Adopting a XaaS-first approach in 2021

This year has seen a disruption to the way we work like no other. It has shone a light on the role and functionality of IT departments and perhaps highlighted areas for improvement. In this context, the concept of XaaS is a good one to explore. This article aims to clarify the three main functions, with respect to the benefits of adopting a XaaS-first approach in 2021.

In the X-factor world of services, “XaaS” (Pronounced ZaaS) is a term that stands for: Everything (and Anything) as a service.  At its core XaaS is the segregation of the responsibility of services into three components: the service creator, the orchestrator of services, and the consumer of these services. Examples that follow this XaaS model include cloud computing solutions such as IaaS, PaaS, SaaS, etc.

The current pandemic has accelerated the adoption of digital business and the domination of cloud computing services to meet the rapidly changing demands of workplaces, such as the work from home revolution and the push for a Domainless Enterprise. Therefore, the traditional operating model for delivering IT-services – and its value chain approach – needs to transform to succeed.

A low entry point to achieving this is by embracing a XaaS-first approach implemented by (i) Segregating service responsibilities (ii) Standardising where possible and (iii) Promoting productised services that follow modern service engineering standards such as IT4IT and use design thinking in both architecture and design that can be configured for changing requirements.

A Typical XaaS operating model for the delivery of IT services: Source ISBN 9780692688311

Making the Enterprise Catalogue central to service delivery

When an enterprise revolves around a unique catalogue of services, why should its IT services be any different? By making the enterprise catalogue (either a request catalogue or a service catalogue or a combination of both) the centre for IT service delivery, an organisation moves away from a reactive, request-driven service approach to a proactive, catalogue-driven service as well as self-service.

In doing so, the IT department takes on the responsibility of providing a best-of-breed portfolio of services; managed and optimised for service consumption, security, agility, reliability, responsiveness, service levels and cost across multiple service providers – some internal and others external to the organisation.

By following this principal: aggregating via a service catalogue and orchestrating delivery of these services, the IT department listens to its users and delivers a marketplace of focused enterprise-approved services, specific to targeted consumers

Acting as an aggregator rather than a creator of services, the IT department can move away from managing technology and costs to managing services and outcomes, allowing it to dictate a unique ‘services’ roadmap rather than being dictated to by technology limitations or tool vendors.

The Service Creator

XaaS is a collective term used both in IT and non-IT service management. It has the capability to select and promote the consumption of well-designed, reliable, market-tested products that seamlessly integrate within the enterprise, without the need for expensive enterprise services brokerage, API’s or service management platforms.

Product design:

For XaaS to be successful the products upon which the services are offered must be architected for XaaS. One way of achieving this is for the product creator to follow a value-stream approach in their design, such as creating products based on the ITIL V2 Kernel and adhering to value frameworks such as ITIL V4, IT4IT (open group standards) and the agile DevOps SAFe 5.0.

Furthermore, the organisation’s own digitised demands will require services to be built on products modelled on needs unique to the business and its first level customer base, such as the need for availability, performance, and security.

Products that are designed to such rigour are usually found external to the organisation, making XaaS a viable option not for just ERP applications, but other enterprise services delivery.

Changing behaviours in the consumption of services and managing customer expectations

A cloud native world has seen customers fast become service consumers, replacing traditional values for new ones, such as loyalty for convenience, value for cost and variety for time. In the process, an enterprise that demands a ‘consumer style’ marketplace may become more focussed on quality service, faster ramp-up times, pre-defined yet flexible solutions, effective and attractive value propositions, and services built to handle variable demand.

In this on-demand world of ‘Everything and Anything as a Service’ it may even become possible for expectations to decouple a service from its product, for example: “Can I just order the smile and not the coffee, please”.

Brokerage and Shared responsibility

Enterprise IT has a responsibility to its users (consumers) and customers (paying business units). This responsibility usually includes fundamental non-catalogue enterprise services such as email, personal data storage, as well as catalogued services including support for email and storage.

In a desire to embrace cloud services, an IT department may choose to share some of its service responsibility with external service providers by implementing the following services:

• IaaS: where the internal service responsibility is limited to the management of virtual machines and the physical (compute, storage, network) service management is externalised.
• Containerisation: where the level of responsibility is further decreased by automating the responsibility and service management of the operating system, patch management etc.
• SaaS: where enterprise applications are consumed on demand and the in-house responsibility is limited to the management of the organisation’s data and configurations.

In any of these scenarios, the responsibility for thinking and acting on how to best service the organisation’s users and customers should always be in-house, never assigned to external service providers including advisors and analyst firms.

Brokerage, on the other hand, is a commercial business model that can be used to fill gaps in service responsibility. It should be kept to a minimum to minimise channel hops.

Take away – Build as a product, offer as a service

In a build-as-product mindset, the architect and designer follow a strict product management discipline and design thinking regimen to build a configurable product that can satisfy a changing environment, incorporating the need for continuous improvement. A good example of this is Gmail.  Gmail is a product with more than one billion subscribers who require no tangible customer support (I have used Gmail extensively but have never had the need to make a support call to the service provider).

Companies are now resigned to the fact that employees often have better access to broadband, personal storage, email, and other IT functionality outside the work environment. As such, many are embracing a service consumption approach by promoting operational practices such as Bring Your Own Device (BYOD), edge and other subscription-based services, which are cost-effective, efficient, and flexible.

However, the accelerated transition to a cloud-centric and a digitally resilient environment has seen some IT departments increasingly focus on building in-house cloud-based services instead of concentrating on the delivery of continuous business operations. This comes from a traditional mindset to build products that satisfy the need of the time, further justified by security compliance and company policy.

Build where you must, acquire where you can.

XaaS global expert Prafull Verma says by adopting a controlled XaaS practice, organisations can choose the best of both worlds: by providing services around acquired products that are not only cost-effective, efficient, and flexible but also built with design principals that offer resiliency and continuous improvement. They can do this this while focussing on orchestrating and aggregating services that satisfy the changing needs of its first level user and customer base.

Acknowledgement:

The Author acknowledges research from ISBN-10: 0692688315 and ISBN-13: 978-0692688311 and would like to thank Prafull Verma a Global expert in XaaS for his wisdom.

About the Author

Chris Fosberry is a CIO advisor and Management Consultant (Member of the Institute of Management Consultants). He is a seasoned partner sales manager and cloud technology evangelist, since its mainstream adaptation in early 2000. Chris is contactable on Chris@Cajfor.com for presentations, consulting or advisory on implementing XaaS and service brokerage.