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Benchmarking

The Evolution of Contracting Models in Testing Services | Sherpas in Blue Shirts

By | Benchmarking, Blog, Outsourcing, Pricing

A large enterprise client recently asked us to confirm whether its belief that the majority of organizations have moved to output- and outcome-based contracting models for testing services was true.

What’s the Reality vs. this Perception?

Our analysis of deals in our extensive database over the last 18 months showed that more than 75 percent of buyers are still contracting for testing services on a fixed price basis. Of those, nearly 50 percent are managed services contracts, where performance is linked to key performance indicators (KPIs.) The other 50 percent are a combination of fixed price and Time and Materials (T&M) contracts. In these types of arrangements, the part of the contract where the scope is clear and well defined is fixed price, and the T&M is for the part of the contract where the requirements are unclear, like testing support during the UAT phase, for change requests, etc.

Market Share for Testing Services

About 10-15 percent of the contracts in our set of deals from the last 18 months are purely T&M contracts where clients ask for specific testing resources.

Only the final remaining 10-15 percent of the contracts are based on output- and outcome- based models.

Deeper Look at Output- and Outcome-Based Contracting Models

While the current percentage of output- and outcome-based models is small – the model is  well-suited for engagements where the majority of work is transactional in nature, the client wants pricing clarity and guarantees, and the service provider has no explicit motivation to improve performance beyond service levels.

In fact, we believe that the transition to these as-a-service models is both critical and inevitable for enterprises with engagements matching these criteria – which exceed 15 percent of our database. Why?

  • They ensure enterprises pay for deliverables, not for time
  • They are more closely tied to enterprises’ business activities, as they provide flexibility and visibility into the expected spend
  • They allow enterprises to remain engaged at a strategic level, without worrying about day-to-day responsibilities
  • Since the pricing is delinked from the underlying number of FTEs, process Improvements are driven by the service provider’s motivation to reduce internal costs and improve margins.

At the same time, output- and outcome-based models pose different types of challenges than other types of contracting options, and enterprises must be prepared to address them to achieve success. For example:

  • Due to their fairly complex structure, these contracting models require sophisticated governance and strong due diligence
  • They are not easily benchmarked, because to ensure an apples-to-apples comparison, the benchmarking exercise needs to normalize for all the underlying environment characteristics
  • In multi-vendor environments where there are more dependencies, moving to output- or outcome-based models may increase costs as providers bake the higher risk into their fees.

In our view, most enterprises going down the output- and outcome-based model path will be best served by phasing in the adoption. Doing so will not only help them reduce risks, but also enable them to appropriately update their systems to process output-based transactions, create and put in place sufficient governance mechanisms for the new contracting regime, etc.

Have you embraced an outcome- or output-based contracting model for your testing services? Are you considering it? Please share your experiences with us at [email protected].

CIOs Struggle with Gap in Digital Transformation Expectations and Delivery Capabilities | Sherpas in Blue Shirts

By | Benchmarking, Blog, Digital Transformation

As part of our Pinnacle Model™ methodology and benchmarking, Everest Group recently conducted a study of over 200 companies on their digital transformation readiness. The study found companies’ boards of directors typically believe digital transformation is about technology, and they typically under-estimate the cost and expect results in months, not years. Those expectations are a huge gap away from the reality challenging CIOs and senior leaders leading the digital transformation. CIOs participating in our study revealed their companies were unprepared, under-funded and under-supported as to the tools, investment and commitment required to succeed. In this blog, I’ll share how to effectively communicate to your company the requirements for digital transformation to succeed.

Why Is There a Huge Gap?

The gap between expectations and delivery capabilities is because digital transformation is fundamentally different from companies’ past experiences with transformation. The technologies are disruptive and necessitate changing the organization, talent model, mind-sets, policies, processes and procedures – basically, the entire business model. Those changes are not easy. They don’t come all at once. They’re not completely known at the outset. And they unfold over a multi-year journey.

Peter Drucker advised, “If you want something new, you have to stop doing something old.” But the depth and breadth of necessary changes and the required commitment and investment for digital transformation are complicated to explain. They are hard to understand.

