Tag: next generation IT

Building Global Centers of Excellence (CoEs) in GBS Organizations to Drive the CEO Agenda

The Global Business Services (GBS) market has witnessed improvement in performance, enhancements in role, and growth across verticals and functions over the years. In fact, the pandemic served as a catalyst for GBS organizations to step up and deliver higher value-add services, becoming a pillar for enterprises to evolve at a much faster rate. However, as the world evolves, GBS organizations need to remain agile to keep up with advancing technologies, navigate the recent talent shortage, and maintain cost competitiveness and accelerate innovation to help drive the CEO agenda.

To achieve these multiple priorities, many GBS organizations are building Centers of Excellence (CoEs), which further facilitate collaboration and speed-up transformation and delivery for the enterprise. CoEs are entities that work across business (BU)s units, or product lines within a BU, and provide leading-edge knowledge and capabilities in targeted areas. CoEs have proven instrumental for GBS organizations to drive initiatives and deliver access to high-demand skills and competencies, accelerating improvements and pushing efforts forward for faster execution.

The five types of CoEs that drive the CEO agenda

The role of the GBS organization needs to pivot toward creating strategic impact for the CEO. CoEs and competency centers within GBS organizations are designed to streamline and set actionable steps for the CEO’s agenda and critical priorities. The following five types of CoEs help enterprises to drive stronger business performance.

Core operations and corporate services CoE: This CoE focuses on developing expertise for multiple departments within the enterprise, including reporting, finance, marketing, customer onboarding, and core operations

Next-generation IT and digital technologies CoE: This CoE targets the development and management of new skills and technologies, such as AI, analytics, cybersecurity, blockchain, and testing

Talent CoE: The talent CoE develops the strategic services, capabilities, and best practices for staffing, e-learning, and employee onboarding

Automation and/or innovation CoE: Today’s strategic CEOs are looking to quickly advance their organizations’ automation and innovation maturity. This CoE is dedicated to cultivating these initiatives within the enterprise and deploying and scaling technologies like robotic process automation (RPA) and intelligent automation (IA)

Global sourcing and vendor management CoE: The goals of global sourcing and vendor management within organizations are often changing to keep up with market trends. This CoE provides CEOs with needed processes, insight, and agility to manage their sourcing and vendor models as market trends fluctuate

Going into 2022, these five types of CoEs, built within GBS organizations, can advance and strengthen enterprises and push strategies toward next-generation digital technologies, automation, and innovation. We covered this in more detail in our webinar, 5 Success-driving Actions GBS Organizations Need in 2022.

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Why GBS organizations are the right candidates for building CoEs

Multiple factors play into why GBS organizations are good candidates for building CoEs and ultimately offer significant benefits to enterprises and the CEO agenda. These include:

  • Deep process, domain, and technology expertise, providing a superior overall experience for the enterprise
  • Access to next-generation and niche skills at competitive costs, which accelerate enterprises’ digital transformations
  • Through a microcosm effect, offering high cross-functional and regional impact, the GBS-built CoE improves new product and services development
  • The ability to drive fast-paced, low-cost innovation enables top-line growth throughout the enterprise
  • Alignment with organizational culture and business goals improve overall productivity

How to develop an effective CoE

The various aspects of developing an effective CoE should be charted out to accelerate enterprise-wide adoption. Setting up a CoE is the first step for a GBS to embark on excellence, but it needs to ensure that it takes the right actions to establish success.

  • The first step is to map out a vision and strategy, think through possible risks, and mitigate them
  • Defining a governance and engagement model between the CoE and the enterprise is paramount to ensure that those goals and strategies are communicated, carried out, and met
  • GBS organizations will also need to design a talent model structured around growth and establish funding and financing mechanisms to initiate the process. Once the team is structured and goals are set, GBS organizations should incorporate a way to measure success through performance metrics and KPIs to collect the best data on impact delivered

Best practices for setting up a CoE

CoEs are designed to bring expertise and forward-thinking guidance, which often means taking risks and adapting; however, here are a few best practices to keep in mind when setting up CoEs:

Clearly articulate the “why”: If there is not enough clarity, the CoE is unlikely to deliver results aligned with the enterprises’ strategy

