Infosys can save the UK from Economic Fossilization. Here's how

November 30, 2020 | Phil Fersht

In today's world of constant fake news it was refreshing to get some real news that literally made me choke on my 57th microwaved frozen chicken jalfrezi of the year.  The fact that this real news emanated from the Daily Mail (the UK equivalent of the New York Post or Air India's in-flight magazine) was an indicator of how bad today's media has become.  Also, the fact that my head of marketing actually reads the Daily Mail gives me serious concerns for our 2021 marketing strategy... 

Anyway, let's get to the point.  Our Chancellor of the Exchequer (CFO for you corporate types), "Dishy" Rishi Sunak is married to the daughter one of India's IT industry's founding godfathers, none other than Akshata Murthy, daughter of Narayana Murthy, the man who created Infosys.  Like that happened and no one's noticed until someone at the Daily Mail discovered this... and they wed in 2009.

The UK is in a mess so bloody big we need to redefine "mess"

If a depression-driven Covid catastrophe wasn't bad enough, the mother country is going into a catatonic depression so bad, it may lead to an economic fossilization (that is my term for something worse than a depression) when we throw a no-deal Brexit into the mix... due end of 2020.

Anyone observing the thrilling performance of the Indian-heritage service providers this year will observe how the leaders have somehow kept the IT outsourcing industry actually growing a little bit, despite a predicted 8-10% nosedive that analysts many predicted.  And this owes a huge amount to its standout performer of 2020, Infosys, which has chugged along signing megadeals and reinforcing its commitment to the cloud at a time when enterprises are desperate for a partner to help them pivot at breakneck speed into the cloud model.

Anyway, as a disillusioned British born analyst (and global citizen) I suddenly see hope...

I have a lot more faith in these entrepreneurs from Bangalore than the current old-boys network running Her Majesty's economy into the ground.  I always knew Rishi was the only smart one in there, and now we have the evidence.

So... now good old Infosys has no choice butto bail us out as they married into... the UK!  

I am sure they will appreciate some free advice on the governance team that can drag us quickly out of our current predicament, so here's an initial strawman architecture:

UK Prime Minister:  Ravi Kumar S.  No one spins it better than old Ravi... all he has to do is bulldoze our media with pics of his new baby girl all over twitter and have us guessing forever on the mysterious "S"...

Chancellor:  Pravin "UB" Rao... this man can keep a ship sailing through any storm.  This current crisis stuff is child's play compared to rogue CEO's in private jets and dodgy Israeli automation purchases..

Head of the UK Coronavirus Task Force:  Vishal Sikka... time to dust off the former CEO to convince the UK public that we needn't worry about Covid as "AI will provide the answer" (after showing up 30 minutes late to every briefing).

Brexit Secretary:  Salil Parekh... who better to carve us out of the EU than the king of the carve-out deal himself?  He'll even do the deal on the golfcourse showing the rest of Europe how it's done.

Head of Cybercrime:  Mohit Joshi... who better to arm our cyber-defenses than the man who can iron-wall any bank still running on Cobol mainframes?  Easy, just move all our sensitive data onto Finacle and the Russians and Chinese will go crazy trying to figure out what the hell we just did...

Vaccine Distribution Czar:  Radhakrishnan "Radha" Anantha... who better to command the British vaccination process than InfosysBPM kingpin Radha himself, who will ensure everyone needs to "calm down and just focus on the outcomes".  If things get a bit dicey, he will take questions from his kitchen where we'll be far more interested in what on earth his kids are sneaking out of the fridge while he's too busy talking to us...

But what about Rishi himself?

Oh, he's far too smart for us.  Can't you get him to take over from that Modi guy?  Rishi makes money appear from magic, you know?

Posted in: Outsourcing HerosPolicy and Regulations

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The Agile Gabriel calls the leaders who'll take you into the Cloud faster

November 17, 2020 | Phil FershtMartin Gabriel

Today's environment is based on rapid decisions to move processes and apps into the cloud as fast as possible to keep companies functioning in a remote-working economy.  That means it's all-hands-on-deck to use all available resources to make this happen as cost-effectively as possible.  The principles of agile development have never been as important.

Cloud computing is basically the Internet being used as the system for delivering processes, software, data, and other services.  Being ‘agile’ means being able to use all resources as and when required. It also means not having to use them when not being used, and not pay for them. So how can we expect today's service providers adopt agile development to help our enterprises make the leap to the cloud as effectively and rapidly as they can? Let's ask HFS analyst Martin Gabriel who led the recent Top 10 report in Agile Development Services:

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Martin - why has agile become so talked about in the recent past?  Hasn’t this been around for ages?

Yes, that is very much true. In a nutshell, due to the following reasons, it took center stage – a) Because of the agile success rate in software development space, and b) the traction in organizational agility. It has proved that agile methodology enhances productivity and alpha, and if adopted appropriately, it reduces overall cost over a period of time. The agile concept has come a long way, it has evolved all the way through software development, but now has branched beyond IT and other departments like marketing, legal, HR, and much more. As the concept is getting increasingly popular across business areas, companies have started to witness higher returns because of this. However, this was only feasible because of the embracement it garnered from C-suite members in recent times. That being said, not all big firms embraced it, companies like IBM and GE witnessed a drop in their revenues as per a report on “Market capitalization of big firms.”  On the contrary, firms like Amazon and Microsoft, who adopted agile practices at the top level, have delivered significant results over a period of five years. Companies like Netflix and Spotify were born agile, and they were far from being bureaucratic and hierarchical and are one of the fastest-growing. I believe these are some of the key reasons in recent times it’s been discussed a lot in my perspective.

And has anything changed significantly with the pandemic, or is agile now even more relevant in the current environment?

As we know, agile software development is all about being iterative and collaborative at work. During the pandemic, few agile teams struggled but bounced back faster. But few of them were not doing that well before COVID as well, and the pandemic triggered its downfall too. On the other side, teams that performed well before COVID have developed trust due to the work from home coming in to the play and also plugged mental health management models in the team that shaped them to perform better during the crisis.

While we see this in the organizational perspective, certainly, the pandemic has pushed the organizations to play with an unfamiliar swiftness, and that is how organizational agility became inevitable in today’s environment. Many non-agile organizations adopted agile operating model out of necessity, and it has significantly helped them to cope with the crisis regardless of industries.

With agile operating model adopted completely or partially, companies led with a smooth transition, efficient work management, and met customer needs within set timelines. In fact, within an organization, agile business units performed significantly well than the non-agile business units. We cannot deny the fact that non-agile organizations struggled to manage the remote work environment and resource prioritization.

The Challenge of performing well in crisis with agile models does not end here. The real test will begin when the same organizations who adopted the agile way of working out of emergency might have to figure out the most sustainable model that suits them after things settle down. The current operating model was only developed out of emergency and was not a well-planned one in the long run.  

So, what impressed you - and disappointed you - the most when you conducted the briefings and enterprise reference calls during the recent T10 report? Did you feel the industry has been making a lot of progress with agile or is it more “lip service”, Martin?

What impressed me – Well, I have lot to discuss on this, starting from enterprise adoption rate of the Agile methodology to success rate, client relationship, providers’ willingness to go overboard, and to my surprise, commitment and impressive client relations. This is where some of the mid-tier players were able to demonstrate and deliver better than the tier 1 players – this does not mean that tier 1 players were less impressive or have not wooed their clients. Sometimes the complex management structure takes away the perk and makes it intricate and challenging to achieve desired results faster.

Flexibility, when I say flexibility, here I am talking about the willingness to flex resources if needed, flexible pricing, free hands-on choosing resources for their projects, open environment where developers from providers’ side were able to push back if that’s not the right approach and the willingness to go out of the box rather than sticking only with the contract.

These are some of the positive angles that few providers were able to pull off.

What disappointed me the numbers they gave for their agile resources. While conversing on providers' strength in their agile practice, it was observed that the numbers of trained agile associates were a little unrealistic. Few providers mentioned more than 80% of their application development work in agile, whereas few of its peers only mentioned around 35%. These numbers lie in two ends and difficult to analyze.

Large organizations are still focusing on pleasing clients instead of being true to the name of agile engagement. Few agile team members were unable to have difficult conversations with their clients, instead, they agreed to every task thrown at them without explaining the challenges behind. In fact, they did not create room to push things back if they were unrealistic.

In my humble opinion, clients are very mature compared to many service providers. They have vast know-how and understand the ground-level challenges and common market problems better and on top of that, they have a willingness to cooperate.

Sometimes, client references given by the providers refuse to participate as there were no prior intimations given. These instances reflect that providers sometimes assume clients are happy and ready to share happy testimonials.

Across providers' offerings, frameworks, partnership ecosystems, and capabilities are the same. End of the day it’s about customer satisfaction, overall experience, and pricing.

Answering the last part of your question, the Agile model indeed progressed over the years. It has almost replaced the traditional waterfall methodology. The agile failure rate is only 8%. Yes, it has its challenges too. Initial costs, unclear objectives that lead to constant changes, scaling across different teams and locations, resistance to change, and lack of executive support are some of the challenges.

Martin is actually pretty cool you know...

