Tag: Industry 4.0

How Enterprises Can Achieve Full Value from ServiceNow Investments | Blog

In response to changing market demands, ServiceNow has expanded its platform over the past two years, from primarily managing IT workflows to providing full enterprise solutions. Read on to learn the best practices from industry leaders to ensure your greatest return from ServiceNow investments.   

Since our inaugural ServiceNow Services PEAK Matrix Assessment in 2020, the software company has significantly expanded its portfolio to go beyond IT Service Management (ITSM) to new offerings that help clients drive business growth, increase resilience, and enhance employee productivity.

Our recently published second edition of the assessment found about 65% of enterprises are exploring scaling up ServiceNow investments for end-to-end process modernization. CIOs who have upgraded their IT workflow on ServiceNow are now looking to transform business processes and integrate the platform with existing systems of record, engagement, and intelligence.

Based on our interactions with industry leaders, we recommend enterprises consider the following factors when seeking to modernize their business processes with ServiceNow:

  1. Shift away from IT to business Key Performance Indicators (KPIs)

The watermelon effect of KPIs in ITSM is not new. Over the past two years, we have addressed several situations where ServiceNow clients struggled with having all the metrics look green on the outside but are red on the inside.

The reason often is two-fold – tracking irrelevant metrics and overreliance on IT metrics. Enterprises need to track relevant metrics closely tied to business outcomes while being aware of the pitfalls in measuring these metrics.

ServiceNow customers are tracking business KPIs such as customer experience, reduction in touchpoints, percentage of issues resolved by self-healing, and cost efficiency. Leading service partners are proactively collaborating with customers to course correct and update KPIs and tracking methods during quarterly and mid-year reviews.

  1. Minimize customization

Early adopters leveraged ServiceNow to make custom applications and create a final product that mimicked organizational processes. These solutions were developed on the go to meet demand. As ServiceNow continues to push new and improved versions, it has become very difficult and costly for these customers to make updates due to the huge technical debt.

Clients that adopted ServiceNow largely out-of-box are more agile and tend to benefit from improved processes. Enterprises should modernize their processes to fit the standard offerings and minimize customization or wait for the offerings to sufficiently mature before investing.

  1. Select the right transformation partner

We think Albert Einstein’s famous statement, “The definition of insanity is doing the same thing over and over and expecting different results,” unfortunately, applies here. Most enterprises need qualified staff to help guide and manage the project over multiple years. They also need to deal with unplanned turnover, the ServiceNow talent gap, inflexible contracts that don’t allow for strategy changes, ever-shrinking budgets, and, last but not least, the desire to have measurable outcomes. But often, enterprises end up using the same vendor selection and RFP processes without taking these factors into account.

Leading enterprises have not only updated their vendor selection methods but also have started planning for attrition, contractual flexibility, and outcome accountability right at the beginning of the engagement.

Large enterprises now are more open to engaging with specialist ServiceNow partners for module-specific requirements, especially for non-ITSM products such as Human Resources Service Delivery (HRSD), Customer Service Management (CSM), and Governance, Risk, and Compliance (GRC). This is mainly owing to the specialized focus and right mix of flexibility and agility that large Global System Integrators (GSIs) often fail to offer.

We are closely tracking demand and supply-side developments in ServiceNow. For more insights, see our report, ServiceNow Services PEAK Matrix Assessment 2022, which sheds light on the ServiceNow partner ecosystem.

We would like to hear your thoughts on your ServiceNow investments and the growing adoption of innovative operating models to achieve business outcomes. Please reach out to us at [email protected] and [email protected].

You ca also find out What’s Ahead After a Decade of Digital Transformation in this webinar as we share perspectives on what’s in store for the digital transformation industry.

Industry 4.0 Trailblazers: Worker Safety and Training | Market Insights™

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Industry 4.0 Trailblazers: Equipment Monitoring | Market Insights™

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Everest Group Says Two-Thirds of Enterprises Have Invested in Industry 4.0 | Press Release

As enterprises leverage emerging technologies for interconnectivity, digitalization and automation, outsourcing to service providers for industry 4.0 services grows steadily; majority of sourcing engagements involve IIoT, analytics, and AI/ML solutions.