The digital journey requires far more resources, support, commitment and investment than anyone wants to believe. Digital technologies also take far longer to implement than people expect. For instance, in Robotic Process Automation (RPA) technology, a company can put a robot up quickly to create process improvement; but getting significant value involves more than that. Sure, a company can automate a function. But until the executives rethink the process that the robots will perform, they cannot create a meaningful improvement or breakthrough performance.

So, it’s no wonder that the boards don’t understand the extent of what is required to successfully complete a digital transformation journey. They also don’t understand that they need to fund IT transformation at the outset so that IT can successfully support the digital transformation.

As a result, most digital transformation initiatives fail (70%, according to a 2013 McKinsey & Company study. Many participants in Everest Group’s Pinnacle study revealed that, even when they understood the journey, they could not communicate it to their board, could not get funding, could not build support for it, and thus could not drive the change necessary to get it done.

How to Communicate Digital Change Requirements to Your Company

From our Pinnacle Model study, we developed an assessment vehicle (a 30-minute questionnaire) from which your company can compare its digital readiness against the broader population and against the market leaders (the Pinnacle Enterprises™). Together with a four-hour workshop, you’ll have the tools that will allow you to identify gaps, create learnings, understand what things you could do differently to improve your company’s readiness and performance and well as build road maps that allow you to systematically mature your digital readiness.

Learn more about our digital transformation analyses

Executives that have gone through the assessment and workshop tell us it created a great tool for communicating with their board of directors and the rest of the business about the support, resources and investment necessary to allow for successful digital transformation.

It is also a supporting budgeting tool that allows you to demonstrate the value against the cost, build support for the investment required to mature digital readiness and communicate the value that the IT organization will be able to achieve or support by increasing its digital readiness.

There’s a startling fact in the 2013 McKinsey study I cited earlier: Of the “successful” 30% that didn’t report their initiatives as failures, “success” was described as either breaking even or finishing the program but not delivering the anticipated business results. Of course, no company wants to undergo the challenge, effort, and expense of transformation only to break even or remain in the same relative competitive position.

Harvard Professor John P. Kotter’s study of 100 companies that underwent transformation initiatives found more than 50% failed in the first phase (getting organizational commitment and cooperation for the initiative). The Pinnacle assessment, workshop and communication tools are very helpful in addressing these issues.

The Characteristics of Europe’s Digital Banking Leaders | Sherpas in Blue Shirts

By | Banking, Financial Services & Insurance, Benchmarking, Blog

Disruptive forces – open banking regulations, growing FinTech ecosystems, and increasing demand for a seamless customer experience – are forcing banks to make significant investments in digital technologies.

The UK and European banking market is characterized by heightened activity on account of multiple converging factors

To effectively compete, banks must move away from being perceived as physical structures that offer financial services/products to an ambient fabric that connects people and businesses. They must transition from a transactional, product-centric approach to an intelligence-oriented customer-centric model centered around customers’ journeys. Artificial Intelligence (AI), API-enabled open banking architecture, and cloud are fast-becoming the foundations of banks’ IT architecture.

In order to evaluate and measure how organizations are faring in their leverage of digital technologies, Everest Group several years ago developed the Digital Effectiveness Assessment model.

Everest Group Digital Effectiveness Assessment model

On the Capability maturity axis, we measure organizations’ presence on all digital platforms, the quality of their mobile apps and online banking capabilities, their activity on various social media channels, their self-service innovations, and their open banking capabilities. On the Business outcomes axis, we measure their digital prowess using parameters including customers’ digital channel adoption, the customer experience (based on mobile app ratings, website optimization, and engagement), brand perception, and financial performance.

