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HfS Research Blueprint: Design Thinking in the As-a-Service EconomyExcerpt for AccentureA study on the use of Design Thinking in Business Operations and Outsourcing Services Engagements

March 2017

Hema SantoshPrincipal [email protected]

Barbra Sheridan McGannChief Research Officer, HfS [email protected]

©2017HfSResearchLtd.ExcerptforAccenture Proprietary│Page2

Table of Contents

Topic Page

ExecutiveSummary 5

MarketOverview 16

ResearchMethodology 30

ServiceProviderAnalysis 35

Recommendations 41

AbouttheAuthors 47

Proprietary│Page3©2017HfSResearchLtd.ExcerptforAccenture

Context for HfS Blueprint on Design Thinking in the As-a-Service Economy

§ Being successful in today’s consumer-focused and rapidly changing economyrequires companies to be more flexibleand innovative, faster.

§ For the services industry, it meansmaking fundamental changes to the “oldway” of service design and delivery.

§ This is driving the shift to servicesolutions being designed with realbusiness context and creativity, asopposed to looking at process andtechnology alone.

§ In this context, Design Thinking sits atthe intersection of analytical andempathetic-centered work in businessprocess and IT operations andoutsourcing. It also provides an outletand a framework for creativity.

Design Thinking complements “classic” outsourcing methods and tools

Source: HfS Research

§ Industrialization, standard delivery methods, Lean Six Sigma, and global delivery models are allvaluable tools for business and IT operations, and we see service providers looking to integrate DesignThinking here, not replace.


Context for HfS Blueprint on Design Thinking in the As-a-Service Economy, continuedn Outsourcing used to be about doing the same thing more efficiently – to drive out time, cost,

and labor by doing them over and over. But in this emerging As-a-Service Economy, outsourcingis about getting access to capabilities and driving outcomes.

n Since the new approach means you often don't know exactly what you need to do to achievethose outcomes, or which technologies to use when and how that impacts your talent, then youneed Design Thinking to brainstorm your options. That's the fundamental shift of why you needDesign Thinking now.

n This Blueprint Report, therefore, explores the use and impact of Design Thinking on servicesengagements by service providers. We see it taking shape in consulting, workshops, and as anintegral part of outsourcing solution and service delivery.

n This Blueprint Report focuses on selected service providers in terms of the integration of DesignThinking and the benefits that have been achieved for enterprise clients and service providers.

“Design is not being creative. It's solving hard problems. You may come to acreative solution, but only after you've done the hard work.”

– JaredSpool,Designer

Executive Summary


Introduction to the 2017 HfS Blueprint: Design Thinking in the As-a-Service Economyn The HfS Blueprint for Design Thinking in The As-a-Service Economy is an assessment of the

integration of Design Thinking principles and methods into a way of working in outsourcingservices and operations. We first examined if and how service providers were adopting DesignThinking for innovation in this industry in 2016 and have only seen momentum in the interim.”

n The 2016 HfS Blueprint for Design Thinking in the As-a-Service Economy was the first-of-its-kindreport to use the HfS Blueprint methodology to assess the business process and IT servicesmarket for this approach in outsourcing engagements.

n Since then, Design Thinking has come a long way from being a scholarly written concept to apractical utility. The goal of the 2017 HfS Blueprint Report on Design Thinking in the As-a-ServiceEconomy is to assess the progress made on the real uses cases, concepts, and adoption into theculture of Design Thinking among top-tier service providers.

n These service providers described their rationale, approaches, stories, and investment areas, andconnected us with clients to share their experience. It says to us that this group believes there isa new way to work in business operations and IT that enables collaboration between servicebuyers and service providers.

n These service providers are on a journey to redefine outsourcing engagement and impact. Theparticipants are Accenture, Capgemini, Cognizant, Concentrix, EXL, Genpact, IBM, Infosys,Sutherland, Tech Mahindra, and Wipro.


Introduction to the 2017 HfS Blueprint: Design Thinking in the As-a-Service Economy, continuedn Through this Blueprint, we review the overall market penchant for adopting Design Thinking and

evaluate the approach of participating service providers, including leadership, methodology,investment plans, corporate culture, and in-house talent.

n Unlike other quadrants and matrices, the HfS Blueprint identifies relevant differentials betweenservice providers across a number of facets under two main categories: innovation andexecution. The input for the evaluation comes from service providers and clients, survey data, anetwork of outsourcing services leaders, and the HfS industry analyst team.