And which providers, Martin - in your view - distinguished themselves the most?  And why?

Infosys, HCL, and Accenture bagged the top 3 ranks in our top 10 studies. Sometimes simple things make a huge difference, and in our agile study, that’s exactly what happened. I reiterate that customer feedback, pricing, and flexibility differentiates providers. Methodology, approach, partnership ecosystem, scale and breadth, IP, and accelerators are very close calls among the top players. It is tough to differentiate for buyers and even me as an analyst. Little you can make difference wherein the thought leadership, investment roadmap, and willingness to go that extra mile is the one that differentiates among the top players. Matter of fact, fourth, fifth, and sixth rank holders were very close to each other. They were equally good in most of the assessed parameters.

As we evolve rapidly into this new hyper-digital environment, how would you like to see agile evolve and a practice?  What is your advice to young professionals in this space? 

Well, agile is not limited to individual teams (say product development team) anymore; embracing the agile practice organization as a whole is the way.

Advice to young professionals - Coders who are developing agile competency will differentiate themselves and have a better advantage over others. Also, we are embracing organizational agility; therefore, an agile foundation or awareness is going to be inevitable.    

Furthermore, some of the skills are often taken casually or being ignored. Agile team members must equally focus on developing soft skills like managing difficult conversations, the ability to present your work to a wider audience if needed. Being a good developer or coder isn’t sufficient anymore. Agile is about constant change and iteration and for that these skills are ideal.

And how would you describe the similarities between agile development and the rapid scaling up investments? How can we use agile to get to our “North Stars” faster these days?

In short, the Agile concept took years to reach where it is today. Even today, some of the top IT service providers agreed that only ~36% of their application development work is in agile. Similarly, scaling up agile has its own challenges. In the past, sr. leaders were very stringent in approving the budget. Last four-five years with proven agile results and an agile mindset, C-Suite members are open to scaling, and the COVID crisis further pushed the process.

Answering your second part of the question. We witnessed results in organizational agility over a period and it’s one of the big fuss in the industry right now. Also, in the recent pandemic, agile organizations were the ones who were able to swiftly move/adapt to the remote workspace than others. Leaving challenges aside, the benefits of organizational agility is faster adoption of changes, capitalization on new trends, and incline towards an innovative firm. I believe, in short, organizational agility is the best way to reach our North Stars, faster. There are a lot of steps and approaches to be followed, that is another discussion altogether.

Premium HFS subscribers can click here to download the Top 10 report in Agile Development Services

Posted in: Cloud ComputingIT Outsourcing / IT ServicesDigital OneOffice

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So what's coming coming next folks? Stay tuned right here as the fogs clears for the New Dawn...

November 14, 2020 | Phil Fersht

Posted in: Digital OneOffice

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Chatting to Vinnie Mirchandani on how the IT and business services industry has coped with a pandemic

November 09, 2020 | Phil Fersht

One of my oldest blogging sparring partners is the gnostic Vinnie Mirchandani of Deal Architect fame.  We caught up a few days ago to talk about the impact of Covid on the services and outsourcing industry, how to lead through these challenging times, and how to embrace the faster, cheaper, more competitive tenets of digital to exploit these market conditions:

Posted in: Business Process Outsourcing (BPO)IT Outsourcing / IT Services

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Meet Sudhir Singh... the Coforge King

October 19, 2020 | Phil FershtSarah LittleSia Ravari

Watching the rise of the mid-tier services providers - especially in the midst of a pandemic - has been nothing short of impressive.  Firms that got written off a few years ago because "only the top tier only got to the table"... are now at that table.  In fact, I could name several who broke protocol to become sought after partners with reputations for going way above the standard service and regular win engagements against the juggernauts.  Just read our post about the surge in growth for mid-tier IT service providers.

With 50% growth in the last three years, Coforge – formerly known as NIIT Technologies – is no exception here. In the midst of a $600M platform and (in spite of) a global pandemic, they hit the refresh button with a new name that aligned with their identity.  Changing one's name is a brave move, but when your British clients have called you "Nit" for a couple of decades and you have a supercool CEO who plays field hockey and racketball, you just gotta do it...

Within 3 years, CEO Sudhir Singh has led Coforge has taken this firm well past the $500m barrier, so let's get the story behind the strategy, the rebrand, and how the Coforge King sees the industry unraveling...

Phil Fersht, CEO and Chief Analyst, HFS Research: Thank you Sudhir for taking the time today to speak with us. You have recently gone through a rebranding and I would like to find out why Coforge and you decided on a name change, particularly in these economically uncertain times. And a little bit about how you have fared since you have taken over the role... 

Sudhir Singh, CEO and Executive Director, Coforge: Very good to be speaking with you Phil. We spoke about the name change around February when we met in Mumbai. This was an exercise that we were very excited about because all of us had this gut feeling that we are not going to be getting too many opportunities in our careers to rename a $600 million platform. This was a

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Posted in: IT Outsourcing / IT ServicesOutsourcing Heros

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After Groundhog Day... what happens next?

October 18, 2020 | Phil Fersht
When the fog clears in the coming weeks, we're faced with rebuilding workforces, rethinking failed political ideals,  revamping education and healthcare systems,  re-energizing ourselves, our families, our attitudes towards diversity, our own health, how we work… and so much more.  While we are all weary of living a real-life Groundhog Day, we have to stay focused, motivated, healthy and prepared to be ready for a new era that is approaching.   Surely this will represent the biggest reset in modern history.
 
There is no place to hide anymore. We are the dawn of a Hyperconnected Economy with the advent of connected global talent and the infinite possibilities of processes and data running in the cloud. The HFS 2025 Vision represents the north star for bold enterprises who want to design their organizations to thrive in this new era and not meet a painful, boring, and irrelevant death.

Watch the replay of this HFS Live purely unfiltered, unsponsored real talk with real industry leaders to help us unravel the emerging landscape:
 
Host:
 
Phil Fersht, CEO and Chief Analyst, HFS
 
Guests:
 
Traci Gusher, Leader AI and Enterprise Innovation KPMG
Chirag Mehta, Product Leader Google Cloud
Jesus Mantas, Chief Strategy Officer GBS, IBM
Malcolm Frank, President of Digital Business, Cognizant
Mike Small, CEO Americas,Sitel
 
 
 

Posted in: Cloud ComputingDigital OneOffice

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There is nowhere to hide in the Pandemic Economy

September 20, 2020 | Phil Fersht

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As the industry churns Tom Reuner returns

September 13, 2020 | Phil Fersht

There aren't many more exciting professions to be in these days than the analyst industry... you're right at the heart of all the key industry stakeholders absorbing a level of disruption, volatility and confusion we'll likely never experience again (we hope).  When everyone is stuck at home fretting about their futures, what better to do than talk to analysts plying their trade unraveling the current scenarios?

As an analyst firm, we need analysts who thrive in this scenario, with the experience and foresight to help us define our Vision2025, who understand this technology convergence of the hybrid cloud and containerization with data and digital technologies, all made possible by automation, AI, digital workers and - most importantly - people.  So when my old friend, colleague, and fellow Tottenham sufferer Dr Thomas Reuner agreed to return to the HFS family after a two-year sojourn in the AI software world, we knew we had the right person to lead our tech services vision...

Tom - so why did you choose to come back to the analyst community?  What really makes you get up in the morning?

Funny that you ask that, Phil. I am definitely not a morning person. If anything, I am intolerable in the morning, just ask my long-suffering lovely wife. On a more serious note, what drives me (professionally) is to understand technology evolution and how it helps organizations to advance their delivery of services. I get a real kick when I see in meetings and projects that I can help clients to better understand the dynamics of the market and achieve their strategic objectives. Working with the brilliant folks at arago has helped me to gain a more nuanced understanding of all the issues around AI, but also to appreciate more the many challenges and opportunities that innovative startups face. As such, I hope I have gleaned a much more rounded view of the industry. But deep down I always had an inkling that I would return to the analyst fold at some point. When you guys came knocking at my door that point came perhaps earlier than I expected, but being an analyst has always been my passion, so I didn’t have to think too long to make up my mind.

It must have been quite the experience working for an AI software provider during the hype-overload phase and then to experience the sobering reality of COVID where the rules of the game went out of the window.  Can you share what you learned from it all?

arago is a unique organization, both in terms of a highly differentiated technology but equally culturally. Working with one of the best development teams in AI has given me a much better comprehension of where the development of AI is really at. Not surprisingly, there is a fascinating life beyond just Machine Learning and Chatbots. However, on the negative flipside, being at the cusp of innovation that can’t be squeezed into pigeonholes provides significant challenges in engaging with the broader market. All too often we were asked “how are you different from RPA?”, “how are you different from Machine Learning?” And even where we made progress in discussions, we often got “show us the magic” as if the automation platform was a smartphone that can transform processes in a similar way to manipulating pictures.