Earlier this year, we used the model to determine the European digital banking leaders. And from a field of the top 20 banks in Europe, we identified seven: Barclays, BBVA, BNP Paribas, HSBC, KBC Group, Lloyds, and Société Générale. These financial institutions have achieved:

  1. Superior financial performance: 17 percent higher growth in deposits, and 3 percent advantage in efficiency ratio in 2017
  2. Superior customer experience: Higher penetration of digital and social channels (e.g., up to 75 percent of BNP Paribas’ retail customers are using mobile app and online banking channels), mobile-based advisory capabilities, and personalized products and services. These leaders’ mobile application ratings are 7 percent higher than the other banks we evaluated.
  3. Stronger customer engagement: A superior user interface (UI), feature-packed mobile apps (e.g., BBVA offers 80 percent of the mobile features evaluated) and online banking platforms, self-service technologies across branch/ATM network (e.g., Barclays offers card-less cash withdrawal, bill payments, and check deposits through ATMs), and meaningful social media content.
  4. Higher business growth: Wider adoption of digital banking channels, superior efficiency ratios, adoption of an open banking ecosystem, and innovative product offerings, particularly through the wider set of APIs they offer.

European Banking Leaders

These leaders have re-designed their customer journey to adapt to external disruptions by:

  1. Calibrating current customer satisfaction: Formulating a unique customer engagement model based on insights gained on each customer’s digital readiness and adoption.
  2. Benchmarking current digital maturity with best-in-class enterprises: Evaluating their digital channel maturity and customer satisfaction scores against best-in-class peers, and then tailoring their digital strategy to bridge the gap in their organization’s vision of the customer experience.
  3. Redesigning the customer experience: Incorporating human-centric design principles to address customers’ stated and unstated requirements and desires.
  4. Optimizing their channel strategy: Developing a comprehensive channel strategy to drive customer adoption and acquisition, and changing the business model to deliver digital experiences.
  5. Innovative product offerings: Offering personal finance management features through digital channels that are intuitive and simple for users. Other services include payments through multiple messaging and social media channels, and intelligent voice-based payment solutions.

To learn more about the characteristics of Europe’s digital banking leaders, and what sets them apart from the others, see our report: Digital Effectiveness in Retail Banking | Focus on Banks in the UK and Europe: Identifying Digital Banking Leaders in the Open Banking Era.

Marketing Services: You Can’t Outsource Creativity…Can You? | Sherpas in Blue Shirts

By | Benchmarking, Blog, Outsourcing

At the Procurecon Indirect conference in Copenhagen a couple of weeks ago, three senior procurement people from different corporations approached me with their woes about the lack of control and the high levels of procurement indiscipline their marketing departments exhibit. They wanted to know how and if Everest Group could solve the problem of rogue spend with external agencies for marketing services. It’s an interesting and very valid question.

Marketing services is one area in which many enterprises’ Chief Procurement Officers (CPOs) have had neither the evidence nor the mandate to challenge established thinking. Furthermore, unlike IT and non-core business process outsourcing alternatives that have been around for 20 years, outsourcing options for marketing didn’t exist until recently. Now that they do, CPOs are sensing the opportunity, in partnership with Chief Marketing Officers, to transform the way marketing services are delivered.

Benchmarking Can Help, but…

Benchmarking can certainly provide rate-card analysis, SLA review, a breakdown of the cost-stack, and any number of other elements from the contract, to give a view of pricing and equitable contracting. But there are problems:

  1. Marketing services engagements are often part of the long-tail of spend, ad hoc in nature, sometimes not subject to a formal contract, and often worth not much individually. Benchmarking these could cost a CPO several-fold more than would likely be saved
  2. If a contract did exist, benchmarking would drive the discussion between a procurement team wanting to understand whether marketing services suppliers are delivering value and a marketing department wanting to defend the status quo. Typically, however, benchmarking informs the commercial negotiation between client and supplier
  3. The nature of marketing services engagements are sometimes niche and specialist, based on knowledge of a vertical or channel acquired over time. Providing meaningful points of comparison is likely to be difficult
  4. Buyers will doubtless maintain that it is impossible to benchmark creativity.

But, as one of my Procurecon conversations suggested, the issues for CPOs aren’t high levels of spend or a desire to be in control of every spending decision. Rather, they’re concerned about fragmented spend and lack of overall visibility.

5 Steps CPOs Can Take

They can begin by promoting the procurement function as an exemplar of best practice by pointing to examples in other spend categories of how procurement has driven cost savings, improved quality, or stimulated innovation. Doing so establishes CPOs’ leadership credentials.

