Top 10 Reports of 2018
As enterprises ramp up their digital transformation initiatives, the IT Strategic Sourcing and Vendor Management (SS&VM) function faces the onerous task of establishing and orchestrating an IT services vendor portfolio that can help the enterprise navigate the proverbial IT maze and fulfill strategic business objectives.
Digital transformation has become a necessity for firms to survive in this era of disruptive business models and rapidly-changing markets. Undoubtedly, Service Delivery Automation (SDA) solutions, such as Robotic Process Automation (RPA) and Artificial Intelligence (AI), can play a significant role in enabling this transformation and creating business value for enterprises.
As global organizations shift from an “arbitrage-first” to a “digital-first” model of service delivery, adoption of digital technologies has accelerated. Global In-house Centers (GICs) have a unique opportunity to increase their role in enterprise-wide digital transformation initiatives, as they are well positioned to drive adoption and implementation of digital technologies such as Robotic Process Automation (RPA) for global enterprises. RPA is gaining acceptance among GICs, as it enhances the value proposition of these offshore in-house delivery centers by offering incremental cost savings over arbitrage, means to improve quality of service delivery, and drive operational efficiencies.
The infrastructure services landscape is undergoing a significant shift, driven by digitalization. Organizations need to reimagine the current IT infrastructure services model to deliver the necessary agility and flexibility. Automation, analytics, and artificial intelligence (AI) – which comprise the “codifying elements” for driving AIOps –enable business-aligned infrastructure that can rapidly adapt to dynamic business requirements.
In April 2016, the European Parliament adopted the European Union General Data Protection Regulation (GDPR, officially EU 2016/679) that came into effect in May 2018. The regulation replaces the 1995 EU Data Protection Directive (DPD) and introduces new, stricter provisions. The legislation directly impacts all companies based in, or doing business with companies/individuals based in the European Economic Area (EEA), which comprises the EU, Norway, Iceland, and Liechtenstein.
In today’s world of continuously evolving technology landscape and intensifying competition, Research and Development (R&D) activities are playing an increasingly significant role than ever before for businesses to stay innovative, sustainable, and ready for the challenges of future. The global spend on R&D activities grew at a Compound Annual Growth Rate (CAGR) of ~3.5% during 2010-2017. The widespread proliferation of software across verticals is leading to a shift in “core vs. context” for enterprises and is driving enterprise R&D investments in new areas beyond conventional investments for product development and upgrades.
Our recent digital services research reveals a sizable mismatch between digital demand and supply dynamics. Fifty seven percent of enterprise demand is digital-first in nature, but from a strategy perspective, 53% of enterprises choose to embark on the digital transformation journey alone (DIY) versus engaging external partners. Sixty-one percent of enterprises with a digital-first mandate are dissatisfied with their service providers, while traditional IT deals have a higher share of satisfaction (55%). Overall dissatisfaction levels increased to 54% in 2017 from 48% in 2016. Enterprises’ internal organizational challenges have further reduced engagement opportunities for service providers.
Shared services centers have offered organizations a strategic approach to realizing efficiency, while at the same time protecting themselves from economic uncertainty with onshore/offshore models that not only generate cost savings but also spread risks of disruption. Today, they are expected to deliver top-line impact as well as serve as cost centers. As such, shared services centers enjoy greater strategic importance than ever before. Organizations increasingly look to shared services centers to function as strategic partners in their transformation journey. In this paper, we explore how shared services centers can play a key role in the digital transformation of their parent organizations through automation.
The GDPR regulations are expected to affect all industries but the impact on the life sciences vertical is likely to be relatively greater, owing to the large volume of complex sensitive data that is currently processed by relatively less mature IT systems. Each stakeholder in the life sciences ecosystem, comprising pharmaceutical firms, medical device manufacturers.
The AI adoption journey is set to fundamentally redefine the role of IT. The IT function will need to work closely with business to establish itself as an enabler, a governor, and the eventual flag bearer for enterprise AI initiatives. Cross-pollination of skills and responsibilities will lead to extensive blurring of lines between business and IT in the long run – an impending change that IT function needs to brace for.