There is little doubt that 2018 has been an interesting year. And it makes one wonder what’s ahead.
As we all know, the fate of most businesses is now based upon the global economy. In the U.S., the economy has been on fire with great GDP growth, record stock markets (until the recent dip!), and unemployment rates that are at generational lows. But President Trump’s “America First” policies have introduced a layer of uncertainty to the business world. And the rest of the world certainly has experienced a mixed bag of economic results.
So, what’s next? While it is easy to worry about rising interest rates, tariffs, increasing global/regional geopolitical tensions, and maybe even global warming – none of these issues are directly within your business’ leadership team’s control.
Yet, there is one common issue (at least in the U.S./European markets) that is becoming even more persistent, and that is the talent shortage across many different segments of the economy. Our hypothesis is that organizations are going to need to double down on their automation efforts to get more productivity out of their existing workforce.
Do you agree with our automation prediction? Or are there other challenges more pressing for your organization? We want to hear what you think are truly the most important topics impacting your organization and its plans for 2019.
Changes in global services buying centers and service delivery activities
Your digital priorities
Your talent challenges and priorities
As thank you for your participation, we’ll share a summary of the results; you’ll gain a comprehensive understanding of the areas where your peers are focusing their attention. Are they the same as yours? Completely different? A mix? Will 2019 be a repeat of 2018 Crazytown? Take the survey and see. (Although no promises on getting the right answer to that last one.)
As summer quickly fades from our memories, and we turn our attention to the end of 2018 and planning 2019, Everest Group conducted a survey of service providers to gather their thoughts on where the market has been, where it is, and where it’s headed. The results were expected … and surprising.
Every year, IvyExec.com – a curated online network of the world’s most successful executives – surveys more than 5,000 professionals to rank their current or previous consulting firm employers against five key parameters: Work, Culture, Money, Leadership, and Prestige.
In 2017, more than 95 percent of the respondents who ranked Everest Group gave the boutique global consultancy four or five stars on the provided five star scale. Comments from respondents included:
Growing, entrepreneurial firm with top strategy consultant talent rivaling the MBBs. Early and significant opportunities for impact working with C-level executives at Fortune 100 firms.
High-performing culture and ability to advance as quickly as you are able.
Great people, interesting and challenging work; we make a real difference for our clients
We are thought leaders in the industry, and often thought of as a much larger firm than we actually are. That’s simply because the quality of our work has provided us with a stellar reputation as facts-first, unbiased consultants and analysts.
Flat hierarchy, freedom to innovate, collaborative and open culture, talented people.
The firm gives even junior employees ample client experience, with very competitive pay/bonuses.
About the Rankings
Ivy Exec surveyed over 5,000 current and former employees of approximately 100 global management consultant firms. Firms were divided into two groups according to the number of employees, with firms employing fewer than 1,000 employees classified as boutiques. Respondents rated the firms in five areas: Work, Culture, Money, Leadership, and Prestige. Ivy Exec used a proprietary algorithm to create the rankings.
About Ivy Exec
Ivy Exec is a curated community of the world’s most successful executives and professionals. Their exclusive portfolio of career-focused experts & recruiters, curated job listings, and proprietary company & business school profiles helps their members continue achieving their biggest career objectives. Always inspired by its members’ goals and aspirations, Ivy Exec is their long-term partner — helping them thrive in their career, and harness their best-in-class insights for enduring success
In 2007, Everest Group conducted a value diagnostic survey among GICs (previously called “captives”) and their parent organizations to understand the alignment on expectations and perceptions of value delivered by GICs to parent organizations (Download results of the 2007 survey). A whopping 42% executives from parent organizations stated that the GIC should focus only on delivering cost savings. Interestingly,
58% of these responses came from executives in parent organizations of early stage GICs (<2 years of age)
Lack of requisite capabilities and offshoring of only limited part of work were cited as the top two reasons for the belief that GIC should focus on cost savings only
Fast forward five years: Has the expectation of parent organizations from their GICs changed? Have the GICs evolved and matured in their approach to serve parent organizations? Have the GICs developed the capability gaps unearthed by the 2007 survey?
