Service organizations are special creatures that are not getting enough love in this world.
They don’t base their business model on the products that they sell. Instead, they work with their clients (typically product organizations) and help them deliver the best possible software solutions that would enable them to reach their business goals.
To build a good product, product organizations need to get many things right: the business problem, the solution for their users, the right technology for the job, the right methodology to tie everything together, and the right team to execute it. Missing only one of these can put an organization into trouble.
Not all product organizations have all of these skills so it’s only natural for them to look for help. Consulting/service companies have been there for ages to provide such support.
Product organizations typically generate income by selling their product through subscription-based or maintenance models. Service organizations, on the other hand, don’t have these (let’s call them) passive income streams. To maintain a steady income stream, they need to continuously sell and deliver their services. Much like sharks that need to be in constant movement to keep water flowing over their gills and prevent suffocating, service organizations must constantly sell and deliver their services to keep the cash flow healthy. And they need to do it most efficiently!
What does all of this mean for collaboration between client and service organizations?
Last year I had a chance to talk to wonderful Courtney Kissler about the relationship between client companies and consulting companies. Through her huge experience collaborating with consulting companies, Courtney recognized the following patterns that product organizations should embrace as crucial for successful collaboration (listen to our conversation here):
1. create a win-win for your company and the consulting company
2. ensure the consulting company truly understands your business and problem
3. be committed, ensure you have the internal people ready to partner with the consultant
In the same tone, I wanted to express the values that service organizations should live by – just like Courtney did for client organizations. Is there a better way to express values than through a manifesto? I think not.
Manifesto for service organizations
We are uncovering better ways of developing software by doing it and helping others do it.
Through this work we have come to value:
Strategic work over just “more” work
Flow over headcount
Missionaries over mercenaries
Community over zero-sum approach
That is, while there is value in the items on the right,
we value the items on the left more.
Strategic work over just “more” work
Service organization can definitely grow by taking on more work – any work – but it’s much better to take on strategic work. Sometimes you don’t need to take more work, you just need to eliminate existing non-strategic work and replace it with strategic work. It’s like going to the gym to get stronger: you don’t need to gain extra weight, you need to replace the fat weight with muscle weight even if that means your total weight will actually stay the same.
Flow over headcount
Adding extra headcount could be a way for a service organization to do more work – although I’d be careful since Fred Brooks taught us differently – but even if increasing the headcount leads to more work being done, it is still better for an organization to do more work by improving the flow instead of increasing the headcount.
Missionaries over mercenaries
Service organizations are here to help client organizations achieve their business goals, either through consulting or outsourcing parts of work. Either way, service organizations should be in the game, deeply engaged, understanding the real needs and pains of client organizations, and actively looking for ways to help client organizations. Only through such behavior will client organizations feel the trust, drop their guard, let them come closer, and plan together which is an important factor in improving the flow of value in service organizations. It’s what Marty Cagan best described as moving from “mercenaries” to “missionaries”.
Community over the zero-sum approach
I feel like there is much more competition among service organizations than among product organizations because product organizations use tangible things like their product features to differentiate themselves, while service organizations use intangible things like skills, knowledge, and experience. And these are much easier to fake than concrete product features that you either have or don’t have. Consequentially, all service organizations are allegedly fantastic and all of them can allegedly pull off any project perfectly. This inability to differentiate drives service organizations to hide every advantage, close themselves, and not share their experience. The moment we start treating our industry as a zero-sum game is the moment in which we all lose. Not only service organizations but our client organizations as well.
Three different perspectives
When you look at these values, you will notice three different perspectives: internal, client and community.
The internal perspective addresses the organization itself through values “Strategic work over just more work” and “Flow over headcount”. The client perspective guides the organization’s relationship with its clients through the value of “Missionaries over mercenaries”. The community perspective guides organization’s relationship with the ecosystem in which it operates through the value “Community over the zero-sum approach”.
Our experience shows that for a service organization to grow sustainably, it needs to take into account all of these three perspectives. Leaving out any one of these perspectives can still yield short-term good results but this service organization won’t succeed in the long run.
We hope that the Manifesto for service organizations will become the foundation of many future successful collaborations between client and service organizations!
This talk was featured on DevOps Enterprise Summit Europe 2022 and is available here.