Take an entity-wide view: Combine the business case with an internal assessment of the company’s vision and strategy, requirements, and capabilities to identify concrete opportunity cases

Clearly define the governance and organizational model: The CoE should articulate the governance mechanism, reporting model, roles and responsibilities, and business units supported, so all parties are aware

Talent is the most critical success enabler: Leadership and team skills are often the most critical factor for a CoE’s success. Consider collaborating with external partners such as startups and academic institutions to fill gaps

Aim for quick wins in the initial stages to gain visibility and confidence: Select early use cases that allow the enterprise to develop confidence in the CoE

Ensure strong engagement and precise stakeholder management: Secure the right sponsorship at the right time, preferably in the early stages

For more information on how GBS CoE’s can drive the CEO agenda, watch our webinar, 5 Success-driving Actions GBS Organizations Need in 2022.

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Next-Generation Infrastructure – The Backbone of Your Digital Transformation | Webinar

Complimentary 60-minute webinar held on Wednesday, November 7, 2018 | 11 a.m. PST, 1 p.m. CST, 2 p.m. EST

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Infrastructure is the backbone of every digital transformation, enabling all the technologies that power the digital era. The success of your enterprise’s business strategy will increasingly depend on next-generation infrastructure advances that cost effectively deliver new capabilities and free up IT talent.

In this fact-based, example-rich session, we will share insights we have gathered from research with more than 100 enterprises across 10 industries about which infrastructure practices and capabilities produce superior outcomes – business, operational, and cost. You will learn how these insights translate into actionable steps enterprises can take to increase the business value enabled by next-generation infrastructure.

Questions we’ll address:

  • What are the driving factors behind the infrastructure strategies of companies on successful digital transformation journeys?
  • What are some examples of how business strategy is directly impacted by infrastructure strategy?
  • How are enterprises addressing the funding challenges of transforming their infrastructure to the next generation?

Who should attend, and why?
Enterprises: CIOs, CTOs, CDOs, and VPs of IT from all industries who are wrestling with developing and executing infrastructure strategies that drive business value in their digital transformations.

Presenters
Cecilia R. Edwards
Partner
Everest Group

Mark Lade
Associate Partner
Everest Group

Brian Blumer
Senior Consultant
Everest Group

Enterprise Sourcing Executives, Everest Group to Gather July 21 in NYC to Share Insights on Unlocking Outsourcing Value | Press Release

Second event in “On Point | Summit Series 2016” to feature Rod Bourgeois of DeepDive Equity Research; topics will include sourcing models, next-generation IT, and contracting for business outcomes.

The global outsourcing industry has matured into a slower growth pattern, but strategic outsourcing solutions can still add dramatically more and different value to organizations. Discovering the keys to unlocking this outsourcing value will be the focus of the day as enterprise sourcing executives and senior leaders gather in New York City on July 21 at the On Point Summit to network and share insights on optimizing their global sourcing strategies.

The half-day summit—hosted by Everest Group and themed “Succeeding in Outsourcing 4.0: Imperatives for Strategic Sourcing Executives”—is a forum designed for enterprise attendees to learn from each other and featured industry experts and leading practitioners.

Special guest speaker, Rod Bourgeois, head of research and consulting at DeepDive Equity Research, will present, “What are the Winning Models? An Investor’s View.”

“We launched the ‘On Point | Summit Series 2016’ because our clients and others in the industry wanted a safe forum where they could exchange ideas with peers and engage with us in person,” said Eric Simonson, managing partner – research at Everest Group. “Based on feedback from our first event, our format of intimate interaction with peers, an opportunity to hear provocative thought leaders, and a chance to have detailed discussions with us on key issues is exactly what these business leaders are looking for. The takeaways from the event offer an excellent ROI on the time invested.”

The July 21 agenda will feature a panel of leading outsourcing practitioners who will engage participants in a lively discussion about incorporating next-generation capabilities into outsourcing solutions. Other highlights will include “Bring Your Own Topic” (BYOT) roundtable discussions and insights on contracting for business outcomes, offered by Everest Group.

Everest Group hosts for the event include Simonson; Jimit Arora, partner and leader of IT services – research; and Sarthak Brahma, vice president, pricing assurance – research.

