Value Co-Creation for Leaders

The Fundamental Shift: From "Delivering" to "Co-Creating" Value

Traditional IT service management operated under a one-directional model where IT delivers services to the business. ITIL v5 fundamentally changes this paradigm to value co-creation: value emerges collaboratively through a service relationship between providers and consumers, rather than being produced by one party and consumed by another.

Why This Matters for Leaders

Aspect	Old Model (Delivery)	New Model (Co-Creation)
Service Definition	IT decides what services to offer	IT and business jointly discover needs
Value Definition	Value defined by the provider	Value defined by consumer outcomes
Success Measurement	Success = SLA compliance	Success = consumer achieves intended outcomes
Customer Role	Passive recipient	Active participant
Relationship Type	Vendor/buyer	Partners

A service can achieve 99.99% availability and still fail to create value if it doesn't help the consumer achieve their intended outcomes. Measuring delivery without measuring value represents incomplete success.

The ITIL Service Relationship Model

The official ITIL v5 framework defines three primary roles in every service relationship:

Role	Responsibility	Example
Service Provider	Makes resources available and manages the service	IT department providing an ERP system
Service Consumer	Uses the service to achieve outcomes	Business units using ERP for operations
Other Stakeholders	Affected by or interested in the service relationship	Regulators, shareholders, employees, customers of customers

Consumer Sub-Roles

Within the service consumer role, three distinct sub-roles exist:

Sub-Role	Responsibility
Customer	Defines requirements and agrees on service levels (budget holder)
User	Uses the service day-to-day
Sponsor	Authorizes budget and provides strategic direction

Service Relationships Are Bidirectional

In every service interaction, value flows in both directions:

Provider to consumer: Access to resources, capabilities, service actions
Consumer to provider: Feedback, usage data, co-participation, funding

Both parties must be engaged for value to be co-created. A provider delivering without listening creates "the wrong thing, done right." A consumer demanding without participating creates "the right thing, done poorly."

Three Types of Service Relationships

The official ITIL v5 book defines three types:

Type	Description	IT Example
Basic	Limited interaction; standardized service delivery	Cloud infrastructure (IaaS): provider offers compute and storage; consumer provisions and manages their own workloads
Cooperative	Active collaboration; shared goals; regular interaction	Enterprise application management: IT and business jointly manage an ERP system, share planning, and collaborate on enhancements
Partnership	Deep integration; shared risks and rewards; strategic alignment	Digital transformation partnership: IT and business co-own digital products, share KPIs, and jointly invest in innovation

Choosing the Right Relationship Type

Factor	Basic	Cooperative	Partnership
Strategic importance of the service	Low	Medium	High
Frequency of interaction	Low	Medium	High
Customization required	Low	Medium	High
Shared risk	Minimal	Some	Significant
Cost to manage	Low	Medium	High

⚠️

Not every service needs a partnership. Basic relationships appropriately serve commodity services (email, office productivity). Reserve partnerships for services that directly drive competitive advantage or strategic outcomes. Attempting to make every service a partnership creates unsustainable overhead.

Operationalizing Value Co-Creation

1. Redefine How You Measure Value

Move from provider-centric metrics to outcome-centric metrics:

Provider-Centric (Old)	Outcome-Centric (New)
System uptime: 99.9%	Business process completion rate: 99.5%
Ticket resolution time: 4 hours	Employee productivity restored within 2 hours
Changes deployed: 50/month	Business capabilities delivered on schedule: 95%
Cost per ticket: $25	Cost per business outcome enabled: declining trend

2. Design Service Interactions for Co-Creation

Every touchpoint between provider and consumer represents an opportunity for co-creation:

Touchpoint	Delivery Model	Co-Creation Model
Service Request	User submits request; IT fulfils it	User and IT jointly determine the best solution
Incident	IT fixes the problem; user waits	User provides context; IT resolves; both contribute to knowledge base
Service Review	IT presents metrics	IT and business jointly analyse performance and plan improvements
New Service Design	IT designs based on requirements document	IT and business co-design through workshops, prototyping, and iteration
Continual Improvement	IT identifies improvements	Joint improvement backlog: business and IT propose, prioritize, and execute together

3. Embed Co-Creation in Governance

Governance structures should reflect the co-creative nature of the relationship:

Governance Element	Co-Creation Approach
Service Level Agreements	Jointly authored by IT and business. Include outcome metrics, not just technical metrics.
Service Reviews	Bi-directional: IT reports on service performance; business reports on value realized.
Investment Decisions	Joint business cases where IT and business share responsibility for ROI.
Risk Management	Shared risk register: both IT risks and business risks are managed together.
Portfolio Management	Joint portfolio governance: business provides strategic direction; IT provides technical feasibility.

4. Develop Co-Creation Capabilities

Your teams need new skills for co-creation:

Capability	Traditional Skill	Co-Creation Skill
Communication	Technical writing, status reports	Facilitation, active listening, business storytelling
Analysis	Technical requirements gathering	Business outcome analysis, journey mapping
Design	System architecture	Human-centred design, service design thinking
Measurement	KPI tracking	Value realization analysis, experience measurement
Relationship	Vendor management	Partnership management, stakeholder engagement

Value Co-Creation Across the Lifecycle

Lifecycle Activity	Provider Contribution	Consumer Contribution	Co-Created Value
Discover	Technology landscape analysis	Business strategy and market insight	Joint identification of opportunities
Design	Technical design options	User needs and business constraints	Service design that works for both
Acquire	Procurement expertise	Business requirements and budget	Right technology at the right cost
Build	Engineering and development	Feedback, testing, and validation	Product that meets actual needs
Transition	Deployment and training	User acceptance and adoption effort	Smooth transition with high adoption
Operate	Monitoring, maintenance, reliability	Feedback and incident reporting	Stable, responsive services
Deliver	Service delivery and support	Active participation and self-service	Efficient value delivery
Support	Technical support and resolution	Context, diagnostics, and feedback	Fast resolution and knowledge growth

Anti-Patterns in Value Co-Creation

Anti-pattern	Symptom	Correction
"Service Theatre"	Co-creation workshops held but decisions made unilaterally by IT	Ensure consumer input has real influence on decisions
"Feedback Graveyard"	User feedback collected but never acted upon	Close the loop: report back on what changed because of feedback
"Partnership Overload"	Every service treated as a strategic partnership	Match relationship type to service importance
"Provider Knows Best"	IT designs services without consumer input	Embed consumers in the design process, not just at review
"Consumer as Blocker"	Business seen as obstacle to IT innovation	Reframe: business provides essential context, not interference

Key Concepts (service, value, outcome definitions)
Measuring Success (outcome-centric metrics and XLAs)
Culture Transformation (building a co-creative culture)
Operating Model Design (structuring teams for co-creation)
Service Level Management (SLA management)

Last updated on April 2, 2026

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