Well, there went year two of pandemic living and we’re still figuring out how to stay focused, motivated and successful during times where we’re one turgid video call away from screaming uncontrollably just to see what reaction we get. So what can we do to change it up in 2022, which surely will be better than 2021, which was much better than 2020?
1. Accept the fact that today’s predicament will be over soon. As much as we have been drilled with the knowledge that the world will never go back to pre-pandemic levels of travel and physicality, our careers and our businesses will stagnate and likely lose effectiveness if we just give in to a world of soul-crushing video calls and allow ourselves to drift away on our islands of remoteness. This is a time to make more efforts than ever to stay in touch with friends, colleagues, clients, peers, etc. As much as you can, please make plans to meet with people physically when we get past the next (and hopefully final) weeks of this.
2. Keep relationships personal and less bloody awkward. Remember how great it was when you could have a candid conversation with someone? Seriously, not everything needs to be some turgid video conference call where we all stare at each other awkwardly, wondering if we should actually look into each others’ eyes or that light on our webcams. I still struggle with that one… moreover, what happened to the 1-1 conversation where we could just listen to each other and talk without others glomming on?
3. Park the ego – for good. Seriously, everyone’s fed up with egos. We all have them, but being able to keep them buried somewhere is more important than ever. Everyone’s so sick of people constantly trying to tell you how amazing they are because they clearly don’t hear it enough from others. Sorry to be blunt, but if you need to keep reassuring yourself openly about your own brilliance you may not be that brilliant…. That may have worked in pre-pandemic world where it was all about showboating at conferences, but those days are long gone. Now, this may be hard for some, but try praising others and they might even praise you back…
4. Be humble and get sh*t done. It’s incredible how many folks who were quiet as mice in the old world are now front and center of business activity. Why? Because the watchwords today are all about being solid collaborators, rolling your sleeves up, and actually doing stuff. I think we are all exhausted with the blowhards who talk a big game but never follow through on anything. So after a good conversation, follow up with the things that were promised, make sure you have an agenda for your next discussion, and show that you actually want to get things done. The days of lip service are well and truly done.
5. Stop working when you lose energy and focus – it’s imperative to work smarter now. This is happening to all of us – we’re so engrossed and glued into the multiple electronic discussion threads going on, we’re actually becoming really unproductive. I am as guilty of this as anyone! Nothing beats the uninterrupted time when you can execute on work that needs to be done, so when you find yourself flagging, needing a mental break, then take a f*cking break. Go work out, play with your dog or child, have a drink, go for a run or cycle ride… Trust me, burnout comes from an inability to switch off. Remember in the old days when you took a week or two off work and were able to clear your inbox in the morning when you returned to work? It’s even worse today when you can spend excruciating hours discussing things that could be decided in minutes if we all took a step back and worked smarter. At the end of the day, you will be judged on what you achieved for your firm, not how many hours you spent trying to achieve it.
Automation Anywhere buying FortressIQ is a less-than-exciting combination. It seems like too little too late for AA to jump into the process mining/intelligence world, and a quick cash-out for FortressIQ Founder, Pankaj Chowdhry, who just wanted out and was running out of time and money – and losing all hope of an eventual acquisition by Microsoft. RPA and process mining are different beasts and not one where the process intelligence market leader Celonis has successfully (or intentionally) combined, and where UiPath, the RPA market leader, has struggled, with its acquisition of ProcessGold. So what makes AA and FortressIQ think they can succeed where many others have failed? Is this what the market demands? Do these firms really understand who their customer is?
So let’s weigh up how these offerings fit together and whether this merger has any real potential.
The acquisition seems like a Hail Mary for both firms
Automation Anywhere just announced its acquisition of process intelligence vendor, FortressIQ. In their statement, the software firms pledge to “build the automated company, together”. But in that declaration lies our first impressions of the limiting potential of this combination. The acquisition feels like a knee-jerk reaction to the current market trend of using user activity data to find, measure, and monitor RPA opportunities. In HFS’ view, the use of enterprise process data can be far more impactful and address larger change programs as businesses push towards digital and cloud modernity.
