Author: JimitArora

The Contactless Economy – Reimagining Process Through Technology | Blog

Digital Reality podcast episode #10 examines how savvy companies leveraged technology to redesign their processes to continue to serve clients, streamline operations, and even thrive during the crisis. We examine lessons from three diverse B2C sectors – restaurants, apparel stores, and liquor stores – that ensured some semblance of “normal” during these uncertain times.

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Jimit Arora (JA): Welcome to the tenth episode of Digital Reality, Everest Group’s monthly podcast that moves beyond theory and beyond technology to discuss the realities of doing business in a digital-first world. I’m Jimit Arora and…

Cecilia Edwards (CE): I’m Cecilia Edwards. Each month we bring you a discussion that digs into the details of what it means, fundamentally, to execute a digital transformation that creates real business results.

This month, we are talking about how technology impacts an organization’s ability not only to continue to operate, but to streamline operations and thrive during times of crisis. As the pandemic wreaked havoc on the economy, many businesses shuttered or lost a tremendous amount of value amidst the shelter-at-home orders. However, today we want to look at two examples of companies that leveraged technology to meet the shifting demands of the “new normal” we find ourselves in.

Jimit, do you want to kick us off?

JA: Let’s start with B2C examples because most of us can relate to whether or not we can still eat from our favorite restaurants or purchase the goods we desire. I’ll briefly touch on restaurants. The shift restaurants have made during this time period was clearly a technology plan supported by some operational shifts. In a previous podcast, we talked about how Domino’s transformed itself over a 10-year period into an e-commerce company that sells pizza. Every restaurant that wanted to survive the pandemic has had to do the same. They have had to beef up their online capabilities to make it easier for customers to order. And they had to create changes in their operating processes to support curbside pick-up without the convenience of the drive-through windows that are used by fast food stores. While they are still cooking food, their survival depends on a technology play.

Now let’s talk a bit about brick and mortar apparel stores. This pandemic caused nearly all of them, as non-essential businesses, to shut down. Their only option to not be completely decimated by the crisis was to turn to e-commerce. However, it became clear quickly that merely having an e-commerce website, which by now, most retailers have, was not sufficient. Order fulfillment and inventory management became an issue. Most businesses handle their e-commerce sales from centralized warehouses. With no new shipments and lots of inventory at retail locations, Lululemon’s technology choices allowed them to thrive.

Having invested in RFID technology to track every piece of clothing in every store or warehouse worldwide, it was able to effectively use its retail locations, and staff, as fulfillment centers to support their online business.

This strategy worked for Lululemon; its stock is up 37% so far this year. The company has pulled back on its plans to build experiential bricks and mortar stores and will invested in digital, omnichannel, and e-commerce tools. While not able to completely offset the loss of in-store sales, the company is planning for double-digit growth in online revenue over the next three years.

Question to you Cecilia: What do you see as some of the lessons companies can take away from both the restaurant and Lululemon stories as companies contemplate their technology strategies?

CE: B2C success in a social distanced world requires more than an e-commerce site – there are implications for the entire operation’s ability to support the digital strategy. There needs to be a plan for how people will be deployed differently to support the e-commerce strategy. These new practices are likely, in some form or another, to become part of our future business norms.

Let’s shift our focus now to a B2B example and talk about how Johnson & Johnson has been doing. As one of the world’s largest healthcare companies, supplying consumers and businesses with medical devices, pharmaceuticals, and consumer packaged goods, J&J was obviously deemed an essential business during the shutdown. But that doesn’t mean its business wasn’t impacted.

In addition to the same work-from-home challenges most businesses had to adjust to, J&J has been supporting front-line workers with medical devices and products, continuing to supply consumer hygiene and health products, and is one of the companies working on a coronavirus vaccine.  It’s a bit of an understatement to say J&J has a complex business, with over 200 business units in different parts of the essential business spectrum.

Its IT capabilities have played a critical role in keeping J&J going. Data and analytics has been a big focus. The company has needed to ensure that the data required to scale up its supply chain was available to both internal and external partners and that real-time insights were uncovered to provide patients with the right care at the right time. For example, J&J consistently overcame operational challenges by using data analytics to assess alternative logistics and supply chain routes.

