HfS Network
Phil Fersht
 
CEO and Chief Analyst 
Learn more about Phil Fersht
Who's ready to change the industry this week in Chicago?
September 18, 2017 | Phil Fersht

HfS has hired Johnny Robo Brien!
September 13, 2017 | Phil Fersht

Fed up with all the helicopter-view prophesizing of the emerging robo world that just leaves you with a headache?  Irritated by those matrices of suppliers which all look the same and tell you nothing meaningful?  Sickened by the bizarre rose-tinted claims of how easy this all is?  

Well... ee're changing all that at HfS, by issuing proper user experience reports of RPA and intelligent automation solutions, based on the real experiences of users, that aren't coming from the same old tired list of wined and dined RPA customers sent straight from the suppliers.  So we've just hired a terrific analyst who not only understands the rules of robo, but can apply them to specific business processes and industry operations.  So without further ado, let's learn a little more about our newest analyst brain, John Robo Brien... whom you may know better using his birth name of John O'Brien (see bio).  

John - it's just terrific to be working with you at HfS!  Can you share a little about your background and why you have chosen research and strategy as your career path? 

Hi Phil, and thanks, it’s fantastic to be here working with you and the HfS team. I’ve been an IT analyst since joining ComputerWire in 2000 where I started out covering European IT services. I’ve since worked in senior positions at Ovum and Datamonitor/Informa covering the global IT, BPO and Public Sector markets. For the past seven years, I’ve worked at TechMarketView, as

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HfS data products get a Suvradeep-dive
September 11, 2017 | Phil Fersht

As you may have seen last week, we officially unveiled our data products at HfS, where we bring together the full gamet of demand and supply side data to share everything you ever needed to know about the big change agents impacting business operations.  So who better to help support our new range of offerings that a veteran analyst with a broad knowledge across all services markets, who's developed a solid reputation with the likes of Ovum and NelsonHall: Suvradeep Bhattacharjee.  

In addition to being a true gent and an eloquent observer of the market, what also appeals is the fact he moved himself to our new HfS headquarters in Cambridge England (where his wife teaches HR practice at one of the local colleges), but he also comes from the great city of Calcutta, where you can actually visit man-eating tigers.  My 8-year-old boy is begging me to take him, so I will need some local expertise to give me the lowdown.... 

Welcome, Suvradeep - it's just terrific to be working with you at HfS!  Can you share a little about your background and why you have chosen research and strategy as your career path? 

I think, I am curious by nature. I am usually stimulated by new knowledge which is mostly

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It's Design Thinking heaven with TandemSeven as Genpact makes its OneOffice move
September 08, 2017 | Phil FershtBarbra McGann

"You guys really should evolve your lean capabilities into Design Thinking with your clients" was my conversation with Genpact's innovation lead, Gianni Giacomelli (pictured), a year ago.  "You should also do that with your research clients" was Gianni's response.  Exactly a year later, we open our  Research ThinkTank in Cambridge England to perform said exercises with our clients, and Genpact announces the acquisition of Design Thinking specialist TandemSeven in Cambridge Massachussets. 

Why is Design Thinking becoming so relevant to the middle-back office operations?

We see the emergence of Design Thinking as critical to help enterprises collapse these barriers between their front, middle and back offices - one of the core fundaments of achieving a true OneOffice framework.  You really can't be a digital organization if your operations are not supporting the front office in realtime, being able to respond to customer needs as and when they happen:

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Design Thinking offers an approach for a diverse group of people to work together to identify

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HfS Data Products are here!
September 07, 2017 | Phil FershtJamie Snowdon

We just love data at HfS - we built this company by surveying our terrific community over the last 10 years to keep on top of all the curious things enterprises do to stay competitive and profitable.  And this year, we are literally surveying 3,000 billion dollar plus enterprises on their intentions and dynamics across the 5 critical change agents of our industry: automation, AI, analytics, blockchain, emerging digital business models, and global sourcing strategies.  

While everything we do is based on data, we've not really packaged it all up in a way for our clients to digest it and use it most effectively for themselves.  Until today.

