for the development and support from Subject Matter Expert (SME) with deep knowledge. This can also help the services organization to build a reputation as a leader in that area and attract clients who are specifically looking for that type of service. By focusing on a specific area, service providers can build up deep expertise and knowledge that can be applied to multiple clients.
4. Pricing: Because Services offerings are pre-scoped and pre-packaged, there is more consistency and predictability than custom work. Since the offerings are standardized, the company can establish fixed pricing for each offering, which can make it easier for clients to understand and compare pricing across different providers.
5. Marketing: Services offerings can be marketed more easily than custom work. Since the offerings are standardized, it is easier to create marketing materials and campaigns that promote the benefits of the service and its unique value proposition. Custom work, on the other hand, can be more difficult to market since each project is unique and requires a different approach.

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But the custom SOW are sometimes the preferred approach because Services offerings has limitations:

• Inflexible — no changes are allowed to scope, timeline, or budget.
  Pre-made services offerings are designed based on common patterns therefore meet the needs of a broad range of customers. The customer do not have control over the scope, timeline, and budget of the project, and can not make adjustments to the project as needed based on their unique requirements
• No customization — can not tailor to client’s exact requirements. Sometimes customers want to create a unique solution that is tailored to the their specific needs, the customer can differentiate themselves from their competitors and create a solution that is uniquely suited to their business. That could be harder to do with a pre-made services offering.

So how to strike a balance between speed/scalability and customization when designing an offering?

I will explore that with you in the next blog.

This blog is a part of a larger series of blogs “Technology Services Offerings Demystified” that dives deeper into services offering management.

Part 1: What is Technology Services Product Management: https://medium.com/@wennieyallen/what-is-technology-services-product-management-cd0b752da2d4