J&J has updated its mission statement to reflect the importance of IT. It now reads, “We shape the future of healthcare by unlocking the power of people, technology, and insights.” This mission has translated into investments in digital robotic surgeries, cloud computing, AI, and blockchain. J&J has obviously also had to take security into consideration. Its digital infrastructure allows its cybersecurity to scan the entire system every 15 minutes. And lastly, the company has a clear focus on business outcomes – it can routinely provide performance against key business metrics to the entire firm, not just IT.

While it’s unclear whether it is causal, J&J has announced that human trials of its coronavirus vaccine will begin in July versus its previously planned September timeline.

Question to you Jimit: As other companies are unsure about investing in technology during times of crisis, like now, what are some of the people considerations they should take into account?

JA: Three things:

  • Aligning everyone against a clear set of business objectives and investing against those
  • Ensuring transparency and collaboration across business silos and external business partners
  • Fully leveraging data – having the right data, updating it, making it broadly available

Digital Reality Checkpoints

CE: While technology is not the silver bullet to address all of the challenges companies currently face – and will continue to face – as we navigate through and eventually come out of this COVID-19 crisis, it has been shown to be a key enabler in the success of both B2C and B2B businesses. As usual, there are some lessons, or Digital Reality Checkpoints, that can be broadly applied:

  • Invest beyond the technology basics, but at a level to support your business objectives
  • Plan for how people will be deployed differently after the technology investments are in place
  • Ensure you have the data and analytics capabilities required to power your digital investments and make sound business decisions

Please check us out at www.everestgrp.com, or follow us on LinkedIn at jimitarora and ceciliaedwards. If you’d like to share your company’s story or have a digital topic you would like us to explore, reach out to us at [email protected].

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The Transformation Paradox: Funding Digital Transformation | Blog

In the ninth episode of our Digital Reality podcast series, Cecilia Edwards and Jimit Arora highlight examples of financial engineering solutions service providers are offering to accelerate the digital transformation of cash strapped enterprises. They also discuss changes in internal funding approval and allocation processes that support rapid decision-making while limiting the associated risk.

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Jimit Arora: Welcome to this month’s episode of Digital Reality, Everest Group’s monthly podcast that moves beyond theory and beyond technology to discuss the realities of doing business in a digital-first world. I’m Jimit Arora…

Cecilia Edwards: and I’m Cecilia Edwards. Each month we bring you a discussion that digs into the details of what it means, fundamentally, to execute a digital transformation that creates real business results.

This month, as we continue to see the impacts of the COVID-19 crisis globally, we shift the conversation to an important issue facing IT leaders as they wrestle with whether they should they increase or decrease the pace of digital transformation. From our leadership team’s conversations with over 50 enterprises in the last few weeks – the biggest regret we hear is that they wish they had made more progress on our automation and digital agendas prior to the crisis. So clearly the posture coming out of this crisis is that the pace of digital transformation needs to accelerate to drive the needed efficiencies in the organizational value chain.

However, there is a sobering reality check here – digital transformation requires investment, and budgets are the one thing that have been impacted significantly given the broader recessionary environment that we find ourselves in. So this creates a paradox – companies need digital transformation to bend the cost curve and at the same time find themselves lacking the budgets to realize these transformations.

Jimit, you have noted this paradox in the past – what are some strategies that you think are important to potentially find the funding to drive digital transformation.

JA: Yes, this is indeed an interesting paradox – the good news is that this isn’t new. As an industry we have been dealing with this issue for as long as I can recall, because no CIO will say that their budgets are adequate to keep the lights on and deliver the change they need. What is most instructive is: if you look back to prior crises – the dotcom bubble, the global financial crisis, and now in the aftermath of COVID-19 – one of the funding strategies we are going to see is a resurgence in is financial engineering.

Now, financial engineering is not new – it has been around for a while. Effectively, you end up using accounting strategies – either your own or your vendor’s – to realize benefits without incurring all of the costs upfront. The most common manifestation is that you are using a partner’s balance sheet in the form of financing to make investments today and realizing value in the near term, where the payout happens over a longer period of time. A simple example of this becomes taking investment strategies that require CapEx and turning them into OpEx.

It might sound simple, but it isn’t a one-size-fits-all approach and is going to be a function of how a company’s financial rules and internal accounting policies are structured.

For example, what aspects of new projects and upgrades are capitalized vs. considered an operating expense? How does your organization account for the labor involved in implementing new features and functionalities? Fundamentally, if the goal was to increase OpEx and your finance organization insists that these need to be capitalized then you may not be able to realize the benefits. I think that is one caution I provide organizations that are looking to leverage vendor financial engineering solutions to ensure that the path you are looking to go down will meet the necessary approvals of the finance organization. Which is why one of the most important things for IT leaders to do is to ensure you work very closely with your finance organization.

