As we brace ourselves for yet another deluge of dodgy automation and AI predictions for 2018, where people just make stuff up and hope we don’t remember them in a few months, we thought we’d break the mold and actually release some real numbers based on real adoption trends and real expenditure date on software and services. We also had the audacity to define the market so this might actually make some sense:
As we revealed earlier this year, despite all the ridiculous hype, the global market for RPA Software and Services will pass $400 million in 2017 and is expected to grow to $1.2 billion by 2021 at a compound annual growth rate of 36%. The direct services market includes implementation and consulting services focused on building RPA capabilities within an organization. It does not include wider operational services like BPO, which may include RPA becoming increasingly embedded in its delivery.
RPA Definition: RPA describes a software development toolkit that allows non-engineers to quickly create software robots (known commonly as “bots”) to automate rules-driven business processes. At the core, an RPA system imitates human interventions that interact with internal IT systems. It is a non-invasive application that requires minimum integration with the existing IT setup; delivering productivity by replacing human effort to complete the task. Any company which has labor-intensive processes, where people are performing high-volume, highly transactional process functions, will boost their capabilities and save money and time with robotic process automation. Similarly, RPA offers enough advantage to companies which operate with very few people or shortage of labor. Both situations offer a welcome opportunity to save on cost as well as streamline the resource allocation by deploying automation.
Intelligent Process Automation
RPA is only 10% of the true picture when it comes to total spending by enterprises on automating their processes. The internal training and development, pilot projects and trial implementations, is so much larger than simply software licences and third-party professional services to work the software effectively. We term this broader automation market, beyond RPA as “Intelligent Process Automation”. This market will surpass $6bn this year and more than double over the next four years.
Intelligent Process Automation Definition: Intelligent Process Automation (IPA) is the use of technology to allow a business function or part of the operation of a process workflow work automatically. It includes the use of RPA, BPM suites, Remote Desktop Automation, screen scraping and custom scripting and related technologies. IPA comprises of two core elements:
External professional services: Relates to all external spending focused on developing business process automation strategies / roadmaps and the use/ implementation of automation with business functions.
Internal operational spend: Includes internal and external spending on automation – change management, IT and operational teams focused on process automation and automation use as part of existing business process management initiatives.
Artificial Intelligence
And the most talked about area is Artificial Intelligence (AI), which is already emerging as a billion dollar market for enterprise operations, and could almost treble in spend in four years.
AI Definition: AI refers to the simulation of human thought processes across enterprise operations, where the system makes autonomous decisions, using high-level policies, constantly monitoring and optimizing its performance and automatically adapting itself to changing conditions and evolving business rules and dynamics. It involves self-learning systems that use data mining, pattern recognition, machine learning. virtual agents, computer vision and natural language processing to mimic the way the human brain works, without continuous manual intervention.
The Bottom-Line: Automation and AI have a significant part to play in engineering a touchless and intelligent OneOffice
However which way we spin “digital”, the name of the game is about enterprises responding to customer needs as and when they occur, and these customers are increasingly wanting to interact with companies without physical interaction. This means manual interventions must be eliminated, data sets converged and process chains broadened and digitized to cater for the customer. This means entire supply chains need to be designed to meet these outcomes and engage with all the stakeholders to service customers seamlessly and effectively. There is no silver bullet to achieve this, but there is emerging technology available to design processes faster, cheaper and smarter with desired outcomes in mind. The concept was pretty much the same with business process reengineering two+ decades ago, but the difference today is we have the tech available to do the real data engineering that is necessary:
In short, every siloed dataset restricts the analytical insight that makes process owners strategic contributors to the business. You can’t create value – or transform a business operation – without converged, real-time data. Digitally-driven organizations must create a Digital Underbelly to support the front office by automating manual processes, digitizing manual documents to create converged datasets, and embracing the cloud in a way that enables genuine scalability and security for a digital organization. Organizations simply cannot be effective with a digital strategy without automating processes intelligently – forget all the hype around robotics and jobs going away, this is about making processes run digitally so smart organizations can grow their digital businesses and create new work and opportunities. This is where RPA adds most value today… however, as more processes become digitized, the more value we can glean from cognitive applications that feed off data patterns to help orchestrate more intelligent, broader process chains that link the front to the back office. In our view, as these solutions mature, we’ll see a real convergence of analytics, RPA and cognitive solutions as intelligent data orchestration becomes the true lifeblood – and currency – for organizations.
Do take some time to read the HfS Trifecta to understand the real enmeshing of automation, analytics and AI.
Over the last 15 years, we’ve witnessed the rise and fall of the sourcing consultancy. Clients needed help finding the right services partners – at the right price points – and the likes of EquaTerra, TPI (now ISG), Everest, Alsbridge were there happily to oblige. Today, only ISG survives as a credible boutique sourcing advisor, while the Big 4 have moved into developing sourcing practices of their own. However, new data from our soon-to-be-unveiled, Journey to the Digital OneOffice study, conducted with the support of Cognizant, shows that decision makers for business operations are looking largely to other places to stay ahead of all this change:
However which way we look at this, not even a third of decision-makers are relying on consultants in this ever-confusing market, when you would have thought consultants would be licking their lips at the opportunity. Don’t these guys feed off confusion, hype and nervousness from the well-resourced enterprise leaders, only too keen to pay their rates to get a steer on what to do next? What’s going wrong here?
Consultants just don’t do research. For example, I have yet to see a single set of publications from any of the sourcing advisors examining the performance of the RPA solution vendors. There are a million best practice pieces, but nothing of actionable substance. Clients want substance, not just the fluff. Clients are shifting to soliciting help from firms which can do the work and have the proven knowledge to support it, which is why so many are resorting to analyst reports to figure stuff out.
The MBA bus can’t find its usual parking spot in the visitor’s parking lot. As the demand for expertise in areas such as complex operating models, understanding murky automation challenges and being able to design outcomes-focused models is reaching unprecedented proportions, it’s just not possible for the traditional gaggle of consultants to serve up the inexperienced kids with their Visio charts and park them in the basement for six months to come up with a plan. While most of these people are brilliant, many don’t really know what they are doing. For them, doing RPA and automation tool selection is just plain scary.