This is the second installment of Everest Group’s by-invitation-only “On Point | Summit Series 2016.”  The first event, held in May, focused on emerging technology and talent trends in the banking, financial services and insurance industry. Guests enjoyed active dialogue with peers, insights from Everest Group research analysts, and a presentation by guest speaker, Chitra Dorai, IBM fellow and CTO of cognitive services, who shared her thoughts on “Cognitive Computing for Process Re-imagination in Financial Services.”

The third event in the “On Point | Summit Series 2016” will be held in October. Everest Group recently announced that, due to popular demand, the “On Point | Summit Series” will be extended with a full slate of events in 2017.

***Learn more and request to attend the July 21 event in the “On Point | Summit Series 2016” here. (Enterprise companies only; no service providers.)

Lacking a Clear Path to Digital Nirvana? You’re Not Alone | Sherpas in Blue Shirts

While enterprises that correctly embrace digital stand to gain great rewards – not the least of which is survival – Everest Group research shows that the road to success is not a straight shot.

As an organization begins its digital journey, its initial investments are focused on streamlining the existing IT landscape to prepare for future digital initiatives. During this phase, enterprise IT generally focuses attention on traditional internal-to-IT success measures (cost, control, and compliance), and there is little need for redesign, nor much involvement from the broader organization. As a result, perceived barriers to adoption are few, and enterprises feel confident about the outcome of their technology investments – the journey looks clear and easy.

But just as the enterprise thinks it is on a clear path to digital nirvana, it hits a speedbump that threatens to wreck its transmission and send it spinning off the road. Once the initial streamlining work is done, the next phase requires the IT and business functions to work together to achieve digital goals, which requires significant change.

Suddenly, what seemed easy becomes much more complicated, requiring the enterprise face challenges such as:

  • Effectively measuring and demonstrating the beneficial outcomes of digital investments
  • Overcoming the inertia of redesigning long-standing business processes and changing end-user behavior
  • Addressing legacy technology challenges, a significant talent crunch, and behavioral change management

And lest you think you can find an alternative path to avoid this barrier, beware: our research indicates that nearly half – 43 percent – of North American enterprises are caught in this murky area we call the “Digital Trough.”

 

What should you do when you’ve hit the Digital Trough?

Just as failure to address problems with your car’s undercarriage can lead to erosion of your transmission, failure to address problems in the Digital Trough can lead to erosion of executive support for your digital transformation.

Here are a few strategies you can use to continue your digital adoption journey and reap the longer-term rewards of digital transformation:

  • Design a set of metrics that measure digital investments on a clear set of efficiency or growth objectives
  • Shift from a technology bolt-on view to a business process-centric view, with rigorous processes for evaluating new technologies against business efficiency or growth metrics
  • Leverage digital technologies for larger end-to-end processes to capture scope and scale benefits across the organization

The last point addresses the necessity for a pervasive approach to digital adoption (see our So You Think You’re Digital blog) as the benefits of a converged, end-to-end digital strategy significantly outweigh those of an isolated, piecemeal approach.

Once past the Digital Trough, our research suggests that the path to digital success is smoother…and well worth the trip.

To learn more about digital adoption patterns in North America, check out our just released research report, North American Digital Adoption Survey – How pervasive is your digital strategy.

Our readers are also very interested in hearing about your experiences with digital adoption. Are you suffering the impacts of the Digital Trough? Feel free to share your thoughts and comments.


Photo credit: Flickr

So You Think You’re Digital? | Sherpas in Blue Shirts

These days it seems as if every enterprise is talking about “going digital,” and service providers are adding to the noise with hyperbolic promises about digital solutions that will re-imagine the workplace as we know it. However, each stakeholder in the ecosystem, from service providers to enterprises, industry shapers to investors, is using a different definition of digital adoption. So in the interest of industry cohesion, we will attempt to bust some prominent myths surrounding digital adoption and offer a workable definition of digital.

First, a few myths

Myth 1: Standalone implementation of a single digital technology theme counts as “digital adoption”

The true power of digital adoption is realized when enterprises leverage and integrate a variety of digital technology themes across the enterprise. Putting some data in the cloud or creating a nifty mobile customer interface tool is not digital adoption.

