Navigating Service Transition Risks: Mitigation Strategies for Success
When embarking on service transitions and engaging new service providers, organizations often emphasize value while overlooking the critical aspect of supplier transition. Picking a supplier with a proven transition performance record and deploying an experienced IT transition project management team are pivotal for successful service transition and delivery. Here are the top five service transition risks and corresponding mitigation strategies:
- Risk: Schedule Delays
- Mitigation Strategy: Develop a transition strategy with a stepwise schedule approach. Progressively test transition readiness, increasing scope and complexity as specific milestone criteria are met.
- Risk: Service Costs
- Mitigation Strategy: Employ rigorous due diligence to understand current demand drivers and service management requirements. Align baseline costs with out-of-scope costs and accurately forecast future service costs during contract negotiations.
- Risk: High Demand Skill Sets
- Mitigation Strategy: Evaluate the complexity of current and future business processes to identify specialized resources needed. Make HR adjustments to mitigate the impact of critical resources leaving the organization.
- Risk: Quality of Service (QOS) Degradation
- Mitigation Strategy: Establish service level management best practices, activate governance during transition, and set up governance procedures. This minimizes QOS degradation and provides contract mechanisms for financial relief.
- Risk: Managing Service Provider Effectiveness
- Mitigation Strategy: Build an effective contract governance model ensuring:
- IT retains control of IT services
- Responsibility and commitment are shared values
- Performance and improvements are continually measured
- Both partners strive for efficiency and excellence
- A stable and trustful relationship is cultivated
- Mitigation Strategy: Build an effective contract governance model ensuring:
Addressing these risks as part of service requirements during sourcing and including them in the supplier selection process is crucial. Mitigating transition delays is essential for integrating a new supplier and minimizing service interruptions caused by poorly planned transitions. By implementing these strategies, organizations can navigate service transition challenges successfully.