Next, they can introduce some level of technology that will deliver at least visibility into spend. Several speakers at the conference cited the need for the procurement process to generate data to increase efficiency. Many CPOs without a mandate for category management seem reluctant to push for integrated procure-to-pay or source-to-contract systems. But less invasive approaches, such as customized applications in Salesforce, could still generate useful information about spend categories, transaction volumes, and whether suppliers are being contracted by separate groups within an enterprise.

Third, they can consider portfolio rationalisation, against these rationales:

  1. unravelling large numbers of small, often informal arrangements is hard, but the disconnected procurement of “specialized” or creative skills by separate parts of the business can produce a rate-card premium of up to 25 percent
  2. buyers may have contracted long-term rates for specialized skills; in this age of rapid obsolescence, the skills may have become commonplace, but the long-term contracts continue to charge contracted premiums
  3. a specific resource requirement may indeed be specialised for a provider with low capability in a particular area, but may fall into another provider’s delivery sweet spot; in our experience, transitioning such skills to a best-fit provider can save between 1 percent and 3 percent of contracting costs.

Next, they can investigate alternatives. Arguably, marketing services and creative agency spend are still immature enough to offer the opportunity to arbitrage. And providers with capability are rapidly emerging. Accenture has acquired over 20 agencies since 2010. Onsite digital design agencies such as NuFu, Oliver, and Spark44 have a growing impact. Every major service provider – Atos, Cognizant, Sutherland Global, Wipro, etc. – is investing in or acquiring digital agencies, and these investments will allow enterprises to consider accessing marketing services alongside a suite of outsourced IT or business process services.

Finally, they can benchmark the status quo with an alternative. Can a sourced solution give the enterprise not only a cost advantage but also faster delivery, access to global talent, measurable outcomes, and real transparency?

So, CPOs, there’s little reason to ask yourself “how do I do it?” Instead, the real question is, “why wait?”

You can find out how Everest Group helps enterprises optimise global procurement operations here. We also help enterprises rationalise complex portfolios of external suppliers.

WaterSprint or AgileFall: Implementing Packaged Apps in Contemporary Times | Sherpas in Blue Shirts

By | Benchmarking, Blog

During a recent next-generation packaged application benchmarking project for one of our Tier 1 clients, one point jumped out at us: service providers and product vendors have started moving away from the traditional waterfall approach to an adaptive hybrid agile-waterfall approach while solutioning for packaged application deployments.

Is an Agile-Led Methodology Needed?

You’re probably wondering if an agile-led methodology is necessary, since packaged applications have inbuilt configurations that are aligned to industry best practices. The resounding answer is yes, as packaged apps projects have been victims of scope creep, cost overruns, missed deadlines, objective mismatches, and a host of other issues. A good share of these failures can be attributed to the customization requirements that were built using a traditional implementation approach, which encouraged a siloed and non-continuous way of working.

How is the Hybrid Approach Effective?

The effectiveness of the hybrid approach can be easily gauged through a mix of waterfall and agile-based SLAs and KPIs. We are seeing that using the hybrid waterfall-agile methodology significantly improves traditional packaged apps implementation project SLAs such as defect leakage, defect density, and schedule and cost adherence. And agile KPIs such as velocity rate, work-focus factor, and percent of story-point accuracy help keep track of team productivity, and enable the team to track deviations from standard configurations.

One major adopter of the hybrid approach is SAP, which has refurbished its implementation framework with the introduction of its agile-based Activate methodology for the SAP S/4 HANA suite. While SAP has retained the strong elements of the traditional Accelerated SAP (ASAP) waterfall methodology, it has changed its approach from a template-led long duration blueprinting exercise to a fit-gap analysis for processes configured on a cloud-based solution. Additionally, it no longer runs the realization phase in a linear fashion, wherein testing is performed only after complete configuration or customization is done. Instead, testing resources are onboarded as soon as the sprint starts, and implementation effectiveness is gauged right from the word “go.”

Many service providers and product vendors are also following this same approach in some form and fashion, particularly in the realization phase.