Automation Anywhere was very late to the market trying to develop its own process intelligence capability, Discovery Bot. When the vendor eventually launched the solution earlier in 2020, its key differentiator against other existing tools was simply that it was built within the AA platform and integrated with IQBot and other AA components. Discovery Bot was eventually offered as a complimentary solution for existing AA clients and signals the vendor’s lackluster efforts to catch up with the fast-growing process intelligence market. Acquiring FortressIQ now feels late in the game to bridge the same gap from 3 years ago which Discovery Bot struggled to fill.
FortressIQ on its part seemed poised for a possible Microsoft tuck-in acquisition. The software giant invested in FortressIQ’s 2020 Series B round through its venture fund, M2, and the companies deepened their relationship earlier this year. The companies saw a natural synergy around the Power Platform and were focusing their efforts on process discovery to support Power Automate use cases. The timing of the Automation Anywhere acquisition seems to suggest FortressIQ ran out of time waiting for Microsoft to pull the trigger, and secure its future with a competing partner. All while the vendor fought for market share alongside process intelligence pure plays, such as Celonis, that have grown to dominate the market.
Submerging process intelligence into the automation bucket is selling short the technology’s potential
FortressIQ’s original messaging was around “Data-driven insights powering transformation across your extended enterprise” – automation was one lever, but the technology has far wider applicability. If this acquisition is just about enabling automation, we’re going to call it, it will fail. AAI needs to think bigger. It can make FortressIQ part if its stack for the process discovery hookup, but using the power of process intelligence just to find automation opportunities is a massive undersell. UiPath already learned this with ProcessGold in the last two years. UiPath struggled with selling a process mining product and naturally fell back on the obvious sell of positioning as an add-on to RPA. ProcessGold is a proper mining tool so that link was never clear, as opposed to analyzing user activity data with discovery tools and finding RPA opportunities. Which helped Celonis drive over them. Now UiPath more actively decouples them.
As for our friends at AA, they need to be clear about what they want to do with FortressIQ. Is it just a conduit to automation? If that’s it, then what a waste. Even Kryon, which pioneered the combination, has realized that it has to decouple process discovery from automation. Automation MAY result from process intelligence insights, but it’s only one potential option. Structuring and orchestrating your business processes using data, real time process monitoring, and anticipating changes, transactions, and interactions to deliver superior customer experience are all more holistic approaches where process intelligence can and should be used. Automation is the discipline through which enterprises can achieve these goals, but it cannot be your entire strategy as a company, and what you preach as a technology vendor.
The value propositions on process intelligence and RPA are not aligned and aren’t hitting the same set of stakeholders. Technology firms must become comfortable getting out of their comfortable ‘categories’ and create solutions that their clients actually need.
Process mining is a CFO-level sale with a transformation focus – hence the likes of Celonis preaching working capital optimization and supply chain agility. The level of visibility into the state of operations that process intelligence tools offer, immediately make them appealing to business executives. RPA typically is addressed at two to three rungs down from the CFO to do quick fixes to legacy systems. The value propositions don’t mesh – unless you use the tools purely for automation projects.
By contrast, the Celonis and Servicenow partnership is a bold attempt to create products that bring the CIO+CFO worlds together. It’s not a surefire win, but it’s in the right direction to create something differentiating, blending operationalizing data science with the ability to design workflows in the cloud. Another example is startup Soroco that is exploring how technologies like automation, process mining, and discovery can impact multiple change programs, help remote teams be more effective, and drive more visibility into how work gets gone in an organization through its ‘work graph’ proposition.
