HfS Network

Category Archives: SaaS, PaaS, IaaS and BPaaS

Innovation: Did you get any?

July 24, 2016 | Khalda De Souza

Innovation: Did you get any?

Buyer: “This service provider delivered no innovation, thought leadership, or long-term best practice management advice for my business process.”

Me: “Did you ask them for any of this?”

Buyer: “Erm….no.”

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Posted in: SaaS, PaaS, IaaS and BPaaS

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HfS: The Silver Lining in Cloud Applications Services Research

July 22, 2016 | Khalda De Souza

So it’s finally happening. Enterprises are using SaaS applications to run important processes, such as CRM, HR and even Finance. Moreover, some even have an enterprise cloud strategy that requires departments to consider cloud options alongside on premise solutions, as part of process transformation projects.  

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Posted in: SaaS, PaaS, IaaS and BPaaS

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Is ServiceNow the new black?

July 16, 2016 | Tom Reuner

 

There is a lot of buzz about ServiceNow technology. Thousands of developers and partners made their pilgrimage to Knowledge 16, ServiceNow’s customer event in Las Vegas. Service providers are starting to standardize service delivery on the ServiceNow platform and M&A is helping to build out service providers capabilities, as in the case of CSC acquiring Aspediens. Even though ServiceNow tends to position itself as the Enterprise Cloud Company, industry stakeholders are rather enthusiastic about the single data model, the embedded workflows and new ways of collaboration. As such, ServiceNow has the potential to evolve into one of the key building blocks for moving toward As-a-Service because its core value proposition centers on clients accelerating their time to value through faster actions and interactions, overcoming clunky legacy solutions like ITSM.

Buoyed by such buzz and enthusiasm, ServiceNow is aiming to expand the notion of service management to evolving into the “third estate between CRM and ERP,” providing a new cloud-based level of efficiency between the front and back offices. Thus, there are many touch points with the HfS notion of the OneOffice: Digitally driven enterprises must create a Digital Underbelly to support the front office by automating manual processes, digitizing manual documents and leveraging smart devices and IoT where they are present in the value chain. As a result, ServiceNow can be part of a broader innovation ecosystem in which the ability to orchestrate and integrate will become the pivot for creating value and differentiation. Nonetheless, as HfS has stated repeatedly, it is not just about the technology or solution ideals of the As-a-Service Economy, but about the change ideals in equal measure.

Here is the crucial question: How are organizations advancing their innovation agendas?

The recent HfS ServiceNow Services Blueprint highlighted two key issues in that respect: First, ServiceNow itself has been slow in embracing the notion of an ecosystem that goes beyond treating partners as mere sales channels. Thus, co-innovation with partners around vertical offerings and other innovation had not been high on the agenda. This is starting to change though, which is critical as the notion of the As-a-Service Economy is predicated on a collaborative partner ecosystem. Second, there are issues for service providers as well to address as many clients were unhappy with the lack of innovation driven by their supplier. The most successful projects were those in which clients drove the innovation process. This points to a crucial aspect for the journey toward the As-a-Service Economy. The eventual success is less about the technology building blocks and more about a change in mindset.

As the ServiceNow Services Blueprint shows, many clients need help in understanding the direction of travel. What vision do innovations like ServiceNow support? One compelling example for such a change in mindset came on a recent visit to an Atos delivery center in Barcelona that is supporting the 2016 Rio Olympics. It is a shift in mindset because Atos is treating the Olympics as a transformation project. The firm’s executives summarized the challenge of this project by comparing it to a business of 200,000 employees, addressing 4 billion customers, operating 24x7, in a new territory, every 2 years. To deal with such a complexity condensed to a short time frame, Atos did two things: First, it switched its service management to ServiceNow, which is a bold move given the scale of the project and the relative immaturity of the platform. Second, to be able to manage the heterogeneous supplier landscape, Atos is leveraging the SIAM methodology. Furthermore, it is migrating the infrastructure to a centralized cloud delivery model to drive down cost while enhancing agility.

To further highlight the intensity of the project, during London 2012 there were in excess of 255 million IT alerts without a major incident at the Games. This underpins the outcome orientation of the project. What counts to the client is managing a unique complexity without any hiccups in the quality of service delivery.

