Category: Blog

Future-proofing Insurance: Embracing Sustainability in Insurance for a Resilient Future | Blog

Sustainability in insurance transcends traditional practices, weaving Environmental, Social, and Governance (ESG) elements into the core of day-to-day operations, thereby safeguarding the future of stakeholders and the planet. In this evolving industry, embracing sustainability is no longer optional but essential for mitigating climate risks, meeting regulatory demands, and ensuring long-term value in a world facing complex environmental and social challenges.

The shift toward sustainability in insurance

Sustainability is becoming increasingly critical in the insurance sector due to the escalating unpredictability of losses driven by climate change, economic instability, and social inequalities. As per a report by the National Oceanic and Atmospheric Administration (NOAA), in 2023 alone, the United States witnessed 25 climate-related disasters that each resulted in damages exceeding US$1 billion, nearly doubling the annual average from the previous five years and leading to 464 fatalities. Such extreme weather events, occurring in regions where they were previously uncommon, are compelling insurers to acknowledge their responsibility in environmental protection. Additionally, shifts in consumer behavior are influencing the move towards sustainable practices. A growing number of consumers, about 25%, are now willing to pay a premium for environmentally friendly products, such as electric vehicles and sustainably sourced clothing, expecting that the companies they patronize uphold similar ethical standards.

Regulatory changes are also pushing the insurance industry towards greater transparency and sustainability. In the first half of 2023, there were over 1,715 adjustments to the US state insurance regulations, many of which address climate issues. A notable example is the California Climate Risk Disclosure Survey, which requires insurers to disclose how they are managing climate-related risks. Moreover, entities such as the Securities and Exchange Commission (SEC) are preparing to enforce new mandates requiring climate risk disclosures, potentially impacting publicly traded insurance firms that do not proactively address climate change.

As a result, insurers have started developing and offering new products across personal, commercial, and specialty lines. In personal lines, companies have begun offering green property insurance, which covers eco-friendly materials and energy-efficient upgrades following a loss, as well as discounts for hybrid or electric vehicle owners to encourage sustainable transportation choices. In commercial lines, insurers in geographies like the US and EU now provide insurance for renewable energy projects and green building coverage, helping businesses transition to sustainable practices. These include coverage for renewable energy equipment, green construction materials, and tools to manage climate-related risks. Specialty lines see innovations driven by InsurTech, such as parametric insurance for climate risks and the use of IoT devices for real-time environmental monitoring, enhancing risk mitigation and encouraging eco-friendly behaviors.

Sustainable insurance in action

Insurers integrating sustainable practices into their value chains include:

  • AXA (2015), launching the AXA Climate School to educate clients on climate risks, enhancing client trust and risk management
  • Zurich Insurance Group (2017), initiating the Zurich Forest Project for reforestation, boosting their brand reputation and environmental impact
  • Allianz (2018), incorporating ESG factors into underwriting and investments, improving investment resilience and attracting ESG-conscious clients
  • Swiss Re (2019), ceasing re/insurance for the most carbon-intensive oil and gas companies, aligning with climate goals and reducing exposure to high-risk industries
  • Aviva (2020), setting a net-zero carbon target by 2040, enhancing long-term sustainability and appealing to eco-friendly investors
  • Munich Re (2021), investing in green bonds and applying ESG criteria to their investment portfolio, supporting sustainable projects and strengthening their market position in the green economy

Currently, while the integration of sustainability into corporate strategies is becoming crucial for many firms, the actual implementation of these strategies in a tangible way remains a very early stage for many companies. According to a global survey, 25% of insurers identified “grasping ESG-related regulations and guidelines” as their primary challenge in advancing their ESG initiatives. This was followed by 17% who cited “determining the most effective actions to take on ESG” as a key hurdle and 15% who pointed to “aligning ESG efforts with customer expectations” as a significant concern.

Challenges in implementing sustainable insurance

Besides the difficulties of managing risks in a world altered by climate change, the insurance sector also contends with issues arising from regulatory, operational, and market-related complexities.

  1. Regulatory uncertainty – Insurers need to navigate a complex web of local and international ESG-related regulations that can vary significantly from one jurisdiction to another. The lack of standardized regulatory frameworks makes it difficult for global insurance companies to implement uniform strategies across all markets. This regulatory complexity requires insurers to invest heavily in legal expertise and compliance functions to ensure they meet all applicable guidelines
  2. Lack of standardized metrics and data deficiency – The insurance industry relies heavily on accurate data to assess risks and set premiums. However, there is currently no universally accepted methodology for quantifying ESG risks, which complicates the integration of sustainability into traditional risk models. This lack of standardized data not only hinders the assessment and pricing of risks but also makes it difficult to track progress and measure the impact of sustainability initiatives
  3. Liability risks – One of the significant challenges for insurers in implementing sustainability is managing liability risks stemming from compensation claims related to climate change damages. As climate change increases the frequency and severity of extreme weather events, the potential for substantial claims also rises, impacting the liability side of insurers’ balance sheets. Additionally, there is an increased risk of litigation, with insurers potentially facing legal challenges for failing to manage or disclose climate-related risks adequately
  4. Affordability and availability of coverage – Affordability and availability of coverage pose significant challenges in implementing sustainability in the insurance industry. As climate change leads to more frequent and severe natural disasters, insurance costs rise, making coverage less affordable. High-risk areas, such as flood or hurricane-prone regions, for example, face higher premiums or loss of coverage, leaving communities vulnerable. This not only affects individual policyholders but also has broader economic implications, leading to underinsurance or no insurance in these zones
  5. Aligning sustainability with market and customer expectations – Insurers must balance the need to implement sustainable practices with the need to remain competitive and meet the expectations of their clients. This involves developing new insurance products and services that not only comply with ESG standards but also appeal to a market that is increasingly sensitive to sustainability issues

Shaping tomorrow’s insurance industry

In the insurance sector, several unpredictable developments stand out, including emerging risks such as an aging population, climate change, and cyber threats, along with the rise of the sharing economy affecting freelancer, auto, and home insurance markets and the integration of technology in the smart economy. Social factors, such as evolving consumer expectations for corporate responsibility and equitable services, also play a crucial role, as do governance issues like regulatory changes and corporate transparency. While accurately forecasting the future remains a challenge, identifying catalysts for market changes is possible. By combining historical data with industry insights, we can use a specifically designed model to construct various future scenarios. These scenarios illustrate potential outcomes and opportunities driven by key trends in environmental, social, and governance (ESG) aspects under different conditions [Exhibit 1]. With this approach, we can strategize effectively, choosing paths that optimize financial gains, enhance social impact, or minimize risks.