We’ve set out our research agenda to bring reality to the research analyst world, dynamic engagement with our clients and our vision for the industry: our Analyst 2.0 model. Over the next 6 months, we will be adding more data products and enriching the existing ones, based on the wealth of information we have collected over the years:


1: Contracts Database

Launching in September 2017. As part of its ongoing research HfS has always collected and collated contract data across the different service lines it tracked. HfS Contracts Database gives subscribers access to this data, which provides up-to-date analysis of IT Services and Business Process Outsourcing contracts. This interactive tool allows users to search for specific contracts, view contract progression annually and by quarter, and view heat maps of specific deal categories by region.

2: HfS PriceIndicator™

HfS PriceIndicator™ has been part of HfS Research data tools for over 4 years now. The next 6 months we will start to include RPA and automation pricing.

HfS PriceIndicator™ is a real-time, research based price benchmarking service that provides clients an insight into current ITO and BPO pricing. Currently, PriceIndicator™ provides a biannual set of hourly FTE rate cards for ADM, F&A BPO, Insurance BPO and Healthcare Payor BPO.

3: Buyers’ Guides

HfS buyers' guides provide an independent view of individual service providers across different service capabilities. Giving a summary of the organization's strengths and weaknesses in addition to details in specific service categories.

The long-term plan will be to integrate these guides into the HfS Data website updating them whenever new financial data is available and when we publish new blueprints/vendor analysis – so they always deliver the most up-to-date content on each provider.

4: Quarterly Market Indices

HfS provides market size and forecast for the IT and business services market updated on a quarterly basis. This view of the industry provides a top-level view of service provider performance and uses this to predict market growth and performance within the main IT and business services markets.

5: Supplier Revenue Data

For the past 5 years, HfS has been tracking the IT and Business service supplier landscape collecting key financial data from the industry – creating models which are used to create our Top 25 IT services and our Top 50 BPO provider list. HfS is expanding these models to create revenue maps across key service lines, industry, and geography.

6: Direct Buyer Viewpoints

HfS regularly interviews buyers throughout the Global 2000 organizations, conducting 3,500 interviews over the course of the year. The Buyer Viewpoints opens up this data for additional analysis by industry, and across regions. So our subscribers can create their own views of the information for presentations and infographics, in addition to HfS own drive to make our data more accessible.

The bottom-line

The Analyst 2.0 model means making data more accessible, easier to digest and self-service – the analyst should not be a barrier to insight. HfS wants to enable our community with the right data to drive their own insights and their decision making – revolutionizing the way market data is used and consumed. At the same time letting our analysts do what they do best - drive thought leadership within the operations and IT services community.

 

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Socially-paranoid media: where did it all go wrong? (Weekend rant)
September 02, 2017 | Phil Fersht

What’s really happened to social media these days? What used to be a fun place to share untethered banter, humor, intellectual conversation and debate, perhaps be a little risqué, has degenerated into a stuffy medium for puffing up corporate brand mush, and regurgitating the same old bland insight we’re having pushed at us daily. Every corporate suit is now on there, lauding how amazing their company is… praising their clients and uttering meaningless, hollow words of adulation. In fact, many of the "senior" people on there have their marketing people even do their social for them... it's not even them.

All of you know I do like to dabble a bit with Twitter, Facebook and LinkedIn to engage with people - both with people I like socially (Facebook) and industry contacts with whom I consider valuable to stay in regular touch (LinkedIn). I also have the luxury of being the boss, so no one can fire me ;)

Over the years, social has been terrific for communicating with people, sharing insights, opinions, research, news… it’s been fun, and it’s been personal. It keeps you connected with so many people that when you bump into folks at conferences etc., it feels like you spoke just the other day, rather than five years' ago.

But, in recent months, it’s just become so polarized and stuffy. There are people using social only to promote themselves and their companies… the personality has drained from it. I find myself spending more time removing connections than adding new ones.