CE: Excellent point Jimit and a much-needed word of caution here. I think there is definitely a lot of commitment on the part of two categories of participants in the digital transformation enablement stack. BigTech vendors, like Microsoft, SAP, AWS, Oracle, Cisco, and systems integrators are preparing significantly to leverage their impressive balance sheets to enable client transformation programs to offset the decline in demand that they are likely to see.

A very public example has been Cisco, which said it is allocating $2.5 billion to help customers defer up to 95% of payments on new products and associated services until 2021. I also have examples of systems integrators that are offering to help “collapse the stack” by offering to the client a single monthly invoice that takes into account the investments in the infrastructure, software, and services by getting the client to the post-transformation run rate in year one in return of a seven- or 10-year deal. So clearly the wave has started, and companies need not be constrained by their own budget challenges, because BigTech and SIs are ready to make things happen in return for a large, long-term deal.

JA: Cecilia, changing gears somewhat. I know you have been examining an alternate mindset to thinking about investments and funding for digital transformation and you actually presented that in a recent webcast we conducted.

CE: Yes Jimit. In some ways, the approach we mention is consistent with the discussions we have had on how digital transformation is not an IT conversation exclusively but a business conversation. So three broad factors to keep in mind:

  • First, ensuring alignment of the digital transformation effort with strategic objectives is very important and often this trumps traditional ROI calculations. Why? Because in a number of situations, the business objectives might be framed on dimensions that are hard to quantify and put a dollar figure on. Coming out of this crisis, productivity and resilience are emerging as very important dimensions – and current models can’t effectively frame these into a robust ROI conversation;
  • Second, empowering those with business context to make many decisions becomes most important;
  • Third, strategic priorities will change over time. Having the discipline to stop funding for things that no longer align with the strategic priorities is important (i.e., avoiding the sunk cost fallacy) and also ensuring new funding for new priorities. Traditional budgeting approaches need to change, and ensuring that you have mechanisms to fund and defund only for value becomes paramount.

JA: Unprecedented is probably the most used (and potentially misused) word to describe the nature of the crisis at hand. However, this crisis has also helped amplify the need for digital transformation. Microsoft CEO Satya Nadella recently said that we saw two years of digital transformation in two months. And this transformation needs sustainable and creative funding strategies. There are clear lessons for us as we think through the funding strategies available to us today. We call these lessons Digital Reality Check Points:

  1. Leverage financial engineering – it is real, effective, especially in a hypercompetitive supply environment and can help accelerate your transformation journey;
  2. However, this is not a one-size-fits-all approach. Ensure the applicability of these vendor financing solutions to your organization’s financial and accounting context;
  3. Align new investment strategies to the business’ strategic objectives.

Please check us out at www.everestgrp.com, or follow us on LinkedIn at jimitarora and ceciliaedwards. If you’d like to share your company’s story or have a digital topic you would like us to explore, reach out to us at [email protected].

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Impact of Automation in Business Continuity – Removing the Human Risk | Blog

In the eighth episode of Digital Reality podcasts, Cecilia Edwards and Jimit Arora examine the impact of automation on an organization’s ability to continue operating during times of crisis, especially as it pertains to mitigating risk to human life and enabling safety. This blog is a summarized transcript of the podcast.

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Cecilia Edwards: Welcome to the eighth episode of Digital Reality, Everest Group’s monthly podcast that moves beyond theory and beyond technology to discuss the realities of doing business in a digital-first world. I’m Cecilia Edwards…

Jimit Arora: …and I’m Jimit Arora. Each month we bring you a discussion that digs into the details of what it means, fundamentally, to execute a digital transformation that creates real business results.

This month, we are going to talk about the impact automation has on an organization’s ability to continue operating during times of crisis. We are all familiar with some of the top of mind benefits of automation, such as reducing costs, increasing productivity, ensuring high availability, increasing reliability, and optimizing performance. Another use case that is frequently deployed – but may not have been as top of mind before the COVID-19 crisis as it is today – is the protection of human life. When human life is at risk, availability naturally takes a back seat. Yet we have examples, both historic and current, where automation is being used to simultaneously address both of these objectives.

Cecilia, why don’t we start with an experience that is personal for you – and that is the form of automation deployed after the Challenger exploded back in 1986.