Slide1 1

Driving sustainability in insurance is not just about compliance with regulatory changes and risk management; it also involves capitalizing on new opportunities and fostering a more sustainable, resilient world. As financial intermediaries and risk managers, insurers have a unique ability to drive and support sustainable practices across different industries and communities. The following strategic key objectives present a structured approach for insurance companies to embed sustainability into each stage of their value chain, along with key performance metrics to align with broader societal goals [Exhibit 2].


By embedding sustainability into its core identity and fostering innovation, the insurance industry can go beyond managing risks to actively stewarding the planet and its people. This transformation will not only reshape the industry but also significantly contribute to a sustainable, resilient, and equitable global future.

To discuss more on the importance of sustainability in the insurance space, please reach out to Debasruti Mitra at [email protected] and [email protected]  and stay updated by accessing Everest Group’s latest research on Insurance Business Processes.

Watch the webinar, What’s Next in Financial Services? Driving Transformation Through Sourcing, Technology, and Operations, to learn how the banking, financial services, and insurance (BFSI) industry is driving business transformation in response to evolving customer needs and the rapid adoption of AI and cloud technologies.

When Will Quantum Computers Affect Your Competitive Landscape? | Blog

One of the questions enterprise CIOs ask us at Everest Group is how they can anticipate when quantum computers will impact their competitive capabilities. Quantum computers have the ability to perform complex calculations at unprecedented speeds. Thus, they will transform areas such as data encryption, network optimization, and artificial intelligence and will enable the offering of new services. As such, they cannot be ignored. But how soon will this happen? This blog discusses the current development progression of this beneficial yet disruptive technology.

Read more in my blog on Forbes

Why Your Employer Brand Matters: Key Insights from Top GBS and Tech Talent Reports | Blog

Amid economic challenges and a cautious business outlook, maintaining a positive brand image is not just important – it’s vital. Specialized skills are more critical than ever, making the attraction and retention of top talent a key objective for organizations. Exceptional talent is the golden ticket, and GBS and tech employers must revamp their approach to building, maintaining, and strengthening their employer brand in local markets. But let’s face it, it is easier said than done.

What the latest research reveals

In its third iteration, Everest Group Top Employers research dives deep into the employer brand perception of over 380 leading GBS employers across India, the Philippines, and Poland and over 430 leading tech employers across India, the US, and the UK. This study isn’t just about ratings – it’s a mirror showing how prospective employees view you across critical dimensions like compensation, work environment, work-life balance, culture, leadership, career development, and diversity. Both reports reflect employee and candidate sentiment, offering a raw, unfiltered view based on publicly available information. We continue to track this market and refresh this assessment annually.

Want to know how you stack up against the competition? This is your blueprint.

The cold, hard truths

  • Brand perception is on a downward spiral: Since 2022, employer brand perception for both GBS and tech employers has plummeted. GBS perception fell by 3% in India and the Philippines. For tech employers, brand perception dropped by 2% in India, 5% in the US, and a staggering 10% in the UK. These figures aren’t just stats—they’re a wake-up call. Brand perception is volatile, and if you’re not constantly investing in your EVP, you’re falling behind
  • Volatility is the new norm: Employer brand perception is as stable as a house of cards. Last year’s top employers have faded – 40-45% of top employers have fallen from grace
  • Career development is a dealbreaker: A lack of investment in career development and upskilling is a major turn-off for employees. GBS ratings in this area have dropped by 7% YoY in India and the Philippines. For tech employers, the drop is even more pronounced, with ratings falling by 8-12%, especially in the UK. This is a clear signal: employees want growth opportunities, and if you’re not providing them, they’ll look elsewhere

Busting the myths

  • Big doesn’t mean better: Think your size will save you? Think again. Some of the largest GBS entities are getting slammed with negative feedback. Size isn’t the silver bullet
  • Old isn’t gold: Longevity doesn’t guarantee success. Many companies hit their peak brand perception in the first three years and then decline. Don’t rest on your laurels
  • Location, location, location: Headquarters matter. North American-headquartered GBS fare better in India and the Philippines, while European-headquartered GBS do better in Poland

The outside-in advantage

Here’s the kicker – understanding and leveraging outside-in brand perception might just be your secret weapon. This perspective offers invaluable insights into how prospective employees see you.

  • Validate and identify gaps in your internal pulse surveys by comparing them with your external branding strategy. See what’s working and what isn’t
  • Align your internal strategies with these external perceptions, and you’re on your way to attracting and retaining top talent
  • Leverage this independent outside-in assessment to supercharge your branding initiatives

Making it actionable

So, what can you do? Here are some actionable insights:

  • Invest in EVP: Constantly evolve your Employee Value Proposition. It’s a moving target and requires continuous effort
  • Enhance the work environment: Create a workplace that people want to be a part of. Invest in a positive work culture and flexible work policies
  • Competitive compensation: Make sure your pay and benefits are at least on par with your competition. Don’t give talent a reason to look elsewhere
  • Prioritize career development: Offer clear paths for growth and upskilling opportunities. Show your employees you’re invested in their future
  • Embrace diversity and inclusion: Foster an inclusive environment. It’s not just about ticking boxes – it’s about creating a culture where everyone feels valued
  • Stay agile: Keep your finger on the pulse of employee sentiment and be ready to adapt quickly. Brand perception is volatile, and complacency is your enemy

Conclusion: embrace outside-in brand perception

As the battle for top talent heats up, the importance of a strong employer brand can’t be overstated. The insights from the “Top GBS Employers” and “Top Employers for Tech Talent” reports highlight the need for a comprehensive, multifaceted approach to building and maintaining a positive brand image. Focus on continuous improvement in key areas, understand and leverage the connection between local and global brand perception, and be ready to adapt. The ability to respond to changing perceptions will be crucial for sustaining a strong employer brand in the dynamic global market.