Enterprises need consultants with deep, relevant and up-to-date experience. This market calls for hands-on experienced practitioners, skilled in understanding modern solutions and real change issues, who are prepared to roll up their sleeves and live their clients’ pain to find the answers. Simply rebadging outsourcing deal negotiators as robotic or digital experts does not work – these guys need serious retraining if they are to stay relevant in the current market – it’s not like the old days where you could hide behind some fancy new acronyms, utter the phrase “digital disruption” in every sentence, and promise “innovation”. Noone wants promises – they want real business cases, with genuine milestones and measurable, proven impact. They also want people who have got their hands dirty with these emerging solutions and can articulate how they can align to their processes and business models. In short, you can’t get away with half the bullsh*t these days…
Service Providers are in direct competition these days when it comes to transformation support with automation, digital and AI. In the heyday of sourcing advisory, advisors and service providers fed off each other as advisors cultivated clients and brought business to service providers, and service providers returned the compliment when they had clients in need of independent advice. It was a perfect symbiotic relationship. Now that model is rapidly atrophying as these two entities increasingly find themselves now competing for the same dollar. Let’s makes no bones about it, advisors and service providers are now in direct competition for supporting clients with their transformation journeys. Most the service providers are now offering intermediary services to provide automation strategy, implementation and delivery to enterprises, catering to whatever technology tools and platforms the clients require. As you can plainly see above, many operations leaders are now getting more value from them than they are from their advisor relationships. Clients can call on Genpact, TCS and Wipro these days, as much as they can KPMG, EY and Deloitte when it comes to the new stuff.
While service providers are integrating upwards into advisory services, advisors are integrating down into annuity services. Most the advisors are now evolving themselves as service providers and annuity-based revenue models in areas such as cyber-security services, blockchain services, managed RPA services – and even payroll services in certain countries. KPMG even declared it was in the Workday managed services market.
However, we might be on the cusp of a whole new era of new digital operations advisory boutiques, equipped to help clients make sense of it all
What gives me hope that we haven’t just witnessed the demise of the sourcing consultant, is the emergence of several small, but highly practical, boutiques of mid-career process guys who are in serious demand – and some of them are scaling up at a breathtaking pace – and we’re seeing some serious hitters make the jump from established consultancies to lead these boutiques, such as David Poole and his excellent team at Symphony, Paul Donaldson who has just moved from leading ISG’s RPA practice to being the new CEO at Robiquity with a very compelling automation bootcamp, Mohit Sharma and his determined drive from Down Under with Mindfields, the brand new “Agilify” (not quite launched) that Lee Coulter will head up as a new initiative from healthcare giant Ascension Health, Jan Rapala’s NEEOPS, driving RPA advisory from central and eastern Europe, Christian Voigt’s compelling Roboyo business emanating from Germany, and Richard Jeffrey’s ActiveOps firm, which is driving Workware, a back office optimization solution with a strong alignment to RPA effectiveness and now expanding aggressively from the UK to the US market. I’ll stop there for now, but there is a significant influx of very smart, experienced operations experts branching out and taking advantage of a market where clients need hands-on real help – and need it fast.
The emerging advisory market is about hiring people with the capabilities to understand client outcomes and implement solutions using the right mix of new tech on the market. What’s more, most of these consultants are relishing working in a boutique environment – it just feels like the age of the boutique is coming back, and we will see several more of these spring us with the barriers to entry still pretty low. Only GenFour has got absorbed (by Accenture earlier this year), as a first-mover in RPA implementation, but I’d be surprised if many of these other boutiques really want to get swallowed by the mega-firms… most seem to be hell-bent on building up organically in this market.
And there’s another reason why these emerging boutiques are so compelling… many have the emerging skills to support enterprises with their number one talent requirement – the ability to partner across these increasingly complex ecosystems of RPA, AI, and digital firms to help them:
While the traditional consulting firms have continued to bury themselves in supporting the “left-brained” areas of process delivery, digital tech etc., where clients really need help right now is understanding how to cement the right partnerships across the digital operations ecosystem to truly understand these change agents and devise the right plan to achieve their outcomes. Net-net, it’s not just about left-brain support these days, it’s about entrepreneurial, savvy, “right-brained” capabilities and nimble boutiques are able to mix up their teams with the talent clients really need to address the complexity.
The Bottom-Line: The digital operations train has already left the station and not all the consultants are on it
It’s not all doom-and-gloom in the management consulting firms, as KPMG’s Cliff Justice leads the firm’s AI strategy, with some promising key industry partnerships, most notably with IBM Watson, and Dave Brown’s SSO advisory is leading the industry with RPA transformation revenue; EY has jumped in aggressively with strong RPA deployments; ISG has held onto Chip Wagner, one of the first advisors to “get” RPA during his time running Alsbridge; Deloitte has developed its own brand of “process robotics” with some eye-opening projects, such as their work with NASA, and PwC is boasting some impressive work with the likes of Tesla, as it seeks to make up ground on the rest. The challenge is how to support clients with the experienced talent which actually understands how to implement this stuff in a way that is affordable.
However, the change upon us is seismic and we need advisors which can surf the wave of change agents forming the new Digital Operations industry:
In short, the worlds of software, business operations and services have always been chasms apart – different mindsets, vernaculars, conversations, ideas of what constitutes value – and vastly different cultures. Software people never understood the operations folks and vice versa – each thought they were top of the corporate food chain.
However, the past couple of years have seen the coming together of these diverse groups of people to rethink completely how we run global operations in this robotically digital era (or whatever we want to call this curious period of time in which we exist). What’s uniting this array of industry players is the fact that we’re all now in the business of addressing clients’ desired business outcomes, as opposed to simply selling them some product or service with some vague ROI attached to it. And those desired outcomes are unifying around the fact that nearly all clients are under immense pressure to become digital businesses with touchless customer interactions, supported by digital operations to make it all possible.
One thing is abundantly clear: the outsourcing phenomenon which has gripped the Global 2000 over the past decade is making way for a genuine industry in which we all play a part – an industry where we have no choice but to develop learning programs, sustainable business strategies and make real, actual investments in order to survive. And what’s most fascinating are the new conversations that have rapidly emerged to bridge this divide between the technologists and the business operators.
Suddenly, we’re talking about business logic, about datasets, about redesigning processes with genuine business outcomes in mind. We’re talking about deep learning AI systems that store what has been learned in the past, take notes of how variables and results have changed under different scenarios and then make decisions based on that.
The narrative has radically changed and the focus is now firmly on bringing together all the components that can escort us to this promised land of Digital Operations. And the firms to take us there might just not be the ones who got us here in the first place…
We got so sick of this nonsense, we just went out and surveyed 400 enterprise automation and AI decision makers across the Global 2000, split across IT and business operations functions, and hit them with some very straight poignant questions about their attitudes, satisfaction levels and genuine plans for both AI and Automation across their business operations.
But let’s start with the hype: AI and Machine Learning is now one of the most critical strategic directives being dictated from the C-Suite onto the operations function
81% of operations leaders are feeling the pressure from their bosses to reduce the reliance on mid/higher skilled labor, viewing AI and Machine Learning as increasingly important or even mission-critical directives to drive this. Only cost reduction beats this out as a priority, but as we all know, we can’t reduce costs much further without investing in our digital underbellies:
What’s clear is that enterprises are frantically evaluating their talent (81%) and looking to collapse these silos in the middle/back offices to improve their customer experiences. And they see AI, Machine Learning, and process automation as the levers to achieve this.