“Weknowhowtomakesomethingefficient,”inoursharedservicescenter,“andwehavebeendoingLeanSixSigmaforyears.Werequiredanewwayofthinkingtolookatspecificareaswheretochangeandmakeitsustainable.”

– SharedServicesGlobalLeader


What is Design Thinking?

HfSsubscribestotheIDEOdefinitionofDesignThinking,whichfollows,andtheKeyPrinciplesbasedonStanfordd.school thatcanbeincorporatedintothewayweworkinservicedeliveryandengageaspartnersinoutsourcing.

“Designthinkingisahuman-centeredapproachtoinnovationthatdrawsonthedesigner’stoolkittointegratetheneedsofpeople,thepossibilitiesoftechnology,andtherequirementsforbusinesssuccess.”

- TimBrown,presidentandCEO,IDEO

Source:Modifiedfromprinciplesputforthbythed.school,StanfordUniversity

PrinciplesofDesignThinking

Thisapproachprovidesprinciplesforserviceprovidersandservicebuyerstoworkacrosssilosinsideandoutsideyourbusiness,takestakeholderanduserexperienceintoconsideration,movequicklyandflexiblythroughexperimentationtosolution,andcommunicateinanengagingwaythroughvisuals,hands-onprototypes,andstories.


Why Are We Looking at Design Thinking for Service Delivery and Outsourcing? DesignThinkingisawaytomakeinnovation“active”—tocreateacycleofinnovation.Wemustcontinuetolearnandimprovetoimpactoutcomes.Todothesamethingoverandoverandexpectdifferentresultsis,asoftencreditedtoEinstein,thedefinitionof“insanity.”

SoDesignThinkingisawaytocontinuallythinkaboutwhatcouldbebetterfortheend-user,thestakeholder,byengagingthatindividualorgroup(directlyorindirectly)inthewayabusinessworks,bypeopleforpeople,enabledbytechnology.Indoingso,youarewinningtheirloyaltytouseyourproductorservice…aslongasitisdoneinthecontextofyourbusinessstrategyandindustrydirection.

Sharedservicesandoutsourcingusedtostartwithaclearobjectiveinmind(takeoverthislabor/workprocess),butnowthattheworldisaboutoutcomes,youneedmorecreativethinkingaboutwhattodoandhowtodoit.That'swhyoutsourcingcontractswithoutDesignThinkingare,increasingly,lesseffective.Youmaybeachievingalevelofcostsavingsandefficiency,buthowwillyoucontinuetoraisethebar?Whenservicelevelagreementsaregreen,whydoyoufeelthereissomethingmoretobedone?

“AVoiceofCustomersurveyrevealedahighdegreeofdissatisfactionwiththeoverallprocess(transparency,complexity,cycletime,effort),despitetheachievementofcostsavingsandgreenSLAs.ItledusintoaDesignThinkingexercise.”- FinanceTransformationLead

WhendoyouuseDesignThinkingwithyourserviceprovider?Examplessharedininterviewsforthisstudy:• Tosupportatransitionintosharedservicesand/oroutsourcing• Tocreatealongtermvision• Tocheckthatyouaresolvingthe“right”problems• Tofigureouthowtomoveforwardwithusingroboticprocessautomation• Tofindoutifyourbusinessoperation(e.g.,finance,HR)ismissing

opportunitiesforsavingsorefficiencies• Tounderstandwhatwillreallyattractandengagethetypeofpeopleyou

wantinyourworkforce


How Does it Work?AcommonbaselineforDesignThinkingisthemethodputforthbytheStanfordd.School.Theserviceprovidersinthisresearchhaveincorporatedsomeformofthisapproachintomethodologiesforworkingwithclientsinservicesandoutsourcingengagements.

Why?Weareseeinghowitishelpingtochangetheapproachfrom“wehavetheseservicesandthisIPforyou”tomoreofaquestioning-based,iterativeapproach:“whatistheproblemyouaretryingtosolve,andforwhom;whatisreallyneededandrelevanttoyourbusiness;andwhatbusinessoutcomesdoyouwanttoimpact”inordertohelpsolveproblemsandaddressopportunities,notjustprovideservices.

DesignThinkingProcess

Forafullexplanationof“DesignThinkingProcess,”visittheStanfordd.School site.

