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Corporate themes

Creating Agile Business Processes through 3rd Platform Technologies

 
July 19, 2016

Enterprises today are embarking on a digital transformation journey as a result of strong market forces including pricing pressures, evolving buyer needs, and an influx of new disruptive technologies. Buyers are leveraging 3rd Platform technologies and innovation accelerators to power this journey as they look to increase operational efficiencies, exploit the full potential of their data and information assets, and drive business outcomes. The following shifts in business analytics, automation, and as-a-Service models have been key elements in improving and creating more agile business processes.

Outcome-driven business analytics. Enterprises want analytics support from providers across the gamut: from reporting and interpretation of business analytics data and metrics to the implementation of data warehouses and the extracting and compiling of unrelated (structured and unstructured) data sources. Users strive to be proactive in how they respond to events by leveraging predictive analytics to operate as close to real time as possible; they also desire more self-service capabilities and better visualization tools to improve reporting competencies.

Rise in automation. As the automation of business process services evolves, there will be a shift from automating simple, easily repeatable tasks to focusing on critical and intricate use cases and tasks. To do so, customers will look to leverage emerging technologies like cloud computing or automation tools and platforms. According to IDCs 2016 Finance, Accounting and Procurement BPO Services Buyer Survey, buyers feel on average that 37% of their current business processes are suitable for automation now and they are most interested in automating the procure-to-pay process (finance and accounting) and sourcing support processes (procurement).

Shift from traditional outsourcing to Business-Process-as-a-Service (BPaaS). The likely long-term benefits of BPaaS include: cost advantages for the customer, provider, and SaaS partners if utilizing a specialized BPaaS model; greater flexibility in contracts, delivery structures, process design, and pricing models; and the replacement of legacy technologies and outsourcing to enable customers to focus on their core competencies. While adoption has yet to peak, according to IDC’s 2015 Outsourcing Services Survey, 54% of IT decision makers who currently outsource or plan to outsource any business processes would prefer using the BPaaS model in place of a traditional outsourcing model of service delivery. Providers should consider which BPaaS model (vertically integrated or specialized) will best support the varying nature of their clients requests.

Growth of as-a-Service models. Enterprises are increasingly looking to providers to provide horizontally and vertically focused end-to-end services. From the providers perspective, this could not only be a competitive differentiator, it could also improve client relationships and drive non-linear growth. Key elements of the as-a-Service model may include:

  • Identifying or pre-defining business outcomes
  • Providing domain expertise
  • Utilizing an optimized delivery platform (such as BPaaS or RPA tools)
  • Embedded analytics
  • Non-FTE pricing methodologies like transactions or outcome-based pricing

The next step for digital transformation in the business process services industry is an increasing shift towards machine learning and AI/cognitive computing in the forms of cognitive automation and cognitive analytics, which we see coming to fruition through the likes of ignio, Holmes (Wipro), DryICE (HCL), AI Technology Lab (Accenture), and Ameila (IPsoft) (in the cognitive space).

The BPaaS model also has the potential to enable new business models, especially through crowdsourcing. The combination of BPaaS/cloud based platforms and crowdsourcing, which are similar in nature (where you obtain a business process/service and utilize an output-based pricing methodology) could provide a new operating model that is scalable, automated and transforms the way buyers receive services and how providers deliver services.

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Alison Close is a Senior Research Analyst for IDCs Worldwide Outsourcing Services Team and leads the Worldwide Finance, Accounting and Procurement BPO Services practice. As part of developing and delivering research for this program, she also focuses on research related to IDC's 3rd platform, particularly in areas of analytics, IoT and cloud/BPaaS.