Case-in-point, I dared to post some (slightly dubious) research on LinkedIn the other day with a joke about how much analysts need to be wined and dined to get the best scatterplot grid placements. I didn’t even criticize the research, I just popped up the grid with a joke on the axes about boondoggles and posh dinners. Within about three hours of posting, I received some really snotty comments from the analyst firm in question berating me for daring to poke a little fun at one of its lovely magic grids. They were pretty nasty about it too. And then I got an aggressive note from a marketing guy in one of the suppliers (which was nicely positioned in said grid), complaining about my "unprofessionalism" for poking fun at a competitor. 

So I took the offending post down – my intent was to generate some banter about the techniques suppliers use to get positioned well in these grids, not a bunch of nastiness from people who just seem so bloody paranoid these days.

To cap this all off, I then get a phone call from the boss of the marketing guy (who complained about my post) requesting me to put it back up as they were getting so much free publicity from it (20K+ eyeballs).  You just can’t win at this, can you?

So where do we go with this?

  • Hone your network to people you get value from. If you find people offensive or not adding value to you, then just remove them, rather than create a nasty discussion thread
  • Get a sense of humor: arguments can be fun. If you disagree with someone, but the conversation is useful, then voice your disagreement about the topic and have a proper discussion… don’t just criticise and disappear. Use the forum to exchange views and ideas – you never know, some good may come of it.  If we all just agreed with each other all the time, we’d never learn anything…
  • Drop the ego. These are networks where you agreed to exchange information with people, so be prepared to see things you have an opinion about. And be prepared to be criticized – that’s the whole purpose of this stuff. If you can’t handle a little professional debate, then stick to Facebook and the pictures of dogs and babies…
  • Be open to the fact that the opinions or research you put out may be flawed. We should be willing to learn from each other and accept some input, flattering or not. If you think I am smoking something, just tell me… and I’ll do the same with you. Challenging each other is the only way we learn and get better at what we do.

Automation to displace 750,000 low skilled Indian jobs, but create 300,000 mid-high skilled jobs by 2022
August 30, 2017 | Phil FershtJamie Snowdon

HfS subscribers can access the full report by clicking here

A lot has changed in the last year... especially when it comes to automation: it has now become the broadly-accepted efficiency tool for cost leverage with operations.

Every customer has RPA project managers and automation leads hungry for data, advice, and ideas. Every service provider has RPA embedded into their service delivery models, and every credible advisor has a practice that is working with multiple clients to make this happen. The Armageddon days of talking about robots taking our jobs are over - these are now the reality days where we can see exactly what's going on with automation and AI, and accurately estimate how it's going to impact the services industry in the next few years.

There will be impact, but it's manageable provided we focus on new skills and value.  

In short, the global IT and BPO services industry employs 16 million workers today.  By 2022, our industry will employ 14.8 million - a likely decrease of 7.5%* in total workers (see our research methodology below).  This isn't devastating news - we'll lose this many people through natural attrition, but what this data signifies is this industry is now delivering more for less because of advantages in automation and artificial intelligence.  The new data also shows how job roles are evolving from low skilled workers conducting simple entry level, process driven tasks that require little abstract thinking or autonomy, to medium and high skilled workers undertaking more complicated tasks that require experience, expertise, abstract thinking, ability to manage machine-learning tools and autonomy.

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The low skill routine jobs are getting increasingly impacted, and our new demand data shows an acceleration in RPA tools (a 60% increase over the next year) where service providers are the largest adopters into their own service delivery organizations.  We expect to see a more rapid impact on routine job roles which is most notable in 2022 as companies take time to build the impact of RPA into service contracts and figure out how to turn work elimination into hard savings than merely soft efficiency savings.  With barely a 50% satisfaction level, this will take 4-5 years to see the real cost benefits in terms of job elimination.  Most of the short-medium term benefits are being seen in increased efficiencies and more digital process workflows.  All major service delivery locations are expected to be impacted at the low-end, but the higher the wage costs, the higher the expected role elimination (750,000 roles in India and a similar number in the US):