Yes,serviceprovidersstillwanttomaptheirIP,capability,andtalentintoasolutionwithservicesforyourbusiness,buttheywanttomakeitrelevantovertime– notjustatapointintime,forcurrentandpotentiallynewbusinessopportunitiesaswell.Todothat,theyneedtobemoreinteractiveandmoreflexiblewithyourbusiness.

Contractsalsoneedtomatchthatflexibility,soDesignThinkingisalsohelpingtobettershaperelevantoutcomes-drivencontractsthatarebasedontransactions,oracombination,withpeople.


Impact of Design Thinking on Outsourcing and Service Design and Deliveryn “A design isn’t finished until somebody is using it,” Brenda Laurel, designer at MIT. While this Blueprint

starts with a look at the use of Design Thinking for ideation, we also explore the transition into action –the doing, the using, the implementation, and the results.

n Business results and outcomes are especially relevant to the study. Being able to define and talk aboutdesired business outcomes, such as entering new markets, creating new revenue streams, increasingemployee engagement or customer loyalty, attracting new members, reducing risk, etc., has to be partof the Design Thinking culture in this results-oriented and measured industry.

n Through sharing the process of understanding the problem or opportunity and designing the solutiontogether, service providers have told us they are more willing to step into outcome-based contracts.

n Most of what we learned in our 2016 research was about how Design Thinking was in the early stagesof being used in service design and IT and business operations (e.g., in F&A, HR). It is taking hold asservice providers and clients better understand the value of this approach to defining, prioritizing, andaddressing operational and business problems, big and small, and finding opportunities for cost savingsand growth plans.

n Design Thinking really is changing the way executives talk about business operations and outsourcingfrom being focused on overhead, cost reduction, labor arbitrage, how to use automation and when,etc., to a focus on the end user/stakeholder/customer experience and what problem to solve, resultdesired, and what people/process/technology is needed in a solution to get there: try, tweak, try again.

n This is driving the shift to service solutions being designed with relevant business context, as opposedto looking at just the the process (what are the steps we can re-design or cut out), or the technology(what can we automate, what app can we develop), or the people (how many people do we need tohire and manage to process transactions).


Impact of Design Thinking on Outsourcing and Service Design and Delivery, Continuedn For a service buyer, the advantages of working with a service provider include:

(a) Business Context: They are often already working within your business operations and know thesteps, the processes, and the results. “They have such a good view of where our pain points are,because our pain is their pain,” said one executive.

(b) Resources: People with skills, technology of their own or through partnerships, investment forpiloting and prototypes, and experience with business cases.

(c) Motivation: Realize that the outsourcing industry is in a shift and must work with clients in a newway, so are increasingly willing take on more risk, flexibility, and experimentation in partnership.

n Creative firms have the design and ideation methodology and expertise, and often also the experts inunderstanding human emotion and capability (sociologists and ethnographers for example). Consultingand outsourcing firms have the business and market context, as well as engineering and quantitativeanalytics capability that help define the business context and rationale for ideas, and drive the ideasthrough prototyping and experimentation into implementation. We are seeing a considerable amountof collaboration and consolidation between these two groups, through acquisitions, such as:

• Capgemini – Idean (2017),Fahrenheit212(2016)• Cognizant– IdeaCouture(2016)• TechMahindra– BIOAgency(2016)• Wipro– Designit (2015)• Accenture– ChaoticMoon(2015),Fjord(2013)

n Andwhileotheroutsourcingcompaniesarenotmakingacquisitions,theyarepartneringwithDesignThinkingfirms (e.g.,SutherlandwithUXAlliance,Genpact withElixirDesign)andacademicinstitutionsthatofferDesign-Thinkingcurriculum(e.g.,InfosyswithStanfordd.school).


Why Is Design Thinking Relevant to Outsourcing and Service Design and Delivery? n Business leaders need to address a number of industry factors, and it can be difficult to know where

to start and how to work with the many people who need to be involved to effect change. Thesefactors and how Design Thinking is relevant include the following:

• Digital Transformation: Robotic process automation, cognitive computing, artificial intelligence,machine learning, mobility … all of these and more technologies are available to use and are partof our everyday lives, but what is the most effective way to use them in the business – in a waythat is going to make operations more efficient and effective at a lower cost and enable thebusiness to grow? Design Thinking is an approach that starts with defining the problem oropportunity for which to experiment with these technologies.

