Service Strategylifecycle stage

Service Strategylifecycle stage

The purpose of the Service Strategy stage of the Service Lifecycle is to define the perspective, position, plans and patterns that a service provider needs to be able to execute to meet an organisation’s business outcomes.

By adopting a clear Service Strategy that reflects the strategies and policies of the service provider’s overall organisation, all IT service solutions and activities can be driven by identified business needs and requirements.

To be successful, the Service Strategy must direct the development and provision of services that are perceived by the customer as delivering real value to them, in the form of outcomes that the customer needs to achieve.

The service provider must first make sure they have a clear understanding of who their existing and potential customers are, in order to achieve a deep understanding of customer requirements in terms of what their needs are and when they occur. This requires the service provider to understand the wider context of the current and potential market place that the service provider does and could operate in.

A successful Service Strategy cannot be created in isolation of the overall business strategy and culture of the organisation that the service provider belongs to. So a good starting point in developing your Service Strategy is your organisation’s Business Strategy. The service provider may exist within an organisation solely to deliver services to one specific business unit, or to service multiple business units (the internal IT department), or to operate as an external service provider serving multiple external businesses. The strategy they adopt must provide sufficient value to their customers and all the service provider’s other stakeholders – it must fulfil the service provider’s strategic purpose.

Service Transition

The Service Strategy of all IT service providers must recognise the existence of competition, and embody an awareness that customers and suppliers always have choices irrespective of the context in which they operate. Remember, at any point in time an external IT supplier will be talking with your CEO telling them they can do it better than the internal provider. Therefore, a Service Strategy must describe how that service provider will be differentiated from the competition. All service providers have current or potential competition. All need a Service Strategy.


A Service Strategy must provide:

  • An understanding of what strategy is;
  • Clear identification of the definition of services and the customers who use them;
  • The ability to define how value is created and delivered;
  • A means to identify opportunities to provide services and how to exploit them;
  • A clear service provision model, that articulates how services will be delivered and funded, and to whom they will be delivered and for what purpose;
  • The means to understand the organisational capability required to deliver the strategy;
  • Documentation and coordination of how service assets are used to deliver services, and how to optimise their performance;
  • Processes that define the strategy of the organisation, which services will achieve the strategy, what level of investment will be required, at what levels of demand, and the means to ensure a working relationship exists between the customer and service provider.
  • The reader should be able to understand the most important practices related to defining and executing a Service Strategy within a service provider organisation.
London School of Economics ITSM Process Transformation

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Kate Hamblin

Senior ITSM Consultant +44 0118 324 0620