The Bottom Line: ServiceNow is standardizing service orchestration

ServiceNow has the potential to evolve into one of the key building blocks for moving to As-a-Service, but service providers need to engage proactively with clients to demonstrate the direction of travel as well as leading with a comprehensive innovation agenda. Moves of service providers to standardize broader service delivery on ServiceNow as part of service orchestration strategies reference an increasing maturity on this journey.

Over the next 12 months, we expect a broad maturation across the industry with accelerated levels of M&A. As a result, ServiceNow will continue to be the center of many innovation projects extending to scenarios involving security and IoT. However, we urgently need more reference cases demonstrating the lessons learned from projects to be able to conclude that ServiceNow is the new black—and it’ll last longer than a few episodes in Netflix.

Posted in: HfS Blueprint ResultsSaaS, PaaS, IaaS and BPaaSThe As-a-Service Economy

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Can HPE + CSC dominate the digital underbelly, or has that ship sailed?

June 19, 2016 | Phil Fersht
Digital Underbelly

Just stare at that digital underbelly... there's a lot of work needed down there!

When the news broke last month about the second largest IT services merger of all time (after the 2008 HP-EDS whopper), the reaction among the services cognoscenti was - and has continued to be - one of confusion.  Big services mergers have just not done very well over the years. HP/EDS was a culture clash of immense proportions - and occurred right before the great recession, while other mergers, like Dell's acquisition of Perot, has resulted in the old Perot business being flipped over to NTT Data at a significant loss, and the Xerox/ACS merger has been shaken up and spun off and needs a major reinvention under new CEO Ashok Vemuri to get the company back on track.  Meanwhile, Capgemini and IGATE are still figuring out the best pieces of each other to mesh together, while not taking their eye off the ball, during the services industries' most cut-throat transition phase.

We heard HPE CEO, Meg Whitman, excitedly address the firm’s key clients and industry analysts at HP’s recent Discover event in Las Vegas, with an obsessive focus on “digital transformation” and the impending impact of “digital disruption”.  However, the real opportunity for HPE isn’t really in the design of digital business models for clients, it’s the enablement of them – it’s the provision of the agile “digital underbelly” to make digital change really happen for enterprises.

It's easy to be cynical about legacy IT services, but there's an awful lot of it to scrap over as enterprises are forced to fix their plumbing

Digesting the merger of these two struggling services giants has resulted in more rumination than most, considering the timing, sheer scale, transitional uncertain market and motivation. This is not a time when most traditional service providers are looking to add more global delivery scale to already large foundations – most are trying to slim down their delivery armies and sales forces,

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Posted in: Analytics and Big DataBusiness Process Outsourcing (BPO)Buyers' Sourcing Best Practices

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HfS adds a new twist to Digital and IoT coverage with Oliver Marks

June 06, 2016 | Phil Fersht
Oliver Marks is Research Vice President, Digital and Internet of Things, HfS (Click for bio)

Oliver Marks is Research Vice President, Digital and Internet of Things, HfS (Click for bio)

You may have seen we've been busy expanding our research team to make sure we can help executives pull all the right value levers to take their enterprises into the As-a-Service Economy. In the old days we put a lot of focus into outsourcing services, until we really made a statement being the first analyst to introduce Robotic Process Automation to the analyst and advisory industry in 2012, before priming the Digital transformation services pump in 2014 and IoT in 2015.

So, we thought it high time we recruited one of the industry's most respected authorities on the digi and IoT topics, Oliver Marks... so without further ado, let's hear a bit more about HfS' newest recruit...

Welcome Oliver!  Can you share a little about your background and why you have chosen research and strategy as your career path? 

Thanks Phil! I’ve got quite an interesting past: I started out in the UK design and advertising business having done a graphic design degree which was remarkably similar conceptually to the current vogue for 'design thinking’ in the tech world. We ran a ‘concepts & copy’ creative shop on

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Posted in: Digital TransformationHfSResearch.com HomepageIT Outsourcing / IT Services

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Robotic Process Automation has now penetrated a third of enterprises. Time to advance the conversation...

May 30, 2016 | Phil Fersht

RPA 1.0 is a done discussion. We know what it is, we know what it can do, we know how it can augment operations and help digitize broken processes.  To this end, our brand new study on Intelligent Operations, which canvassed the dynamics of 371 global enterprises, already shows a third of them are very active with RPA within their IT and finance and accounting processes:

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RPA is here and being adopted at a fast clip

All the incessant RPA hype has done its job - it has literally dominated IT services and BPO conversations at every conference, provider strategy deck, advisor "new practice" press release and many buyer converations.  Indeed, we can even forgive those cheesy sales presentations from guys who suddenly claimed to have 20 years' experience as automation pioneers and talked about bot farms as if they were actually hand-raised on one...