What’s the Value of Shifting to a Hybrid Agile Approach?

It helps enterprises streamline their journey to becoming a truly agile organization, and enables a better end-user experience, as improved SLAs underscore better service delivery. And it helps service providers enhance their brand reputation, capture more business, and shed the tag of being old school and monolithic in their implementation approach.

If you are interested in learning more about the impact of the hybrid waterfall methodology on project timelines, average daily rate, overall TCV, contractual SLAs, and risk alleviation mechanisms, please feel free to reach out to me at [email protected]. You can also visit our Benchmarking page.

Three Characteristics of Digital Pinnacle Enterprises | Sherpas in Blue Shirts

By | Benchmarking, Blog, Digital Transformation

Earlier this week, we announced our new Pinnacle ModelTM analyses, which provide deep research on the capabilities top-performing companies have leveraged, and the journey they’ve taken, to become the crème de la crème.

Now, to sate your bated breath, here are the results of our first analysis on organizations’ adoption of digital strategies and what sets Digital Pinnacle EnterprisesTM apart from their peers.

Many people equate the word “digital” with “technology.” In the consumer world, they might think about the cool new mobile phone they just bought, the home entertainment streaming device that’s on their wish list, or how to carve out the time before the end of the year to turn their abode into a smart home. In a business context, cloud computing, robotics for their factory or their business processes, or a new customer interaction application may come to mind.

But one of the key findings from this analysis is that technology in and of itself isn’t Digital Pinnacle Enterprises’ biggest differentiator. Rather, Digital Pinnacle Enterprises stand out for making a strategic impact through their digital transformation efforts. Their track record for accomplishing business outcomes such as disrupting the industry, improving customer experiences, increasing market share, and launching innovative products and services, were significantly better than their peers.

And the value their digital transformation projects deliver are measurable and quantifiable. For example, as I mentioned in my previous blog, one banking client reduced its customer onboarding process from 16 days to 9 minutes. A retailer reduced its SKU management efforts by 80 percent, while simultaneously improving accuracy. And a software company saw improved invoice processing that reduced direct FTEs by 67 percent, and decreased customer calls to the help desk by 20 percent.

Digital pinnacle enterprise characteristics
Our analysis showed three key capabilities that Digital Pinnacle Enterprises have leveraged to realize these types of outcomes.

  1. Culture: Digital Pinnacle Enterprises have invested extensively in adopting and embracing an innovation-focused culture. They have partnered in startups to source new innovation across their product and services portfolio, and established a centralized team responsible for sourcing ideas from vendors, startups, employees, and customers. Their peers did not.
  2. Technology adoption practices: Digital Pinnacle Enterprises have built management practices around the evaluation of new innovative technologies such as big data analytics, cloud, DevOps, cognitive computing, and artificial intelligence. Their peers did not.
  3. Process Re-imagination: Digital Pinnacle Enterprises have defined current and future states of key internal processes, and worked with their process owners to identify waste. And…you guessed it. Their peers did not.

Of course, technology is a required core of any organization’s digital initiative. But those that have reached the pinnacle have focused on the key capabilities required to achieve real, measurable transformation.

I hope this has given you some food for thought on how to elevate your company to a Digital Pinnacle Enterprise. I also hope you’re hungry for more, because over the next few months and quarters we’ll be discussing very specific disruptive digital technologies and other market hot topics in additional Pinnacle Model Analyses. Bring your appetite!

Global Services’ Pinnacle Enterprises – How Did They Become the Best of the Best? | Sherpas in Blue Shirts

By | Benchmarking, Blog, Digital Transformation

Companies like Amazon, Apple, Disney, GE, Starbucks, and Tesla are considered by most as the best of the best in their industries. The ways they became the “coolest kids” are the stuff of business school case studies, countless news articles, and lunch room / board room discussions around the world.

Of course, there are many less iconic enterprises that have unlocked the performance excellence code. For example, a leading global bank recently reduced its customer onboarding time from 16 days to 9 minutes. Yes, you read that right…from 7,680 minutes to 9 minutes, assuming an 8-hour business day. Wouldn’t you love to know how it achieved that mind-numbingly positive business outcome, and how you could extrapolate what it did into your organization?

