A year ago I wrote an article on why application convergence could spell the end for niche IT Service Management products – One year on, has anything changed?
Software and application vendors have long been offering ITSM-light or systems that can be manipulated to provide more IT service-centric or Customer Relationship Management (CRM) functionality. While there have been acquisitions and integrations aimed at developing more cross-department/platform-based applications, no one has yet built a true cross-market product that is a significant threat to market share.
So why should traditional ITSM providers be worried?
Just as many ITSM products have been reinventing themselves as Customer Service Management applications, CRM has been moving away from purely sales and contact management to offer marketing, business intelligence and service functionality. In fact, CRM’s rapid expansion and more developed cloud delivery model could mean that firms no longer need niche products with add-ons. They will get it all in one place.
People working in the ITSM industry will be aware that larger office tool vendors have been looking to add service functionality to their application platforms for some time. Until now, this has not been at a level that would concern more-established ITSM vendors. Recent product releases have been much more than a step into the realms of ITSM. You could almost call it a full-scale invasion of the market sector.
With the acquisition of service management and field service management technologies, vendors have been able to add significant service functionality to their application suites. Let’s consider the key areas of service that are already being offered by CRM providers.
- Field Service
This typically offers advanced scheduling, inventory tracking and asset management for service depots as well as for highly mobile, in-field specialists fulfilling work orders and providing preventive maintenance across multiple sites under complex service agreements. It will also provide mobile access to central customer records and the ability to share and amend this information with project service on the fly. - Project Service
These capabilities give organisations the ability to estimate, quote and contract work, plan and assign resources, capture time, expense and progress data. - Self-Service Portals
Self-service portals are a popular area of development in the ITSM industry. These are now available to CRM application customers, giving organisations the ability to deploy them with profile management capabilities and configurable design components.
Now that the functionality is more aligned, what is the main threat to market share?
It’s quite simple and it lies in the method of deployment and integration.
CRM vendors are already gaining significant market penetration though their ability to include core Service Management functionality as a part of an existing application suite or as an additional license sold into their user base. Add ERP integration into the mix, and you can see why medium and larger organisations, in particular, will benefit from this single platform that is easy for employees to access and familiar for them to use. And that is hard to argue against.
Organisations are increasingly looking for applications that can manage the entire business process and customer lifecycle and that have the ability to share data seamlessly between departments. This is driven by a need to report back on performance of staff and the company as a whole, so that investments are focused in the appropriate areas. Service is another key area that could lead organisations to decide that the one platform approach offers not only what their ITSM provider does, but much more in some cases – all fully integrated with their CRM and office systems.
In my musings one year ago, my assessment of these moves into the ITSM space by CRM vendors, the level of the technology involved and its functionality, made it seem bleak for ITSM as a standalone sector. But a year is a long time in technology, and, as I also suggested at the time, the market has shifted to include a greater focus on SIAM, ESM and other specialist frameworks that deal with operational complexities that CRM vendors who offer service functionality are a long way off matching.
ITSM as an industry has a real knack of reinventing and evolving to maintain its position in the essential business tool arsenal. If this innovation continues, it is hard to see how full application convergence can be achieved. Importantly, some companies will get all they need from the basic functionality offered by some vendors. I feel that this has, in part, driven the ITSM community to innovate to solve business issues, to adapt to modern working practice and to grow market share away from the basic helpdesk.
So perhaps the title should be ITSM – what’s next folks?