The overwhelming conclusion is that a large chunk of enterprises are actively implementing it, and

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Posted in: 2015 As-a-Service StudyAnalytics and Big DataBusiness Process Outsourcing (BPO)

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It's time we started Being As-a-Service

March 23, 2016 | Phil Fersht

Coming away from our Cambridge University buyers summit this week, I was pleasantly surprised by the increased level of sophistication and maturity many services buyers are now exhibiting.

Gone are the provider bitch-fests and endless ranting about failed promises and absent innovation (that they didn't pay for in the first place).  Instead, there was a desire to look at themselves, and really try to figure out how to broker change and run their outsourcing engagements as part of a broader business agenda, not some quirky siloed activity, forever tarnished by the word "outsourcing".

Adopting a mindset to change today (not tomorrow), is where everything must start

Yes, the conversation has turned to buyers accepting they need to change first, before heaping all the blame for their woes onto their service providers. This is why our Ideals of As-a-Service begin with a mandate for buyers and providers to change how they behave, how they can adopt a mindset to start writing off their legacy processes and technologies.  In short, it's time we focused on fixing our present - it's time we focused on Being As-a-Service:

Being-as-a-Service

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It's time we stopped talking about this scenario of "this was legacy and this is our future desired endstate"... we'll just remain stuck in this perpetual stranglehold of never getting anywhere. We'll always we a work-in-progress, a project that never finishes...

As someone joked during our Cambridge University summit this week "Cognitive computing is always going to be huge in the future"... so let's stop evangelizing about a nirvana we many never reach and, instead, start talking about what we need to do today. Let's stop panicking about the future, which is scaring so many people, and start focusing on what we can do today to be more effective.

Let's start talking about Being As-a-Service today... not tomorrow, or some far off point in the future, where we just hope this all becomes somebody else's nightmare...

Bottom-line: We have to narrow the chasm between hype and reality in order to be successful in the present

Our industry is beset by fear, like never before. People are scared - they know their skills and capabilities could quickly become obsolete in a world where the job openings increasingly demand creativity, analytical prowess and an ability to pivot across domains.  Suddenly, if you're not a Digital native who talks about endless disruption and the coming robo-geddon, you're a dinosaur... The gap between hype and reality has reached ridiculous proportions, and it's time we stopped thinking about the fantastical future and focus on what we can achieve today.

Successful sourcing executives have to become "brokers of capability" (which one buyer commented sounds like a rock band) where they can live in the present to drive a change mindset for the future. Most of the executives have been tasked with adopting Digital strategies (whatever those may be) and to come up with smart approaches to take advantage of automation technologies. But to get there, they need to change how their teams think, collaborate and operate.

It's a mindset change, it's a culture change. It's about bringing together the key stakeholders and delivery leads to address the As-a-Service Ideals today and stop looking at them as some far off nirvana someone else will take them to.  Simply put, most firms can't simply saw-off their legacy by disposing of some archaic ERP system and slamming in some SaaS product, or mimicking every defunct manual process into a piece of RPA software, or firing an entire department of ineffective process wonks. In fact, a lot of the legacy actually works and the ROI of binning it doesn't make financial sense.  Writing-off legacy is about starting the process of re-imagining a future without those legacy systems and processes that are holding back our businesses.

So the Ideals of As-a-Service can be initially addressed today by making the most of what we currently have, not simply waiting for the day budget magically appears from above to bring in teams of nose-ringed consultants to redesign our businesses.

Posted in: 2015 As-a-Service StudyAnalytics and Big DataBusiness Process Outsourcing (BPO)

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Why it's time for Robotic-BPO to break the mold of legacy F&A engagements

March 18, 2016 | Phil Fersht

Robotic BPOAmidst the relentless robo-hype in our current era of robotic rhetoric, it’s fast-emerging that many buyers and service providers are really struggling to work together to create workable Robotic Process Automation initiatives – in many cases, neither are willing to make the necessary investments, trade-offs or sacrifices to make his work.

So let’s start with those selfish service providers unwilling to share the robotic rewards...