The sobering reality of COVID was intriguing in many respects. On the one hand, the notion of a Digital Workforce took on a completely new quality as companies never really envisaged that employees literally couldn’t get to work. Thus, arago’s end-to-end automation became a have-to-have as you tend to call it. On the other hand, arago was at the forefront of providing a technology solution to trace COVID that would be interoperable between many countries. It was a rollercoaster ride starting with a groundswell of positivity as everybody wanted to engage with us but culminating in informal pressures and fickle politicians derailing much of the brilliant work my colleagues had done. I suppose much had to do with the various COVID apps being seen as a key to getting access to healthcare systems and consequently contracts. What saddened me about this journey is that the arago team worked pro bono on all of this and our CEO Chris Boos worked tirelessly day and night trying to get the project off the ground while engaging with the public about the implications and merits of the approach. To witness the headwinds and some of the public discussions on all of this makes one only more cynical. If anything, the experience has reinforced for me the importance of not losing sight of informal dynamics when analyzing the industry.

So where next for intelligent automation?  Will we see the phoenix rising from the ashes?  We talk a lot about the "have-to-have" economy at HFS... how much of this is really a have-to-have? 

I have fond memories of the early days of Intelligent Automation. It was a small community and we all had no clear idea of where the development would be heading. At least for me, the context was always about how do we progress to end-to-end automation and how can we decouple routine services delivery from labor arbitrage. To help clients on their digital journey, collapsing the many siloes was top of the agenda. Yet, the current hype around RPA appears to be confining the goals more and more to task automation and employee productivity. And in my view, the discussions on “Hyperautomation” are not helping either because they are re-enforcing an RPA-centric view of the world.

Therefore, we should re-focus the discussions back to the outcomes we had in mind at the outset, take a more holistic view and focus on how we finally can scale deployments. If we succeed with that you could argue we would see a phoenix rising from the ashes, but I am not holding my breath. The breath-taking valuations for some of the RPA providers are masking many of those discussions. At the same time, the blurriness as to what constitutes AI is adding to the confusion.

As with the discussion on COVID, Intelligent Automation and a Digital Workforce should be have-to-haves to guarantee business continuity in these pandemic times where organizations have to plan for the unknown. But talking to clients they increasingly realize the limitations of RPA and that we need new approaches to really succeed with a Digital Workforce. It is here where I see HFS continuing to be the leading authority of guiding the market.

And how much will enterprises depend on services to make their have-to-haves happen for them?  As you scope your research agenda across the tech services domain what areas are you going to cover that will help HFS clients and readers?

You always give me the easy tasks (laughs). Services remain, or more precisely, build the cornerstone in most organizations as they are accelerating the journey towards the OneOffice (or call it truly digital organizations) and are trying to find ways to survive these pandemics times. But crucially, success is about the outcome, not the technology itself. As such, the research agenda will be aligned with the various HFS frameworks, the OneOffice being the most relevant one. With that in mind, it is about how best to orchestrate and configure cloud offerings as the market is shifting from multi-cloud to hybrid-cloud. Crucially, this includes change agents such as RPA and AI as legacy environments have to work together with all those innovations. As we are touching on the change agents, of course, Intelligent Automation and AI will remain close to my heart, but I hope I will bring new insights to the discussions having benefitted from working with the brilliant folks at arago. In the context of applications, we are likely to expand our coverage on distributed agile. What are the best practices to make it work in complex engagements, including outsourced engagements? Similarly, looking at our coverage on testing, I could imagine focussing more on the testing of innovation, especially around the big change agents. I hope you can see, Phil, that this is more about aligning our research to our sweet spots rather than reinventing the wheel. But as I have the privilege of working with a hugely talented team, I am sure we will be able to move the goalposts at least a bit.

Now you're officially an analyst veteran (hehe), what do you see next for the analyst industry?  Are we still going to get the same old vendor grids and turgid vendor-driven messaging, or will we finally see a change in how the industry consumes research and engages with analysts? 

Thanks for reminding me that time is flying, Phil. If I am honest, I am seeing at best a marginal change in how the industry deals with the wondrous world of analysts. Too many AR folks spend the majority of their time dealing with Magic Quadrants, notwithstanding any other grids or activities. We have seen more consolidation of analyst firms, yet we haven’t really seen new firms with new ideas breaking through. There are many wonderful analysts out there, but if you look at the industry, I would argue it has gone a tad stale. Smart AR folks reacting to that by working more with individual analysts. Take some stalwarts like Gurvinder Sahni at Wipro, he is building deep relationships but then orchestrates those relationships according to his requirements. And if I take my experience on the vendor side, which represented more innovative startups, I was struggling to get relevant advice. The guidance was often templated and you were encouraged to engage with ten other analysts to glean relevant insights. My “favorite” piece of advice, was: “Tom, you have to reinvent RPA for your space”. But I would love to see new firms emerging as this is the most challenging but also the most intriguing time to be an analyst.

And finally, Tom, what will you do to set your own research apart as we venture into this murky future ahead?

To be honest, the quality of my research will always be in the eye of the beholder. But I would hope by leveraging HFS’s vast network of buy-side organizations and by continuing to build deep relationships with stakeholders, I can provide value to my clients. It was always the collaboration with some of those outstanding industry veterans that has helped to shape frameworks like the Intelligent Automation Continuum. Folks like Boris Krumrey at UiPath and Wayne McQuoid at Credit Suisse are top of the tree. By exchanging ideas, challenges, and working together on projects, the most relevant research pieces have come up. You keep challenging me to revamp the Continuum and revamp our IT Services research. To do that I really look forward to engaging with many of the brilliant folks in our network!!

Well it's terrific to have you back in the HFS family Tom and looking forward to hearing your new ideas

Posted in: IT Outsourcing / IT ServicesDigital OneOfficeIT Infrastructure

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My five learnings leading a company through a pandemic: Just be human, be smart and you’ll find your way

September 06, 2020 | Phil Fersht

Having founded a successful analyst firm 10 years ago, nothing seemed to derail us from continuous growth… every obstacle could seemingly be overcome by throwing smart people at it or investing time with your clients.  Net net – if you were good at what you did and had some smart people who believed in what you were doing and saw your value, you would always find a way.  You were always a safe bet, a sure thing, something to invest in for the future. 

You could ride out prosperous times and tough times because you influenced sales cycles and validated multi-million (even billion) dollar decisions. Whatever was going on in the world, you thrived off the one thing that kept the wheels on everything:  certainty.  Enterprise leaders, investors, politicians alike all banked on one thing – they had a reassuring view of the future, of where things were heading.  They could always make decisions to keep pushing in the right direction.

We’ve been given the worst corporate disease possible:  Uncertainty

Then along came something no one accounted for which caused the one thing that can destroy the status quo:  uncertainty.  Suddenly everyone is unfamiliar and uncomfortable with their environment – their certainty has dissipated and the rules for conducting business have gone out of the window.  Unless your business is something they have-to-have you may find yourself out in the cold so quickly by the time you realized your perilous position, it may already be too late.

And the scariest part of all this is the immediacy of your potential demise.  If you’re not Zoom, Microsoft, Amazon, Nintendo, Instacart or Occado - who have immediate opportunity to exploit the situation – your whole business model is immediately wracked in uncertainty.  Whoever you may be.  How do you sell the same stuff when you can’t meet your clients, when many your key staff are surely too busy home-schooling their kids to commit to extra work, when your clients’ bosses are suddenly demanding things form your clients that don’t include your products or services?  What do you do if you are suddenly deemed irrelevant?  

As much as pandemics suck (yes, they really bloody do!) they give you a once-in-an-era chance to make changes you never thought possible, or never even realized you needed to make.

Five things I have learned about leading in these times:

  1. Moving everything to digital is not some crazy expensive investment – it’s the best thing you’ll ever do to your business. Seriously, can we please stop this bullshit that “digital transformation” is some insanely expensive cost that is just too much for your firm to handle. Shifting your core products and services to digital results in them being cheaper to deliver, cheaper for your clients, more efficient, faster and give you much, much better data to make better decisions.  If you can’t move some of your services to digital, then they were probably ready for the analog scrap-heap in any case.
  2. Choose your team you need to take with you on this journey – and do it fast.  This is where it gets hard, but deep down you know what you have to do.  This is probably the only rare time you can make painful – and sometimes unpopular - decisions to shape your business around your digital present and future.  Now you can make decisions and take actions that could have resulted in a rebellion pre-March 2020.  Just make the changes and move on fast, you just gotta do it - and be honest about them.  Sure, they’ll probably paint you as one huge asshole and write something about your “toxicity” on Glassdoor, but you know you made a painful - but professional - decision – and so did they deep down. 
  3. Invest in trust with your chosen team. The old rules about managing people are all over the place.  Once you have decided who you need and who you want, this is the motley crew that is going to get you through this.  So don’t just select the people you know you have-to-have, select those who will be up at 3.00 am with you thrashing out proposals and executing for your clients, listening to your quasi-insanity as your turn over every damned stone to keep the wheels on into 2021… Just make sure you have people who know what they have to do, who you trust, who trust you, who are on this road to somewhere with you.  This means you will need to share a level of transparency with them which made you uncomfortable in the past.  This means the old metrics need to be sacrificed for a simple “we just need to get this shit done”.  That’s what real trust is all about.
  4. Family comes first, business second. Then business wins.  These times will define you forever as a leader. This isn’t about being nice, or kind, or even generous – this is about being human.  If anything good came out of 2020, it’s the value of our families around us as stabilizing forces and responsibilities. We may be breadwinners, but we are also mothers, fathers, daughters, sons, sisters, and brothers.  We have to make every possible accommodation for our fellow workers to look after aging parents, home-school their kids, support their spouses, etc.  Clients can wait an extra day or two if they need to – they have similar pressures and will understand.  The old 9.00-5.00 is pretty much gone for now… so trust your team to prioritize family needs and find the time later to finalize their critical work.  We all find the time when we are committed, when we feel trusted, when we feel good our family is finding their way through this with us.
  5. Manage extreme emotions with humility and forgiveness. If you are not flying off the handle in this environment on the odd bad day, you are definitely not human.  We are all mentally drained, we are all operating at the edges of our tolerance, and emotions are frequently being stoked.  But that’s not all bad – we get to see the human side of each other a lot more than we ever expected. And arguments are not always bad if we resolve them – that what families do, and that’s what colleagues can do too… just be cognizant that people are human and we’re just seeing everyone function with less of the emotional filters on. I guarantee when this is all over you will have better and closer working relationships than you ever thought possible.