In the end, the quest for top talent is relentless. But with the right strategies, you can turn the tide in your favor. Are you ready to step up your game?

See the reports

The Top GBS Employers™ in India, The Philippines, and Poland

The Top Employers for Tech Talent™ in India, the US, and the UK

Sustainability in Retail and CPG: A Reactive Approach Will No Longer Work | Blog

With increasing customer preferences for environmentally friendly products and evolving government regulations, retail and consumer packaged goods (RCPG) enterprises are being compelled to embrace sustainable practices. Read on to learn how they are actively engaging with the rapidly evolving sustainability technology ecosystem to expedite their ESG journeys.

Contact us to speak to an analyst on this topic.

Sustainability has long been a pivotal issue, but changing consumer behavior, a shifting regulatory landscape, and escalating climate change impacts have intensified pressure on industries to address their Environmental, Social, and Governance (ESG) footprint. Our recent research revealed that:

79% of consumers are willing to switch brands based on their environmental and social practices.

5% of revenue is the cost of waste and waste disposal on average for retailers and CPG companies.

Companies with consistently high ESG performance tended to score more than 2x on total shareholder return than those with medium ESG performance.

The retail consumer packaged goods (RCPG) industry is now more committed than ever to sustainable practices, recognizing the urgency of integrating sustainability in retail and CPG operations. This involves mitigating climate risks, enhancing long-term resilience, and contributing to a sustainable future through technological investments, product innovation, supply chain optimization, and transparent disclosures. Many firms have embarked on the journey to become purpose-driven organizations, embedding sustainability into their core business strategies.

From our analysis, the following key areas emerge:

  1. ESG data management: Centralized systems for collecting and analyzing ESG data help companies track their sustainability performance and identify areas for improvement. These systems enhance operational efficiency by automating data collection and reporting processes.

For instance, Walmart leverages an ESG data management system to track and report its sustainability performance, focusing on monitoring energy consumption, carbon emissions, and waste management

  1. Supply chain traceability: Advanced technologies like blockchain and IoT enable companies to monitor their supply chains in real-time, ensuring transparency and accountability from source to shelf. This helps in managing ethical sourcing and reducing the risk of supply chain disruptions.

For instance, Nestlé uses blockchain technology to track milk and palm oil supply chains, ensuring sustainable and ethical sourcing while providing transparency from origin to the final product

  1. Climate risk analytics: Predictive analytics tools assess the impact of climate change on business operations, enabling companies to proactively mitigate risks. These tools support scenario planning and help attract investment by demonstrating a commitment to managing environmental risks.

For instance, PepsiCo uses predictive analytics tools to evaluate the impact of climate change on agricultural supply chains. This allows the company to develop strategies to mitigate risks related to crop yields and water availability, ensuring long-term sustainability

  1. Circular economy practices: Embracing circular economy principles, such as using recycled materials and designing products for longevity, helps reduce waste and resource consumption.

For instance, SHEIN has launched a new apparel collection made from “deadstock,” the excess, unsold, and leftover fabric inventory that is typically discarded by fashion brands. SHEIN is utilizing Queen of Raw’s proprietary software, Materia MX, to source existing materials from brands and retailers looking to responsibly clear out their excess fabric inventory rather than have it go to waste in landfills

  1. Sustainable Consumer Experience: Digital labels and QR codes provide consumers with detailed information about the sustainability attributes of products, enhancing transparency and building brand loyalty.

For instance, Patagonia uses QR codes to provide customers with detailed information about product sustainability, enhancing consumer trust and reducing the need for single-use tags, thereby promoting a more sustainable consumer experience

  1. Waste minimization: Advanced inventory management systems and IoT sensors help companies monitor stock levels in real time, reducing waste from overstocking and spoilage.

For instance, Tesco uses IoT technology for real-time inventory tracking, reducing waste from overstocking and spoilage, enhancing sustainability by ensuring products are sold before expiration

A framework to guide RCPG enterprises in their sustainable business model transformation journey

As enterprises navigate the transformation to derive more value from their sustainability investments, The Everest Group framework for guiding Retail Consumer Packaged Goods (RCPG) enterprises in sustainable business model transformation involves four key steps: Commit, Define, Invest, and Sustain. This approach provides a structured path to integrating sustainability into core business strategies.

sustainability blog


The outlook for sustainability in retail and CPG

Consumer demand for sustainable products continues to rise as awareness of environmental impacts grows. This drives innovation and investment in sustainable practices, resulting in new products and business models that prioritize sustainability. Companies that embrace these changes will build stronger, more resilient brands. Ultimately, successful companies will be those that integrate sustainability into their core strategies, ensuring every aspect of their operations is environmentally mindful. This approach not only contributes to a healthier planet but also creates value for stakeholders and ensures long-term success in an increasingly eco-conscious marketplace. By embedding sustainability into their business models and leveraging advanced technologies, retail, and CPG companies can achieve environmental goals while driving growth and profitability.

Everest Group will continue to follow the evolution in this space. To discuss sustainability in retail and the CPG industry, please reach out to Abhishek Mundra, [email protected], Ambika Kini, [email protected], and Shraddha Pandey, [email protected].

Cloud ERP Wars: Is Infor Adoption Reaching the Tipping Point? | Blog

As enterprises turn to industry-specific ERP solutions, Infor’s growing presence in the Cloud ERP market is becoming more prominent. This blog explores Infor’s strengths and challenges as it aims to compete with traditional ERPs. Reach out to us to discuss further.

In recent interactions with enterprises regarding their ERP investments, it has become evident that there is a growing preference for industry-specific ERP that can bridge the gap between traditional ERP and core business systems. While traditional ERPs such as SAP, Oracle, and Dynamics cater to broader enterprise objectives, industry-specific ERPs are tailored for specific industries, offering specialized functionality, seamless integration, and industry-focused approaches that shape their offerings.