Some service providers want to implement RPA on themselves and avoid passing on the savings to their buyers. Having come off a great many buyer discussions about their developing Robotic Process Automation (RPA) capabilities to augment their BPO engagement productivity, I have been shocked to hear a common thread from several buyers: their service providers only want to implement RPA on themselves and insist on charging their buyers the same legacy FTE rates.  Some service providers simply cannot stomach sharing gains with their buyers - some have, but the general experience, from the buyers, has been they are not really interested. And one of those service providers even boasts its own "cannibalization fund", while refusing to do anything different with several of its biggest engagements.  It's quite mind blowing how contrary some of these service providers can be, when it comes to what they claim they are doing versus the reality of what they really up to.

Yes, amidst this talk of the leading service providers breaking away from the old model and openly exploring ways to invest in initiatives to delink headcount from revenue, it would appear that some are simply playing lip service to the industry while, in reality, they are just looking at RPA as a vehicle to drive down their own costs and improve their margins, while maintaining their legacy FTE-pricing.  One buyer even mentioned to me that their service provider had the nerve to ask them if they could reduce their own staff delivery headcount using RPA, but keep charging them the same FTE rates.... no joke.

However, this isn’t just the fault of the service providers, many buyers are equally to blame for robotic restraint...

Buyers need to entrust their providers with more intimate data access. Most enterprise buyers, for security and control reasons, keep the providers at bay and force them to connect to their systems only using Citrix. This limits the effectiveness of RPA overall and encourages an “us versus them” mindset between buyer and provider, so it’s no surprise service providers do what they can on the other side of the “Citrix” firewall. Both parties cannot enjoy the full benefits of RPA and Intelligent Automation, without genuine collaborative engagements and a holistic security model that aligns the capabilities more effectively.

Greedy buyers need to stop treating RPA like legacy offshore BPO, demanding all the savings up front. I would also argue that many costs of RPA –greater testing, maintaining a fall-back agent pool and the incremental manner that robots are typically actually rolled out (versus a one time overall reduction in costs, as often asked by buyers) diminish the “greedy” aspect of this from many service providers. In addition, many buyers want royalties for advancing the automation initiatives of the

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Posted in: Business Process Outsourcing (BPO)Cognitive ComputingDesign Thinking

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Accenture, IBM, NGA and NTT Data lead in SuccessFactors services

March 12, 2016 | Phil Fersht

One of the most significant shifts towards As-a-Service delivery, in recent times, has been the investments in delivering comprehensive IT and business process services to support the enablement of leading SaaS platforms. With the gravy train of revenue the leading service providers have enjoyed from clunky on-premise ERP services, over the last 2+ decades, now slowing, the land-grab to manage the data, business transformation and integration elements of the leading SaaS platforms is hotter than ever.

To this end, we're very excited to unveil the industry's very first HfS Blueprint on SuccessFactors Services. With HfS Principal Analyst in SaaS services, Khalda De Souza, at the helm, this Blueprint builds on the direction we carved out in our Workday and Salesforce Blueprints in 2015.  So who better than Khalda to bring us up to date:

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Khalda, why have we undertaken an HfS Blueprint on the SuccessFactors Services market?

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Blueprint author Khalda De Souza covers SaaS for HfS. (click for bio)

The SuccessFactors Blueprint continues our theme of looking at the markets for services around leading SaaS platforms, following on from our Workday and Salesforce Services Blueprints of the past 12 months. All of these markets are in high growth mode as enterprises seek flexible, user-friendly solutions to better manage their HR or CRM processes. The service providers included in our SuccessFactors Blueprint have experienced an average of 45% growth in SuccessFactors services last year and expect to see the same growth levels next year. Given that enterprises with SAP ERP in the back-office are more likely to select SuccessFactors for their cloud HR solution, the potential market is huge.

We also see snippets of the HfS Ideals of the As-a-Service Economy in the SuccessFactors service market. Clearly, enterprises are making the commitment to Write Off Legacy by moving to SuccessFactors and building new HR processes around the platform. Service providers are also driving Collaborative Engagements with flexible engagement methodologies and a key focus on desired business outcomes.

How does HfS define the SuccessFactors Services market?

