According to the article https://support.atlassian.com/jira-service-management-cloud/docs/migrate-between-next-gen-and-classic-projects/ , I should be able to choose how I wish the project to be managed.
When I create JIRA software projects, I get to choose whether it is team-managed or company-managed, just as the article suggested.
However for JIRA service management projects, I don't have the option to choose this, all projects under service management are company-managed.
All JSM templates are available for team-managed projects but only for users who are opt-in for the next-gen experience. Check to see if you're eligible for creating next-gen projects https://support.atlassian.com/jira-service-management-cloud/docs/get-the-team-managed-jira-service-management-experience/