I recently joined a few of my colleagues at IAOP OWS (Outsourcing World Summit) in San Antonio where Everest Group led sessions and set up several meetings resulting in interesting conversations. We had a unique perspective at the event given we were one of the few (maybe the only?) organizations there with a research practice dedicated to the world of global services. People came to our booth probing for insights on what was going on with the market. What we didn’t hear was interesting.
Three key realities for global services were surprisingly scarce discussion topics in much of our conversations.
- How the impact of digital and automation will change the nature and business of global services
While many conference sessions and hallway discussions mentioned RPA and cognitive automation (CA), few conversations looked beyond the initial implementation stage and asked the challenging questions about how talent models will need to change, how hiring practices will need to evolve, and how the engagements and relationships between the clients of outsourcing and their service providers will evolve. RPA and CA are more than technology solutions – fundamentally they are about changing the very nature of work – allowing businesses to operate along entirely new models. The bigger question is – How will automation change our business and operational models?
- Management of shifting geopolitical realities
At the IAOP summit, somehow the realities of the world outside the conference halls didn’t quite make it inside. Some folks certainly lamented the uncertainties of things like U.S. immigration and visa reform, moves towards protectionism, uncertainties around the Philippines and other delivery locations, etc. However, we heard little about how enterprises (or service providers) plan to actually navigate these changes, what steps they plan to take to ensure the stability of their operations, or how they’re evolving their operations for resiliency and continuity. Everest Group addressed global 2017 geopolitical trends in our recent Market Vista™ webinars here (global services 2017 outlook) and here (How to respond to the Philippines climate).
- Deceleration within the global services industry
At an event organized by IAOP – with the “O” standing for outsourcing – we noticed there was little discussion of the overall growth and direction of the global services industry. Everest Group research finds that the IT Services industry has had four straight quarters of deceleration. Last quarter, the IT Services industry grew at 3.1 percent, and the top five Indian firms grew at 7.7 percent. This is the lowest level of growth many of these service providers have ever experienced. However, even behind closed doors a relatively optimistic tone prevailed. This was noticeably different than the annual Nasscom summit just one week earlier in Bangalore, where a somber atmosphere seemed to prevail. (Please see our CEO Peter Bendor-Samuel’s NASSCOM blog for more on this.)
Why the hush-hush on these critical topics? Could it be everyone feels they’re shoulder-to-shoulder, looking at un-ventured territory as the industry experiences what seems to be its next evolution? Or are companies simply keeping quiet about their next steps? We’d love to hear your thoughts.