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Medium skilled roles are picking up across the board, especially in roles that are customer/employee facing with the need for more customized support, the ability to handle

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Unveiling the HfS 1-2-3-4 Research Agenda
August 26, 2017 | Phil FershtJamie SnowdonBram WeertsSaurabh Gupta

 

Last week, we launched the Analyst 2.0 Model along with the HfS ThinkTank to revolutionize our industry. And today we unveil the new HfS 1-2-3-4 Research Agenda. The updated agenda serves the real needs of our clients. The tired legacy analyst model continues to only look at the past and lacks out-of-the-box, stimulating, and forward-looking thinking. We aim to turn this legacy Analyst 1.0 Model on its head, by delivering impactful knowledge and insights that will help our clients survive and succeed in the VUCA (Volatile, Uncertain, Complex, and Ambiguous) world that we all live in.

1: Research coverage across each element of the OneOffice

HfS launched the OneOffice Framework in January 2017. Our industry is evolving to an era where there is only "OneOffice" that matters anymore, one that is focused on creating an impactful customer experience and intelligent operations to enable and support it. At HfS, we like to practice what we preach. We have aligned our research practices with the OneOffice with designated research leaders.

  • The Digital Front Office research explores customer engagement, design thinking, contact center, marketing and sales, as well as social, mobile, and interactive solutions.
  • The Digital Underbelly research focuses on desktop automation, robotic automation, and security.
  • Our coverage for Intelligent Digital Support Functions spans across IT services, Finance, Procurement, Supply Chain, Payroll, and Engineering services.
  • The Intelligent Digital Processes research explores advancements in artificial intelligence, smart analytics, blockchain, and IoT.

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2: Voice of the Customer embedded in the Analyst 2.0 Model

In-sync with the Analyst 2.0 Model, we designed the new research agenda to help us become the leading Voice of the Customer. Our team of global analysts speaks to over 3000 stakeholders across the Global 2000, our industry summits provide us with an unmatched platform to interact with senior stakeholders, and our analysts publish real client stories. We’ve always mandated customer reference calls for every Blueprint report that we publish and with the new research agenda, we are taking this customer focus a notch higher. Some key initiatives:

  • Our recently published and upcoming IT-services research, based on a Global 2000 client-only survey that helps us get beyond the supplier marketing and sales spiel.
  • Similar survey(s) for mature horizontal business process areas as well as industry-specific offerings.
  • Our major Blueprint reports will now be accompanied by a summary of client conversations in the space to present aggregated patterns of how clients view market execution and innovation.
  • A unique buyer experience guide for the top RPA products, based solely on interviews with RPA clients. 

3: Forward-looking research across three-time horizons

A key reason for clients to engage with us is the provocative nature of our research.  We’re future looking, and unafraid to call a spade a spade. The new research agenda aims to arm our clients with the knowledge and insights across three-time horizons they need to navigate the future of operations:

  • Horizon 1 - Act-now: Mainstream topics in the market, such as Robotic Process Automation (RPA). Horizon 1 research is aimed to deliver practical insights into current market trends, supplier capabilities, as well as current client experience that will help institutionalize the concepts.
  • Horizon 2 - Watch-out: Emerging themes and topics that are likely to become mainstream in the next 1-2 years, such as Artificial Intelligence (AI). The objective is to help clients test value propositions and understand potential benefits and challenges in their industry.
  • Horizon 3 - Investigate: Areas that show tremendous potential but are still too nascent to predict adoption, such as blockchain. The purpose of covering such topics is to ensure a healthy dialog with key industry stakeholders to define these spaces, articulate challenges and support awareness.