CE: You’re right, Jimit. This accident was an integral part of the start of my professional career. After graduating from college, I was commissioned as an officer in the US Air Force and worked on the Titan Space Launch Program at Vandenberg AFB in California. So, what does that have to do with the shuttle?

VANDENBERG AIR FORCE BASE, Calif. -- A Titian IV Centaur rocket launches here Oct. 19. The rocket is the largest unmanned space booster used by the Air Force. The vehicle carries payloads equivalent to the size and weight of those carried on the space shuttle. (U.S. Air Force photo)
Photo credits: U.S. Air Force

Back in the ‘80s we had grown accustomed to successful launches of space shuttles, and deeming them safe, we sent politicians, royalty, and civilians on missions. The 25th mission, the 10th for the Challenger, ended in disaster, blowing up just 73 seconds into flight and killing all on board, including a school teacher. This incident rightfully grounded the shuttle program for almost three years as the investigation and remediation procedures were put in place to ensure there would not be a repeat.

One of the functions the shuttle performed was to launch satellites, in particular large satellites, for the US Air Force. With the shuttle grounded, the Air Force was left with no means of completing its mission of putting several large satellites into orbit. Instead of waiting it out, the Air Force made a determination that injecting a satellite into orbit really didn’t require a human, and the Titan IV program was born.

The Titan IV was an unmanned space launch vehicle with flexibility to configure the payload to match that of the space shuttle. In other words, anything that could be launched on the shuttle could also be launched on the Titan IV.

The Air Force chose to automate the launch of the remaining satellites to resume the mission more quickly and to reduce the risk to human life going forward. People worked to prepare the satellite and rocket and then launch remotely, from a control room about 20 miles away. Future disasters would be costly only in dollars, not lives.

Jimit, what do you see as the lesson companies can take away from this story as they contemplate their automation strategies?

JA: Just because you have always done something a certain way doesn’t mean you shouldn’t challenge your assumptions. What might have been the only option at one point might be outdated; you should consider other technology solutions.

Assume that at some point something will go wrong. How long will your operations be shut down if the loss of human life is a part of an incident? Can you identify ways to eliminate or minimize the risk to people so your business can quickly recover?

Given the massive loss of jobs we are witnessing right now, on the surface, it seems a bit thoughtless to be considering navigation solutions for a crisis of the type we are experiencing that would result in the loss of additional jobs. It is actually a misconception that automation necessarily results in disadvantages for the displaced humans. That wasn’t the experience at Rio Tinto.

Rio Tinto is the world’s second-largest metals and mining corporation, producing iron ore, copper, diamonds, gold, coal, and uranium. I don’t know if you have ever seen pictures, but these mines are humongous holes in the ground; trucks are required to move the mined resources. It is a very dangerous job to drive these trucks and the mines are located in very remote locations. Not the ideal working conditions.

In 2008, Rio Tinto began deploying automation, in particular, a fleet of self-driving trucks to perform this dangerous task. This allowed them to run safer operations that were more efficient – self-driving trucks don’t get sleepy – and lower production costs.

Photo credits: Getty Images

But what was the impact on the people? They were able to reskill, upskill, and redeploy their people to safer and higher-value tasks. This technology has enabled them to create new career pathways and with investments and innovation in training, they believe their adaptability will be a key factor of their longer-term success.

CE: As other companies are thinking about increasing automation, here are some of the people considerations they should take into account:

  • Ensure you have people to work on the technology
  • Consider the implications of a blended workforce – you don’t necessarily need to get rid of people. Use the technology to make them more productive if you plan on having a blended automated and human workforce
    Side note: when Henry Ford introduced the assembly line – a major new innovation of the time – instead of people losing their jobs, with the increased productivity, they were able to produce cars at a lower price point that led to an expanded market for cars. He ended up hiring more people to keep up with the demand.
  • Train people for their new, higher-value jobs

Digital Reality Check Points

JA: Humans ought to matter to business as much as costs do. We can take a few lessons from the past that provide a guidepost on how protecting your people is protecting your business. As we do every month, we’ll share three of these lessons, our Digital Reality Check Points, that you can apply to your business.

  1. Understand the tasks in your business that are dangerous for humans to perform and determine whether there is an automation or other technology solution to protect them.
  2. Plan for humans to work alongside any technology solutions you deploy.
  3. Seek opportunities for your more efficient automated and human processes to be leveraged as an advantage in the marketplace.