Bottom line:  Staying relevant means staying energized, staying committed, and being damned smart.  And being very human.

Roll on 2021 when we slowly pick up the pieces of 2019 and before, coupled with the experiences of 2020 which changed the world ever (and are still not over).  There are new rules for almost everything: how we treat our clients, our staff… and most importantly our families. And there are other changes emerging we have to figure out, such as how we shape our approach to politics, to endemic racism, to inclusion and diversity, to climate change.  My main hope is we are just more human, more pragmatic, more tolerant, and more transparent as our future unravels around us… there is already enough for our aching brains to handle. 

Peace out =)

Posted in: HR Strategy

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Without a Virtual OneOffice Organization, you won’t survive this Pandemic Economy

August 30, 2020 | Phil FershtMelissa O'BrienSarah Little

OneOffice is no longer a pipedream – almost overnight it has become a “have-to-have” business environment to operate and compete effectively in this virtual Pandemic Economy.  There is no waiting around for things to revert to the analogous way we used to run things in 2019.  Especially when new HFS data shows only 37% of the Global 2000 intends to revert back to the same office-based environment in the future.  If you can survive on a third of your client base in the future then good luck to you!

Creating a true OneOffice experience is the very foundation of operating as a digital or virtual organization, where there are no stovepipes, no silos, no breakpoints that prevent processes functioning end-to-end, and data to flow freely across the organization.  A virtual OneOffice experience will give you a huge chance of thriving in this new reality, provided you have figured out how you are pivoting your business.

Digital is the only language operations now understand

OneOffice is where automation becomes a native competency, where human performance is augmented by unleashing creativity and personal interaction, where the immediacy of data creates insights to support decision-making that can make or break the firm. In fact, if you can’t operate your organization as one integrated unit where data flows freely back and forth across your process chains from your customers to your employees, from your front office to what you used to call your back office, then you probably won’t survive much longer in today’s brutal Pandemic Economy, where digital is the only language operations now understand.

 

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The Virtual OneOffice Organization is the foundation of the virtual workforce that encompasses both physical and digital entities

Our Virtual OneOffice Experience is the foundation of the ‘virtual workforce,’ where automation tools augment the employee’s digital capabilities and the workplace becomes a “plug-and-play,” work-from-anywhere scenario . It is all about creating touchless, frictionless digital experiences and connecting the front and back offices to facilitate them within a virtual setting.

Increasingly important to HFS’s OneOffice Experience is that any business strategy must align and equally consider both employee experience (EX) and customer experience (CX). Even more so in this virtual environment, the lines blur between who the customer is and who is servicing the customer. Leaders need to focus on the positives they will glean from this Paradigm Economy by putting customers’ needs at the core of their strategy.

Focus on human experiences to unleash people and drive business results

There is an evolution of thinking about experiences underway, from the traditional thinking in siloes --- customer, partner, and employee --- to a more holistic human experience-focused strategy. Based on the premise that human connections generate satisfaction and loyalty, aligning the goals and experiences across all of your company’s stakeholders will serve to create an impact on business growth and success.

OneOffice Experiences require EX and CX alignment to elevate the human experience

While the concept of ‘CX’ has had most of the fanfare in recent years, your employee experience is just as important and inherently tied to CX (whether or not you’ve made efforts to align them.)  The HFS Virtual OneOffice Experience is all about how customer, partner and employee experiences are coming together to drive a unified mindset, goals and business outcomes.  Organizations need to ensure they find the right balance of optimizing the use of emerging technology with a robust business case to improve CX to the long-term benefit of the business.  This means getting the right information flows in place, eliciting strategic advantage and ensuring exceptional CX to drive loyalty and growth.  The OneOffice approach centers on the optimization of the all human experiences involved in an enterprise ecosystem and in improving the use of technology in support of these experiences.

The more connected workers are to their organization and its values, the more empowered they are to support customer and partner experience

The OneOffice approach has become even more important as companies navigate these new virtual workplace experiences with blended physical and virtual environments. Technology change agents that augment and support people can be the glue that connects employee and customer experience, by making data and insights easier to access and decisions easier to make.   When so many decisions are made based on emotion, it's critical to ensure that people have the best data and information aligned to the shared values to support decision making.   The more connected workers are to their organization and its values, the more empowered they are to support customer and partner experience. 

The Bottom Line:  OneOffice is first about your talent and your business model.   Then it's about how successfully you deploy digital technologies to make it all happen

OneOffice illustrates what true digital transformation is all about – pivoting your business model around your customer’s needs (and anticipated needs) and ensuring your whole organization designs its processes right across the operations to achieve these goals with your staff motivated by the common outcomes. This means making similar investments and priorities to ensure your employees are as engaged digitally with your organization and your customers.  You can't get away just focusing on an exemplary customer digital experiences if your employees are not embedded into the same experience.

OneOffice is not just about improving engagement and productivity, but fundamentally about ‘unleashing people,’ and enabling passion and creativity for a new world of work where different skills are required.  At HFS we have categorized these skills into the following:

Being a Virtual OneOffice Organizaton will give you a huge chance of thriving in this new reality.  It's about pivoting your desired business model around your people an bringing them all together with your customers and partners in one virtual environment.  

Posted in: Digital TransformationDigital OneOfficeIntelligent Automation

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Surviving to win in this “Have-to-Have” Economy

August 27, 2020 | Phil Fersht

Gone are the bells and the whistles.  Gone is the sugar-frosting… even that lovely cherry on the top.  Those are the things that only appeal when your organization’s core is not under threat… because addressing that critical core of the business is boring, it’s stressful, and it was not great for your career to expose what was truly dysfunctional in your organization.  Now all the frilly paraphernalia has been cast aside, and we have no choice but to focus 100% on that core.

Why we didn’t address the core and focused on nice-to-haves

Having to deal with critical issues like security, making processes flow and work better, helping train staff to stop doing things the same way they have for 30 years, addressing why your service providers never deliver any of the stuff they claim they do on their PPT slides, asking difficult questions why your firm spent millions on software they simply failed to deploy… those were the things we knew deep down we needed to do, but most the folks around us just didn’t care, and would have thrown us under the bus if we'd agitated for real change.  So we did the safe thing… pushed initiatives that promised some incredible future value as long as we threw around some cash and made everyone look good.  Plus, the steak dinners with decanted wine always helped… After a while, we just convinced ourselves what we were doing was critical even if our firm didn’t really have to have any of it.

Addressing the core of your business is the only thing to save yourself... and your business

We have absolutely zero choice but to address these two actions to survive and win our in today's environment:

  • Finding our “bottom” and devising a financial plan to survive the cross-winds of recession. As much as we can play with sexy terms like resilience, we cannot avoid the one reality of surviving what were are currently experiencing – having a decisive financial plan to survive.  Without it, we’ll continually panic and flounder and never be able to attack our markets with a game-plan to come out of this on top.
  • Finding that chink of light to guide our organization to the market leadership position we crave. Once we've achieved a financial plan to survive, we are now in a position to get focused on the services and products customers simply have to buy, because they have no choice, as their cores are under threat without them. That means focusing all our investments on making damned sure that happens.

The Bottom-line:  Identifying your customers’ have-to-haves is the only path to follow in this market, but only once they know what they are!

It’s one thing to identify what our current customers (or prospective customers) have to buy from us, but it’s another to make sure we are not wasting our valuable time and resources on those who haven’t yet worked out their plan to survive this market.  There are still many organizations out there who are still scrambling to fathom what is going on, holding out some hope for a magical imminent V-shaped bounce-back.  As lovely as that prospect is, holding out for that miracle will likely end in tears.  What’s more, you are also a terrible customer, as your firm is too nervous to invest in anything serious. 

So find your bottom, find your chink of light, then identify your customers who simply know they have to buy what you are selling.  It really is that simple.

