Tag: innovation

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

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.

Three reasons why innovation and technology pilots often don’t succeed | Sherpas in Blue Shirts

Disruption from new technologies and new business models fundamentally changes companies’ competitive positioning. Most CEOs and boards of directors today recognize their business is at risk if they don’t change, as disruptive competitors will gain ascendency over them. Because they recognize the power of disruptive technologies and the need to change, many invest in pilots to determine whether a technology can create the desired performance outcome. Unfortunately, pilots rarely deliver real value. Furthermore, look at Amazon, GE and other firms that successfully incorporate disruptive technologies into their business model, and you’ll realize they don’t use pilots to drive change. Why not?

Pilots often succeed in demonstrating a technology is useful in achieving company objectives. What happens next is an “evangelist” communicates the success, believing this will result in the organization implementing the technology and driving change. Sounds good, but there’s little evidence that this works. I’ve observed countless pilots over more than two decades, and very few resulted in meaningful changes to competitive positioning. There are three primary reasons why this happens.

Read more at my CIO Online blog

Is Perceived Impact Hindering Your GIC’s Growth? | Sherpas in Blue Shirts

The GIC model has evolved significantly over the last decade, and is gearing up for the third wave of evolution – GIC 3.0, as some are calling it – driven by GICs’ strong desire to move away from the “arbitrage-first” delivery model towards a “digital-first” model.

Everest Group describes the journey to mature GICs as progressing through four different stages.

Journey to GIC maturity

GIC maturity for optimal business impact

Our research shows that best-in-class – or Stage 4 – GICs deliver up to six to eight times incremental value beyond arbitrage. Yet, while many of our engagements over the last few years have made it clear that most Global 1,000 GICs deliver value beyond arbitrage, very few track and measure their impact. When they do, it’s typically in a piecemeal, selective manner. Thus, their parent perceives that they are delivering limited business value, beyond arbitrage, to the enterprise.

By educating their parent on their impact, GICs can improve their credibility, and build a case to secure support for expanding their role.

So how can GICs measure and articulate the value they deliver?

We believe that putting a dollar number to the business impact is the most objective and effective way for GICs to showcase their true worth. The framework we use maps value drivers linked to savings, risk, and revenue, quantifying all forms of impact created by the GIC.

GIC business impact model

Here’s an example: a U.S. company’s GIC was able to prove to its parent that it delivered US$20 to 22 million in overall business impact, compared to incremental cost arbitrage of US$4 to 6 million, through increased effectiveness, greater efficiency, and revenue growth. This helped the GIC secure the parent’s buy-in on increasing the scope of functions currently delivered out of their GIC.

A comprehensive quantification facilitates measuring the overall business impact across businesses/LOBs supported by the GIC. A GIC can use these results to:

  • Enable better understanding of its impact/role in the enterprise
  • Guide internal thinking on prioritization of value-add opportunities
  • Map its maturity to the market
  • Achieve greater sponsorship from parent stakeholders

Contact us about Everest Group’s business impact quantification framework, and learn more about our research on in-house delivery models.

Life Sciences Startups: Catalyzing the Innovation Ecosystem | Sherpas in Blue Shirts

Did you know that global funding for startups dipped more than 20 percent in 2015-16? But that life sciences startups were a rare breed that continued to find favor with those who hold the purse strings? Do you want to know who these startups are? Read on.

First, the context: while life sciences firms make extremely fat margins and sit on huge piles of investment dollars that focus on research, increasing regulatory interventions, slowing growth rates, and growing consumerism have become their new normal. To chart out a new growth path in the face of these challenges, life sciences firms are increasingly looking at tapping the innovation ecosystem that exists outside their legacy environments.

Startups are playing an important role in this transformation journey. By introducing technology solutions that address CXOs’ key imperatives, startups are bringing innovation right to life sciences firms’ doorsteps.

Life Sciences Startups Innovation 1

To understand the dynamics of this trend, Everest Group analyzed over 150 start-ups in the life sciences industry. The results of our analysis are encapsulated in our recently published report, “Hot Life Sciences Startups: Friends, Foes, and Frenemies in the Innovation Ecosystem.”

This life sciences startup research helped us answer the following questions:

 

What is the big deal?

While funds are drying up globally for start-ups, life sciences start-ups continue to find favor with venture capitalists. Niche therapeutics within life sciences such as cancer therapies and medical devices are attracting investments like never before.

Life Sciences Startups Innovation 2

Where are these dollars headed?

The majority of the focus is on biopharmaceutical start-ups that are aligned to three value chain functions: drug discovery/product development, clinical and pre-clinical trials, and sales and marketing. The start-ups leverage analytics, cloud computing, social media, mobility, and automation to create significant impact in the three life sciences segments.

Life Sciences Innovation Startups 3

Who are these investment magnets and innovation leaders?

Everest Group assessed the startups against three key criteria – level of business disruption, level of technology disruption, and market buzz. Our scoring methodology led us to select the following as the top 20 “Hot Life Sciences Startups” for 2017.

Life Sciences Startups Innovation 5

What are the implications for the global services industry?

These start-ups provide enterprises with enhanced access to bleeding edge innovation. This is evident with various life sciences firms investing actively in start-ups through corporate venture arms. For service providers, the startups provide an attractive channel to catalyze their innovation journey with a view towards partnership or acquisition. They also help providers move away from their cost-sensitive business model to focus on growth and capability development.

What’s your take on the life sciences innovation ecosystem and seminal role of start-ups? Do you have direct experience with any of them? We’d love to hear your story!

How can we engage?

Please let us know how we can help you on your journey.

Contact Us

  • Please review our Privacy Notice and check the box below to consent to the use of Personal Data that you provide.