Industry-specific ERPs offer several advantages over traditional counterparts, including industry-specific features, cost efficiency, smooth integration, rapid implementation, enhanced user experience, comprehensive data insights, and adaptability to dynamic market conditions.

One prominent player in this landscape is Infor, a platform we have closely observed. In a previous blog from February 2020 titled “Koch Industries’ Takeover of Infor Signals Key Bet on Cloud ERP Market | Blog,” we delved into the reasons behind Infor’s acquisition and its implications for the Cloud ERP sector.

Infor’s financial performance is notable, boasting approximately US$3.5 billion in total revenue and around US$1.2 billion in SaaS revenue. The platform has achieved remarkable growth of around 20% over the past few years.

There are several key factors contributing to Infor’s success:

  • Deep industry-specificity: Infor’s primary strength lies in its strong focus on industry-tailored offerings, especially for manufacturing, healthcare, retail, and the public sector. Infor’s commitment to industry-specificity is evident from its investment in restructuring its internal organization around focus industries
  • Increasing global presence and partnerships: With operations spanning over 45 countries and a workforce of over 19,000, Infor’s global presence is substantial. Its extensive partnership network encompasses resellers, alliance partners, product partners, service partners, and support partners, featuring prominent names such as Accenture, HCLTech, Deloitte, Wipro, and TCS, as well as specialized partners such as Grant Thornton and Advoco
  • Cloud adaptability: While initially an on-premises ERP, Infor has effectively evolved its cloud capabilities over time. Its leadership in cloud adoption within the industry-specific ERP segment has been recognized, attributed in part to strategic collaborations with AWS for accelerated cloud deployment and innovation. Additionally, Infor’s unique approach to building three separate public cloud solutions, each designed to support a limited number of industries, helps it keep its solution compact, agile, and relevant.

While all the above key factors are driving Infor’s growth, there are some areas that enterprises need to be aware of while assessing Infor as their ERP of choice –

  • AI and gen AI capabilities: Technology is constantly evolving, and expectations for all platform functionality to have AI and gen AI embedded are also picking up. While Infor offers some capabilities, competitors such as Microsoft, Oracle, and SAP are making significant investments in this area. Enterprises may need to evaluate AI and related technologies closely relevant to their needs
  • Enterprise feedback: Some enterprises have raised concerns about Infor’s reporting tools, customer support, and the complexity of integrating with other systems. Enterprises must be aware of such concerns before starting their ERP implementation journey
  • Heavy customization needs: Infor’s strength lies in its industry-specific solutions, but this focus might not be ideal for companies that require extensive customization of their ERP system

The implications for both enterprises and service providers are noteworthy. While Infor’s platform primarily catered to SMBs, there is an observable shift towards larger deals and expanded market share, especially in comparison to traditional ERPs. Enterprises are becoming discerning in their ERP choices, exploring alternatives beyond conventional options to maximize value from their investments. Moreover, Infor is gaining traction even among larger corporations, as exemplified by companies such as Pfizer, Electrolux, Lenovo, GAP, and Jaguar. Instances have emerged where Infor’s solutions have been adopted to replace or supplement traditional ERPs. Recent examples include Riedel, SEG Automotive, Delta Plus, and Saudi Lime.

The adoption of cloud in manufacturing and related industries has hit the tipping point where we see accelerated adoption of cloud, whether this enables Infor to hit its tipping point is a story that is yet to unfold. As Infor scales up to become relevant for large and very large enterprise segments, it needs to address challenges around integration and business value realization from the ERP investments. At the same time, they would also need to get the mindshare of a partner network for them to scale up the talent needed for Infor implementation. Few providers have already started scaling their Infor practice; however, that may not be sufficient.

Watch this space for additional blogs on how the key niche ERP players are evolving with time, key considerations for enterprises and service providers, and what this means for traditional ERPs.

What has been your experience with Infor? Please feel free to write to us at [email protected] and [email protected].

From Chaos to Harmony: The Transformative Role of Supply Chain Orchestration | Blog

Navigating the complexities of global supply chains has become increasingly challenging due to recent disruptions and evolving customer . Read on to discover how supply chain orchestration helps enable operational efficiency, resilience, and adaptability to thrive amid continuous changes and pressures.

In the intricate world of global business, supply chains serve as the backbone, ensuring products seamlessly move from factories to customers, keeping commerce fluid and consumers satisfied. However, in recent times of uncertainty, maintaining this is becoming increasingly difficult, putting supply chains under more pressure than ever. Effective supply chain management is no longer only about operational efficiencies, it is also about the ability to anticipate, adapt, and thrive amidst disruptions.

Challenges facing modern supply chains

The past few years have been tumultuous for supply chains, affected by the pandemic, geopolitical tensions, macroeconomic uncertainties, labor shortages, and disruptions in maritime trade. Incidents like the tensions in the Red Sea and attacks on pipelines and cables in the Baltic and North Seas have also underscored the fragility of these networks, creating ripples and shocks across the supply chains. Compounding these environmental challenges are additional hurdles, such as limited real-time visibility and evolving customer demands, such as the rise of omnichannel distribution, real-time order status updates, and requirements for same-day or next-day delivery. Furthermore, the use of disparate management systems across processes hampers the ability to capture and transfer real-time data effectively, and organizing, processing, and managing internal and external data remains inefficient due to limited interoperability caused by differing operating and design standards.