In Part II we’ll get into what customers have-to-have.  You know you have to read it =)

Posted in: Cloud ComputingDigital OneOfficeIntelligent Automation

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Time to get taught... by Delaporte

August 10, 2020 | Phil FershtSarah Little

Thierry Delaporte, the new CEO of Wipro Limited – accompanied by colleagues Milan Rao, Gurvinder Singh Sahni, and Laura Langdon – gives HFS the story behind the story as he sets sail with Wipro.

 

Strong operator... tough decisions... aggressive changes. That's a triptych summary from my recent post which drives into Wipro's bold appointment of industry titan Thierry Delaporte as CEO. The course now turns from firm to fluid with the story behind the story from Thierry himself – who guides us on his journey of navigating north stars, surprises, principles, and people. And breaking walls...

I once called for a ruthless CEO with teeth at the helm here, and while I stand by that reckoning, I do believe we've met the human in the middle of the sea change... 

Phil Fersht, CEO and Chief Analyst, HFS Research: Thanks very much, Thierry, for getting some time with us today; I know you’ve only been in the job, what is it, like, two or three weeks?

Thierry Delaporte, CEO, Wipro: Three weeks.

Phil: Three weeks! So, it would be great to hear a bit more… I learned a lot more about you, when you took the job, and the one thing I learned a lot was that you’re a very international person, you’ve lived in a lot of different countries and experienced a lot of different cultures – it would be great to hear a bit more about yourself, and where you came from, background, and then your career. Did you always intend to do a job like this? And was this your expectation, in recent years?

Thierry: Okay, sure. So, you’re right, … although my accent keeps reminding everyone I’m French, I’m probably one of the least French people you can find in France. I spent most of my life abroad. If you look at my career, 25 years, I’ve spent 21 years of those 25 years abroad. I lived in the UK; I lived in Switzerland, in Zurich, in Spain. I lived in Singapore and in Sydney, Australia. I lived in the US for 15 years, and, every time, my wife and my kids were with me, so four kids, a wife – incredibly resilient, as you can imagine, following every new adventure, with a lot of energy and passion.

And, frankly, you know, I was known at Capgemini as being one who’s really tried, pretty much, everything. I’ve been a finance person… Actually, I started as a member of the Internal Audit team for two years, and then moved as a CFO of subsidiaries in different continents, and then [moved on] to cover sales. I was the Head of Sales, at some point in time, for about a third of the group of Capgemini, which I’ve never seen a finance person becoming a salesperson [smiles], and then managing operations, in different places, or different businesses across the organization. So, I’ve been in consulting, I’ve been in outsourcing, and I’ve been in the apps world of Capgemini. And then, from that experience in operations, spent time in running a business in BFSI, before coming back to Paris to be Chief Operating Officer of the group.  This year, I completed 25 years with Cap Gemini. It was an amazing ride, but it also got me thinking that it was time to pursue new adventures outside the organization.

 

“One of the lessons I’ve learned in life, Phil, is that you must let life surprise you. The only thing you have to do is don’t miss opportunities.”

 

I don’t think you can ever say that you were born to be a CEO. One of the lessons I’ve learned in life, Phil, is that you must let life surprise you. The only thing you have to do is don’t miss opportunities. So opportunities will come, and many will surprise you, but just not saying no is a good enough decision to make, in order to not miss these opportunities that come. And so I try to apply this in my life.

Phil: Excellent. So, as you looked at opportunities, and you obviously saw what was happening with the economy and the pandemic, etc., and then the Wipro thing came up, did you immediately think, “Yes, that’s the one for me”? Or was it kind of a long, drawn-out thought process, on [moving] from Cap to Wipro. You were at one company for a very long time, and the cultural shift…. Was it an immediate decision, that you thought, “This is what I want?” Or did it take some time to cultivate with you?

 

 “So, I’m going to tell you in full transparency what happened.”

 

Thierry: So, I’m going to tell you in full transparency what happened, Phil. I made up my mind mid-Feb and informed the CEO and the Chairman of Capgemini.

 

“I had the plan to sail transatlantic, from Newport to Brittany, in May. So that was my plan. I had the boat, I was going to do it with a friend of mine…”


My immediate plan was to take a six-month sabbatical – I haven’t had a single day sabbatical since my career started, so this was going to be my “me time.” And I’m a sailor ­– I had the plan to sail transatlantic, from Newport to Brittany, in May. So that was my plan. I had the boat, I was going to do it with a friend of mine, and that was the plan that I had sold to my wife.

 

“But then, literally, days after I went on sabbatical, my phone started to ring.”

 

But then, literally, days after I went on sabbatical, my phone started to ring. And it’s very interesting, and more of a surprise, because there was no announcement of me leaving. It was just being on sabbatical, that, actually, the industry knew it rapidly. I was starting to get calls on opportunities. And I knew that if I was going, it was for something I wanted to do. And I was not in a hurry. I really wanted to make the right choice.

 

“And I knew that if I was going, it was for something I wanted to do. And I was not in a hurry. I really wanted to make the right choice.”

 

I’ve known Wipro for twenty plus years. As I said to the team several times, I’ve been competing with Wipro many times. I won often – I lost often, as well. And so, I’ve really learned to respect tremendously this brand, the people, and the success of this company. I still remember the time when Wipro was still a rather small company, but growing every year at an exceptional pace.

 

“I don’t know any other company that has such a sense of purpose, where it’s not only about delivering the numbers… The fact that this is a company where 67% of its profit is going to philanthropic activities is very much talking to my view of what capitalism should be.”

 

Then I had conversations with Founder Chairman Mr. Azim Premji and Chairman Rishad Premji. This is when I felt this is a unique company, because I don’t know any other company that has such a sense of purpose, where it’s not only about delivering the numbers – it has a much broader ambition. The fact that this is a company where 67% of its profit is going to philanthropic activities is very much talking to my view of what capitalism should be.

 

“And then I felt, ‘Okay, this is an incredible company.’”

 

So I went and met both of them… actually, I started with three hours with Rishad, and it was really an outstanding, natural, easy connection between us, and then I met Azim Premji, and then several members of the board. And then I felt, “Okay, this is an incredible company.”

 

“And so, with humility, I would say I’m convinced – I’m seriously convinced – that there is a good match, and that we have a wonderful page to write. And so then, the decision was made – everything based on principles.”

 

I feel that the challenges that this company has, I can really have an impact. And so, with humility, I would say I’m convinced – I’m seriously convinced – that there is a good match, and that we have a wonderful page to write. And so then, the decision was made ­– everything based on principles. It’s people, of principles agreeing on things, and I think we were very aligned, culturally very aligned, on many, many different fronts.

Then I started to engage with the team before July 6, which is the official day one. I met all the members of the Executive Committee, I spent hours with Rishad, and engaging with Saurabh (President and CHRO) connecting on many different fronts, so that, you know, when I actually started, on day one, I was immediately hitting the ground. The Executive Committee has 17 people. By the time I officially joined, I knew all of them and what they did. So, it was a really great start.

Phil: And obviously at an interesting time, Thierry. I’m getting tired, talking about the shock and the change. I think what’s happened has happened – now we’re in a new world, and we just have to play by different rules and expectations. Obviously, digital has gone from being aspirational to something that is suddenly forced upon us. And we have a very different economy; one that’s not going to change any time soon. So, does this level the playing field? And is this an opportunity for Wipro to get ahead of the market? Do you feel that everybody has kind of a clean slate? Or do you think this is just going to be a very challenging time, and we just need to hunker down and see through the next year or two?

Thierry: So, there’s no doubt that we are at a moment of our history where you cannot imagine that what we’ve been through, over the last five months, will have no implications. I believe that what we’ve learned over the last five months is that, in a context where you are suddenly not able to connect physically with people every day, that there is a need to connect always more; connect more with your clients, connect more with your employees. In the context where, basically, it’s no longer about going and visiting, but connecting.

 

“The dimension of trust is more important than ever, and I am convinced that one of the implications of this crisis, going forward, is that the length of relationship will matter more than ever.”

 

The dimension of trust is more important than ever, and I am convinced that one of the implications of this crisis, going forward, is that the length of relationship will matter more than ever. So I think, more than jumping from one partner to another for 3% of savings, I think our clients will value more than ever the value of commitment and long-term partnership. I think it’s true for our employees, as well.

I think that we’ve also seen that companies that have not moved fast enough in their digital agenda have been struggling, and I think they didn’t expect to have such a brutal event confronting their own strategy. I think the reality is that there will be an acceleration of the rotation of the offerings, of the rotation to digitally transform organisations across industries.

So, yes, it’s going to change things for us, because what it means is that your legacy offerings, I would say, the more traditional offerings of the past, are going to shrink even faster. You need to accelerate your rotation to the new, because this is where the investments are going to happen. So, I absolutely agree that, yes, I feel that in arriving at this point in time, I have an incredible opportunity to reset the stage, somehow, for our business, and make some bets.

 

“I am a great believer in strong partnership. I have built my success, over the last years, in focusing on a few strong partnerships, and it has paid off multiple times. And so, I’m convinced that it will be even more important in this new world.”

 

We are going to make some bets, I cannot tell you which ones, you know, this is what I’m working on right now, to define where I want to make the bets. I believe we will see efforts, or focus, on simplifications.