To help answer these questions and also take a fresh view of the GIC-parent model from cost-savings vs. value delivered perspective, Everest Group is re-launching the survey . The results will help the industry understand the progress GICs are making and help companies learn if their approaches to GICs are similar or different than others.
If you are an industry stakeholder with first-hand experience with GICs, we invite you to take the survey.
All survey participants will receive a complimentary copy of the summary findings. If you wish to get a customized benchmarking for your organization to compare expectation and perception of value delivered between parent and GIC, please contact us, and we will get back to you with next steps.
The market conversation around enterprise adoption of private, public and hybrid cloud models has been surprisingly light on facts. Data, surveys and analysis tend to focus either on predicting overall market sizes for cloud services (which often strain credulity of even the most ardent cloud supporter), or on high level surveys around planned cloud adoption and perceived issues. While interesting from a broad market perspective, they provide little insight for IT executives facing hard choices around cloud migration. Decision makers are faced with little hard data on the use cases that are actually being implemented in the enterprises and the value that they’re generating. This gap creates challenges not just for enterprise CIOs but also for cloud service providers and consultants.
In conjunction with Cloud Connect and UBM TechWeb, Everest Group is excited to announce a new tracking survey focused on better understanding where the “rubber is hitting the road” with enterprise cloud adoption. Targeted at enterprises and vendors alike, our Enterprise Cloud Adoption Survey will focus on identifying global enterprise cloud adoption trends and patterns and where enterprises are seeing value today from the cloud. Our survey will help readers gain visibility and insight into questions such as:
What are the use cases that are driving adoption of SaaS, PaaS, IaaS and private cloud?
How are cloud adoption patterns and uses cases are differing by vertical? By geography?
What cloud infrastructure models are most frequently being deployed (private, public, hybrid)?
What cloud management platforms are gaining traction in the enterprise? Where are open source options (OpenStack, CloudStack) being adopted?
How does the value being delivered by cloud deployments compare to expectations?
We think some of the more interesting insights will come from seeing how these responses change and trend over time. Our goal is not to provide just a one-time shapshot of adoption, but to conduct an ongoing survey several times a year to surface key trends and patterns. The results from our first joint survey will be announced in conjunction with Cloud Connect Chicago, to be held September 10-13 at the Hyatt Regency O’Hare.
As you may recall, in December Everest Group announced that we were partnering with Shared Services & Outsourcing Network (SSON) to launch the industry’s first-ever survey to investigate Vertical Industry-specific Strategies for Shared Services and Outsourcing (or “VISSSO” for those who like acronyms that hiss like a snake).
The survey covered not only traditional horizontal functions like F&A, HR, and IT, but also industry-specific functions like order management in hi-tech, merchandising analytics in retail, and loan and mortgage servicing in banking. In total, it addressed 164 vertical functions and 8 horizontal functions. Scope, sourcing model, technology strategy, organization model, improvement initiatives…all that stuff for each function across 28 industries.
Quite simply, it was a huge effort, and we are just now climbing out from underneath the avalanche of data.
Starting tomorrow at the North America Shared Services & Outsourcing Week in Orlando, we will begin unveiling the findings. We will follow with similar sessions in other SSOW events around the world, plus release the summary report later in March.
Enough about what is to come, let’s jump into some of the insights we have uncovered.
Looking across the 164 vertical functions, the responses reveal that services industries like financial services, transportation, and healthcare (in comparison to product-oriented industries like manufacturing and energy) include over twice as many vertical functions in their shared services and outsourcing strategies. Why? To over-simplify, the mid-office of services industries is simply larger and more important than that of product-oriented industries.