• Consumerism: You need to see how your customer sees you in order to do business with them.You also need to understand how they work and their motivations in order to engage over time.With Design Thinking, the end-user/customer/stakeholder experience and feeling is consideredin solution design, implementation, and iteration.

• “Lack of Innovation”: Outsourcing service providers have been challenged with the “what haveyou done for me lately” and “what’s innovative” about the work you do? A first step in DesignThinking is to define the problem or opportunity and the business outcomes and results youwant to impact. By doing so as a team, you share the understanding of the starting point andenter a journey on which everyone shares in the change and everyone sees the innovation (orlack thereof).


Why Is Design Thinking Relevant to Outsourcing and Service Design and Delivery?, continued

• Big Data and Analytics: What is the relevance of all the data that is being created, aggregated,and normalized? What questions do you want answered? What challenges are you looking toaddress? Using a Design Thinking method gives you a way to frame questions and testassumptions using the data – or redefine what data you actually need. “Using empathy meansthinking about the customer at a whole new level and moving on from just data to alsounderstand the emotion and how customers feel, hear, say, and do, and from multipleperspectives,” said one executive in an interview.


n As-a-ServiceWinnersareserviceprovidersthatareincollaborativeengagementswithclientsandmakingrecognizableinvestmentsinfuturecapabilitiesintalentandtechnologytocontinuetoincreasethevalueofDesignThinkingmethodsintoawayofworking:

• Accenture,IBM,Capgeminin TheHighPerformers allexecuteDesignThinkingwelland

areinvestingincapabilitiesbutneedtogainmoreconsistencyandtractionamongclientsinthetransitiontodeliverythatinvolvesthebroaderbusiness:

• Cognizant,Genpact,Sutherland,Wipron AsserviceproviderswithHighPotential,wesee

Concentrix,Infosys,andEXLalsoonajourneytoincorporateDesignThinkingmoreeffectivelyintotheirwayofworking.

HfSappreciateshowtheseserviceproviders,amongthemanythattalkaboutusingDesignThinking,havesharedtheirapproaches,stories,andclientcontactswithussothatwecansharewiththeindustryaperspectiveontheroleandvalueofDesignThinkingtoservicedesignanddeliveryintheoutsourcingmarket.Eachonebringsuniquestrengthsthatshouldbeconsideredbyaservicebuyerfortheright“match”inanengagement.

AS-A-SERVICEECONOMY

Useofoperatingmodels,enablingtechnologiesandtalenttodrivebusinessoutcomesthroughoutsourcing.Thefocusisonwhatmatterstotheendconsumer.

HfSusestheword“economy”todescribethenextphaseofoutsourcingasanewwayofengagingandmanagingresourcestodeliverservices.

The8IdealsoftheAs-a-ServiceEconomy:

1. Write-OffLegacy2. DesignThinking3. IntelligentEngagement4. BrokersofCapability5. IntelligentAutomation6. AccessibleandActionableData7. Holistic Security8. Plug-and-PlayDigitalServices

Source:BewareoftheSmoke:YourPlatformIsBurningbyHfSResearch,2015

Use of Design Thinking in Service Design and Delivery and Outsourcing: Service Provider Landscape

Market Overview


Leaders Are Looking to Grow the Business Without Growing Operations and Services CostsHowcriticalarethefollowingC-suite directivestoyouroperationsstrategy?(SVPsandabove)

20%

22%

24%

26%

29%

30%

31%

31%

42%

48%

46%

38%

55%

50%

45%

48%

48%

43%

19%

19%

17%

13%

17%

20%

15%

15%

8%

12%

12%

21%

5%

4%

5%

6%

6%

7%

Invest in cognitive technologies and machine learning to reduce reliance on mid/high skilled labor

Invest in process automation and robotics to reduce reliance on low-skilled labor

Policies that restrict the hiring of people

Improve the quality of operations talent

Scalable / Flexible services

Accelerate speed to market with new products

Create real-time data that supports predictive, not reactive decisions

Align middle/back office operations to improve customer experiences

Drive down operating costs

Mission Critical Increasingly Important Emerging Not a Directive

Source: HfS Research in Conjunction with KPMG, “State of Operations and Outsourcing 2017” Sample: n=454 Enterprise Buyers Note:Totalsmaynotequal100%duetorounding


Service Providers Need to Adapt or Risk Losing Executive Sponsors

HowlikelyisitthatyouaregoingtoswitchoutprimaryserviceprovidersthatfailtoevolvelegacyservicedeliverytointelligentoperationswhenyourenewyournextphaseofITOand/orBPOcontracts?