FortressIQ lines up with Automation Anywhere’s push on cloud enablement, but won’t be a panacea
We acknowledge joining hands with cloud-native FortressIQ supports AA’s continued focus on cloud. But that won’t make it successful. The automation vendor forged a Google Cloud partnership earlier this year, where its Automation 360 platform became available on Google Cloud, with AA becoming Google Cloud’s preferred RPA partner. However, since the announcement, we have seen little sign of upside for something differentiating in the cloud from AA and – quite frankly – with the flagging update of GoogleCloud enterprise offerings, it’s hard to see where RPA fits into the conversation, especially when the Microsoft’s Power Automate focus has been so much more widespread and effective.
Will enterprises care? If you’re in the market for an emerging technology solution, use this as an opportunity to revisit your process strategy
As always, the sign of a good acquisition is that it ultimately needs to add up to more value for clients. What does the AA-FortressIQ combination mean for enterprises? Not a heck of a lot:
Existing AAI clients who want process intelligence are already likely using something else rather than trying to manage with the bundled Discovery Bot.
And FortressIQ clients are definitely already using RPA – and sure, some of it is AAI, but they were RPA agnostic.
The big win for enterprises will be to consider this an opportunity to think bigger than automation. Automation, ultimately, is the solution to bad or overly manual processes. Process intelligence allows enterprises to reclaim visibility and understanding of their processes and enables them to optimize them – which may or may not involve automation. However, given AAI’s core focus on automation, we’re skeptical this will happen.
“The pandemic has shown the importance of connectivity and visibility for enterprise resilience and operations management. As IoT is a key building block of connected systems, IoT initiatives have become a strategic lever for enterprises and received significant investment commitment. With clear business benefits, IoT adoption has gained significant traction with scaled IoT engagements,” says Tanmoy Mondal, Practice Leader, HFS
Mayank Madhur, Associate Practice Leader, HFS adds “IoT usage has been propelled up by its convergence with different emerging techs such as AI, Blockchain, and Cloud, driving the next wave of digital transformation helping to create new business models. COVID-19 has shown that we have been using IoT use cases piecemeal, making fragmentation across the IoT industry. The real benefit of IoT will be when it can connect seamlessly with other devices to benefit the user using the interoperability feature.”
The HFS Top 10 Rankings for the IoT Service Providers 2021 is out! HFS defines IoT (internet of things) services as any service provider engagement aimed at enabling a physical asset to generate or communicate data to a centralized platform with the goal of driving insight into ways the recipient enterprise might raise operational efficiency or increase revenue through the creation of new products or services.
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The HFS Top10 Internet of Things (IoT) Service Providers 2021 report examines service providers’ role in the evolving IoT landscape. We assessed and rated the IoT service capabilities of 15 service providers across a defined series of innovation, execution, voice of the customer, and HFS OneOfficeTM alignment criteria. We spoke with Mayank and Tanmoy, the analysts behind this comprehensive study to learn about their perspectives and insights from working on the report.
To download a copy of the report, please click here.
Phil Fersht, CEO and Chief Analyst, HFS Research: So, Mayank – My first question to you is around understanding the IoT market. Please can you share key highlights as we step into 2022?
Mayank Madhur, Associate Practice Leader, HFS Research: The global pandemic has accelerated IoT adoption across industries as it enables remote monitoring and real-time actionable insights.
Among all the industries, we have observed the highest IoT adoption in industrial manufacturing. The HFS Pulse survey covering 800 G-2000 enterprise respondents indicates that in industrial manufacturing, around 80% of the respondents hinted at IoT budget increase in the near term. Some of the key industrial IoT use-cases are the application of digital twins, remote operations monitoring, and supply chain tracking.
The pandemic has impressed upon firms to align IoT initiatives with the other enterprise applications to realize greater business values, and not to use IoT as a piecemeal technology. For example, in industrial manufacturing the IoT use-cases are scaled within the organization (for example, across multiple factory sites/ multiple assets within the same site) and integrated with larger enterprise applications like ERP for broader insights and visibility. Also, the convergence of IoT with other emerging and digital technologies such as cloud computing, 5G, etc., is becoming more prevalent across the engagements.
Phil: What were your biggest learnings from this report, Tanmoy?