So let’s summarize the key findings from the study, and you can download your copy here :
Automation is the number one strategic priority four-fifths of enterprise C-Suites are placing on their operations. Enterprises see AI and machine learning (81%) and process automation and robotics (82%) as important C-suite directives toward operations strategy – higher than any priority other than cost reduction.
98% of enterprises have an automation agenda, but a third already have embedded it into their service delivery. Every organization today needs to have an automation strategy and that is reflected in the responses in our survey; only 2% suggest not having a strategy as of now, while 20% are in the process of formulating their strategy. Already, 31% of enterprises are integrating automation into the fabric of their service operations. Others are setting up dedicated CoEs (18%) and working with service providers (13%).
Corporate leadership and IT are most active driving the automation agenda. Decision making is increasingly being led by the CEO (54%), CIO/IT Director (57%), and CFO/Finance Director (35%). Additionally, a diverse group of automation influencers and stakeholders emerge, notably the finance department (49% consider as influencers), procurement (47%), data center managers (51%) and purchasing managers (48%).
Deployments of RPA as well as AI starting to scale out with varying degrees of maturity. RPA is seeing rapid adoption and AI will become mainstream in two years. More than 70% of customers are planning to deploy RPA over the next two years and more than 50% believe that AI will be applicable for a broad set of processes within the same timeframe. Therefore, investments, planning, and training of talent around the notion of Intelligent Automation is pivotal for staying competitive.
Many customers are in an automation dichotomy: they want automation to drive long-term quality and agility, but need rapid cost takeout to sell the ROI. For a significant number of enterprises, their automation strategies are expected to deliver, primarily, better quality of operations (52%), more workforce agility and scalability (49%), and superior data accuracy (48%). Only a minority of respondents are seeking short-term cost savings (21%) or a way to displace employees (12%). However, when you ask what is inhibiting automation adoption, the top criterion is that the “Immediate cost savings are not high enough” (35%), indicating a disconnect in expected benefits and business case.
Satisfaction with initial automation deployments is mixed as customers struggle to define success and execute against it. Only a little over half the enterprises (58%) that have gone down the RPA path are satisfied with the level of business value and cost savings from their implementations thus far. Enterprises that have yet to explore technologies like RPA point to struggles with establishing business cases (41%), while 30% expect that automation capabilities will be absorbed by enterprise applications in the next five years. In addition, many enterprises struggle with developing an effective centralized governance structure for automation initiatives, citing that projects are too siloed, don’t have success milestones established, and lack organized training to use the tools effectively.
Despite the growing pains, RPA is starting to be used effectively in this era of innovation and the current satisfaction results reflect this. IT operations have the most satisfied clients for both cost savings (70% satisfied) and business value (72% satisfied), followed by marketing (70% satisfied with cost) and procurement (63% satisfied with business value). Regardless of the level of satisfaction on cost and business value as of today, operations leaders are making incremental progress, one process at a time. In the interim time between sawing off broken processes and legacy systems and replacing them with costly new systems and services, RPA seems to be helping enterprises get some level of access to new business value from their current processes.
Automation Centers of Excellence (CoE) proving a major success. Of organizations with the CoE approach, 88% believe that the automation CoE has been effective in delivering business value (scores of 4 or 5 on a 5-point scale). HfS has been hearing advisors in the RPA arena claim many clients are failing miserably with their CoEs, but this data proves, beyond doubt, these are scare tactics and those customers who are centralizing automation projects into one governance team are already reaping significant benefits.
If there one service provider who’s really got focused over the last couple of years, it’s Wipro – not only expanding all its main business lines and making some exciting acquisitions, but also revamping its brand and showing a very focused approach to its marketing and positioning. While several of its Indian-heritage competitors have struggled to differentiate themselves, or just failed to develop a coherent strategy, Wipro has stayed focused on pushing its automation platform, Holmes, and making determined efforts with its digital proposition. One man who is tirelessly pushing its digitization efforts to a new level is Rajan Kohli – a really nice guy who doesn’t mince his words….
Phil Fersht, CEO and Chief Analyst, HfS Research: Good afternoon Rajan – thank you for your time today. We would love to hear more about Wipro’s digital strategy. We have been hearing a lot about the opening of your new centers and the recent acquisitions of Designit and Appirio. There really seems to be a lot of energy around the strategy here. Maybe we could start with a bit about you, Rajan… could you tell us a bit about yourself, your background and how you came to be leading Wipro Digital?
Rajan Kohli, Senior Vice President and Global Head, Wipro Digital: It’s a great honour to be speaking to you, Phil. I have spoken to you many times before, but this is the first interview with you specific to Wipro Digital. So thank you.
A brief history about me. I have been with Wipro for 22 years now. I have been through various roles within Wipro in both Sales and Leadership. I was also the Chief Marketing Officer and more recently running the banking business for Wipro globally before I was moved into our digital business three years ago.
When we were going to start this new digital business we wanted to do something differentiated in the market and we had to decide what that differentiation would be about. We identified four pillars:
Design. Design will be the starting point of differentiation for our clients. Design talent would be the starting point of differentiation for us. That’s why we acquired Designit – because we really wanted a proven platform, that we can really build on for design.
Talent. We had to think about the quality and the type of engineering talent that we wanted to bring in. A lot of the system integrators really have grown up where technical talent is grown in ‘I’ shape. You go deep in a particular technology and you earn your stripes off that particular technology. In the digital world, we need a fuller understanding, we need T shaped, Pi shaped and what we call X shaped.
Velocity. Velocity for our clients because that was going to be a big differentiator for us. How we can service our clients. How we can come together in autonomous small teams quite quickly, behave and operate in autonomous agile teams to deliver larger projects in smaller pipes for our clients and how we can localize our workforce. This enables us to work in a ‘No-Shore model’. We call it a ‘No-Shore model’ not an offshore model, because talent is more important than the location.
Combining our skills. There are a lot of agencies that can do small digital projects and there are system integrators, but we didn’t really see a company that could combine the best of what a digital agency can do with the best a systems integrator can bring to the table. We really wanted to be that company.
That was the intention behind how we started with Wipro digital and our digital foray for Wipro.
Phil: So when you talk to clients today, Rajan, how would you define the digital opportunity to them? What is different about “digital” than the next generation IT conversations we were having three or four years ago?
Rajan: That is a hard question to answer in a short interview, Phil, because it is actually very difficult to box what digital is. So we unbox it, and we tell our clients that actually it is not about digital transformation, it is about transformation. That transformation could be in what is traditionally known as the back office. It could be operations, operational transformation. It could be a transformation of your channel, transformation of the enterprise, of how enterprise works between business and IT, or in more realistic terms, a transformation of a new product or new business model.