The current state of supply chains

Modern supply chains are uniquely complex and multi-faceted, more so than many other enterprise functions. Unlike functions such as Finance & Accounting (F&A) or Customer Experience Management, supply chain operations involve a higher number of decision-makers. Supply chain operations are often overseen by a range of C-suite executives and senior leaders, including Chief Procurement Officer (CPO), Chief Operating Officer (COO), Chief Supply Chain Officer (CSCO), Chief Information Officer (CIO), and Chief Sustainability Officer (CSO), often with distinct and sometimes conflicting priorities. The varied goals of these stakeholders can often lead to fragmented decision-making and operations. For example, a CPO’s focus on minimizing costs may clash with a COO’s priority for agility or a Chief Sustainability Officer’s push for environmentally friendly practices. This misalignment creates operational silos, where different parts of the supply chain work in isolation rather than as a cohesive unit. Additionally, the provider landscape in supply chain management reflects this fragmentation. Providers often tailor their solutions to meet the needs of one or a few stakeholder groups, leading to a segmented approach that exacerbates the issue of silos.

The result of this fragmented approach is a series of data silos, disconnected processes, and isolated systems across various supply chain functions—planning, inventory management, procurement, and logistics.

  • Fragmented data: Without integrated data systems, supply chain leaders struggle to obtain a holistic view of operations, making it difficult to align inventory levels with real-time demand
  • Fragmented processes: Disjointed operations can slow down order processing and fulfillment, impacting customer satisfaction and leading to lost sales opportunities
  • Fragmented systems: When technology systems across the supply chain don’t communicate effectively, it can result in inefficiencies and increased operational costs

These fragmentations significantly impede visibility and the ability to make informed, timely decisions and cause missed opportunities. To overcome these challenges and transform their supply chains into agile, resilient networks, organizations must seek integrated, holistic solutions that foster collaboration and seamless operation across all functions and stakeholders.

Emerging as a solution: supply chain orchestration

C-suite executives are turning to supply chain orchestration to address these challenges and build resilient, agile supply chains.

From Chaos to Harmony The Transformative Role of Supply Chain

Supply chain orchestration is the comprehensive coordination and synchronization of all activities and processes involved in the supply chain—from planning to logistics and after-sales services.

It involves integrating and harmonizing various functions, systems, and stakeholders to ensure a seamless flow of information and real-time visibility. It comprises three core components:

Data orchestration

This involves aggregating data from all internal and external sources into a unified data lake, followed by rigorous cleaning, refining, and making the data usable across functions. Multiple teams can then leverage the data for predictive and prescriptive analytics, real-time visibility, and data-driven decision-making.

Technology orchestration

Connecting various supply chain platforms and software, such as planning software, manufacturing execution systems, Order Management Systems (OMS), Transport Management Systems (TMS), Warehouse Management Systems (WMS), Returns Management Systems (RMS), and others, through APIs or integration software ensures real-time data flow and information exchange.

People/Service orchestration:

This component focuses on aligning organizational structures and processes across functions, promoting a unified approach to supply chain management. It also encourages collective planning and decision-making, reducing fragmented communication with external and internal stakeholders.

What’s ahead

Supply chain orchestration, although still evolving, represents a forward-thinking goal for both mature and emerging organizations. Achieving end-to-end orchestration requires significant investments in time, effort, and resources. The path forward involves a phased approach.

Organizations can begin by orchestrating data, focusing on integration, cleansing, and harmonization across all supply chain functions. This foundational step establishes the groundwork for integrating technology systems to ensure seamless information flow across different systems. Subsequently, aligning organizational processes to foster seamless communication and collaboration among departments and stakeholders becomes essential. Additionally, organizational structures, including appropriate governance, change management, and stakeholder alignment, are crucial to enable the holistic orchestration of supply chains across data, technology, and people.

Ultimately, this phased approach sets the stage for comprehensive supply chain orchestration, allowing companies to adapt swiftly to market changes, mitigate risks, and capitalize on growth opportunities in today’s dynamic global landscape.

Discover more about how to navigate the evolving supply chain landscape in the webinar, Innovating End-to-End Supply Chain Orchestration.

Changing of the Guard | Blog

The other day I was speaking to my good friend Cara Herrick of ServiceNow, bemoaning the fact that when I go to a GBS industry event, increasingly the leaders are sufficiently young enough to be my children—just like her. The discussion prompted me to go beyond their age and tenure, trying to unpack the difference between their GBS leadership approach and those of my age cohort who are moving onto the 4 G’s—grey hair, golf, grenache, and grandchildren at increasing rates.

Now, I must confess that, as a baby boomer, I’m not always au fait with how my younger peers work. I’ve never figured out work-life balance; I prefer picking up the phone; I like writing emails and penning monthly articles such as this one—and I struggle with Slack, podcasts, wearing iPods, and 25-minute Teams meetings.

But I’m increasingly working with GBS leaders who were born after IBM released the first personal computer or even when the Berlin Wall fell, forcing me to figure how these folks tick, and what it means for the future of GBS. No doubt about it, they are a different breed—now more likely to come to the role either as a loyalist—from another enterprise function—or as a step-up leader from a shared services or smaller GBS organization.

Looking at these next-gen leaders, does any of what I am seeing resonate?

