The Year Ahead – Two Imperatives

As we indulge in the seasonal habit of taking stock of the past 12 months and looking ahead to the next 12, I think it’s safe to say that 2014 can be characterized as a “year of disruption.” We’ve talked a lot about game-changing technologiesnew service delivery models and the end of business-as-usual. In terms of preparing for 2015, I propose that we think of a “year of the new normal.” In other words, if we’ve agreed that our world is changing, it’s now incumbent upon us – particularly “us” as sourcing advisors – to know what the new rules are and to get on with it.

In that spirit, here are some thoughts on two central challenges facing enterprise buyers, service providers and third-party advisors in 2015.

Leveraging autonomics/RPA: Client interest in intelligent machines is growing rapidly, and service providers are scrambling to get on the autonomics bandwagon, either as aggressive leaders eager to seize the opportunity, or reluctant followers who see the writing on the wall. Preliminary data shows that Robotics Process Automation (RPA) solutions are already having an impact on IT services pricing. The challenge now becomes smart implementations that achieve optimal benefits. As we learn more about intelligent systems, it’s becoming increasingly clear that the value proposition is by no means straightforward – we’re not talking about a clear-cut percentage reduction in labor requirements. Rather than eliminating discrete and clearly defined “jobs,” RPA solutions will eliminate specific functions and time-consuming tasks, so enterprises will have to figure out how to reallocate portions of existing resources and utilize additional bandwidth. RPA results, moreover, will vary, based on enterprise maturity level and service tower. Business cases and forecast models must take these variances into account, as well as factor in implementation and long-term support costs.

Finding the right partners (and customers)Clients increasingly require service providers who have broad and deep knowledge of their industry, and who can apply technology and operational expertise to address industry-specific regulatory issues, competitive pressures and customer requirements. In this environment, enterprises must identify providers who have the right mix of capabilities and proven expertise. Providers, meanwhile, need to articulate their value propositions and hone their go-to-market strategies to identify the best opportunities. Put bluntly, clients can’t afford to pick a provider who doesn’t have the right stuff, and providers can’t afford to chase deals they won’t win. To remain relevant, advisors need to focus on and invest in industry knowledge.

About the author

Chip is a recognized outsourcing industry expert, committed to helping clients understand and respond to emerging trends and disruptive technologies, such as the nascent field of Robotic Process Automation (RPA). As an industry thought leader, Chip is a regular speaker and panelist on the impact of innovation and the myriad challenges of change management.