Myth 2: Digital adoption is solely about digital marketing and/or enabling online/mobile channels

While most of the hype around digital services and solutions refers to its use in marketing, the reality is that digital is much more inclusive and pervasive. In fact, our research shows that almost half of North American enterprises are concentrating their digital investment on back- and core mid-office efficiency, rather than market-facing business processes.

Myth 3: Digital is just another name for SMAC

Another myth being perpetuated is what we call “digital-washing,” pulling a bait-and-switch with terms like SMAC (social, mobile, analytics, and cloud) or BYOD (bring your own device). Digital is much more comprehensive than any of these existing terms, encompassing an array of technologies to support and augment digital functionality that touches every aspect of back-,
mid-, and front-office business processes.

So how does Everest Group define digital?

Enterprises are spoiled for choices in adopting next-generation solutions and services. Possibly for the first time in history, enterprises are challenged not by the lack of technology, but by its overwhelming abundance.

But that abundance creates its own difficulties. Enterprises that are looking to ride the digital wave to improve operations and grab greater market share need to look at digital solutions with a more holistic view. The greatest benefits of digital solutions come from the development and implementation of a comprehensive digital strategy, not a piecemeal adoption of a particular next-generation technology for a siloed business process.

In other words, digital adoption is the converged use of emerging technology themes to drive efficiencies across back-office and core mid-office business processes, as well as to enhance competitive advantage by impacting market-facing front-office processes.

Let’s focus on two key aspects of this definition.

  1. Digital is about technology convergence: In more than one way, digital adoption perfectly represents the concept “the sum is greater than its parts.” The combination of multiple technology themes ‒ SMAC, Internet of Things (IoT), artificial intelligence (AI), etc.‒ is more powerful in resolving real business challenges than is employing each of them separately.

    In other words, enterprises achieve the true power of digital adoption when they develop strategies that leverage and link the benefits of a broad number of digital technology solutions, e.g., engaging analytics using social and mobile data stored on a cloud infrastructure.

  2. Digital adoption encompasses multiple layers of functionality and technology enablers across enterprise value chains and business processes: Our research indicates that enterprises are investing in – and, more importantly, gaining significant value from – digital technology themes across the enterprise value chain and throughout various business processes. Far more than fancy marketing gimmicks, true digital adoption touches nearly every aspect of a business, with use cases ranging from employee engagement to supply chain transformation.

Digital Adoption Definition

Finally, as the plethora of digital solutions, services, and developments indicates, the opportunities for digital adoption are ever-changing; the range of digital-enabling technologies and corresponding interfaces in the interaction layers is not a static concept, but instead is dynamic in nature. As such, the collection of available technologies across the interaction and enablement layers can change over time, creating new opportunities…and new challenges.

Have you been bitten by the digital bug? Keep your eyes on this space for findings from our soon-to-be-released report, North American Digital Adoption Survey – How pervasive is your digital strategy.

SaaS versus Enterprise IT as-a-Service | Sherpas in Blue Shirts

New business models are capturing growth and stand to reshape the services industry. Two of the most promising of these are SaaS and “Enterprise IT as-a-Service.” Buyers need to understand that each model takes a different approach to delivering services; their risks also are not the same, and each approach has different consequences.

They are the same in one aspect: both models attempt to change the relationship of IT to the business by better aligning the IT environment to the customer or business needs and making the IT infrastructure more agile and responsive to changes in the business environment. So the prize is better alignment to business value, more responsiveness, shorter time to get new functionality, and more efficient use of IT dollars.

But how they deliver that prize is very different.

SaaS approach

The SaaS promise is strong on efficiency gains. SaaS is inherently a multitenant-leveraged approach in which common platforms are built, standard functionality is developed and is allowed to be configured to a customer’s needs. The platforms come with flexible, powerful APIs that allow the SaaS offerings to be integrated into enterprise systems. But at its heart, SaaS is a one-size-fits-all, unyielding standard. Efficiency gains in a SaaS approach come from having many customers use the same software and hardware, limiting customization through configuration and APIs.