That, to us, is the holy grail. But really we don’t call anything digital or un-digital, as long it is a transformation in its true sense then it is digital for us. That’s what we attack with our strategy – design and technology teams coming together and working in very un-siloed ways to solve company problems.
Phil: When we look at the value that Wipro brings to the table, Rajan, we like to talk about the whole being greater than the sum of the parts. So when you look at the design piece of digital, the execution piece, the enablement piece, where do you think that the true value and strengths are, that can help you win out against other illustrious competitors?
Rajan: The best value for us is that all the pieces are utilized together. As I said, if a client just wants to use strategic design, there may be another five to ten firms which would be equally good in a particular region, as you know design is quite regional and localized. If a client just wants digital engineering, then there may be a handful of firms who can deliver that. But when a client wants both, strategic design and what we call strategic tech, along with solving large problems in their enterprise, that means you need real system integration capability and world-class technology competence, being able to look under the hood in client enterprise systems. That to us is our sweet spot. Those three pieces together. There are very few people who could address this with the quality and the quantity that we at Wipro could.
Of course, we are happy to do some strategic design standalone projects as long as they are strategic and designing a new market entrance strategy or a new product. Because they reposition us. But our real intention, and where our clients see true value from us, is when all three come together. That’s where our positioning is to become a transformational partner.
Phil: In terms of your broader market capabilities, we’ve spoken about partnering in the past, but as you look at the emerging digital pure plays and Fintech firms etc., we are talking about a very different marketplace than we have been operating in. I’m even seeing advertising executives joining IT firms now, because of this. So as you look at this shifting landscape, and you look at the role of Wipro in this industry, do you feel it is more important than ever to develop much tighter partnerships with emerging digital players, so you can have that broader offering?
Rajan: Absolutely, Phil. It is critical and it is a part of the objective that I carry. Wipro clearly believes that there will be tremendous innovation outside the enterprise and we cannot be restricting our client’s access to innovation through this channel. In fact we need to use this channel of Wipro to expand our client’s access to innovation, and we have used that quite effectively.
We have broadly three sources of partnership. One is a broader 360 degree partnership where start-ups come to us and we evaluate these. They want to work with us because we understand our enterprise clients. We want to work with them because they are at the forefront of innovation and will help set new standards of experience for end customers. Second is the higher level partnerships for us when we make investments in these firms. At the last count, we made 13 investments through our Wipro venture fund and they have been very successful. Our interest is to take these products and services to our clients because our clients see tremendous value in working with a known trusted player like Wipro while working with the start-ups.
The third way for us, when it truly makes sense, is to do mergers and acquisitions. We would not want to acquire a company that really doesn’t fit in when we can use the other two channels, the partnership and investment channel to really maximize the returns for both the partners, the company as well as for our clients.
We have been on this journey for the last two years and it has been quite successful.
In addition, there are obviously our traditional large partners. There are a number of smaller services areas today where innovation can lead to potentially becoming very big projects. For example, thinking about how AWS or Azure would have been four years back. We are also working very closely with our large partners to identify these innovative opportunities and focus areas so we are part of them from the start.
Phil: Thinking about two or three years ahead, and with everything happening in the industry, what do you think this digital landscape will look like? Do you think it’s going to be vastly different as more cognitive engines come into play, as human interactions get replaced by more machine interactions? What do you think this landscape is going to look like?
Rajan: A very important and an interesting question. I hope I have the answer to this. In my broad thinking, number one, we should see more differentiation between the players in the market. It is already beginning to happen through the acquisitions or investments that have been made. They are beginning to create a differentiator between each other. That is a path we are all on, and I think that will continue to move forward quite briskly.
Second to your point about automation. I think automation is really key, both for running operations or running infrastructure and applications services. How automation happens will look different but automation is here to stay. Again there will be investments that we do directly, for example we have invested in Wipro HOLMES. At the same time we have key investments in the partner ecosystems. We work with almost all the top cognitive players in the industry to actually implement those products for our clients. In many cases we have clients who have already invested in those products. We leverage HOLMES and our Capabilities to help clients maximize their value in those investments.
So I definitely see automation being central.
Number three is where certain players will become the best providers in a certain space. There could be certain areas where, for example, Wipro would have the advantage with acquisitions. For example, we acquired HPS. Similarly, we may make more bets on BPaaS. So where there is standardization of process and clients we believe would want As-a-Service model, you would also see that sort of differentiation coming into the picture.
There are several elements of differentiation. Different companies will place bets in different places. At Wipro we have clearly identified design, cloud, BPS, security and data space as areas for investment and to drive our experience.
Phil: Right. If you were made the emperor of the digital industry for a whole week and you had one wish to change the industry for the better. What would that wish be?
Rajan: Thank you for making it one week and not one day. I think first of all I would go and find the answer to your previous question because that would really help us invest better and make better decisions today. I would try to build myself a crystal ball in the seven days because it’s not just those seven days, the industry is changing almost every day. I would want to be the emperor almost every day.
I think the biggest struggle our clients are facing today is they are getting disrupted both on the consumer side whose expectations are changing and on the provider’s side they are not getting what they need. They want the same partner to be able to do strategy, design and technology implementation. The technology itself is changing so fast.
I would like to find out which are those technologies, which are those use cases that enable our clients to get value three years from now and start investing in them today. That is how we will be more successful in the future and that’s how our clients will be more successful.
Phil: Very good answer and the perfect end to this conversation! So thank you very much for your time, Rajan. I look forward to sharing this with our readers very shortly.
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Rohit Kapoor (right), Chair of the NASSCOMBPM Council, hosts his first summit in Bangalore
It was good times revisited in Bangalore last week, where the Indian-heritage BPM (BPO) services firms gathered for their annual reality check, courtesy of NASSCOM, India’s leading IT and BPM services body. We were pleased to get the chance to meet with many of the industry’s finest and have some frank exchanges on what this industry must do to stay relevant and keep eking out a growth curve.
And, similar to the recent HfS summit in Chicago, the conversation has moved rapidly along in recent months with a genuine buzz of excitement about the future. In short, most folks are stepping out of the comfort zone and attempting to embrace the emergence of technology-driven value levers as part of the very fabric of the future of business process services. However we look at this, we’re becoming a data services industry that supports the inexorable enterprise drive towards Digital Operations.
The NASSCOM folks fondly remember how we once described the Indian-heritage BPM (BPO) industry rather like a “biryani” – (a mixed rice dish comprised of many different ingredients that also has many different regional variants across India). At that time, three years ago, we called out all the ingredients the industry needed to embrace to reach that next level, namely partnerships, platform plays and RPA. Fast-forwarding to last week’s BPM bonanza in Bangalore, we can proclaim that a pretty tasty biryani is being regularly served up, and now we are enjoying one of my favorite dishes, the “bhuna”. Bhuna is a cooking process where spices are gently fried in plenty of oil to bring out their flavor. The Indian curry dish “bhuna” is an extension of that process where meat is added to the spices and then cooked in its own juices which results in deep strong flavours but very little sauce.