We will see focus on rationalisation, on consolidation, to build bigger partnerships. I am a great believer in strong partnership. I have built my success, over the last years, in focusing on a few strong partnerships, and it has paid off multiple times. And so, I’m convinced that it will be even more important in this new world.

Last, you know, looking at the market, but also looking at our employees… when I look at our employees, this is our asset. Right? This is what makes us different. It’s very weird, to start with, because I have no clue how long I will have to wait before I can actually physically meet people from Wipro. You know? They might wonder if I’m a real person, or if I’m just a hologram [laughs].

 

“I think connecting with our people will be my obsession for the next weeks. One of the beauties with Teams or these tools, is that you can actually break a lot of the hierarchy. Everyone on the screen is equal sized, and there’s no one ahead with people standing in the back. It also breaks a lot of the walls; walls between one office and another, or a business unit and another, or a language and another. And so, it’s wonderful, because you really can now drive a lot more alignment. So, I will use this new world to the benefit.”

 

I think connecting with our people will be my obsession for the next weeks. One of the beauties, with Teams or these tools, is that you can actually break a lot of the hierarchy. Everyone on the screen is equal sized, and there’s no one ahead with people standing in the back. It also breaks a lot of the walls; walls between one office and another, or a business unit and another, or a language and another. And so it’s wonderful, because you really can now drive a lot more alignment. So, I will use this new world to the benefit. It will never be the same, I think.

You will never be able to ask your employees to be at the office five days a week, if this is not what they want. But I think, equally, it will not be a time where, everyone is working from home every day, because you will miss a lot, in terms of connection, in terms of engagement. But I think it’s going to be a world that requires fluidity and agility; which is fine, I’m very comfortable in this environment.

Phil: Yes. And, to me, a new CEO within three weeks? This wouldn’t have happened, if we were back in the analogue days, right? It would’ve taken probably six months or something. [Laughs].

Thierry: [Laughs].

Phil: So...

Thierry: Phil, today… Today, I have spoken to six clients.

Phil: Wow =)

Thierry: And since day one, I have spoken to 35 clients already. 35 clients. When I say spoken, it’s basically I have met 35 clients. And, you know, I’m just increasing the speed. I’m engaging more than ever. If I had to jump on a plane for the meetings I have had today, it would have taken me more than a week because of the different locations.

Phil: And if I could tell you how our business as a research company has changed, it’s beyond belief, in terms of the speed we can get things done, the extra time our analysts have, because they’re not traveling all the time to deliver work. And the closeness we’re getting with our clients. This was terrifying for a couple of months, Thierry, and then we realized we have to move everything we have onto a digital setting. But once you get ahead of this, and embrace it, and realize this is how we do business, the benefits are just astounding and surprising. And I’ve been reading and hearing about entire transitions now being done on Teams. I mean, you can do a hell of a lot now that you didn’t realize you were capable of, without physically being with people.

Thierry: I absolutely agree.

Phil: …this is a huge, huge gamechanger in how we operate.

Thierry: Agreed, Phil.

Phil: Right. So I’ve got one last question, then. If you could have one wish for the industry, in the next couple of years, what would that be? 

 

“…the beauty of our industry is that our assets are our people – our enabler is technology.”

 

Thierry: One wish for the industry. Continue to maintain the balance between technology and people. So I think, you know, the beauty of our industry is that our assets are our people – our enabler is technology. And my wish is that we continue along this line, and we don’t take it for granted, or we don’t go in a world where technology replaces talent and people, because I think we would take the wrong direction.

Phil: Very good. That was excellent, Thierry, I really appreciated the time… and I know our audience will when they read this.

Posted in: Business Process Outsourcing (BPO)IT Outsourcing / IT ServicesDigital OneOffice

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You’ve got to start with the customer experience and work backwards to the technology

August 08, 2020 | Phil Fersht

I don't think any singular statement better described the world of technology in the last three decades:

"You’ve got to start with the customer experience and work backward to the technology. You can’t start with the technology then try to figure out where to sell it." 

-- Steve Jobs 1997

Posted in: Customer Experience ManagementCustomer-Engagement

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The Umph behind Humph: after 15 months in the Cognizant hotseat, Brian Humphries dives deep on the pace of change, the lessons learned... and much more

July 23, 2020 | Phil FershtSarah Little

Brian Humphries, CEO of Cognizant since April 1, 2019. In an interview with HFS CEO Phil Fersht, Brian moves beyond the business talk and straight to the deep end – the personal, the humble, the lessons learned – and the stakes set firmly in the ground.

 

I wrote a detailed business piece on Cognizant’s 2019 leadership change after losing its edge in the market: The Life of Brian: Prettying up a baby that’s got a bit ugly. One of our readers, Mike N, commented, “Don’t weep for Brian. I for one believe his hiring reflects the vision of a Cognizant and that he has the perfect timing and opportunity to shake up the old guard and culture. New day dawning!”

True indeed, but to now quote myself from the same piece, “When we’re asked what we think of the new CEO, our honest answer is we don’t know. He has, for all intents and purposes, kept a low profile externally, instead focusing his energies on extensive liposuction internally.”

I’ve managed to breach Brian’s low-pro firewall, finding a leader willing to engage beyond the business talk and go straight to the deep end – the personal, the humble, the lessons learned – as well as the stakes set firmly in the ground…  So, without further ado, let’s meet Brian:

Phil Fersht, CEO and Chief Analyst, HFS Research: Good afternoon, Brian. It’s great to get some time with you again today. I want to keep this conversation a bit more informal, and a little bit about you; not just about Cognizant; Did you ever expect to be doing this job today, when you set out, many years ago?

Brian Humphries, CEO, Cognizant: No, I did not. I’m from a relatively humble background, I would say, growing up in Ireland. I can’t say I started off wanting to be a CEO, Phil, because I probably didn’t have exposure to large MNCs until my early 20s. But I started working at a company called Digital Equipment Corporation, or DEC, which was acquired by Compaq and later acquired by HP.

So, for the first 18 years, I was there, and, subsequently, moved to Dell, became the President of the Enterprise Solutions Group there. I was most recently in Vodafone as the CEO of Vodafone Business, prior to joining Cognizant. So, I can’t say I’ve had a fully orchestrated career.

 

“I certainly made commitments along the way, in terms of moving internationally and throwing myself into the deep end of the swimming pool, more than once…”

 

I think, as the years went by, I had figured out paths of success. I certainly worked and invested in my career. I certainly made commitments along the way, in terms of moving internationally

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Posted in: IT Outsourcing / IT ServicesOutsourcing Heros

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There's no settling with Mike Ettling... he wants to win it all!

July 14, 2020 | Phil FershtSarah Little

 
Mike Ettling is looking to create a new trifecta by following Springbok’s 2019 World Cup win and Liverpool’s 2020 championship with a Unit4 ERP mid-market sweep.

Mike Ettling has a storied career in HR software and services and is looking to create a new trifecta following Springbok’s 2019 World Cup win and Liverpool’s 2020 championship with a Unit4 ERP mid-market sweep. Mike founded two of his own businesses, nurtured eight start-ups in the HCM technology sector, and led SAP SuccessFactors as President for four years. He also served as CEO of NorthgateArinso (when he spoke with us 10 years ago), one of the original HR outsourcing firms, which is now part of Alight. Speaking at the SuccessFactors 2017 Influencer Summit, Mike stated “no one will be logging into HR Systems in five years’ time.” As we rocket through an unprecedented 2020 towards the noted five-year mark, it’s time to check in on faceless ERP and discover the draw to Unit4’s “sizzle” and its people-centric ERP paradigm.

Phil Fersht, CEO and Chief Analyst, HFS Research: Good afternoon, Mike. It’s great to get connected again, after so many years. You’ve been a big legend on the whole HR software and services market, but now you’ve gone, full ERP on us. Can you give the lowdown to our audience about how you got started? Had you always planned on being a tech CEO?

Mike Ettling, Chief Executive Officer of Unit4: Interestingly, I stumbled into tech in an intriguing way. I did COBOL and Fortran at school – I still have my Daniel McCracken textbooks on Fortran and COBOL – but then I went down the path of business studies, became a chartered accountant, CPA, in two countries. When I started my life at what was then Peat Marwick, or KPMG, I very quickly got into the tech side. We were setting up this African Futures Exchange, and we designed the clearing system for futures trading, and then I started my own business at university, and it was all predicated on building a cool piece of tech to do something which people were doing manually. In those days, we were building stuff on PC networks, using Realia

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Posted in: Cloud ComputingHR StrategySaaS

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IBM just changed the automation game. Hello Extreme Automation

July 10, 2020 | Phil Fersht

The automation game just changed – and most of you barely noticed

It’s sometimes those low-profile moves that make the bigger impacts on markets, versus the big glamor ones.  Who would have thought Jurgen Klopp would end Liverpool’s 30-year wait for the English Premier League title when he quietly disappeared himself from Borussia Dortmund?  And who would have thought a smallish Brazilian RPA firm, WDG, could propel IBM into the first one-stop services and software automation shop for organizations.  This is in stark contrast to the Accenture Synops model, which is focused almost entirely on partnering with 3rd party software. Oh, this is going to be fun... the big services giants are back to duke out automation dominance in the middle of a pandemic.

