Having been an analyst for the best part of nearly two decades, the big ERPs have always maintained a stranglehold over the majority of the global 2000. Any service or technology enhancement has to connect / integrate / work-around the existing ERP template. Entire operations departments essentially become structured around the ERP platform and dependent on their capabilities and relationships with their ERP vendor.
And the ERP premise has always been pretty good – accomplish standard, automated ways of doing things and you can employ less people to achieve the outcomes you want. However, we all know how that has failed to transpire for so many…
However, the world of business process solutions is finally changing. Most mid-market companies looking at their first “ERP suites”, whether it’s in HR, or finance, or procurement etc, are going straight into the Cloud, with the likes of Workday, Netsuite, Ariba and so on. It’s these companies evaluating business process solutions from scratch, or are simply at the end of their tethers beating the crap out of their legacy ERP systems, which are taking the leap and reinventing their whole approach to process management. I firmly believe it’s many of today’s mid-market companies today that will make up the majority of the Global 2000 in 5 years’ time.
But let’s not get overly carried away…there isn’t a dramatic switch happening from the legacy ERP-driven firms to the new generation organization, where everything is run under a beautifully centralized global operating model, process flows are accessed in the cloud and all non-differentiating processes are outsourced. It’s simply those firms ready for the new are growing in stature and scale, while those clinging to the old are trying to get smaller and leaner. It’s about reinvention, not replacement; it’s about taking a completely new path, not simply papering over the cracks of the old one.
So without further ado, I wanted to introduce a spectacular new personality into the HfS family, Susan Scrupski, a legendary figure in the worlds of disruptive technology and social business – and Fast Company’s “Most Influential Women in Technology” in 2010 – who’s embarked on a pivotal new project with us entitled “Business Process Reinvention”…
Business Process 21C: The Jackhammer Tales
Over the past few months I’ve begun to reflect upon how I arrived here at the intersection of process and innovation in the Enterprise. It occurred to me that everything I learned as a researcher, a writer, and an industry observer in the services provider space (my pre-Internet career) now had great bearing on what I was seeing in the Enterprise as a result of the pace of disruptive technologies impacting the market. The question that kept re-emerging for me was: how are rigidly defined business processes that were hammered out in the 90s reconfiguring to adapt to better, faster, more efficient ways of meeting customer needs? Even more puzzling is, if my friend Josh’s old joke is correct, “SAP is like pouring concrete into a company,” how are large enterprises dismantling foundational ERP systems to include disruptive technologies? After all, no 21st Century business can stand to stay frozen in the past. Even SAP itself is retooling to provide greater flexibility and real-time actions and insights with its HANA in-memory database and its JAM social platform.
This big question has been vexing me for a while, so I asked my friend and fellow Enterprise Irregular, Phil Fersht at HfS Research, if he’d be interested in an exploratory study to see how BPO providers and consultants are responding to new advances in mobile, social, the Internet of things– all new capabilities that were not present when the majority of institutional business processes were “cemented” into the Enterprise. I’ve seen evidence of several companies who’ve been introducing social, in particular, to provide greater value to customers. Of course, some of the best examples are coming from platform vendors themselves such as this post, “Enterprise Social is about Business Process Redesign” by CEO Michael Idinopulos at Socialtext. But, I’ve seen other examples such as Deloitte’s work in this area explained in this post, “Social Reengineering by Design,” and even examples about how large consulting firms are changing their own internal processes as a result of new ways of working, as evidenced by this post, “Spark – taking Collaboration and Corporate Social Networking to a new Level at PwC.” Luckily, Phil agreed this is an area definitely worth pursuing, so we’ve kicked the study off this week. We’re compiling data and hope to publish results in the early May timeframe.
I’m really happy to be working in this area that combines my long history of covering the traditional outsourcing sector with my area of interest for this current iteration of my career in next generation technologies. Phil has done an amazing job with HfS Research, too, so I’m proud to be contributing to their strong brand in the market. HfS was recently named one of the leading analyst firms in a formidable field of competitors. Last week, I paid a visit to my longtime business advisor Mort Meyersen, who is an icon in the outsourcing field having helped build EDS and then Perot Systems. It feels good to be back among old friends, mashing up what I’ve been learning from new friends.
I will be working hard on this study for the next few months, but also working on the startup we announced a few weeks ago, Change Agents Worldwide. So, busy, busy, but really having fun. Hope to see some of you at SXSW, but I will be hunkered down and only getting out to a few of the evening events. Please keep up with me on Foursquare if you’d like to connect while you’re here in Austin.
Susan Scrupski (pictured above) is Research Fellow, HfS Research.
Posted in : Business Process Outsourcing (BPO), HfSResearch.com Homepage, Outsourcing Heros, SaaS, PaaS, IaaS and BPaaS, Social Networking
Super article, and I love your positive breakthrough energy Susan.
There’s a huge population of spreadsheet users out there – basically rolling their own “end user computing” “ERP” – because the “cement” version doesn’t cater for many of their fast changing business processes. Unfortunately these spreadsheets are disconnected so there’s endless cutting/pasting and emailing to keep everyone on the same page.
Like Workday, my company is reinventing the way work gets done in part by enabling spreadsheets to be “always already” connected to each other via a super smart data hub in the cloud, along with transparent plugins so the spreadsheets can function just like any online web form except they remain native MS Excel with all the powerful desktop functionality users need & love.
This is of course a plug for my company, but I am also championing a perceptual shift in what can be achieved with spreadsheets – because that’s where a significant percentage of business people spend their time, right?
This thinking is right at the edge, Phil and Susan!
Outsourcing and SaaS are tools that help companies get access to better talent/technology, but the real challenge is re-crafting the processes to take companies to a whole new level of productivity, collaboration and innovation.
Am excited to read the research,
Paul – I think its systemic/complex as opposed to certain aspects being the real challenge 🙂
Hi Ian. Can you post a link to your company? Sounds interesting. I agree that a lot of the gaps are being cobbled together in spreadsheets. Love to see how you’re addressing that…
Thanks Paul. This is what we’re hoping to uncover… so, fingers crossed! 🙂
Thank you Susan – it’s http://www.synapseinformation.com
I should have added, Susan, if you, or anyone, would like to contact me about this:
USA: +1 415 691 6097
UK: +44 (0)208 816 8379
iangoldsmid at synapseinformation dot com
Get article and a subject close to my heart.
Even well meaning and experienced change managers get stuck on real business practice change. This article on the subject was not written tongue in cheek.