Industry 4.0 is where enterprises aim to be, with almost two-thirds already invested in some capacity. According to Everest Group, 34% of enterprises have invested in pilot projects and are evaluating returns; 24% have implemented use cases and are willing to scale up to enterprise-wide adoption levels; and 5% of enterprises are enjoying maturity in the digital domain and realizing significant gains across their businesses. The remainder of enterprises are either still in the strategy-building phase (14%) or early stages of adoption (23%).

Industry 4.0 is the latest phase in the industrial revolution, characterized by advanced themes of interconnectivity, digitalization, and automation, and made possible through technological developments in multiple fields, including Internet of Things (IoT), additive manufacturing, cloud computing, edge computing, analytics, robotics, cybersecurity, artificial intelligence (AI) and machine learning (ML).

In its recently released “Industry 4.0 State of the Market Report: A Transformational Leap in Cyber-physical Convergence,” Everest Group analyses the global Industry 4.0 market, discusses the emerging trends among enterprises, and offers a detailed description of the outsourcing landscape for Industry 4.0 services.

Key findings:

The global Industry 4.0 market: The overall global spend for Industry 4.0 has been steady at approximately 15% over the past couple of years and stands at US$80-85 billion for calendar year 2019. The majority of growth can be attributed to the emerging areas of IoT, cloud, analytics and connected platforms.

Impact of COVID-19: Lack of visibility on returns and reduced cash flows have caused somewhat of a dip in enterprise spending on Industry 4.0 as a result of the pandemic; however, the change in workplace dynamics and remote work have only fueled the need to digitally enable factories and the workplace in the aftermath of COVID-19. Everest Group expects the market to recover well.

Top impediments to scaled adoption: Lack of management buy-in and organizational complexity remain key concerns when it comes to successful projects in this domain.

Emerging trends:

  • Developing capabilities in multiple technology domains has become an imperative to delivering successful end-to-end solutions.
  • Converging technologies within Industry 4.0 include 5G, cloud, analytics, connected systems, digital twins, mixed reality, robotics, intelligent assistants, additive manufacturing, nanotechnology, composite materials, AI and ML.
  • Larger technology firms such as AWS, Microsoft and Google have dominated the industrial IoT market, with most others on the fringe.
  • A number of government initiatives across the globe have been kickstarted to boost competitive advantage in emerging technologies. Examples include the U.S. government’s “Advanced Manufacturing Partnership,” Germany’s “High Tech Strategy 2020,” France’s “La Nouvelle France Industrielle,” China’s “Made in China 2025,” and South Korea’s “Innovation in Manufacturing 3.0.”
  • Larger partnerships and rollouts are now becoming increasingly common as the market matures. For example, Microsoft and SAP announced a partnership to build Industry 4.0 solutions using existing cloud infrastructure and edge computing resources. Similarly, French automotive giant Renault has partnered with Google Cloud Platform to accelerate digitization of the supply chain and 22 facilities.

The role of service providers: Outsourcing spend for Industry 4.0 has experienced stable year-on-year growth over the last few years and captured roughly US$7.5 billion of the overall spend for calendar year 2019. Aerospace, energy and manufacturing-centric companies in North America, major automotive players in Germany, and industrial firms in the United Kingdom are the major contributors to this spend. Larger service providers hold the major portion of revenue; however, growth rate is higher among the smaller service providers. Service providers have invested in a range of competitive investments in order to expand the breadth and depth of their offerings; however, more than half of all customer engagements typically leverage only industrial IoT (IIoT), analytic solutions, and AI/ML solutions.

***Download a complimentary abstract of the report here.***

About Everest Group
Everest Group is a research firm focused on strategic IT, business services, engineering services, and sourcing. Our clients include leading global companies, service providers, and investors. Clients use our services to guide their journeys to achieve heightened operational and financial performance, accelerated value delivery, and high-impact business outcomes. Details and in-depth content are available at http://www.everestgrp.com

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