  • Less flash and splash: Next-gen leaders are focused on getting their GBS houses in order and all their internal ducks in a row rather than looking for industry glory. When do they have a story to tell, they often need cajoling to take a conference podium, preferring venues that allow them to share practices and explore ideas rather than play rock star.
  • Tightly aligned with the enterprise agenda rather than to GBS orthodoxy: I see our younger leaders really focused on their enterprise agendas rather than being seen as external vanguards of a GBS movement as their predecessors did. These folks don’t swallow the GBS common wisdom hook, line, and sinker. While they actively look at industry trends and best practices, imposing GBS best practices as a North Star is not in their DNA. They pick and choose, mindful of what will drive effective change, and eschew the rest of the usual playbook.
  • Penchant for action: These leaders do not act sequentially, first thinking through a transformation blueprint. Rather, they come up with a thesis, then continually test and learn to drive change. Operations becomes a transformation lab rather than an implementation, driving operations with transformative actions rather than making change sequentially. They are sufficiently agile and flexible to pivot quickly.
  • IT, their new best friend: Fewer millennial leaders are fighting battles royal with their IT counterparts as their forebears often did. The imperative to go digital, partner in an S4Hana implementation, and figure out AI use cases is forcing a more collaborative co-existence—and increasingly new reporting lines to IT. Under their stewardship, the dialog is combative and fraught with fights over who’s the boss.
  • Unrelenting incrementalists: More often than previously, our new leaders come into GBS roles as loyalists, having had success in another enterprise position. They take the helm with effective working relationships with their stakeholders and know which change levers to pull when. Adeptness at forming coalition is a hallmark of their leadership. Consequently, they exhibit far less of the “savior syndrome.”
  • Less tribal: Let’s be honest; our more mature GBSs have been staffed by keeping the tribe together; when an expert leader moves, they are more often than not bringing at least one member, if not the entire tribe, along with them. Next-gen leaders have become adept at blending the DNA of their organizations, with less dependence on their friends.
  • More tech conversant, if not savvy: It seems to me that they don’t jump as quickly to the trifecta solution of people, process, and cheaper location as their GBS forebearers did (and are still doing) without first looking through the lens of digitization. They know what they are buying and are often more fluent in the features and functionality of their tools than the salespeople knocking at their doors. Last, they expect their workplaces—and GBS to have up-to-date tools and platforms, and are willing aggressively to fight for them.
  • Fixated on talent and structure: Having the right capabilities on their teams is priority one for these leaders. They tend to think about their organizations as an orchestration of capability rather than a hierarchy, embracing structures that are flat, moving talent into roles laterally as a cross-training exercise, and compelling double hatting responsibilities. And, because their management prowess was honed during the pandemic, they aren’t afraid of appointing a truly global leadership team.
  • Transparent: No black box for many of these folks; governance is as much about keeping their stakeholders informed as it is managing performance, risk, and compliance. They’ll more easily discuss their challenges and set realistic expectations as opposed to glossing over them.
  • Adept at forming critical coalitions: Collaborating internally is a priority for these next-gen leaders. They pick their battles when driving change and looking to increase scope, pairing up CXOs and peers that share and support key elements of the GBS imperative (note that I don’t use the term “vision”).
  • Less dependent on outside help: These folks are sufficiently confident and fluent in GBS operations to keep their own counsel. When a big name is “transforming” their operation, it’s more likely a decision in response to a major corporate change or made by a CXO than by themselves. When they do hire outside consultants, it’s likely due to a) a need for arms and legs; b) a request for strategy validation; or c) a discrete project. They are also less fussed about consulting brand names; they will fight procurement to hire small boutiques, one-man shop advisors, and interims to help move the dial.

So, if you are coming away thinking that I’m dismissing the old guard, nothing could be further from the truth. Today’s GBS leaders have career advantages that those of us around at the advent of the model never had; they don’t have to spend the same amount of evangelizing, fighting, and figuring out what good should look like. The model is accepted, career potential is acknowledged, and we have practices and precedents on which to build.

I’m optimistic that this next generation of leadership will force a radical rethink of the GBS model, about five years overdue to my mind. Perhaps we will be less fussed about GBS orthodoxy, creating new operating models where control and ownership are no longer the main imperative. Perhaps we’ll move a little bit closer to harnessing the promise of technology. Perhaps GBS will become an enterprise state of mind rather than a service organization, delivering value beyond cost.

New guard, I’m counting on you.

Emerging Risk and Compliance (R&C) Outsourcing Needs | Blog

In the dynamic landscape of banking, financial services, and insurance (BFSI), risk and compliance (R&C) functions have become critical. Read on to explore the growing trend of outsourcing R&C processes, including the strategic advantages, regulatory considerations, and the role of specialized service providers in bolstering operational efficiency and compliance resilience amid evolving industry dynamics. Reach out to us to discuss further.

Risk and compliance (R&C) functions may not directly generate revenue, but they are crucial for the effective execution of business strategies and ongoing operations of banking, financial services, and insurance (BFSI) enterprises. Conventionally, R&C only receive attention when something goes wrong, like regulatory enforcement. It’s time to adopt a proactive and strategic approach.

Recently, there have been rising volumes for processes related to R&C, putting significant pressure on in-house compliance teams of BFSI enterprises, as the cost of failing to meet R&C mandates is extremely high. For example, Binance faced a US$4.3 billion penalty in 2023 due to lapses in anti-money laundering program. Similarly, in 2024 HSBC has been fined £57.4 million for customer deposit protection failings.

So, what’s the solution? While some BFSI enterprises, due to regulatory requirements or other sensitivities, must keep all compliance activities in-house, for others, outsourcing part or all of their compliance functions is a viable alternative. This shift not only addresses immediate pressures but also positions BFSI enterprises for future resilience and competitiveness.

The catch? Regulatory guidance emphasizes that even when compliance activities are outsourced, the company retains accountability for meeting its regulatory obligations. Hence, the need to have a thorough decisioning strategy when it comes to risk and compliance outsourcing.

Traditionally, R&C outsourcing in the BFSI sector has been limited to areas like KYC, AML, credit risk, operational, and third-party risk management, with some audit support services. However, the industry has recently become more open to outsourcing critical processes such as market and liquidity risk, fraud management and chargeback, enterprise risk management, internal audit support, risk consulting, and ESG services.

Risk and compliance

Exhibit 1: Risk and compliance value chain as defined by Everest Group

The rising propensity to outsource R&C processes is driven by a multitude of factors, including:

Current macroeconomic headwinds: The ongoing recessionary pressures are putting cost constraints on BFSI enterprises as they navigate a high-interest environment. Outsourcing R&C promises much-needed cost-effectiveness when compared to maintaining an in-house compliance team.

Rising volumes of R&C requirements: Current geopolitical scenarios, such as the Israel-Palestine and Russia-Ukraine conflicts, along with major global elections, have heightened the need for processes like sanction screening and Politically Exposed People (PEP) monitoring. Additionally, the macroeconomic environment, where many are living paycheck-to-paycheck, has led to an increase in fraud and chargeback instances. Outsourcing to specialist firms can help increase efficiencies due to economies of scale and a clear operational focus.