Therein lies the rub. You might read a case study that explains how it implemented an enterprise-wide automation platform that helped it transform operations. Seeing that automation was the core of its solution, you might access benchmarking studies to better understand best practices and how your business compares. Broadening your research, you might also access high-volume surveys that gather opinions and intentions on automation.

But none of these tools reflect actual performance or the capabilities this organization – or others achieving such remarkable results – has brought to bear to become the best of the best. They lack the insight you need to accelerate your impact in measurable ways.

We believe that to understand a topic, you need to directly compare and correlate business outcomes with the capabilities required to achieve those results. Our new Pinnacle ModelTM anayses do just that.

Pinnacle Model for Enterprises

The analyses paint a picture of the capabilities the “cool,” “it” companies – what we call Pinnacle EnterprisesTM – have leveraged and the journey they’ve gone through to realize superior business outcomes. They’ll arm you with the self-discovery of comparison that will help you design a change roadmap to be competitive today – and tomorrow.

Recently. we released a complimentary assessment of our first Pinnacle Model analysis results, which are for Pinnacle Enterprises adopting digital strategies. Spoiler alert: the capability that distinguishes the Pinnacle Enterprises from their peers isn’t their actual technology deployment.

And as 2018 approaches, we’ll use the Pinnacle Model to tackle other hot topics.

PS: For our service provider friends: When we talk about enterprises understanding their unique paths to accelerating their impact, I challenge you to think about how your differentiated capabilities can help accelerate the journeys of your clients and prospects.

What the Global Services Industry Can Learn from 17th Century Firefighters | Sherpas in Blue Shirts

By | Benchmarking, Blog, Outsourcing

A couple of weeks ago, several of us from Everest Group hosted a roundtable for sourcing executives in the U.K. The event was held in London’s Moorgate area – Moorgate is the name of the northernmost gate in the old city wall, and everything to the south and west was destroyed by the 17th century Great Fire of London – so I decided to orient my discussion on benchmarking by drawing parallels between the fire and digital disruption in the global services industry.

For context, the Great Fire started shortly after midnight on 2 September 1666 in a bakery on Pudding Lane. Over the next three days, the fire gutted the medieval City of London inside the old Roman city wall, and consumed 13,200 houses, 87 parish churches, St. Paul’s cathedral, and most of the buildings of the City authorities.

As we’re just several weeks shy of the 351st anniversary of the Great Fire, let’s all have some fun by casting today’s enterprises and two different types of outsourcing service providers as the entities trying to find a solution to stop the fire from spreading.

service providers

 

First, as there was no city-run fire brigade, the householders – read, the enterprises – attempted to put out the fire themselves, as it engulfed their own buildings. But their two capabilities, dousing buildings with water despite the inadequacies of the pipe network and pulling burning material from structures with bill hooks, were reactive and futile. Theirs was a sub-optimal process.

With the fire quickly spreading, the city authorities realized that a more coordinated approach was required. The city militia – read, service providers that deliver “traditional” services – was called in, and concentrated its efforts on pulling down houses that stood in the fire’s path. While this was an optimized process, it only minimally delayed the spread of the fire, and certainly was not popular with the householders/enterprises.

Finally, the garrison at the Tower of London – read, a provider that offers transformative, digitally-based solutions – offered a solution that was conceptually challenging: the creation of effective firebreaks by using gunpowder to demolish entire streets. This genuinely transformed process rescued the city by leveraging a highly disruptive technology (gunpowder).

The immediate outcome was prevention of further fire spread. Problem solved! But the solution also resulted in two unforeseen, and highly beneficial outcomes: the end of the bubonic plague outbreak that had ravaged London since 1665, and, because of the huge anticipated cost of rebuilding the city, a financial imperative to end the Anglo-Dutch war. The eradication of disease meant that London was immediately a safer place to live, so both economic and intellectual capital returned to the city. Peace with Holland created conditions for trade to thrive, insurance against risk took off (Lloyds appeared as an insurer just 22 years later in 1688,) and London’s emergence as a global city began…extraordinary value-add.