Much the same can be said of the current state of the Indian-flavored BPM industry, where the baseline delivery of process services have been nicely spiced with disciplined execution, competitive pricing, RPA capabilities and process standardization, and the added meat is providing new levers of value with emerging intelligent automation and analytics capabilities. The missing potatoes are the added element of risk that BPM services providers need to take to fix the data underbellies of their clients so they can truly start to benefit from the fruits of having digital operations to support their clients. We’ve reached the era where real data transformation is the missing ingredient that can really take this industry to the next level.
Having met with most of the key BPM service providers with key Indian delivery ties at the annual NASSCOMBPM summit in Bangalore, these were my takeaways:
The mood is upbeat as the Indian BPM leaders are (largely) facing up to reality and embrace the opportunity. Over the last couple of years at the annual NASSCOM reality check, we witnessed heated arguments regarding the viability of the long-term viability of BPM. Several service provider leaders have defended the value of the traditional labor arbitrage model, while others have called for a reality check that the old model is dead and we need to conform to a very different world of outcome-driven, automation-centric models that aggressively cannibalize obsolete engagements. In short, the underlying feeling has been one of doom and gloom, and we’re simply waiting for this impending nose-dive for the industry. This year, most people seem to have taken a crash-course in reality and have realized the answer lies somewhere in-between – the old model provided a valuable lever to drive out costs and tee up the next phase of engagements – and the current crop of service providers should be smart enough to invest with clients to derive value out of several additional value levers, in addition to providing affordable, global talent. Yes, it is possible to advance the traditional labor-driven model into the digital age without making too much of a sacrifice on the profit margins.
The mid-tier service providers are showing the way. As the large FTE monster deals dry up and we’re left with smaller engagements that require less staff, more automation and better analytics-driven outcomes – and most of the mega providers simply cannot afford to scale-down to be competitive. The likes of EXL, WNS, CSS Corp, Sutherland, Concentrix, Hexaware et al are all competing for the smaller, tastier deals on the table that require real attention and focus. Plus most clients are now eager to explore relationships with smaller competitors who roll out of the red carpet for them… the crux of the issue here is that the mega-deals of the past are not coming back, and if the large providers cannot accept this, they are going to be left defending that they have for the next decade, as opposed to growing their businesses and investing in their capabilities along the way. This is going to get worse before it gets better – and everyone knows it.
Most of the BPM providers are still confusing everyone with their “strategies”. I challenged nearly every service provider to articulate their value proposition in three bullet points. They all failed miserably. Being all things to all people is the recipe for bland failure in this attention-deprived world, and spinning the same marketing mush as everyone else has become the disease of our industry for the past couple of decades. It’s time to crush the vernacular and talk openly about what we all stand for. Sadly, I do not expect anything to change soon…
This industry desperately needs new blood. As per the last 10+ years I have been coming to this event, we are subjected to many of the same folks spinning the same old stories and viewpoints. We need to meet more of the emerging talent and hear from some of the newer thinkers. They do exist and need to be blooded… otherwise, we come across like an industry without a succession plan.
There is a chasm between BPM and IT services, which is a real missed opportunity for India. The divide between the process people and the tech people in India seems to be greater than ever, at a time when automation and digitalization are closing that gap. India needs to embrace hybrid delivery and present a united front between BPM and IT at its flagship events. The RPA and AI discussion at the BPM level is so much more real and actionable than when the techies discuss it… As we discussed here, the worlds of software, business operations and services have always been chasms apart – different mindsets, vernaculars, conversations, ideas of what constitutes value – and vastly different cultures. NASSCOM needs to help bring together these mindsets and drive the conversation forward as a unified industry, not several soloed sub-industries.
There is a lack of exciting up-and-coming digitally-centric BPM firms appearing in an industry in real need of some disruption. While the mid-tier BPM firms are clearly enjoying something of a modest renaissance period, there really isn’t much coming up behind them – at least they are not on display ay India’s flagship BPM summit. Where are the Indian digital pureplays and fintechs? Sure, we met some exciting Indian RPA software firms, such as Intellibot and Option 3, but there seems to be precious few emerging human-plus-tech process delivery firms emerging to get us excited. We need these firms to be wheeled out, wrapped in cotton wool and showcased as the future of Indian services.
Bottom-line: NASSCOM needs to deliver a stronger message of reality and guidance to support its industry
While NASSCOM has performed an amazing job over the years putting India on the IT and BPM services map and providing a vehicle for networking and information sharing, the message today is largely avoiding the harsh realities the industry is facing. The industry is going to suffer some labor shrinkage over the next few years (we predict a 450,000 decline by 2022 in India’s IT/BPM service industry alone by 2022). NASSCOM needs to be at the forefront of recreating the next phase of India’s services capability and confronting the legacy model, not celebrating what’s left of its glorious past but embracing its less certain, but high-potential future.
Welcome back to the F&A business, which we’ve been tracking religiously on HfS since our very first blog post more than a decade ago, famously titled “Beyond Labor Arbitrage: The New F&A BPO Frontier”. And how much has changed since then (ahem). However, what has changed is the rampant excitement about the new arbitrage: RPA, where many clients hope they can still avoid that true process transformation by mimicking those same obsolete processes in a piece of robotic process recording software. At some point, they will need to stop dodging the transformation bullets and actually make real investments in their underlying process and data workflows, but until that time, let’s see how the market continues to shake out in our 2017 F&A As-a-Service Blueprint, so let’s hear from the blueprint lead author, Barbra McGann…
The HfS Blueprint is a guide for the service buyer to learn more about what to expect by engaging with a service provider. What does this service provider bring to the table above blocking and tackling? Where does the buyer need to challenge his or her own assumptions or organizational culture to see impact beyond tactical conversion of tasks from human to robotic automation or labor arbitrage? How does the service provider need to engage to provide long-term value – beyond green light SLAs for turnaround time and data accuracy?
This year’s HfS Blueprint: F&A As-a-Service reflects a time of transition as service buyers and service providers move to “finance of the future” – more strategic use of talent, technology, partnerships, and operating models to achieve high-quality, more agile, and insight-driven finance operations. Any company not thinking of how to bring together these elements to impact business outcomes is behind the curve at this point, although it’s not too late to get going. And service providers in this mature services market can play a valuable role in helping broker within and across organizations to develop and/or deliver against a roadmap for “virtual finance.”