The increasing complexity of R&C processes: Fraudsters have become tech-savvy, and the global regulations keep on evolving. Outsourcing can provide quicker access to advanced systems, such as compliance analytics and AI-based risk models, that might be costly or time-consuming to develop in-house. By outsourcing compliance tasks, BFSI enterprises can focus on their core capabilities and strategic goals, thereby increasing productivity and competitiveness.

Access to specialized talent: As BFSI enterprises expand their compliance efforts and integrate them within core business operations, the demand for skilled compliance talent has risen. Effective compliance management now requires not only financial, legal, and analytical skills but also strong operational experience, a combination that is in short supply and can be complemented by an R&C specialist outsourcing partner.

Evolving enterprise priorities within risk and compliance

The COVID-19 pandemic forced BFSI enterprises to rapidly adapt their operations. As the pandemic evolved into an economic crisis, it triggered unemployment and social unrest, presenting challenges like business disruption, remote work, data security, cyber threats, and increased risk and compliance monitoring.

Failures of major banks such as Silicon Valley Bank, Credit Suisse, Silvergate Bank, and First Republic Bank highlighted the urgent need for continuous investment in legal, risk, audit, and compliance functions amid rising inflation and asset/liability mismatches.

Enhanced regulatory scrutiny is another key factor, as highlighted below:

  • AI and external data use control: The EU Artificial Intelligence Act, the first comprehensive legal framework for AI, was adopted on March 13, 2024. The new Colorado Division of Insurance regulations require insurers to test AI/data systems for bias
  • Cybersecurity and data safety: The Consumer Financial Protection Bureau (CFPB) proposed rules on consumer-authorized financial data-sharing, and New York’s expanded cybersecurity rule mandates annual reviews of written policies by a governance committee
  • Capital and solvency oversight: The Financial Stability Oversight Council (FSOC) finalized a framework for assessing risks to US financial stability, including non-bank financial companies and payment systems. The CFPB proposed supervision of digital wallet and payment apps, while the National Association of Insurance Commissioners (NAIC) seeks to protect consumers by ensuring the solvency of life insurers through revised risk-based capital requirements

This more stringent supervisory environment pressures banking organizations to accelerate remediation efforts and operate with less room for error.

The road ahead

Outsourcing broader R&C is similar to the early days of IT outsourcing, where companies gradually outsourced processes one or two at a time. BFSI enterprises should strategically decide which compliance activities to outsource, ensuring these processes are already stable and effective in-house, as outsourcing alone won’t fix existing issues.

As the R&C landscape evolves, financial institutions must proactively adapt by assigning clear compliance responsibilities, integrating technology (AI, analytics, automation), and establishing robust risk management frameworks. Service providers will be essential in supporting these compliance efforts.

For more on R&C outsourcing trends and achieving regulatory compliance, contact Dheeraj Maken ([email protected]), Kriti Gupta ([email protected]) and Ritwik Rudra ([email protected]), or download our report, “High Tide of Transformation – Financial Crime and Compliance (FCC) State of the Market 2024.”

Don’t miss our webinar, What’s Next in Financial Services? Driving Transformation Through Sourcing, Technology, and Operations, to learn how BFSI firms are driving business transformation in response to the macroeconomic environment, evolving customer needs, the tightening regulatory landscape, and the rapid adoption of AI and cloud technologies.

UK Banks Ramp Up Digital Banking Services and Redefine Operations. What are the Implications for the Outsourcing Industry? | Blog

Facing macroeconomic challenges and shifting consumer demands, UK banks are reimagining their operations to stay competitive. This transformation involves cost-cutting, digitalization, and a focus on core business areas. The restructuring opens new opportunities for the outsourcing industry as banks seek third-party support to drive efficiency and innovation. Reach out to us to learn more.

A wave of macroeconomic shifts and evolving consumer demand are driving UK banks to rethink their operating model. The UK financial sector is under pressure amid high inflation, lower interest margins, shrinking profits, and a rise in digital banking services. The top banks of the UK, which have historically concentrated their core business in specific segments such as lending and investment banking, are particularly jolted as the two segments witness a dry business amid the slowdown.

While there were a few banks that began strategic restructuring during the pandemic, the number of banks accelerating transformation efforts has surged in the past two years amid the slowdown. Following are the current key factors that are leading UK banks to reimagine their business:

1. Cost pressure: A competition for deposits has been rising for UK banks as clients shifted to higher-rate products, while new originations have decreased amid a volatile interest-rate environment. Mortgage rates on new loans fell toward the end of 2023 due to a fall in market swap rates. Even as originations recover, lower mortgage rates imply a reduced net interest margin for banks. The cost-to-income ratio increased visibly for key banks in Q4’ 2023 when compared to Q3’ 2023, as highlighted in the exhibit below

UK banks cost to income ratio 1

2. The need for diversification: A few banks in the UK have begun looking at diversification of their business. Some moved toward restructuring as part of their internal strategic plan, while others, that have their revenue concentration in interest rate-reliant segments took a reactive measure amid a pressured, volatile interest rate environment

    1. In 2022, Lloyds announced that it would strive to move away from mortgages to business lines less dependent on interest rates, including wealth management and insurance
    2. In the beginning of 2024, Barclays announced its acquisition of Tesco’s retail banking business to further expand its presence in the segment. It was also planning to cut jobs in the investment banking segment
    3. In February 2024, Standard Chartered was reported to have been looking at restructuring plans for its investment banking division

3. Evolving customer needs
: With the rise in new-age banks such as neobanks, customers in the UK are increasingly switching to these online banks due to their services. By the first half of 2023, neobanks such as Revolut and Monzo were neck and neck with traditional banks such as HSBC when it came to the number of customers in the UK, as highlighted in the exhibit below

of domestic UK customers

As the competition from these banks rises for traditional banks, leading institutions are changing the way they serve their customers. In the past two years, most of the top banks have closed their physical branches due to lesser footfall and a greater move to bring all the services online. A representative list of such branch closures is mentioned below.


Bank Year of shutdown Number of branches closed in the UK
Virgin Money 2023 40
Natwest 2024 98
Barclays 2024 & 2025 96
Lloyds Bank (including Halifax and Bank of Scotland) 2024 & 2025 176


How are banks planning to restructure their operations?