Please check us out at www.everestgrp.com, or follow us on LinkedIn at jimitarora and ceciliaedwards. If you’d like to share your company’s story or have a digital topic you would like us to explore, reach out to us at [email protected]

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Digital Transformation Success Is NOT Rooted in Technology | Blog

Here’s a sobering fact: Everest Group research found that 78 percent of enterprises fail in their digital transformation initiatives. Failure here can mean multiple things, including unsustainable returns, lack of user adoption, or, even worse, abandoned projects.

The following picture illustrates one of the key reasons they’re failing. What is it?

It’s a Steaming Pile of Technology – what we call a SPOT. And, unfortunately, it’s where most organizations start their digital transformation journey.

Why do I say unfortunately? The truth is that a technology-led approach won’t enable you to achieve the business value you expect from your digital transformation initiative. Indeed, as you see in our holistic, interconnected Digital Success Model, technology is only one of eight components that you need to get right to succeed.

Let’s take a quick look at all eight components, which we categorize under strategy and solution.

The strategy

With so much at stake, you have to begin your digital transformation journey by defining where you want to go and how you’ll get there. The four critical strategy components you must address at the very onset are:

Vision
This must clearly and concisely cover what you specifically want to achieve in both the short- and long-term. For example, is the initiative to drive revenues, cut costs, improve customer experience, extend competitive advantage, be compliant? The objective functions will fundamentally dictate your digital transformation journey’s “rate of spin.”

Economics
Typical funding models don’t work in digital transformation programs because they focus on achieving ROI in a short timeframe. Instead, you need to establish the right budget centers in the to-be-transformed business and functional unit/s, and the right funding mechanism – CapEx versus OpEx. Additionally, you should put in place funding gates to ensure your business objectives are met during interim check-points.

Organization and cultural
We consider organizational culture and change management the most important element of the digital strategy model. In order to succeed, you must create an empowered, cross-functional journey team that aligns the C-suite, business stakeholders, and IT stakeholders. Emphasis on agility, risk tolerance, and decision-making speed and flexibility are key. And to make sure your new culture takes hold and sticks, you need to adequately budget both time and money for a comprehensive change program.

Performance and governance
As management guru Peter Drucker said, “You can’t manage what you can’t measure.” To effectively manage the success of your digital transformation journey, you need to identify and measure metrics that tie back to your vision. You also need to establish interim milestones for these metrics to track progress, allocate funding, and drive any needed course correction. Many enterprises find that investing in a digital transformation Program Management Office can help them handle performance and governance on the operational, tactical, and strategic levels.

The solution

Once you have your strategy in place, you can move on to shaping the solution.

Technology
When selecting your technology, a “one-off, one and done” approach may deliver very short-term spurts of success, but it won’t deliver sustained business value. To achieve ongoing success, you need to embrace a platform-based operating model as the foundation for your digital transformation journey. What we call a Digital Capability Platform helps you look at all your users – your employees, your customers, and your partners – in the context of all the technological enablers to drive the customer experience, decisions, process efficiency, and scalability and performance.

Talent
The best strategy, funding mechanisms, technology, etc., can’t deliver to your expectations if you don’t have the right talent. Indeed, your ability to compete in the digital era depends on having the right talent, at the right time, in the right places. You need to prioritize using an elaborate sourcing ecosystem to find the talent you need today, and establish a robust resource management program to help you plan for future skill requirements.

Data
Not surprisingly, data is a key enabler of your digital transformation success. Consider this: our research found that 100 percent of successful enterprises use digital initiatives to collect data and perform analytics for better insights that drive better outcomes, and 94 percent use some form of data and analytical solutions to augment their strategic decision-making. You need to be able to convert your existing volumes of data into a high-quality, actionable enterprise asset to achieve longer-term digital transformation success.

Ecosystem and sourcing
And finally, digital transformation cannot happen within the boundaries of your organization, or even the boundaries of the industry in which you operate. By partnering with start-ups, academia, government, tech vendors, staffing companies, transformation partners, orchestrators, and peers, you can unlock breakthrough value from your digital efforts.

This full-scale realignment of your digital strategy and solution ecosystem is challenging and can feel overwhelming. But it’s critical to your short- and long-term success. Our IT and digital transformation membership offering can help. To learn more, please click here.