20%

43%

29%

6%

2%

15%

35% 38%

10%

2%

Very Likely Likely Neither likely or unlikely

Unlikely Very unlikely

SVP + VP and Below

Source: “Intelligent Operations" Study, HfS Research 2016Sample: Buyers = 371

63% of the buyers with the purse strings are looking for

providers that bring something more to the table –

or they are going to leave.


Service Buyers Have Increasingly Aggressive Expectations for Cost Saving, Productivity, and Growth

Whatadditionalproductivityimprovementswouldyouneedtobeabletojustifyshiftingtoanas-a-serviceledintelligentoperationsmodelnowandin3years?

17% 17% 15% 14% 13% 12% 15% 13% 17% 17%

22% 19% 19% 14%

18% 19%

-17% -18% -17% -17% -21%

-15% -19%

-15% -20%

-24% -24% -20%

-24% -20% -22% -23%

Man & CPGEnergy & Utilities Other

Banking and Financial Services Insurance

Pharma, Life Sciences Healthcare

Retail and Hospitality

Revenue Growth Required Today Revenue Growth In 3 Years

Cost Saving Required Today Cost Saving In 3 Years


Cost savings are not enough. Revenue growth is expected as part of operational transformation.


There Are Many Levers to Pull for More Efficient & Effective Business Operations -- to Work more “As-a-Service”§ Theoutsourcingindustryisin

atransitionstagefromlegacy“liftandshift”andheadcount-basedcontractstomoreflexible,on-demand,business-outcomeorientedservices.Thefocusisonvaluetotheconsumer.ThisistheAs-a-ServiceEconomy.

§ HfSResearchbelievesthatanewapproachtosolutionsandincreasedcollaborationfocusedondefiningandsolvingbusinessproblems,troublespots,andopportunitieswillleadtomoreeffectiveandvaluableengagementsovertime.

§ DesignThinkingisameansofchangingthenatureandfocusofengagement.

THE$OPTIMUM$OPERATING$MODEL$Outsourcing+|+Shared+Services++GBS+|+BPaaS/SaaS/IaaS+|+Crowdsourcing+

EMPOWERING$TALENT$TO$MAKE$IT$POSSIBLE$

Capabili=es+over+Skills+|+Defining+Outcomes+|+

Crea=vity+|+Data+Science+

A$BURNING$PLATFORM$FOR$

CHANGE$Globaliza=on+of+Labor+|++

HighGgrowth+Emerging+Markets+|+Disrup=ve+Business+Models+|+

Consumeriza=on+

AS6A6SERVICE6ECONOMY$Outcome+Focus+Collabora=on+

Agility+|+OneGtoGMany+PlugGandGPlay+Services+

TECHNOLOGY$$TO$AUGMENT$KNOWLEDGE$LABOR$Digi=za=on+&+Robo=c+Automa=on+|+Analy=cs+|+Mobility+|++Social+Media+|++Cogni=ve+Compu=ng+

TOOLS/INFRASTRUCTURE$ GOVERNANCE$

Source: HfS Research

Welcome to the As-a-Service Economy


Design Thinking in the Journey to the As-a-Service Economy

FixedAssetsLeveragedAssets

2DesignThinking

3BrokersofCapability

1Write-OffLegacy

4CollaborativeEngagement

7HolisticSecurity

5IntelligentAutomation

6Accessible&Actionable

Data

8Plug&PlayDigitalServices

SOLUTIONIdeals

LEGACYECONOMY

AS-A-SERVICEECONOMYCHANGEMGMT

Ideals

§ MovingintotheAs-a-ServiceEconomymeanschangingthenatureandfocusofengagementbetweenEnterpriseBuyers,ServiceProviders,andAdvisors.

§ UsingDesignThinkingisawaytomovefromthepastofresolvingproblemsbylookingfirstattheprocessortechnologyasthesourceofthesolutiontounderstandingthebusinesscontexttoreimagineprocessesalignedwithmeetingclientneeds.


Design Thinking Can Help Change the Focus of Services Engagement to Work Smarter§ DesignThinkingprovidesanopportunityforpeopletoworktogethertoshareaproblemandasolution.§ Inthecontextofoutsourcingservices,itstartswithunderstandingthesituationandthepeopleinvolved,

thebusinessoutcomesyouwanttoimpact,andthenquicklygeneratingideas,prioritizingthem,testingthem,figuringouthowtomeasuretheimpact,anditeratetodetermineasolution.