HfS has defined a Value Chain of services that applies to all the SaaS platforms we cover. This includes the five components delivered by service providers to create value for enterprises: Plan, Implement, Manage, Operate and Optimize. For SuccessFactors services, Plan includes consulting services such as SuccessFactors business case development, compliance, security and governance services, as well as HR strategy and SuccessFactors-specific process and design services. Implement covers all the services and skills required for effective deployment, including but not limited to project management, testing, training and data migration services. Manage includes all ongoing integration and support services. Operate includes business processing outsourcing (BPO) services where they are delivered by the service provider around the enterprise's SuccessFactors environment. Finally, Optimize services are intended to improve the impact of SuccessFactors solutions and may include: the assessment of new SuccessFactors releases and solutions and on-going HR strategy alignment.  

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Posted in: Analytics and Big DataBusiness Process Outsourcing (BPO)Buyers' Sourcing Best Practices

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There's a whole generation with a new explanation... in San Francisco

February 25, 2016 | Phil Fersht

Get ready! We're Coming to San Francisco!

sf-email-headerYou may have heard we just announced our first-ever Working Summit for Buyers in San Francisco at the St. Regis Hotel May 26th - 27th. The summit's theme—Vision 2020 for Intelligent Operations—brings together the IT and business process services industry's brightest minds and stakeholders. Seats are limited and available at no cost to well-qualified senior buyers. So, if you are interested, pencil us in your calendar and apply for a seat now.

Unvarnished Discussion Sessions

  • The State of the As-a-Service Economy and Intelligent Operations: Is It Here?
  • Evolution or Revolution: What does the Future really Look Like?
  • The Current State of Intelligent Automation – what’s working and what’s not for buyers
  • Service Automation: Robots and the Future of Work
  • The Digitization of the Finance Function
  • Co-inventing for the As-a-Service Economy
  • Hiring for As-a-Service Skills and the Role HR must play in the As-a-Service Economy
  • The evolution of Omni-Channel for CRM: What is it really, and does is exist?
  • Analytics and Big Data in the As-a-Service Economy… what’s really coming next?
  • Getting ahead of Trust and Security in the As-a-Service Economy
  • The C-Suite Advisor – Buyer Face/Off
  • The C-Suite Service Provider Shootout

Apply-Now-Button-Email

Featured Discussion Leaders

  • Mary Lacity, Curators’ Professor, University of Missouri
  • Lee Coulter, CEO Shared Services, Ascension Health
  • Allison Sagraves, Chief Data Officer, M&T Bank
  • Phil Fersht, CEO HfS Research
  • Carol Britton, CPO, Bank of New York Mellon
  • Charlie Aird, Global Leader, PwC Shared Services and Outsourcing advisory
  • Chip Wagner, CEO Alsbridge
  • Dave Brown, Global Lead, Shared Service & Outsourcing Advisory at KPMG
  • Dennis Howlett, Co-Founder, Diginomica
  • Dilip Vellodi, Chairman and CEO, Sutherland Global Services
  • Jay Desai, Senior Director, Enterprise Outsourcing, AbbVie
  • Gajen Kandiah, Executive Vice President and General Manager Cognizant Digital Works and Business Process Services
  • Harry Wallaesa, CEO, The W Group
  • Jesus Mantas, Head of Global Business Services, IBM
  • Joe Frampus, Partner, Avasant
  • Kevin McDonald, VP of BPO Governance, The E.W. Scripps Company
  • Leslie Willcocks, Professor, Workforce and Globalization, London School of Economics
  • Mark Voytek, Partner, Ernst and Young
  • Michael Corcoran, Head of Strategy, Accenture Operations
  • Pradip Khemani, Head of Global Business Services, Blue Shield of California
  • Scott Furlong, Partner, ISG
  • Shantanu Ghosh, SVP & Global Head – CFO & Transformation Services, Genpact
  • Srinidhi Rao, Head – Service Management and Process Excellence, Juniper Networks
  • Tony Filippone, Senior Vice President, Outsourcing Management, AXIS Capital
  • Robin Rasmussen, Partner, HR SSOA KPMG
  • Vishal Sikka, CEO Infosys
  • Wesley Bryan, Co-Founder, OneSource Virtual

Apply-Now-Button-EmailHfS Analysts

As usual, we'll have a full contingent of HfS analysts on site to present the latest data and stimulate discussions. In San Francisco, we'll have Phil Fersht, Charles Sutherland, Barbra McGann, Fred McClimans, Melissa O’Brien and Reetika Joshi.

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Posted in: Business Process Outsourcing (BPO)Captives and Shared Services StrategiesCloud Computing

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