How to Construct a Digital Transformation Analytics Roadmap | Blog

Is data really the new oil fueling digital transformation? Absolutely. A company’s ability to make fast-paced, meaningful decisions in a volatile business environment is key to competitive differentiation. Indeed, industry leading enterprises are using data and analytics to adapt to dynamic market conditions, drive continuous innovation, and accelerate the speed of doing business.

However, many organizations are struggling in their efforts to harness the value of data to aid their transformation efforts. The single most important reason for these failures is their technology-first thought process. They invest in the latest big data and analytics tools, AI and ML algorithms, and visualization technologies, and subsequently determine how to drive adoption.

This approach is flawed. Why?

Technology in and of itself does not provide answers to how businesses must adapt for success in a data-driven future. It’s not enough to have the best tools; organizations need to start with a broader vision built on a foundation of business requirements. Companies that succeed at meeting their analytics objectives let business goals drive the technology, and not the other way around.

The business objectives

To develop an effective and value-generating analytics roadmap, enterprises need to start with their strategic business objectives. These tend to fall into three broad categories:

• Top-line growth – Value derived from better understanding potential target segments to enable greater revenue generation. For example, improved customer satisfaction, creating long-term customer loyalty, etc.
• Cost reduction – Value created by leveraging analytics to identify the cost leaks, such as redundancies and inefficient processes, and trim expenses. For example, minimizing procurement spend, plugging revenue leakage by reducing inventory cost, etc.
• Risk and compliance management – Value gained from monitoring, preparing, and managing risk and compliance on a real-time basis, and anticipating any potential risk-related issues, e.g., fraud detection and monitoring.

 

analytics roadmap

The building blocks

After clearly establishing their business objectives, organizations need to make important decisions about four distinct building blocks:

• Data – At the heart of every analytics solution lies data in its raw form. Enterprises need to have a data strategy in place to cope with increasingly large and complex data volumes coming from diverse sources in a wide variety of formats (text, images, audio, video, etc.)
• Technology tools – Core technology tools and platforms for data ingestion, processing, preparation, and visualization are critical. But they cannot be one-off implementations. Enterprises should focus on building integrated technology ecosystems to address immediate, distinct use cases without considering the mid-to long-term creation of sustainable capabilities
• Talent – This requires the creation of competencies around the specific, expected data and analytics capabilities. Given the huge demand/supply gap for data and analytics professionals, particularly data scientists, e-enterprises must proactively and enticingly attract and retain the right talent
• Infrastructure – The focus here is on ensuring that the IT infrastructure can handle the volume, variety, and velocity of the data and the complexity of the analytics.

Once they’ve laid the business objectives and building blocks groundwork, enterprises can develop their digital transformation analytics roadmap. In order to achieve the desired business outcomes from the analytics process, they need to embrace a structured, five-step iterative approach.

Getting this right is critical, and the stakes are high. The organizations that proactively embark on a data-driven digital transformation journey – i.e., every company– will gain a significant competitive advantage. Those that fall behind risk irrelevance.

For more information and insights on how to create a digital transformation analytics roadmap for your business, or to share what you’ve been able to achieve with your roadmap, please contact me at [email protected]

Everest Group’s 3rd Annual Service Provider of the Year™ Awards: Did Your IT Services Provider Win? | Sherpas in Blue Shirts

2017 was a seminal year for IT services. Digital adoption finally broke free from the shackles of marketing’s lip service and moved from “pilot” to “program.” The of role CIOs resurged as business stakeholders relied on them to deal with an ever-growing supply landscape and procurement conundrum to deal with new-age technology. And growth challenges appeared to have bottomed out for the two key industry verticals: BFSI (the largest) and Healthcare & Life Sciences (the fastest).

Hence, our 2018 Service Provider of the Year™ awards for IT services providers – our third edition – recognize companies that not only weathered a challenging year but reinvented themselves to chart out a new phase of growth for 2018 and beyond.

Our methodology

We select the IT Service Provider of the Year award winners based on the consolidated scores they achieve in the Star Performer, Leader, Major Contender, and Aspirant positions on our PEAK Matrix™ evaluations. In 2017, 67 service providers participated in 24 PEAK Matrix evaluations.

Awards categories

This year’s awards categories:

  • Leader boards
    • ITS Top 20: A list that recognizes the top 20 service providers
    • Top 10 Challengers: New this year, this list recognizes the top 10 service providers with annual revenue less than US$2 billion that increasingly position in the PEAK Matrix evaluation segments as challengers to the established leaders.
  • Individual awards
    • Leader of the year: Recognizes the service provider(s) with the maximum number of Leader positions
    • Star Performer of the year (overall): Recognizes service provider(s) with the maximum number of Star Performer positions.