Incorporating Design Thinking into Business Context:

1ARTICULATE THE PROBLEM

2DEFINING DESIRED OUTCOMES

3PRIORITIZING IDEAS

4IMPLEMENTING SOLUTIONS

5REALIZING OUTCOMES

1ARTICULATING THE PROBLEM

Source: HfS Research and Stanford d.School

Empathize

Define

Ideate

Prototype

Test

Empathize

Define

Ideate

Prototype

Test


How Service Providers Are Operationalizing Design Thinking: Methods

ServiceProvider ProprietaryMethodsthatIncorporateDesignThinking

Accenture AccentureInnovationArchitectureandFjordServiceDesign

Capgemini Scan– Focus– Act

Cognizant Rethink/Reframe– Reimagine– Reset– Realize

Concentrix EDGEMethodology

EXL Five-PointValueDeliveryFramework;EXLeratorTM

Genpact LeanDigitalTM

IBM Observe– Reflect– Make

Infosys AIKIDOandZeroDistance

Sutherland EmbeddedintoOperationalExcellenceMethodology

TechMahindra/BIOAgency BIOCustomerExperienceFramework

Wipro AlphaBetaFive– StepMethodology


Service Buyers See Design Thinking as a Way to Shift to More “Intelligent Operations”Howsignificantdoyouseethe“As-a-ServiceEconomy”idealsintheshifttomoreintelligentoperationsforyourorganization?


15%

15%

21%

20%

19%

20%

29%

30%

20%

23%

21%

26%

27%

30%

22%

25%

40%

44%

40%

37%

38%

35%

31%

33%

21%

14%

13%

14%

12%

13%

13%

11%

4%

4%

5%

3%

4%

3%

5%

2%

Plug&PlayDigitalBusinessServices

BrokersofCapability

WriteoffLegacy

IntelligentAutomation

CollaborativeEngagement

DesignThinking

HolisticSecurity

Accessible&ActionableData

Absolutelycritical Critical Significant Insignificant Allhypeandnosubstance

Note:Totalsmaynotequal100%duetorounding


Focusingonandaddressingtheend-userandstakeholderexperienceisrelevanttoallindustriesandacrossfront,middle,andbackoffice.TheindustriesthatrecognizethevalueofDesignThinkingtosynchingoperationsinthiswayareEnergy&UtilitiesandInsurance,althoughitisclearlyontheradarscreenacrossallindustries.

Interest in Using Design Thinking by Industry

Howsignificantdoyouseethe“As-a-ServiceEconomy”idealsandtheshifttomoreintelligentoperationsforyourorganization?(ResponsesshowthecutforDesignThinkingandAbsolutelyCritical/Critical.)

50% 61% 61%

52% 51% 43% 43% 41%



Ourresearchshowsthatcompaniesarelookingforpeoplewhoarecreative,criticalthinkers,andinterestedintechnology.ThesecapabilitiessupportallofthefollowingrequirementsfordrivingchangeinbusinessandIToperations.

Design Thinking Leverages Talent that Is Required for More Intelligent Operations

Towhatextentarethefollowingtalentrequirementsincreasinginimportance,inordertogainmorevaluefromyouroperations?


27%

29%

30%

31%

31%

32%

33%

37%

50%

54%

51%

51%

55%

53%

50%

51%

23%

17%

19%

18%

14%

15%

18%

11%

Influencingseniorexecutives

Analyticalprowesstoimproveoperations/productivity

Exploringnewwaysofpartneringacrosstheservicesecosystem

Understanding/usingdigitaltechnologytoimprovebusinessperformance

Proactivelyidentifyingnewwaysofdoingthingsthatbreakoldhabits

Understanding/usingautomationtoimprovebusinessperformance

Improvingend-to-endprocessesacrossexternalandinternaldelivery

Definingbusinessoutcomes

Increasingsignificantly Increasingsomewhat Nochange/Decreasing

Note:Totalsmaynotequal100%duetorounding


It’s an Action that Executives and Management Agree Will Make a Difference in Advancing Business Operations

Source: Ideals of As-a-Service Study, HfS Research, 2015 Sample: Enterprise Service Buyers = 178

Howmuchimpactwouldtakingthefollowingactionshelpyoureachyourdesired“As-a-Service”end-state,ifyouweretomakethemtoday?