10 reasons why IBM’s move will have such an extreme impact on the existing automation market

1. WDG adds proven attended desktop automation capability and has already displaced UiPath in a major organization. The technology provides a low code, cloud-based authoring experience for the business user to create bot scripts with a desktop recorder, without the need of IT. These scripts are executed by digital robots to complete tasks. Digital robots can run on-demand by the end-user or by an automated scheduler.  Arguably, WDG is on a par with Softomotive – acquired by Microsoft for considerably more money. What is clear is these RPA firms are offering pretty much the same functionality for the basic scripting and recording.

2. WDG is focused heavily on quality customer service ops and is great at integrating with chatbots, digital associates and other AI tools. Pre-Covid, most RPA was focused on low-risk back-office processes, especially in finance. Now customers are desperate to automate the customer-facing and revenue-generating processes and need tools proven to work in the environments.  Noone has a huge advantage in the CX automation space so this provides a greenfield opportunity for IBM. 

3. The WDG automation software sits under IBM Cognitive and Cloud giving it a broader playing field to compete with the likes of MSFT, Pega, Appian, and even ServiceNow. Arguably, this is the real play that excites IBM’s top brass. This is where the big dollars are and where IBM has powerful potential as the world’s largest IT services provider. Orchestratng processes and data in hybrid cloud environments is where IBM should be leading the market, and now it has plugged some holes to do it even better.

4. This is no desperate measure. IBM software made this investment after seven patient years observing the market. It was not a huge secret that IBM flirted with the concept of acquiring Blue Prism (and others) in recent times, and its software team also partnered with Automation Anywhere in 2017.  Of one thing you can be sure, IBM Software does not suffer fools these days and does exhaustive due diligence. They also have in-depth working knowledge of the major RPA products and know exactly what functionality they need to have a one-stop-shop capability.

5. IBM doesn’t want to acquire a huge installed base of messy RPA customers - it wants to create its own customer base bought into its own Extreme Automation vision. The last thing future-thinking services firms like IBM need is a plethora of unprofitable clients which have underpaid for too many bot licences and have little money left to spend on professional services to deploy them effectively. It makes more sense for IBM to go after clients willing to start afresh… and with over 90% of RPA clients struggling to get even 5 bots functional, the market is ripe to pick off many of the failed RPA implementations and move them to the emerging IBM automation platform.

6. Already demonstrated by MSFT and SAP, you don’t need to make insane investments to add RPA functionality. In short, why spend billions on the “Big 3” when you can get perfectly adequate functionality (and standout features) from the likes of Another Monday, AntWorks, Kryon, Jiffy.AI, WorkFusion etc?  The big guys did the diligence. Softomotive, Jidoka, WDG, Contextor were all small – but more than good enough to achieve automation goals.

7. IBM no longer has to hang onto the coattails of AA, Blue Prism or UiPath – the power is shifting. While most customers of the “Big 3” will not be ditching their investments anytime soon, IBM can enjoy the freedom to pitch its own automation platform twinned with its own service delivery and choose how to price in the way the clients wants to invest (such as as-a-service).  Being subjected to erratic pricing and some of the wacky marketing being purveyed by some RPA firms, where reality takes second place to hype, makes it hard for services partners to build a cohesive automation business.  This is why so many have backed away from the market.

8. IBM can leverage RPA as a loss-leader to win larger automation and AI business further down the line. IBM can afford to be brutal on price if it knows it will lead to selling more of its other wares. This will make life very difficult to the standalone RPA vendors desperate for whatever revenue they can scrape in the current abnormal market place. It may also be a smart play to win over disaffected customers who need a whole new direction to fast-track their automation journeys.

9. IBM services will still benefit from its partnerships with AA, Blue Prism and UiPath. They will have no choice but t play ball.  This is all about who controls the client in this environment.  Forget lovely partnerships in this post-covid economy - this is a cut throat battle to win the hearts and minds of the customers/

10. WDG' partnerships with Deloitte, Capgemini and Grant Thornton will be challenged, but won’t have a lot of choice but to play ball. WDG’s partners will be desperate not to lose their services business to IBM so will likely have to be very nice to IBM to keep their business with the WDG clients and make efforts to be “collaborative”.

Extreme times call for extreme measures

In a recent conversation with automation leadership at IBM, HFS shared our view that technology is really only 10% of digital transformation. The true heavy lifting is driving change with people, process and data to truly advance to integrated automation. We challenged IBM to showcase their approach to achieving automation at scale without overly relying on specific tools or services. The result is the following “extreme automation” model – showcasing our current anaemic automation reality on the left and the potential “extreme” future opportunity:

 

Source: IBM Automation / IBM Corporation 2020

The Bottom-line: The automation game is being elevated to low-code cloud-based automation platforms with strong capability to integrate across core customer and employee-facing processes. 

The rapidly evolving digital workplace is creating the "have-to-have" mindset and clients need service partners to drive rapid speed-to-outcome solutions, leveraging whatever technology tools can create an immediate impact that are easy to deploy. Complex partnerships, landgrabs and hyped marketing have faded into the memory of the pre-covid world. Clients need real hands-on help to rethink a much more concise - and often extreme - automation strategy, and then need to act fast to execute these plans.  Having a one-stop-shop where software firms and service providers are not fighting for attention, where one partner can help clients look at the bigger picture and devise a realistic, measurable plan is the new normal for automation.

IBM's super patient approach to filling these RPA holes in its portfolio could have just been perfectly timed to take this market in an entirely new direction.

Posted in: Robotic Process AutomationIntelligent AutomationArtificial Intelligence

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Nagendra's agenda: His bullish outlook for the IT and business services industry

July 03, 2020 | Phil FershtSaurabh Gupta

Three serious dudes having a serious conversation –  Phil Fersht, Nagendra P. Bandaru, and Saurabh Gupta

The COVID-19 pandemic shock is possibly (and hopefully) the biggest disruption of our lifetime. This is the time when you need real leaders who can see the light and the end of the tunnel and work tirelessly to unleash their organizational potential. We recently caught up Nagendra P. Bandaru (Nag) to discuss the resilient nature of the IT services industry, his bullish outlook for Wipro, and his sage advice for enterprises to adapt to this pandemic shock. Nag has been a constant in the IT industry for more than 30 years. He is responsible for organically doubling Wipro’s BPM business in the last 4 years and currently manages 40% of Wipro’s revenues, from BPM services to cloud and infrastructure.  I have personally known Nag since 2006, when he was a feisty young sales and marketing leader helping develop Wipro's presence in the US during the year growth years of BPO and it's been great seeing him flourish into one of Wipro's key minds and personalities as he helps shape the business for this challenging future. 

So, Saurabh Gupta, and myself decided it was time to reconnect with Nag to hear more about his views on the current situation and where the industry needs to go to make it through troubled waters to flourish once more...

Phil Fersht, CEO and Chief Analyst, HFS Research: We’ve known each other for more than a decade, Nag, so maybe talk to us a little bit about your background and how you ended up running not just Wipro’s BPM business but other big parts of Wipro such as Cloud and Infrastructure Services. Maybe you could take us a bit back to your earlier days, how you got into this, and what you’re doing now?

Nagendra P. Bandaru, President – Digital Operations and Platforms & Cloud and Infrastructure Services, Wipro: First, thank you for setting up this conversation, Phil. It’s been great knowing you, especially since you have been part of nearly one third of my journey in this industry! The

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Posted in: Business Process Outsourcing (BPO)Cloud ComputingOutsourcing Heros

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The world changed.. then it really changed

June 13, 2020 | Phil Fersht

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Welcome Sarah T... she likes R&B and has a PhD... in Virology

June 06, 2020 | Phil Fersht

Sarah Thomas is Chief Strategy Officer at HFS (Click for bio)

While this current economy is forcing so many of us to hunker down, hold our nerve and prepare to emerge strongly when growth and confidence returns, it also creates an amazing opportunity to add talent and capability we may never have considered when the world was a very different place.  Sarah Thomas and I have enjoyed a great working relationship over the years - she was always an avid consumer of my research when I worked at Everest and Gartner (AMR) and when I founded HFS in 2010 (as a virtual research boutique) she helped bring Accenture on as one of our first clients.  Fast forward 10 years and HFS is making a rapid pivot back to our virtual roots - and with a massive global community to boot.  So what better timing than to bring onboard a super-talented strategist and marketer (with a doctorate in virology) who truly understands the culture of HFS and how to help mastermind our digital push to help us emerge from the current crisis as the leading digital analyst firm covering IT and business services and the technification of business operations.

Before we get to all the work stuff, Sarah, can you share a little bit about yourself….your background, what gets you up in the morning?

So the short answer is that I have had a long and very happy career at Accenture that started in consulting in the Andersen Consulting era, grew into Marketing and involved a minor detour in the early years as a research scientist, working for Novartis where I completed my PhD in Virology. I didn’t have the normal career path for a CMO or head of Industry Analyst Relations but who knew that fast forward to 2020, all my worlds would collide with the Covid-19 pandemic and impact on everyone’s life and business.