Most of the major banks in the UK have begun taking steps to align their internal structure according to market demands. While some banks are focusing on becoming digitally equipped institutions for customers, other banks are undertaking strategic measures to overhaul their business segments. A few of the examples are mentioned below:

  • Digital banking services transformation:
    • In 2022, Lloyds committed to a £1 billion IT spend as part of its digital transformation strategy, with an aim to increase its digitally active customers by more than 10% by 2024
    • Santander UK also started its core banking digital banking services journey in 2022. It has migrated its UK commercial customers to a new digital banking platform, Gravity on Google Cloud
  • Asset sale:
      In 2023, Metro Bank, which currently has a troubled balance sheet, was considering the sale of £3bn of its residential mortgages, but later withdrew from the decision
  • Structural / leadership changes:
    • In February 2024, Barclays declared an operational overhaul, including substantial cost cuts, asset sales, and the division of the business into five business segments
    • In March 2024, Standard Chartered announced changes to its group management team, as part of which the leadership structure of its major divisions has been overhauled
  • Switch to private ownership: Natwest is on its way to returning to private ownership, after the UK government announced in May 2024 to cut its stake to less than 23%

What does it mean for the outsourcing industry?

The UK financial industry is finally opening to outsourcing and catching up with global peers. The post-pandemic environment accelerated the digital push but slowed business for institutions. This is driving banks to transform operations through third-party support. Thus, while operations outsourcing slowed in other regions, it grew in the UK by over 10% in FY2023. With many banks still on their way to the restructuring journey, the UK poses a slew of opportunities for the outsourcing industry. Here is our take:

  • The demand for technology levers such as automation and AI will rise from banks looking to become more digital
  • Financially distressed banks could look for sale or carveout of their loss-making divisions to revive profits
  • Banks that have restructured their business divisions may revisit their sourcing strategies. For instance, new business divisions may warrant a new sourcing plan. Meanwhile, the divisions that have come under common leadership may follow similar sourcing strategies, such as having a common vendor at both front- and back-offices

The era of transformation in the UK financial sector has brought about a diverse set of opportunities for outsourcing. In a market that has remained tough to crack in the past, this serves as a good chance for providers looking to make a headway and expand their presence in the region. For questions or to explore this topic further, reach out to Sakshi Maurya at [email protected] or [email protected].

Catch our webinar, What’s Next in Financial Services? Driving Transformation Through Sourcing, Technology, and Operations, to learn about driving business transformation in response to the macroeconomic environment, evolving customer needs, the tightening regulatory landscape, and the rapid adoption of AI and cloud technologies.



Beyond Conventional QA: Reinventing Quality Engineering for the Phygital Era | Blog

Enterprises are welcoming the adoption of phygital systems, blending physical and digital elements for next-level product experiences. While these innovations offer significant benefits, they also introduce unique quality challenges that require specialized quality engineering, multidisciplinary talent, and strategic partnerships. This blog explores these challenges and the necessary transformations needed to ensure seamless phygital experiences. Reach out to discuss further.

Enterprises are rapidly embracing phygital systems, or the integration of physical and digital components to bring out innovative and immersive product experiences in the market. For example, in the healthcare domain, medical devices are being augmented with digital capabilities for remote monitoring, telemedicine, and data-driven diagnostics. Point-of-sale (POS) systems are evolving into phygital systems with the integration of digital payment gateways, inventory management, and data analytics capabilities. The gaming industry is pushing boundaries with immersive phygital experiences through advanced gaming consoles, virtual reality (VR) headsets, and haptic feedback controllers. Automotive companies are revolutionizing transportation with connected cars, advanced driver-assistance systems (ADAS), and autonomous driving features. While these emerging workflows enhance user experience, they also increase the surface area of potential quality leakages.

Enterprise phygital challenges and the role of quality function

As enterprises accelerate the introduction of phygital systems to the market, they open the door to more encounters of unique quality challenges. Enterprises now recognize that compromised product quality can have severe repercussions, including business losses and brand erosion. Consequently, they must proactively plan for contextualized quality engineering interventions tailored to address these specific challenges. The exhibit below illustrates several domain-specific phygital quality engineering challenges and potential solutions required to ensure seamless phygital experiences.


Evolving quality functions to serve emerging phygital assurance needs

Addressing the quality challenges outlined above will require fundamental rejigging of quality functions across key critical dimensions highlighted in the exhibit below.


  • Transforming quality engineering talent: Quality engineering professionals will have to develop multidisciplinary skillsets spanning hardware, embedded systems, data validation, and deep domain expertise. Upskilling in essential areas such as regulatory compliance landscape, payment gateway workflows of POS systems, game logic, and safety requirements of automotive systems will be key for phygital assurance success
  • Adopting specific toolsets: Beyond traditional software quality engineering tools (be it open source or third-party toolsets), phygital assurance mandates would require investment in specialized toolsets such as hardware-in-loop (HIL) testing, robotic arms, and data validation tools. Enterprises will also need to invest in developing expertise in using these specialized tools
  • Forging external partnerships: Forging partnerships with external technology and service providers will give enterprise access to specialized product engineering and testing expertise these firms already possess, which will help enterprises in attaining phygital success

The road ahead

As enterprises race to roll out phygital products, faster time-to-market will not be a differentiator, but a necessity to attain competitive advantage. But this quest to shorten release cycles cannot come at the cost of product quality. Phygital assurance expertise is critical to ensure flawless phygital experiences. However, enterprise in-house capabilities alone may not suffice, and hence, ecosystem partnerships are pivotal. Enterprise must judiciously select partners that can bring in the right set of quality engineering talent and toolset expertise that will help enterprises meet their assurance requirements.

To share your thoughts and discuss research on the future of phygtial assurance, please contact Ankit Gupta, [email protected], or Ankit Nath, [email protected].

Check out our webinar, Engineering Services in 2024: The Market Outlook and Commercial Trends, to learn the pricing outlook, commercial dynamics, market attractiveness, and evolving buyer expectations for engineering services.

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