HfS Network

The future is about services, not software

August 13, 2017 | Phil Fersht

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I was recently given the lowdown on how amazing ServiceNow is becoming with the "integration of Watson and Chatbots into its core platform".  Sounds terrific, but does this added functionality really deliver huge value to customers when we examine the realities of their current business models? I would argue our industry has become so carried away with the promise of technologies we barely comprehend, we have taken our eyes off the real prize: working with customers to help them be more effective. We've got to stop selling the Ferrari, when their Volkswagen will comfortably get them where they need to be with the help of a routine service inspection.

I increasingly believe today's "post-digital" market is much, much more about aligning services to customer business models than selling software with lots of bells and whistles - there are so many tools on the market that have 10-50x the functionality customers today really need with their current business models. Whether Ignio has more bells than Holmes or Nia, or whether anyone truly understands Watson's capabilities, the key here is which suppliers can work with their customers' business models to drive better automated processes, introduce more self-learning capabilities and smart analytics that can truly improve their businesses.

Net-net - we must look at everything through the customer lens:

1) Why should I care about ServiceNow?
2) What can I truly do with ServiceNow that can improve my speed to market, my customer engagement, my OneOffice experience?
3) Can ServiceNow really make me a smarter, more analytical operation, based on the people I have on staff and within my service partners?

Just adding software isn't the answer, it's about really understanding your desired business model and crafting the operations to sustain and support it. The service providers who invest in staff, that can really align business models to new tech, will win; software firms that can train those winning services firms to do that will win.

This is why Watson is failing to meet IBM's lofty expectations - they're selling solutions to clients that simply do not have the skills or experience to understand how to improve their current biz models with cognitive.

This is why 50% of firms are already admitting they invested in RPA products they aren't getting anywhere with. They just don't have the internal structure, capability or know-how how to really adopt this stuff.

The Bottom-line: It's time to invest in real consultative talent... or go home

Net-net - the biggest issue today is that these are solutions trying to find business problems, as opposed to clients having business problems who are looking to find tech solutions to get smarter. This should be about SOLVING existing problems first... Sadly, most of the problems today are too focused on people elimination that may not be feasible or financially viable.

The services industry needs to evolve to higher value consulting.... educating clients on the true business value of investing in solutions. But unless suppliers invest in themselves first to understand their clients' real business needs, the ROI of investments like ServiceNow will never be realized.  It's time to invest in real consultative talent... or go home.

Posted in: Business Process Outsourcing (BPO)Buyers' Sourcing Best PracticesIT Outsourcing / IT Services

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1 Comments

10 Comments

  1. Kevin McDonald
    Posted Aug 13, 2017 07:48 PM | Permalink Reply

    Amen, Phil. Over the past year or two, I have seen some really cool tech, but not always sure how it would work in the organization.

  2. Partha
    Posted Aug 13, 2017 10:05 PM | Permalink Reply

    Very well articulated Phil. SNow has no choice but to add in Chatbots etc as thats the natural evolution of their platform which will help them stay ahead of competition. However, for the customer, the right consulting talent is the need of the hour. Companies that have invested in their own platforms are at disadvantage as there is a tendency to force fit those for their customer base.

    Partha

  3. Vikas Bansal
    Posted Aug 13, 2017 09:01 PM | Permalink Reply

    On point as usual, Phil.

  4. Jason
    Posted Aug 14, 2017 07:43 AM | Permalink Reply

    Spot on, Phil. Clients are getting lost in the noise, when what they really need is an education on what works best for their business. Most of these solutions all offer great potential... but we need to learn from the lessons of ERP from the last 3 decades - technology can help, but the business needs to drive the outcome.

    Jason

  5. Tracy Webster
    Posted Aug 14, 2017 11:46 AM | Permalink Reply

    A big miss is that many consultants have never worked on the functional side: they show up with technical toolkit and proceed to vomit IT COOLNESS. Many never connect the dots to solve problems or build out solutions that make work easier. As technology evolves, there are solutions that are fast implementations or best practice, more automated software. A consultants value is when we provide guidance and services that help with change management and training ad internally marketing the wins that we are providing so the ROI is felt by all instead of a report run by a select few.

  6. David Kenny
    Posted Aug 15, 2017 04:53 AM | Permalink Reply

    So true. Techno-lust plays a much bigger role than it should in so many tech decisions. But then, then all you have is a hammer, every problem is a nail. Throwing tech at a problem is easier in most cases than dealing with the people and change challenges.

  7. Phil Fersht
    Posted Aug 15, 2017 09:48 AM | Permalink Reply

    @Tracy - good points. This why Salesforce.com and Workday have been so successful - years and years of ineffective investments in CRM and HR technologies eventually led to CMOs and CHROs crying out for a standard set of processes to work with that "did the job". The same happened with Concur for travel and expense management. As more tech gets standardized, the more the onus switches to the alignment with the business. Consultants have traditionally feasted from the inefficiently of technology...today - especially with the advent of automation and AI as industrial scale enterprise tools - they need to feed on the business effectiveness these technologies can bring to their clients' business models. The tech solutions are the easy sell now... the hard sell is the business model!

    PF

  8. Phil Fersht
    Posted Aug 15, 2017 09:53 AM | Permalink Reply

    @David - completely agree. RPA is going nuts because it is giving consultants more stuff to sell under the guise of cost-efficiency. Sadly, most the advisors today are only selling the software and leaving the really hard stuff to the customers themselves, or a handful of boutique specialists, to deliver (the governance, plan, the training, the change management).

    It was similar with outsourcing, where consultants liked to sell the transaction, but were rendered useless very shortly after as they were simply not skilled in the softer art of governance and change management. Fortunately, the outsourcing providers took this on, as they did not want their clients to screw up. The same will hopefully happen with automation as providers skill-up fast to stay in the game,

    PF

  9. Giles
    Posted Aug 14, 2017 09:55 AM | Permalink Reply

    Vintage Fersht! Great piece and good comments too.

  10. Dion Hinchcliffe
    Posted Aug 16, 2017 07:17 AM | Permalink Reply

    You are so right - Orgs want business impact.

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