In terms of what gets me up in the morning – in addition to a strong double espresso and 90s R’n’B on the radio, it’s the joy of learning something new. I like to always be challenging myself so aside from my new role at HFS Research, I am currently also honing my social media savvy, brushing up the German language skills I had when I lived in Vienna during my PhD and learning to ballroom dance with my very good friend Strictly pro, Robin Windsor.  At the weekend, the one thing that gets me up and out at the crack of dawn is the chance to go sailing. Being by the sea (preferably in the Caribbean!), or on the water is my happy place.

And how did you find yourself at Accenture for such a long tranche of your career?  Was it what you intended after studying science? How did you end up in marketing and strategy roles? What were the highlights?

When I joined Andersen Consulting as was, it was my wild card job application. I fully expected to have a scientific career and growing up I actually wanted to be a pathologist – until my aunt who was a doctor at the time, pointed out it wasn’t as glamorous as on TV and that I’d actually spend my life in scrubs, green wellies and working in the basement of hospitals – oh and probably never get a boyfriend! I didn’t expect to love the consulting world quite so much. I spent my early consulting career working for a series of financial services clients before leaving the company to return to science and complete my PhD with Novartis at their research institute in Vienna, Austria. After a post-doctoral fellowship in London, and a stint at the UK Medical Research Council I missed the pace of business life and returned to what soon became Accenture, in a Marketing and Communication role. I know that is not a natural transition of topic or role, but I convinced them I would be great at bringing my left-side logical thinking to bear alongside my creative flair. I definitely had one of the more unusual career histories and combination of experience but I like to think that brought something unique to my role.

I never intended to stay for so long and certainly not for 20+ years, but the advantage of such a large and diverse company is that there is room to move and grow. I was lucky during those early years to have some great mentors and champions in the business, who remain friends today and as their careers grew, so did mine. My career pivot point really came when Mike Salvino took leadership of Accenture’s BPO business. I was CMO for that business for the duration of Mike’s tenure as CEO, working closely alongside him and a number of other leaders who shaped the industry and am extremely proud of the business we built. We were a young, dynamic leadership team who were all invested in growing the business and in each others’ success. We are all still close now; It was a special moment in time. As a team I think we did a great job of not only growing and repositioning the business in the market, but also changing the meaning of what a business process service provider could be for their clients and also for their people.

One of the things I loved about my time at Accenture was working with so many fantastic people. One of my favorite projects was working with a team from all around the world and parts of the business, including many of the companies we had acquired who brought their unique and specialist skill sets to the table, to redefine and rebrand our consulting methodology. It was a unique project and we ended up feeling like an extended family.  

So what from your vast experience do you think you can apply to the services and tech industry now you are on the “light side”.

Well I hope that my experience as a CMO and head of Industry Analyst Relations for such a key industry player will help HFS Research continue to hone and evolve their offerings, and how they work with their key clients to be even more relevant and effective – and I hope that I can bring my experience to bear for the benefit of all my former peers in client organizations. In my first week in role, I have already had a number of interesting and energizing conversations with CMOs and CEOs of client organizations. Its good to be able to learn from and challenge each other.

And why did you choose HFS, Sarah?  How do you think you can drive things forward for the firm, especially with your many years of experience working with all the leading analyst firms?

HFS is known for having a distinctive voice in the market – for being provocative and for challenging the status quo. As a marketer and someone who likes to be working in “the new”, I want to work with the “disruptor” who is shaking up the industry. Having sat in the client and service provider seat I believe I bring a unique perspective to the team. I am naturally someone who thinks laterally and “connects the dots, so I hope I can bring some fresh thinking and challenge the HFS team to be even more agile and responsive with their insights and research, and to shine a light on those providers and clients across the industry who are really driving value and pushing the industry forward.

How do you see the analyst industry changing, especially with the current economic uncertainty? And what needs to change…and what will change in your view?

The pace of change in the industry really demands an analyst firm can that be agile and responsive to the market.  Nobody can wait six to nine months for insight and a category report to be published any more – the world will likely have pivoted on its axis in that time.  To be relevant you need to be quick to market.

I also think that while a robust and relevant research portfolio remain the foundation of any analyst firm going forward, there is huge value in tapping their strategic talent on a project basis too. I see that as being a service area that will be increasingly in demand. Clients can extend their own strategy team on a project or an opportunity or tap a broad set of experts in a more “think tank” environment for strategic advisory, bespoke research or a competitive landscape. Its deep subject matter expertise, on the topics they need, when they need it.

And how do you see the services industry playing out over the next couple of years? Are we truly entering “crunch time” where only the fittest survive?

Absolutely. To come back to my science background, this is business natural selection in action. Experience tells us though that such circumstances forces people to focus, to spend smarter and to really think strategically about who they are and what their strengths are. It’s going to be a tough for a while yet, but it will be those who are able to adapt quickly, take decisive action as necessary and innovate, who will not only survive but thrive.

From a marketing perspective what is interesting for me right now is the refocus on brand. I speak to my fellow B2B marketers across a broad set of industries on a regular basis and everyone is grappling with the same challenges – how to do the same or more, with less resource, how to engage with clients and recruits virtually but still make the experience one that delights – that delivers on content and builds knowledge and relationships. Customers in both the B2B and B2C world are looking at the organizations that they do business with or buy from with a critical eye – how are they responding? How are they taking care of their people and communities? And are thy the organizations they want to do business with going forward? Brand, culture and purpose have never been more relevant.

So if you have one wish to change our industry for the better…what would that be?

As a marketer through and through, I need to spin it a little. I have two wishes but they both come under the umbrella theme of Leadership, so I’ll count that as one. Firstly, we know that diversity in teams leads to greater innovation and yet when you look at most organizational leadership teams in our industry they are anything but. I’d like to see more women in the big jobs and running the P&L. The talent is there – they just need to be given the opportunity.

And I hope that coming out of this period we will see more authentic leaders. Yes, effective leaders who drive business results, but also those who have vision, empathy and who lead by truly inspiring their teams to deliver for their clients.

Thanks so much for your time, Sarah, and we’re excited to see you make some waves from the analyst side of the fence.

Posted in: Outsourcing HerosMarketing

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IT and business services is taking a massive 10.2% hit this year

June 02, 2020 | Jamie SnowdonPhil Fersht

There's not much else we can say beyond the fact the impact of the Paradigm Shock on the IT and business industry is seismic.  Suddenly, the core value of services is to address what customers have to buy right now... and at prices they can afford.  This is a cut-throat market unlike anything we have seen before and the survivors are those who have the nerve, the cash, the luck, the immediate ability to support their clients and the strategic nouse to make quick moves to come out on top as the new business environment gradually unravels:

Forecast Assumptions

  • GDP impact from Q2 2020 is expected to be10-15% in all major Western European and North American markets. Economic recovery to pre-COVID levels is unlikely until the second half of 2021.
  • Business not as usual – with a significant amount of work being unable to complete due to local lockdowns and social distancing. Government bailouts will prevent some businesses from failing but will not be universally successful particularly with small businesses.
  • GDP / GVA forecast analysis for major sectors used as a starting point for forecast variation. Given that the economic impact is industry-sector led.
  • Previous major economic events used as a primary guide for impact due to COVID, particularly the long-term impact as the wider economy is impacted. In particular, the impact of the great recession on the IT & business services market.
  • Major decline in professional services new business, most signed agreements go ahead with a larger percentage of delays to existing work (40-50%).
  • Professional services impact is immediate (Q1/Q2) with a return to pre-COVID spend in 8-10 quarters.
  • Operational services impact is delayed – so won’t immediately hit revenues in Q1, but will gradually affect the market as deal signings slow significantly and are deferred to Q1 2022. We have seen deal volumes reduce by a half for Mar and April.
  • Revenue impacts in Q1 small, with the impact of deal signings and slowing discretionary spend, felt in Q2 and Q3.

The Bottom-line: Recessions do end, but this one is going to reshape the services industry more than anything we have ever experienced

We've ridden the traditional services model for 20 years and - let's be brutally honest - while we've had some awesome developments in areas like digital technology, cloud and automation, the underlying way services have been bought and sold hasn't fundamentally changed. Suddenly many clients facing huge survival challenges (such as in travel and manufacturing sectors), coupled with the downward pressure on pricing is sending large parts of the services industry into a tailspin. For those that don't have the cash reserves to weather this, and fail to reinvest in a plan to attack growth opportunities as the crisis subsides, the future is murky.  Customers will demand "as-a-service" offerings, sweetheart deals and all sorts of outcomes in the market that is to come... the old rule-book is being tossed and the emerging situation is putting unprecedented (there, I used the word) pressure on many service providers to survive.

As the lockdowns slowly ease and business returns to a point where big deals can be done, expect some significant M&A activity - and all sorts of "carve-out" deals to take place - as service providers fight to survive, exit or dominate.  We may even get a few surprise entrants into a market where there is no pre-written playbook.  This is where the brave, the smart and the lucky take control.

Posted in: Business Process Outsourcing (BPO)IT Outsourcing / IT Services

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