Abstract
Traditionally, a Service Level Agreement (SLA) is used as an appendix in IT Service Management agreements to set expectations and delineate the service delivery description as well as the terms and conditions of delivery. However, SLAs are unable to imply and guarantee the added values expected by the customer. Service Value Agreement (SVA) is a newly developed framework that identifies the deliverable added values along with metrics to measure the quality and quantity of achievements in terms of business added values. The objective of this study is to expand the concept of SVA for Application Management (AM) services and suggest guidelines for its implementation in real business cases. This goal is fulfilled through the case study approach and outsourcing industry contributions. Authors suggest discussing the concept of SVA from early stages of the sales lifecycle and implementing it gradually during the steady state phase. Combination of Service Value Mapping approach and Piloting method is suggested for SVA proposition as an option with successful practical history.
Highlights
Information Technology Outsourcing (ITO) has many significant practitioners as well as much academia attention [1]
It is important to know that Service Value Agreement (SVA) is “collectively exhaustive” and “mutually exclusive” meaning that, on one hand, it includes the values and measurement indexes which are under the control of management and, on the other hand, no two indexes overlap one another [12]
The added values are categorized in three cornerstones based on their nature and purpose of development; service performance, process efficiency, and capability
Summary
Information Technology Outsourcing (ITO) has many significant practitioners as well as much academia attention [1]. Environmental demands lead by cost cutting [3,4,5], focusing on core business processes by outsourcing non-core IT services and getting access to “best of breed” capabilities [3,4,5,6], and delivering higher quality services with better reaction to the end/user demands [7] are some examples of internal and external factors. These are considered as internal issues since they improve operational efficiencies by leveraging best practices by specialized service providers. To make previously introduced SVA more comprehensive, seven new added values along with their measurement metrics with a specific focus on Application Management (AM) Operate services are introduced
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