The question is not whether or not to use RPA or cognitive computing but how, when, and where
Many service buyers, from our research, are mostly interested in low-cost standard delivery. What will get that next level of efficiency and cost savings – and how does robotic process automation (RPA) play a role in it? What is the balance of RPA versus lower cost delivery centers – movement from 1st to 2nd to 3rd tier cities, to use industry terminology? In too many cases, labor arbitrage conversations are being replaced by robotic labor arbitrage – a combination of lower cost delivery locations and RPA. The industry is at an inflection point — do service buyers and service providers have a choice to make – (a) move up the value chain with strategic collaboration – defining and addressing business problems, outcomes, and designing appropriate solutions that use digital technology or (b) promise 40-50% further improvement through digitization or automation, a tactical approach. Or is there a combination in play? The industry sits on this knife’s edge today.
Last year many of the finance and operations leads we spoke to for this study when asked about RPA, were, with few exceptions, in one of two camps: had heard of RPA or hadn’t. This year, every client is familiar with RPA and has some kind of status to share, ranging from “discussion” of how and where to use it, working on a business case, or already using it either in-house or with service provider partners. It’s driving change in how the industry thinks about operating models, contracts, governance, partnerships, talent development, and change management. Earlier adopters in the business are realizing that automation for the sake of using the technology or in trial/pilot is not as impactful as when there is a business case for change in partnership with IT to achieve a targeted outcome for a process, e.g., touchless invoicing. There is a disparity in the market as to whether clients want/will develop and keep intelligent automation capability in-house or partner with service providers. We heard examples of both decisions.
Collaborative engagement is an increasing factor in whether or not service providers have “stickiness” with clients
There is a current trend in “considering options” as contracts come up for renewal. A number of service buyers shared their stories of re-bidding parts or all of their finance BPO contracts to (a) create balance in a service portfolio to have strategic partners where there is stronger alignment on strategy and culture as well as thought leadership for finance and tactical partners to address the transaction and increased use of RPA; (b) shake up service providers that clients believe are complacent, e.g., not consistently raising the bar or challenging the status quo.
Clients are (a) kicking it up a notch in partnering for the long –term with strategic roadmaps, (b) getting impatient with service providers that seem to be “resting on their laurels,” complacent, or just not aligned or insightful about the client culture or work/objectives, and (c) more willing to look beyond the traditional market leaders to “up and comers” who can prove trustworthiness, credibility and cultural alignment. This was reflected in scores for “value of engagement over time.” With the increasing mix of technology – platforms for procure-to-pay, record-to-report, and order-to-cash, as well as robotic and cognitive computing – in the business process services market, clients need to be looking at where and how service providers are investing in their own and third-party software, technical and business/consulting talent, and change management.
F&A As-a-Service Winners are service providers with clear vision and momentum towards transformational finance… but face the challenge of making an appropriate match with clients culturally and having the talent to deliver on these promises consistently
Our study included over 60 client interviews as well as surveys, service provider briefings, and additional research and analysis covering the vision and operationalization of F&A As-a-Service. All of the participating service providers are making investments and progress in some way towards a more insight-driven, digital-enabled finance function. The ones that have the clearest and compelling vision and scale as well as roadmap and evidence of investment and progress toward landed in the Winner’s Circle. However, there are also some unique value propositions by players on the whole map.
As always, we recommend that when you as a service buyer – finance, procurement, or operations executive – are evaluating a service provider for a new or existing business process services engagement, that you consider that best fit for your organization. Criteria, as reflected in our methodology for the blueprint, should cover culture, strategic, technical, and corporate alignment.
Accenture: One of the few service providers that consistently through the years touts talent development as a differentiator and is working to create a more flexible workforce management approach (Accenture Agile Workforce). It’s also invested in building out and rationalizing a set of proprietary and third-party tools to address all areas of finance and integrated systems support, e.g., Accenture Intelligent Automation Platform and Accenture Cognitive Engine, with apps like Intelligent Collections, Payables Optmizer, and Period-End Analyzer. Accenture is looking to partner with clients to define and deliver real-time enterprises and is doing a better job at defining joint roadmaps with clients to achieve this kind of vision. It also has industry-specific IP, such as in hospitality and utilities. Accenture faces the challenge of meeting high client expectations for understanding their business and delivering highly relevant and meaningful innovation consistently – for each client across its portfolio.
Capgemini: Through acquisitions and partnerships, Capgemni has built up and then defined a portfolio of offerings that are platform-based and designed to match the culture and approach of its clients to help them achieve “virtual F&A.” The portfolio of “as-a-stack” now includes support for centralizing and supporting FP&A and controllership. In the last year, Capgemini has made progress in defining a more clear and collaborative approach to incorporating robotic and cognitive automation into finance with its clients. It’s also had success in co-defining new models and approaches through design thinking with F&A clients. Capgemini needs to make all of this capability more transparent and relevant to more of the clients in its portfolio, as well as with new clients.
EXL: While operating on a smaller scale then the other players in the Winner’s Circle, EXL serves as an example of being small enough to feel approachable and collaborative but large enough with resources and focused investments. The EXLerator 2.0TM Palette includes custom-developed IP, best practices, and co-development partnerships. EXL has also adopted a more stakeholder and experience-centric approach to transformation and is rotating operations employees through consulting services, EXLerator, and RPA workstreams to develop more talent with future-oriented business, tool, and technology capability. EXL’s industry-specific IP is in insurance, healthcare, banking, and capital markets. EXL’s biggest challenge is the perceived lack of middle management talent pool to lead transformational change at an account level at scale.
Genpact: A steadily increasing percentage of Genpact’s F&A business is led by transformation, and it has built incentives for its teams to measure business impact beyond contracted productivity that must be acknowledged by the client. The latest acquisitions, Rage Frameworks and TandemSeven address two forward-thinking areas – platform-based microservices with conversational artificial intelligence and customer experience focused service design, respectively. Genpact is also building up its FP&A capability. It has particular coverage of consumer goods, manufacturing, pharma/healthcare, and financial services from an industry perspective for F&A. While Genpact’s thought leadership receives recognition consistently, on the ground, there is the inconsistency that gives clients the feeling that there is a gap between the capability of leading and delivering. Genpact needs to invest in raising the whole; and its recent investments are a smart approach.
IBM: Steadily consistent in its messaging, investment, and delivery through IBM Cognitive Process Services to help finance organizations incorporate digital technologies to drive better outcomes in finance. While the momentum is a bit slower across its clients than its peers in this category, IBM clients appreciate that the company has strong technology, design, finance, and industry capability. IBM is focused on how to best use data, and its core to the work it does to help “future-proof” finance. IBM has the highest percentage of its contracts incorporating FP&A and receivables analytics per our analysis. And it has a handful of useful applications for reconciliation, close, and translation that can be incorporated into finance today. The service provider, however, still has a tendency to be too “trigger happy” when it comes to embracing the next shiny toy – and it’s not just IBM Watson anymore, now it’s blockchain. It needs to define a clearer roadmap with clients on how to address the problems of today with the funding and contracts of today to bridge to the future.