SaaS apps are typically function-based, so they evolve quickly. When the SaaS owner brings innovations, it does so in one stable environment, not having to update or take into account very diverse environments that traditional software packages must accommodate. Therefore, SaaS delivers rapid changes in functionality that benefit the entire ecosystem. In contrast, the traditional software model evolves much more slowly and imposes constant requirements for upgrades that are both expensive and have knock-on consequences for the systems that integrate with them.

Enterprise IT as-a-Service approach

The Enterprise IT as-a-Service model takes a supply-chain approach, moving each component of the supply chain into an as-a-service model. This allows the whole supply chain to be better aligned. It loosely couples each part of the supply chain, allowing each component to evolve and allowing the supply chain to capture the benefits as each component evolves at its own pace.

Similarity in benefits

Both models deliver similar flexibility and agility benefits, but they achieve them in different ways. The Enterprise IT as-a-Service model allows far more customization than the SaaS model. It assembles components into a customized end-to-end offering, whereas a SaaS vehicle achieves those aims through API configuration.

Both models also achieve similar benefits in cost savings. Both approaches can achieve significant efficiencies. SaaS achieves this through high leverage over an unyielding standard. The Enterprise IT as-a-service approach achieves efficiencies partly through reducing the over-capacity that all functional-driven IT departments maintain inside their ecosystem.

Substantial differences in cost, risk, and technical requirements

The two models differ substantially in cost, risk, and technical depth. The risk and technical depth to adopt a SaaS vehicle can be very substantial, particularly if it’s a system of records. Existing systems of records come with substantial technical depth in terms of the integration of the system, unamortized assets and also ongoing software licenses. In moving from that environment over to SaaS, organizations often face substantial write-downs and a risky implementation.

The risk is different in the Enterprise IT as-a-service model in that it can be managed component by component. Organizations can achieve substantial flexibility by not having to move off existing systems of records or existing software. Those platforms can be migrated down this path, therefore lessening the technical debt and presenting a different risk profile.

Which approach is better?

I believe that both approaches are important to the future of IT. At the moment, large enterprises adopt SaaS mostly as point solutions. Enterprise IT as-a-service poses the opportunity to operate at the enterprise level, not at a point-solution level.

I don’t believe the two approaches are mutually exclusive and expect that organizations will embrace both capabilities over time.

Services Buyers: Don’t Overlook Technical Debt in New Techs | Sherpas in Blue Shirts

Any replacement of new technology for an old technology, or a new approach to technology acquisition, incurs a technical debt that the consumer of the technology must pay down. Providers make all kinds of promises around SaaS, BPaaS and platforms, which lead buyers to believe they can avoid the technical debt when they adopt these newer technologies. But avoidance is just a myth.

A good example of technical debt is companies that move from waterfall to agile. They must invest in a DevOps platform with automated testing, invest in training new and existing talent and invest in changing the way they architect applications to allow for frequent updates.

Let’s consider a Salesforce (SaaS) implementation. In theory, it’s very easy to start using Salesforce.com for your CRM. But in practice, it turns out to be more complicated. Data must be loaded, APIs must be connected, Salesforce must be configured, user training must be conducted and, finally, all this must be tested.

The technical debt tends to increase the more disruptive the change and, unfortunately, the more impactful the changes on the business. In the case of SaaS or BPaaS, which in large enterprises tend to be point solutions, there is a modest technical debt. But in the case of platforms, where the buyer must make large structural changes to important systems of records, the technical debt is significant.

The technical debt creates complications that slow down migrating to SaaS, BPaaS or platform technologies. It also creates user frustration because of ongoing issues in transition/migration. The business users are eager to get to the resulting capabilities and are impatient with the time it takes to get there and the learning curve they must go through to be productive in the new environment. Users are unwilling to invest in the cost and effort to pay down the technical debt, but it surrounds the users’ ability to integrate the new technology and make necessary changes to be able to use it effectively.

As your business moves forward with adopting new technologies, be aware that the technical debt is a key issue in successful adoption. Service providers must be clearer and more honest about the scale of the technical debt and work on approaches that limit it. Nevertheless, buyers need to remember that the technical debt resides with the consumer. And no matter what the provider tells you, the debt is there and it’s likely to be large.

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