Tanmoy Mondal, Practice Leader, HFS Research: With the increasing adoption of IoT, we observe several large IoT deployments. For example, TCS has implemented the TCS Clever Energy™ solution for a Global Retail Giant across 1300 stores, malls, HQ, and warehouses. LTI engaged with a global elevator manufacturer to create a portfolio of connected elevators (130,000+ elevators) across the globe. This implies the realized business benefits of IoT, which compelled enterprises to expand the scope and scale of existing IoT engagements.
The IoT platform ecosystem is also maturing and we see two leading IoT platforms dominate the market landscape: Microsoft Azure IoT Platform and AWS IoT. Service providers already have strong partnerships with Microsoft and Amazon for their cloud computing and enterprise technology capabilities and are now extending to IoT. They are building joint solutions to address specific problems.
Interestingly, most of the IoT engagements are still associated with operational efficiency (as connected systems provide detailed insights about the state of operations), which in many cases also enables enterprise resilience. Real-time visibility and cost-efficiency are two key targeted outcomes of IoT applications, which are also key drivers for operation optimization. In industrial manufacturing, enterprises have realized the importance of re-designing the operations to be resilient and more flexible through IoT-enabled use-cases such as predictive maintenance, workforce monitoring, etc.
Phil: Which service providers are Top on the list? Why?
For the Top 10, we assessed 15 service providers across execution, innovation, OneOffice alignment, and Voice of the customer criteria. The top 5 leaders are, in order, Accenture, TCS, IBM, EY, and Capgemini.
#1 overall – Accenture: Accenture’s IoT capability is in two main business units within the organization, Industry X and Technology. Accenture Technology provides traditional technology expertise and resources, and Accenture Industry X focuses on sales and go-to-market leadership, client relationships, and cutting-edge IoT skills. They act as a transformation partner with a large delivery presence and follow acquisition-led growth strategy giving it a #1 in IoT services Top 10 report along with #1 In innovation as well as execution.
#2 – TCS: TCS formulated an IoT business framework named “Bringing Life to Things” that analyzes the value chain to unlock exponential business value related to new business models, business agility, customer experience, and sustainable business. TCS also built a robust IoT solutions portfolio that helped it earn the #2 spot overall this year.
#3 – IBM: IoT services in IBM is a part of the Intelligent Connected Operations practice. The four key pillars of the practice are Asset Optimization, Building Optimization, Manufacturing & Industry 4.0, and IoT & Edge Computing. IBM leverages its service lines such as Data & Technology Transformation (D&TT) to infuse emerging technologies such as AI, analytics, 5G, edge, blockchain, automation, and digital twin in IoT services and solutions that helped it earn the #3 spot this year.
#4 – EY: Most of EY’s IoT engagements are in the advisory and consulting domain. EY’s key advisory frameworks are the Industry 4.0 Maturity Model and IoT Maturity Framework for Smart Cities. EY has several smart city engagements in Qatar, India, Singapore, and South Korea. EY also has the highest number of clients among the service providers surveyed for this study and a balanced client portfolio across geographies. All of this helped EY to earn the #4 spot overall this year.
#5 – Capgemini: Capgemini extensively leverages Altran’s capabilities for IoT services portfolio, building strong industry expertise across automotive, aerospace, defense, telecom, semiconductor, electronics, and energy. Capgemini focuses on developing end-to-end solutions for connected products, digital platforms, and Industry 4.0 systems. Its core capabilities are connected mobility, connected healthcare, software product engineering, experience design, and advanced networks. Post-acquisition of Altran, Capgemini has improved from #14 in 2019 to #5 this year.
The large firms continue to dominate on the execution side. Accenture impressed with its Industry revenue as it touches the $5B mark. On the innovation parameter, HCL makes its entry in the top 5. They have built 50+ solutions in the IoT domain and have been scaling IoT engagements. TCS, HCL, Accenture, EY, and LTI are the top 5 firms on the OneOffice side.