TCS: “Touchless and intelligence” sums up the TCS vision for finance of the future. It is a technology first organization, with the “Digital Five Forces” of Analytics, Cloud Computing, Mobility, Robotics, and Cognitive Intelligence and Social Engineering. TCS is getting smarter about how it approaches the positioning of technology within business need and outcomes using its ValueBPS™ approach; it’s also in the top four of service providers reporting contracted analytics work embedded into BPS. Its F&A business by revenue is growing twice as fast as headcount by using this combination of talent and technology and not having a past portfolio of headcount-based deals. The challenge that TCS faces is that its story tends to be complex and in the weeds of technical detail, rather than looking at problem to solve, targeted outcome, and relevant solution.
WNS: In the year since launching its “Outperform CFO Framework,” WNS has invested to build out the capabilities such as thought leadership, domain expertise, maturity models, and context for the appropriate use of digital technology. It provides an outline and guide for building out future finance operations. From a technology perspective, WNS’ new CFO TRAC is the package it puts around cloud-based, mobile-enabled partnerships, such as for invoice-to-pay. It’s also one of the few service providers we cover in this report that has an ad-hoc research and analysis capability that supports FP&A beyond reporting. It’s depth is in industry-specific F&A, such as for travel, logistics, healthcare, and airlines.
High Performers – Cognizant, Conduent, DXC, HCL, Infosys, Sutherland, Wipro – are strong challengers to the F&A As-a-Service Winners, each with some unique capability to bring to the table. Arvato in retail, commerce, and fraud analytics, and NTT Data in industry-specific F&A such as healthcare, execute effectively in these chosen focus areas although lack a clear and compelling vision for future finance. OneSource Virtual is newer to the F&A business process services world with its launch just last year of accounts payable services wrapped around Workday. Hexaware and Intelenet have platform-based business process services in F&A that need consistency in delivery and clarity in vision – although both are advancing in these areas.
Bottom line: It’s time to share the risk to get to the next level in F&A
A focus on customer engagement and relationship is increasingly having an impact on the longevity of service buyer and service provider engagements in F&A. Where RPA and collaboration are both part of the equation, the value of the engagement is rated higher over time. It’s the watermelon effect that we often refer to – even when SLAs show that performance is on target with green, if there is not a feeling of partnership and a visible effort to continually raise the bar (e.g., with journey maps, relevant use of RPA), then the engagement red – not of value to the service buyer and/ or the service provider.
What is making a difference now, per the collective feedback from references in this study, the service providers via briefings, as well as discussions with technology partners of the service providers and other leaders in the industry, is capability, context, communication and transparency, calculated impact, and collaboration. We hear from clients an increased willingness to “look around” and be open-minded if their engagements don’t match their own business, e.g., not customer-centric, or lacking a roadmap, or culturally misaligned. You – as service buyers and providers – need to be engaged, open-minded, and willing to take and share risk in order to drive increased value from services engagements.
Premium HfS Subscribers can download their copy of the Blueprint Report: Finance & Accounting As-a-Service 2017 by clicking here.
Amigos – I’ll be waxing on about my favorite new topic “The Future of Operation in the Robotic Age” this Thursday morning at the Nasscom Summit in Bangalore – reserve your spot here! I hope to see you at my favorite hotel in the world… the lovely Leela in Bangalore…
The worlds of software, business operations and services have always been chasms apart – different mindsets, vernaculars, conversations, ideas of what constitutes value – and vastly different cultures. Software people never understood the operations folks and vice versa – each thought they were top of the corporate food chain.
However, the past couple of years have seen the coming together of these diverse groups of people to rethink completely how we run global operations in this robotically digital era (or whatever we want to call this curious period of time in which we exist).
One thing is abundantly clear: the outsourcing phenomenon which has gripped the Global 2000 over the past decade is making way for a genuine industry in which we all play a part – an industry where we have no choice but to develop learning programs, sustainable business strategies and make real, actual investments in order to survive. And what’s most fascinating are the new conversations that have rapidly emerged to bridge this divide between the technologists and the business operators.
Suddenly, we’re talking about business logic, about datasets, about redesigning processes with genuine business outcomes in mind. We’re talking about deep learning AI systems that store what has been learned in the past, take notes of how variables and results have changed under different scenarios and then make decisions based on that.
The narrative has radically changed and the focus is now firmly on bringing together all the components that can escort us to this promised land of Digital Operations. So let’s take a look at what has transpired to get us to this point, where we can actually claim to be part of this emerging industry….
“Outsourcing” never materialized as an “industry”
Having spent the best part of the last two decades trying to make some sort of sense out of “outsourcing” I have come to the simple conclusion: “outsourcing” was never an industry – it was simply the practice of moving work around the world to save money. It consisted of people selling outsourcing deals and the poor suckers who’d been lumbered with trying to manage them – and the deal brokers and lawyers who took money from both sides making it all happen. It was never an industry, it was greedy corporates slashing their wage bills, and those lovely folks who were just so keen to comply with their wishes to turn a profit. Outsourcing has always been an activity searching for a higher purpose than cost take-out. While service providers and advisors undoubtedly feel part of an outsourcing industry, the buyers do not – they are operations people doing their job deploying whatever techniques are at their disposal to improve efficiencies and operating costs. They would not class themselves as “outsourcing professionals”. It’s like selling gym equipment to gyms. The seller is in the “gym equipment business”, the gym itself is in the “gym business”, and the customer at the gym is looking after their fitness. The “industry” is ultimately the higher purpose of which all the entities are all constituents – in this instance, it is the fitness industry – which could also encompass sportswear manufacturers, specialist outlets stores and so on.
How traditional outsourcing has left us in a right pickle
Outsourcing was like a one-time thing C-suite execs arranged on the golf-course to take 30-40% off the operations budget for a set of low-level processes – and enjoy the bulk of those savings upfront for a nice impact. Many folks became heroes overnight for making these deals happen, and they were lauded and courted at conferences as those radical executives who possessed some secret talent ingredient to make this all possible. Yes, a mystique around outsourcing was created, advisors did an amazing job making a science out of the “art of the deal”, and the façade of a new profession and (possibly) a whole new industry was borne.
Sadly, there was never (really) a long-term plan to sustain those productivity impacts, beyond moving as much work offshore, without overly impacting business performance and finding even lower cost cities to take on the low-hanging fruit to eek out a little bit more cost off the bottom line. Eventually, that well runs dry if you don’t make fundamental improvements to the quality of your processes and the convergence of the data sets they support.
Yes, we had a lot of fun creating useless qualifications and meaningless SLAs, but the end results were always the same: clients figured out how they only got what they had paid for, and the fancy innovations they were fed on those lovely pitch decks were always subject to change orders (or never really existed). The only real leverage came at rebid time, when the incumbent would usually make some new promises to get their house in order, if they felt there was actually a chance they could lose the business. Otherwise, it was business as usual.
