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Service Design - Delivery Models

The workplace is a wash with different delivery sourcing strategies today. These have really exploded during the last 5 years or so. These are well covered in ITIL v3. Techniques such as out sourcing, in sourcing, shared services models, cloud computing etc.. All of these make for more complex choices if you're designing a service, you've got to think about the customer service experience up front and make the right decisions.

Delivery models

This type of delivery model relies heavily on internal organisational resources in the design, development or services and operations. Put simply insourcing equates to in-house which is a more common term for doing the work within the organisation.


This model uses an external organisation for a portion of the services design (or development, support etc.). These are usually formal arrangements for a well defined portion of the workload be it design development etc.


A combination of the above two, this model includes both internal and external organisations working together. This approach is sometimes used to leverage market opportunities by combining the strengths of several partners.

Business process outsourcing (BPO)

A common example of BPO is a call centre, in which entire business functions are relocated. This provides a lost cost location for essential business processes.

Application service provision (ASP)

Involves formal arrangements with an ASP organisation that provide shared computer based services to customers (organisations) over a network. Sometimes these are known as on-demand applications such as BBC iPlayer which lets customers stream TV content for previously aired programmes.

Knowledge process outsourcing (KPO)

This form of outsourcing is where knowledge-related and information-related work is carried out by workers in a different company or by a subsidiary of the same organization. This may be in the same country or in an offshore location to save cost. Unlike other forms of outsourcing, this typically involves high-value work carried out by highly skilled staff e.g. Market Research

See also

  • Service Development Life Cycle (SDLC)
  • Rapid Application Development (RAD)
  • Critical Success Factors (CSFs)
  • Commercial off-the Shelf (COTS)

service design process outsourcing insourcing bpo kpo asp model example shared cloud computing service



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