77%

69%

62%

54%

54%

54%

46%

46%

27%

36%

24%

43%

23%

25%

28%

48%

Replaceyourexisting(legacy)serviceprovider(s)with“As-a-Service”drivenproviders

Identify/hireatransformationalleader/changeagent

Investinspecializedexternalservicestoredesignoperations

Accomplishcreativeproblemsolving/"DesignThinking"

InvestinexternalITservicestohelpusmigrateawayfromlegacysystems

Investinspecializedchangemanagementsupporttoreorientoperationsstaff

Hireinnewoperationstalenttoredesignprocesses

Investineffectiveanalyticstools&skills

C-Level MiddleManagement


Perspective from Business and IT Executives Who Have Engaged in Design Thinking with Service Providers

Source: HfS Research Interviews

“Wemadeassumptionsaboutpeopleintheindustryandarefamiliarwithourservices,”saidoneexecutive.DuringtheDesignThinking-ledprocess,theserviceprovider“calledusoutalotinagreatway…andthencamebackwithwhattheyheardandthoughtfulrecommendations,”ofwhichahandfulhavebeenimplementedquickly.

“Journey mapping isn’t a way to develop big picture strategy or consumer experience but a way to take a problem and understand it as best you can from multiple perspectives, and put solutions in place for that problem or business issue.”

“Weareevolvingsharedservicesintoamoreintegratedapproachwiththestakeholder.”

“Wecan’ttakeeveryidea;we’vehadtodoprioritizationon-going.Itgaveusanewwaytoworktogether.Butthechallengeistoweaveitintotherealworld.Howtocarryonwhatisidentifiedandgettherightlevelsofattentionandfunding.”

“Itgaveusawaytoseebeyondthetransactions.”


Stories of How Design Thinking Is Being Used in OperationsHerearefewexamplesthatshowbrieflyhowDesignThinkingworksinbusinessoperationsandoutsourcingengagements.Therearemoreexamplesonourresearchsiteandblog.

Capgemini facilitatedaRecord-to-AnalyzerefreshjointlywithtwoBusinessProcessServicesclientsina“BusinessPriorityWeek”workshop.AnotherledtothecreationofaBusinessServicesVirtualDeliveryCenter.It’salsousedDesignThinking-ledapproachestoaddresspurchasetopay(P2P),humanresources(HR),andsupplychainmanagementincombinationwithLeanSixSigma.

Genpact andclientssharedstoriesofusingDesignThinkingworkshopsandprincipleseffectivelyincoreoperationsareas– ordermanagement,finance,businessintelligence– thatareGenpact’straditionalareasofstrength.IthasalotofF&Aandindustrysubjectmatterexpertisetoleveragehere,andisusingtheLeanDigitalapproachonitsownF&Awithresults.

An EXL clientwaschallengedwithstakeholdersatisfaction,eventhoughtheSLAsweregreen.EXLworkedwiththeclientteamtodevelopastakeholderexperiencejourneythatinvolvedstartingwithunderstandingthechallengesofthepeopleinvolvedintheend-to-endworkprocesses,attheclient,andatEXL.Onthejourney,theyidentifiedthepainpointsanddiscussedprocessesandtoolstoaddressthem,prototypednewworkflowsandexperimentedwithatechnologysolution,identifiednewresources,arenowlookingtooperationalizethem,andhaveusedcutsofdatatoanalyzealongtheway.

Research Methodology


Research MethodologyDataSummary

n Input was collected Q42016–Q12017, covering service buyers, serviceproviders, and advisors/influencers in the outsourcing servicesindustry.

ThisReportIsBasedon:

n TalesfromtheTrenches:Interviewswithbuyerswhohaveevaluatedserviceprovidersandexperiencedtheirservices.Somearesuppliedbyserviceproviders,andmanyaregatheredthroughinterviewsconductedwithHfSExecutiveCouncilmembersandparticipantsinourextensivemarketresearch.

n Sell-SideExecutiveBriefings:Structureddiscussionswithserviceproviderswereintendedtocollectdatanecessarytoevaluatetheirinnovation,executionandmarketshare,anddealcounts.

n PubliclyAvailableInformation:Thoughtleadership,websiteinformation,presentationsgivenbyseniorexecutives,andothermarketingcollateral.

n ParticipantswereselectedfromtheleadingglobalITaswellasBPOServicesprovidersandhadtomeettwocriteria:

• ExhibitedinterestandspokenaboutinitiativesinbuildingDesignThinkingcapabilityduringdiscussionswithHfSResearch.

