Service management is now probably the most potent approach to the management of information technology from a business perspective. Service management helps focus on business services in spite of the heterogeneity in the underlying IT infrastructure. Consequently, many large organizations are implementing standard IT Service Management guidelines, such as the ITIL. However, there is a need for an integrated methodology (independent of the business sector and underlying technologies) that would allow the development of service solutions from a business perspective. This paper presents a business-oriented 8-Stage Service Design and Management methodology that integrates Total Quality Management techniques, such as House of Quality (HoQ) Matrices to help quantify qualitative service management parameters. The methodology is illustrated with a case study of a major utility organization in Australia, an early adopter of a structured IT Service Management methodology.