The Global 2000 is littered with stale outsourcing deals that need radical transformation
However which way you paper over the cracks of short-termism, costs are like hedges – if you don’t look after them properly, eventually they grow back. As a result of all these fun and games, we are left with thousands of ropy outsourcing engagements littering the corporate world, where the clients are still paying for the same number of FTEs to deliver the same tired old obsolete processes, while their providers has no incentive to cannibalise their revenue streams, and the actual concept of moving these deals to other service providers is pretty desperate – all the smart ones have no interest buying up a legacy mess, while some desperate lower tiers ones may take on the work if they can shunt it to even cheaper, lower quality delivery resources.
But there is a way forward, and outsourcing has served a purpose
Believe it or not, there is a method to all this madness – companies managed to externalize work they didn’t want to run themselves, they got a lot of cost off their books, and they opened up the opportunity to pull more levers in the future to find new thresholds of productivity. Rarely will you ever find an enterprise which regretted outsourcing – they’ll never want that work back. The big issue, now, is ensuring that work is in a state to be optimized further by improving the quality and logic of process flows, digitizing them and applying smart automation techniques, where it makes sense. However, that can prove quite a challenge when the work has been distributed across third and fourth tier cities, and it actually requires some investment to transform those processes to consider meaningful automation and other delights that digitized processes can enjoy, such as Machine Learning and AI.
In fact, in too many cases, outsourcing resulted in enterprises sweeping their real process issues under the carpet and choosing to ignore the real need for genuine transformation until that day of reckoning occurred. And that day is now upon us, as CFOs are smoking the automation crackpipe and demanding that next 50% of cost to be ripped from the bottom-line in a 3 year timescale. Outsourcing provided them with a band-aid to enjoy cost savings through labor arbitrage, but robots can only provide further band-aids if the outsourced work has high-intensity, high-throughput processes that can easily be programmed into the software. If that work is distributed across too many locations, with service providers unwilling to make renewed investments to co-invest with those clients, we have an emerging issue facing many enterprises: their day of reckoning has been reached and they actually need to make some investments in their processes and underlying systems.
Welcome to an actual industry in which we can co-exist: Digital Operations. This is why we are now emerging as an industry – we are facing the reality that most enterprises need to make long-term investments in their digital underbelly, their process flows and their people to run them, in order to find sustainable value over the next decade.
For the first time, we are witnessing deep conversations happening across the operations spectrum: RPA, Machine Learning and AI software vendors and now talking with service providers about how to embed their offering into long-term service contracts to support sustainable productivity and incremental data value over time (our data already shows close to a third of the Global 2000 are already integrating automation into their service delivery):
Ambitious enterprise customers of outsourcing, shared services heads and other operations leaders are all feverishly learning how to understand the value of software tools and how to prepare their process flows for the benefits of digitization and automation. Consultants worth their salt are rapidly training their people to develop automation roadmaps for their clients and prepare them for a longer term strategy of creating a truly effective digital underbelly. Yes, we are still are suffering from a few cowboy consultants claiming their clients can slash 50% overnight through RPA, the our observations are quickly showing that people are learning fast and know they need to address many of their underlying processes and talent issues, if they are truly going to take the next step forward.
Bottom-line: The Industry is Digital Operations, and there are six levers to pull to find sustainable value
The conversation among operations executives has changed dramatically just over the past year. As the excruciating hype around robots taking our jobs and these outlandish predictions from drama-loving analysts and academics, a sense of reality is finally setting in – roles are not changing overnight, we just need to get out of our comfort zones and learn new stuff. We need to understand the pivotal role data plays in our professional lives and become smarter about how we manage it. We need to understand where RPA adds value, where to start with Machine Learning and AI, how we can truly leverage globally distributed talent to support out operations affordably and smartly, we need to be observant about the creeping impact of blockchain and how we can truly take advantage of digital technologies to nurture new revenue streams and enhance customer, partner and employee engagement up and down our supply chains. It’s taken a full decade just to take advantage of the cloud, and we need another one before that really fulfils its potential. It’s going to be even more complex to ingest the benefits of automation, AI and blockchain into our business operations – but now we have six genuine value levers to pull to tend the hedgerows of digital operations.
In case anyone thought we were going soft, we’re proud to announce another feisty outspoken analyst to the HfS family to help drive our coverage of industries – most notably the hi-tech and banking sectors – Elena Christopher.
Elena – 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?
It’s wonderful to join the HfS family. Research and IT and business process services have been the prevailing themes of my professional life. I realized while in university studying social science that research and its various methods provide valuable insights into whatever topics you apply it to. In my second job out of school, I was fortunate to be hired by Dataquest (Gartner), which afforded me the opportunity to learn the IT and business process services industries from the ground up. I never looked back. Since 1994, I have served as either an advisor or supplier partner to clients in most commercial industries, working to make sense of the various waves of seminal change in how businesses operate.
So why did you choose to join HfS… and why now? And didn’t you want to go back to one of the traditional analyst houses?
I started my career as an analyst with Dataquest/Gartner. After nine years, I went into industry to build practical experience to complement my theoretical knowledge. I’ve been in the supplier world for the past ~15 years building and running services businesses. I was resolute in wanting to come full circle and connect my practical experience with my analyst skills. However, I only wanted to go with a firm that was doing things differently and one with which I personally had derived value. I was very attracted to HfS’ approach of tackling and breaking down the major trends and issues in an incredibly timely fashion with much of the research accessible open source. I also appreciated the independent perspective and use of enterprise data rather than substantial reliance on supplier research. And as a services research company it is perfectly aligned with my experience base.
So where is the services industry right now, Elena? Do you see us in a transition state, or is something else bubbling to wake us all up?
We are most certainly in a transition state – with most industries in the process of being remade as disruption and enabling technologies change the fundamental concepts of business as usual. The services industry is enabling much of this transformation but it is also in throes of change with increased impetus placed on platform-based models and business outcomes.
So what can we expect to see from you at HfS… can you give us a little snippet of what you’re going to be working on?
l’ll be driving the industry-specific research agenda for HfS – digging into the major trends impacting each in-scope industry and the implications for business process and IT services. I’ll collaborate with my fellow analysts to cultivate the industry angle on major trends such as automation, artificial intelligence, blockchain, digital business models and smart analytics. My primary coverage areas are High-Tech and Banking. In addition, I’ll drive the industry point of view across HfS research.
And finally, is the analyst industry going as exciting as it was 10 years’ ago?
Probably more so – there is so much change and transition afoot that creates a great need to research near-term and future horizons
Welcome back to the analyst community, Elena – am sure you’ll find HfS a fascinating laboratory for observing the next phase of this industry!