4: Four-dimensional view of business operations

The future of business operations is not one-dimensional. To provide our clients with a completely holistic view of the market, we have a team of four-dimensional analysts who understand the market across four lenses in their area of specialty:

  • Dimension 1 - Change agents: Major change agents driving the industry including automation, artificial intelligence, blockchain, digital business models and smart analytics.
  • Dimension 2 - Business functions: Detailed coverage across Business Process Services (both back office and front office), IT Services, and engineering services.
  • Dimension 3 - Industry orientation: Business operations impact across 10+ industries including Banking & Insurance, Healthcare, Energy, Utilities, Manufacturing, Telecom, Retail, Travel & Hospitality, and Public Sector.
  • Dimension 4 - ThinkTank: Bringing together our collective knowledge and insights across change agents, business functions, and industries to think out-of-the-box and collaboratively solve real business issues.

 

Bottom-line: We are raising the bar, and we are revolutionizing the industry with our new HfS 1-2-3-4 Research Agenda.

Check out the details of the Analyst 2.0 Model, ThinkTank, and our 1-2-3-4 Research Agenda.

Why Donald Trump should take the Infosys CEO gig
August 25, 2017 | Phil Fersht

There's only one thing in our world that keeps Donald Trump off the headlines... of course... it's good ol' Infosys!  Yes, folks, we actually seem to care more about who is attending these board meetings and squabbling about the cost of refueling the company jet, than the nuclear warheads currently pointed at Pyongyang.  

Yes, people, the $10bn Bangalore-headquartered outfit is trumping Trump in the media... an exclusive on what Murthy had for breakfast is far more interesting these days than the handbag Ivanka just purchased.  And the eighty-seventh article analyzing just why poor ol' Vishal wasn't quite leaping for joy every morning during his tenure, is clearly more impactful to our lives than the US government potentially shutting down, because Donald wants his wall built...

But there is a solution:  Donald Trump can avoid impeachment, quit the Prez job and take the reigns at Infosys. Where better to make something great again, where he will hog the headlines more than anyone has... ever!  Just think:  Trump + Infosys... we will never need to read about anything else again. Ever.  

Why this would be Donald's dream job:

1) Build a wall around Electronic City to keep out the TCS and Wipro headhunters.  Then rename it Trump City.

2) Repeal Murthycare without the need for any new ideas.  Just get rid of it and think of something later.

3) Tweet incessantly about how much he hates Abid, Frank, Premji, Vishal, Meg, Ginni, Murthy... 

4) Ban the Times of India and Livemint from all press briefings - only allowing in the new Trumposys Monthly magazine

5) Invest the whole $6bn warchest in Infosys Russia.  Including a state-of-the-art Kremlin Lab that Putin can open personally

6) Put Sean Spicer in charge of the Artificial Intelligence strategy

7) Impose a travel ban on all robots to keep the FTE model intact

There you have it folks... bring on the Trumposys!

Hyping the hyperledger with blockchain boffin Brian Behlendorf
August 24, 2017 | Phil FershtSaurabh Gupta

HfS' Saurabh Gupta recently caught up with Brian Behlendorf (see bio), the Executive Director of Hyperledger at the Linux Foundation. Brian was a primary developer of the Apache Web Server – the most popular web server on the internet. He was a founding member of the Apache Software Foundation, the founding CTO of CollabNet, the CTO of the World Economic Forum, and the managing director at Mithril Capital Management LLC before heading Hyperledger. He is also a board member of the Mozilla Foundation since 2003 and the Electronic Frontier Foundation since 2013.

Two decades after developing the Apache HTTP server that played a key role in giving us the internet and the web, Brian is reimagining our world again with blockchain. We discussed a range of topics around the reality and practicality of blockchain for enterprises along with the one wish that he wants to come true. 

Saurabh Gupta, Chief Strategy Officer, HfS Research: Brian, one of the stated goals for Hyperledger is to create enterprise grade frameworks and solutions. Why do you think enterprises should adopt blockchain?

Brian Behlendorf, the Executive Director of Hyperledger at the Linux Foundation: We have lots of transaction networks that, Saurabh, because of historical network choices, have resulted in many central actors who facilitate digital transactions like a hub in a hub-and-spoke network. And we have to proxy our trust to them - sometimes they do a noble job and charge a nominal rate, but there are times when these central actors charge unreasonable double-digit rates. Blockchain allows business models to become more equitable and agile by behaving more like

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