“Voice of the customer” is a tight category as clients mainly were pleased with their providers, particularly their ability to shift to remote work with minimal disruption. Accenture, TCS, HCL, EY, and Infosys were the top 5 firms per Voice of the customer.
Phil: Tanmoy – Anything that surprised you from this study?
Tanmoy: Overall, the size and maturity of the IoT services portfolio of the providers have surprised us. This has been reflected in the IoT P&L as almost all the providers have registered double-digit revenue growth (YoY) in IoT services. Also, the number of $1M+ accounts for the providers increased significantly on a YoY basis.
Providers have invested significantly in developing their IoT solutions both from vertical and horizontal use-case points of view. In addition, service providers are investing in co-innovation initiatives (for example, Atos has several co-innovation initiatives: Connected Vessel – Maersk, Smart Control Room – Stora Enso, Digital Pharma Twin – GSK) to build joint solutions with the clients. Some service providers have also brought a new narrative around their IoT services. For example, TCS started their IoT campaign, Bringing Life to Things.
Phil: Any interesting trends that you spot from speaking with customers, Mayank?
Mayank: Broadly, clients are satisfied with the quality of the services provided to them. Clients spoke highly of the industry and technical knowledge of the teams delivering these solutions. Some of the providers have also impressed clients with customer centricity and strong account management practice. But providers could focus on the consistency of the services they provide. Clients discussed delivery challenges (availability of talent for new projects, resource attrition, retention, coordination among resources across geographies, etc.). Some clients expect more flexible pricing models from providers. Overall, according to clients, industry, and technology expertise are the key provider differentiators.
Phil: How do you think the IoT market will evolve in the next 12 – 18 months?
Mayank: There has been the trend of acquisition to strengthen its IoT offerings from the past few years, and post COVID-19, there has been a rise in the same. Acquisitions are acting as key growth enablers for service providers’ capability and scale. Capgemini’s acquisition of Altran enabled it to achieve these parameters, and Mindtree’s acquisition of NxT Digital Business from the L&T group will help it expand its footprint in the industrial IoT and smart city segments. Accenture has been on an acquisition spree to strengthen its IoT offering too.
Tanmoy: As IoT has become a strategic lever for enterprises, so IoT consulting services will be a differentiator in this space. I also believe that the large IoT deployments will continue. The manufacturing industry will observe the highest adoption among the verticals due to the convergence of IoT and smart manufacturing. From the service perspective, mid-tier providers will remain on a high growth path due to their IoT investments, close client relationships, and domain capability.
Phil: What are you looking forward to in terms of developments in the IoT market in 2022?
Mayank: Well, post-COVID-19 healthcare is one area where the use cases have increased significantly. Medical practitioners are increasingly relying on real-time data for immediate services, treatment of various diseases, and even tracking resources like staff, assets, patients, and others. As IoT is expanding, data governance and security is becoming a huge concern and focus area. Use cases like Telemedicine, contact tracing, wearable for health parameters have seen an increase which causes IoT data security and governance. Healthcare transformation has been bringing a lot of positive effects, but data security issues need to be addressed to enable growth and scale. So, I feel healthcare is one area where the IoT market will expand exponentially in the coming days.
Tanmoy: In terms of technology, 5G, cybersecurity, and data analytics/AI will be the major differentiators. 5G improves the connectivity aspects, which in turn brings more IoT adoption, particularly in the Industrial IoT area. Cybersecurity is also a critical area as IoT applications involve sensitive data.
Another development that I am expecting a massive surge in is the adoption of non-linear pricing models from an IoT services point of view. Though the majority of the IoT engagements are dominated by fixed-price and time-and-materials (T&M) pricing models, we have seen several examples of non-linear pricing models. As IoT enables “as-a-service” business models, the adoption of outcome-based pricing models will pick up. In most engagements, a non-linear pricing model is blended with fixed-price and T&M models.
Phil: Terrific work guys – looking forward to sharing the report with the industry!
HFS Subscribers can click here to access their copy of Top 10 IoT Service Providers, 2021
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