We awarded these recognitions in the following areas:

  • Overall IT Services
  • Application Services
  • Digital Services
  • Cloud and Infrastructure Services
  • Banking, Financial Services, and Insurance
  • Healthcare and Life Sciences

Highlights of 2018 Service Provider of Year Awards

Here’s a look at the top five on the ITS Top 20 leader board:

PEAK SP of the Year

  • Accenture and TCS took the top two positions in the ITS Top 20
    • Accenture retained its top slot from 2017
    • TCS moved into second place, leapfrogging Cognizant and IBM
  • Accenture won Leader of the Year (overall)
  • TCS won Star Performer of the Year (overall)
  • And in the new Top 10 Challengers category, LTI and Virtusa snagged the top two positions.

Wondering if your IT services provider – or the firm you work for – received one of these coveted awards? See the complete list of winners.

Investments in Digital Pay Off for Retail Banks | Sherpas in Blue Shirts

Our banking analyst team just finished its evaluation of how the leading North American retail banks are doing in their efforts to create the best digital customer experience, and we want to share some highlights from this breakthrough research. This is our third year of assessing 30 of the largest retail banks. The premise for the research is to examine the new consumption context of financial services – where customers are demanding a SUPER (Secure, Ubiquitous, Personalized, Easy, Responsive) banking experience.

Our research assessed the functionality and pervasiveness of the banks’ consumer-facing digital interaction layer to help establish correlations with superior customer experiences, stronger customer engagement, and higher overall business growth.

Based on our research, nine U.S. banks (Ally Bank, Bank of America, Capital One, Chase, Citi, PNC, SunTrust, USAA Bank, and Wells Fargo) and two Canadian banks (CIBC and RBC) have been featured as “Digital Banking Pinnacle Enterprises™.” These banks demonstrated business results that stood above the rest:

  • Better growth – 3% higher growth in deposits
  • Better efficiency – 9% lower efficiency ratio
  • Better customer experience – 20% higher mobile application ratings

We have also recognized four retail banks as “Agile Performers,” as they made the greatest improvements in 2017. These banks include Ally Bank and Bank of America, both of which launched multiple initiatives to meet millennials’ customer experience expectations, such as virtual assistants for personalized experiences and voice-command enabled banking capabilities. USAA demonstrated best-in-class adoption of digital banking channels and maintained its frontrunner position in customer-centric innovation. USAA also joined the cryptocurrency world by adding the ability to display customers’ bitcoin balances. SunTrust made considerable investments into self-service technologies across its branch network and recorded strong growth in customer engagement on social media.

retail-banking-digital-pinnacle-banks

The retail banking industry will continue to make dramatic changes in the next few years. These shifts will require banks to have increased capabilities to deliver an enhanced customer experience whose key elements include:

  • A paradigm shift from the current “product” mindset to a “customer lifestyle” mindset to combine, package, and offer products/services from banking and allied businesses
  • Open banking and partner ecosystems leveraging APIs to integrate third-party services into the bank’s digital banking platforms
  • Collapsing the siloes across the front-, mid-, and back-office to create a frictionless front-to-back experience
  • Harmonized data repositories to enable a unified view of the customer
  • A technology operating model that embraces automation, AI, blockchain, and cloud to enable the needs of the “new business”

We believe the current Digital Banking Pinnacle Enterprises have created superior customer experiences because they deliberately invested in their digital capabilities. But the bar for success is constantly moving, as the industry continues to witness rapid and significant changes. Nonetheless, our data from the last three years establishes an increasing correlation between digital functionality and business outcomes. Banks that are able to quickly adopt a human-centered design thinking approach, build usable experiences, and create a culture of obsessive customer focus will be able to better differentiated experiences, achieve growth, create shareholder value, and ensure market relevance.

To read all of our research findings, see our report: Digital Effectiveness in Retail Banking | Pinnacle Model™ Assessment 2018: Journey of North American Banks to Build SUPER Experiences

Future Proofing Your IT Services Model | Executive Point of View

With the emergence of digitization, the Internet-of-Things, cloud, and other technology disruptors, IT’s role in and value proposition for the business units it supports have become integral to how competitiveness is established and maintained. Business that are incapable or unwilling to leverage the full power of the technology advances or resist adapting to the new business models that are being enabled, will, in relatively short order, become laggards in their industry and, in some cases, cease to remain in business.