This means the mid-office is more closely tied to the financial processes typically at the heart of both shared services and outsourcing efforts. Or as we have hypothesized in our earlier research, “operational finance” processes of services industries are a critical component of value delivery and due to their linkage with other finance process, they are most commonly aggregated into the more general finance activities.
We also broke apart the data based upon the organizational maturity for delivering services (see the graph below). Interestingly, mature organizations are twice as likely to use end-to-end models for delivering F&A services. Further, mature groups are somewhat less focused on consolidation (and re-engineering – not shown), but more focused on increasing collaboration with their user groups. Further, they believe they are more than four times as successful in implementing change.
What does this tell us? Our belief is that shared services and outsourcing professionals are segmenting into two groups. One has been successful in creating change for their organizations, plus implementing and optimizing a new delivery model. The second has not only implemented a new model, but is actively trying to create ongoing change by engaging their users and seeing change as a day-to-day competency instead of a painful and one-time transition.
Consolidation and process re-engineering will not quickly go out of style, but they are far from the end of the story. And, by the way, the more mature group reports greater focus on cost savings, greater ability to meet financial targets, and more increased inclusion of non-cost value drivers in their business cases.
There are many other findings that will be featured in our summary report; some additional interesting factoids in the interim include:
Of all sectors, public sector is most focused on cost savings (tax payers rejoice!)
Not surprising, the hi-tech industry has much more aggressive plans to pursue Saas/cloud solutions
More mature organizations are largely focused on soft factors like user engagement and change management, but they are not more inclined to implement new tools, adopt analytics, or prioritize Saas strategies
All for now…looking forward to sharing more as we work through additional analysis. Please don’t hesitate to contact me if you have questions or wish to debate the findings.
For the first time, we will be able to look at how shared services and outsourcing models are maturing for functions specific to more than 25 industries, such as claims management in insurance, order management in telecommunications, and loyalty program management in hospitality and tourism.
The responses from the Vertical Industries Strategies for Shared Services and Outsourcing survey will enable us to document the current role of shared services and outsourcing, degree of centralization, expected optimization initiatives, technology strategies, and other factors relating to more than 150 functions across all the covered industries. We’ll then be able to arm you with both the broad themes and the detailed nuances that are relevant to you and your business.
Why is a view of vertical industry strategies important?
First, we are receiving an abundance of these questions. We are increasingly asked to help organizations calibrate their approaches based upon factors unique to their businesses. For example, although sometimes collectively referred to as “Energy and Resources”, oil & gas, utilities, and mining are very different industries, and the location of businesses requiring support, the role and degree of centralization, and the tolerance for operating shared services in “non-traditional” geographies vary tremendously. And SSON is hearing the same thing from its members –industry-specific content and networking are increasing in prominence.
Second, solutions specific tovertical industry strategies drive more complex economics, especially as they relate to technology. As the functions being supported more closely touch the business, the potential impact on revenue and cost increases…as does the potential for greater value. However, the unique nature of each function complicates the technology options. Make-buy decisions become more complicated and fewer options exist. Further, service providers must carefully assess whether they have the stomach to invest in and maintain more narrow solutions with fewer potential clients across which to spread their investments. As illustrated below, service providers must think carefully about where to draw the line in making technology investments to serve unique industry needs. Further, their clients must make a corresponding commitment to a technology model.
Third, organization models are under attack and will be shaped by the answer. Traditional shared services models were initially defined around the scope being impacted by ERP implementations. The scope for offshore outsourcing and captives was largely shaped around roles that could be delivered remotely with lower cost labor. Neither was fundamentally designed around what best enabled the business. As shared services and outsourcing initiatives mature and expand, they are challenging existing organizing philosophies, and the degree and type of industry-specific services will fundamentally set the stage for the next generation in global services.
Oh yes, this is an important topic.
The survey, which will launch in early January 2012, will include relevant questions for enterprises, service providers, and consultant/analysts. If you have any questions or comments before you participate in it, please contact me at [email protected].