How does this connect with service providers today?

The moral to this entertaining (and historical fact-filled) exercise? Today’s enterprises are facing multiple, unprecedented forces. In order the stop the spread of the fire – or gain and maintain a competitive foothold – they likely need to partner with  service providers that embrace innovative, disruptive, digital solutions.

Enterprises can always insist that service providers find better ways to prevent the spread of fire, and to optimize processes by taking a rounded, contextualized approach to reviewing the detail of an existing arrangement. In our experience, this can account for value improvements of between 18 and 24 percent of the total cost. But by insisting that service providers themselves start thinking innovatively and imaginatively, that improvement can often be doubled. While some of the consequences will be unintended, many of them will deliver benefit far beyond their intention.

 

An Outsider’s Inside View of the Global Services Industry: New Value Props, and Bots to Boot | Sherpas in Blue Shirts

By | Automation/RPA/AI, Benchmarking, Blog

Just a month ago I rejoined Everest Group as its chief research guru. And while I thoroughly enjoyed my stints as chief research officer at Market Track (a competitive intelligence firm for advertisers) and The Hackett Group (an intellectual property-based strategic consultancy and benchmarking firm) over the last 10 years, I’m feeling like a kid in a candy store in today’s digitally-oriented global services industry!

Here are my gut reactions to visits I had last week with two sell-side organizations.

Wipro

Wow, wow, wow.

That’s research speak for how I felt after the inauguration of Wipro’s brand new Silicon Valley Innovation Center on August 1. The Center, which Wipro bills as, “…state-of-the-art R&D and incubation hub, designed to develop and showcase next-generation technologies and solutions for enterprises” clearly displayed how much its value proposition has changed.

It wasn’t that long ago that Wipro and its peers were promoting savings, quality, and scale, along with a thin layer of industry expertise. Now it’s showcasing innovative solutions along a broad array of concepts that include the future of retail, banking, and healthcare, to name just a few.

It’s clear Wipro knows that the robots are coming, rendering its traditional proposition passé, similar to what EDS, CSC, ACS, and HPE experienced over the past 15 or so years. So will its ideas be enough to compete in this dog-eat-digital global services environment? It’s hard to say, but it’s certainly going to give it the old college try. We’ll update our thoughts in due time.

Automation Anywhere

No C3POs to be found, but I did see some game changers.

I took advantage of my time in Silicon Valley to stop by Automation Anywhere’s headquarters. And I was sorely disappointed when they didn’t show me a warehouse full of R2D2 and C3PO robots. Instead, they showed me an evolutionary capability that has reached a tipping point that should make enterprise executives do an immediate rethink of how they design their organizations.

I had a spirited debate with CEO Mihir Shukla and his team about how Automation Anywhere’s RPA-based solution will impact enterprises. Our mutual thoughts were that some will use it incrementally to create short-term savings and process improvements, but that really innovative executives will use it as one of several key tools to change the competitive landscape in their markets. For them, it will be a thing of beauty. For others? Well, let’s be positive.

Watch this space for some really cool fact-based insights that help differentiate the winner and loser enterprises over the coming months.

10 Golden Rules for Good Benchmarking | Sherpas in Blue Shirts

By | Benchmarking, Blog, Outsourcing

Originally posted on the National Outsourcing Association (NOA) blog


Insights from the NOA “Benchmarking” Special Interests Group with Everest Group

Benchmarking is a worthwhile endeavour. When conducted properly, the practice will give you a baseline indicator of where your business is currently, where it is headed on its current trajectory, where you need to be to maximise gains and how you can get there.

Benchmarking can also act as the catalyst for a more fruitful long-term outsourcing relationship, by highlight areas that must be focused on moving forward. On the other hand, it is not the solution to every problem that relationship might have. The term is frequently misunderstood and the practice is even more frequently misused.

At the NOA’s Special Interests Group on Benchmarking in association with Everest Group, benchmarking experts led a roundtable discussion on when benchmarking is necessary, how it is best carried out and what the practice does to help business relationships between clients and their providers.


Read more on the NOA blog