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Everest Group’s New IT Service Provider of the Year Awards 2016 | Sherpas in Blue Shirts

Everest Group is proud to release the first edition of its annual PEAK Matrix Service Provider of the Year™ awards for IT Services 2016.

Before you turn a blind eye to another set of service provider awards in a market already flooded with matrices, quadrants, and other such convoluted shapes…these are special recognitions of a small handful of providers that are unique stand-outs.

2015 was a seminal year for our IT services PEAK Matrix™ evaluation program. Under the aegis of four key ITS practices – Banking, Financial Services & Insurance (BFSI), Healthcare & Life Sciences (HLS), Application & Digital Services (ADS), and Cloud & Infrastructure Services (CIS) – we published a whopping 26 PEAK Matrix evaluations, featuring double click views on capabilities and market success across practice sub-segments.

While we appropriately recognized performance in individual segments, what started to unravel was a picture of consistency by a few service providers that was hard for us to ignore. Hence, while there indeed are Leaders and Star Performers for each of the segments we evaluated, the composite picture clearly shows that some deliver consistent leadership and top performance across many different categories.

As today’s enterprises navigate the complex landscape of next-generation and legacy technology, a global business footprint, and a complex vendor portfolio, the PEAK Matrix Service Provider of the Year awards will help them to identify the best of the best – service providers with strong broad-based capabilities and successful service strategies that align well with the evolving enterprise IT demand.

The award categories are:

  • ITS Top 20: We arrived at this list using a consolidated score reflecting points received on individual evaluations based on tiered scores for Star Performer, Leader, Major Contender, and Aspirant positions.
  • Individual awards categories: These awards are based on the count of Leader or Star Performer positions across the category evaluated
    • Leader Of The Year
      • IT Services (Overall)
      • HLS
      • BFSI
      • ADS
      • CIS
    • Star Performer Of The Year
      • IT Services (Overall)
      • HLS
      • BFSI

Here’s a PEAK peek at the top five on the ITS Top 20 leader board.

Top_5_PM_SP_oftheyear_award_2016

 

See the complete list of winners.

Have you had experience with one or more of these providers? Our readers would love to hear your views about them!

Why Mess with a Good Thing: Recalibrating Our PEAK Matrix Assessment Methodology | Sherpas in Blue Shirts

We regularly make small adjustments to our PEAK Matrix™ assessment methodology – minor tweaks to fine-tune our approach to align with market evolution. This year, however, we have decided to undertake a more comprehensive modification to the assessment.

Why mess with a good thing? To make it even better and more relevant. In particular, we’re making changes to keep pace with the rapid evolution of IT and business process services, particularly as innovation, intellectual property (IP), digital, and technology-driven solutions take center stage in the delivery of these services.

While our fundamental principle of using a fact-based assessment remains core to our methodology, we are enhancing our PEAK Matrix assessment methodology in three principle areas.

  1. Maximize IP and innovation. We are recognizing the rising value of IP and innovation in global services by significantly increasing the weighting assigned to them. Of course, IP and innovation have always been a part of the PEAK Matrix Assessment, but their status will rise in the assessment, as has their significance in the global services market.
  2. Eliminate FTE count. At the same time, we are eliminating FTE count as an assessment dimension altogether. As technology increasingly fills the roles FTEs had managed in the past – at lower cost and often better outcomes – the size of a provider’s delivery talent pool has become irrelevant.
  3. Minimize scale. The provider’s overall scale – a combination of financial strength and focus on the service area being assessed – will remain as part of the assessment, but will decline in importance in the evaluation, making room for innovation to take on a larger role.

Together, we believe these changes assure that our assessment framework continues to be aligned with the emerging and future direction of the global services market.

We expect these changes to have a couple of implications for service providers. First, those providers that bring innovative programs to their clients will be recognized for their efforts – and expense. Furthermore, overall scale will have less impact on the providers’ ratings, assuming they demonstrate high levels of innovation and good business outcomes.

The recipients of these services, the enterprise buyer, will have a much clearer view of each provider’s ability to deliver innovation and outcome-oriented solutions. And they will gain insights that will help them better understand how service providers’ capabilities align with future objectives.

As the dynamic global services industry evolves, we will continue to make adjustments to our PEAK Matrix assessment methodology – some minor, some major – to ensure that it retains its universal relevance and value.

Because sometimes messing with a good thing is a good thing.

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