• Anamedproviderwithintherankingsectionofourannualenterprisebuyersurvey.

ParticipatingServiceProviders:


HfS Blueprint Scoring for Design Thinking 2017EXECUTION 100%DesignThinkingSponsorshipandCommitment 15%

CreatingAwarenessandPartneringwithClients 15%

ClientFeedbackandResults (UseofDesignThinking) 30%

Real-WorldDelivery

Customer /ClientProblemSolvingandOpportunities 10%

InternalCorporate Initiatives 10%

Trained/ExperiencedPersonnel 10%FormalMethodsandTools 10%

INNOVATION 100%VisionforDesignThinkingin BusinessOperationsandOutsourcingEngagements(“As-a-ServiceEconomy”) 15%

ClientFeedbackandResults(ManagingComplexity/TransitiontoExecution) 10%

AdoptionofDesignThinkingMindsetandMethods:CulturalShift 20%

InvestmentinDesignThinkingResourcesandCapability 15%

UseofInsightsandAnalyticswithDesignThinking 15%

PartnerStrategyandUseofAcquisitions 10%

IntegratingDesignThinkingWithinAs-a-ServiceEnvironment 15%


Execution Definitions

EXECUTION Howwelldoestheserviceproviderexecuteonitscontractualagreement,andhowwelldoestheprovidermanagetheclient/providerrelationship?

DesignThinkingSponsorshipandCommitmentWhatisthedemonstratedenthusiasmandqualityoftheexecutiveandleadershipcommitmentfordrivingDesignThinking? Arethereanyuniqueaspectstothesponsorship?DoesitincludeBusinessProcessandITServices?

CreatingAwarenessandPartneringwithClients

HowwelldoestheserviceproviderengageclientsintheuseofDesignThinking?Areclientsmadeawareofthismethodologyandencouragedtouseit?Doestheserviceproviderengageincommunitybuilding?

ClientFeedbackandResults(UseofDesignThinking)

Whataretheclients'overallimpressionsofthequalityofservice?

Real-WorldDelivery IsDesignThinkingusedtobesttapintosolutions?Createnewofferings?IsitusedinternallybytheServiceProvideraswellaswithClients?

Customer /ClientProblemSolvingandOpportunities

WhatarethesolutionsandengagementsthathavebeenimpactedbytheuseofDesignThinkingandwhathasbeentheresult?ExamplesofDesignThinkingcollaborationbetweenservice providerandclient?UseofDesignThinkingprinciples,workshops,etc.

InternalCorporate Initiatives WhataretheinitiativestoadoptDesignThinkingforfindingsolutionsfororganizationalchallenges,suchassales, procurement,HR,finance?

Trained/ExperiencedPersonnel HowextensiveandpervasiveistheuseofDesignThinking?Arecorporateleaderstrained?Servicedelivery?Bywhat means(classroom,experiential,mentoring,etc.)?

FormalMethodsandTools

Doesthe serviceproviderfollowastandardapproachtoDesignThinking?HavetheprinciplesofDesignThinkingbeenincorporatedintotheservicedesignanddeliverymethodologyforoutsourcingthatwasalreadyinplace?Anyuniquetoolspertheclientfeedback?


Innovation Definitions

INNOVATION Innovationisthecombinationofimprovingservicesandbusinessoutcomes.

VisionforDesignThinkingin BusinessOperationsandOutsourcingEngagements(“As-a-ServiceEconomy”)

ThestrategyforuseofDesignThinkinginsolutionanddelivery.Examples?Howdoestheserviceprovidertellthestory?

ClientFeedbackandResults(ManagingComplexity/TransitiontoExecution)

Whatistheclientfeedbackontransitionfromideas/ideationtoexecution?Isworkcontinuingwiththeclient?

ContinuousImprovementThrough IterativeApproach

How doestheserviceprovideraddressLeanSixSigmaandDesignThinkingasapproachesforcontinuousimprovementandinnovation?Technology enablementcapability?

InvestmentinDesignThinkingResourcesandCapability

WhatistheinvestmentinDesignThinkingcapability? (e.g.,methods,tools,training,acquisitions,innovationcentersandlabs,etc.)

UseofInsightsandAnalyticswithDesignThinking

Howwelldoes theserviceproviderintegrateanalyticswithDesignThinking?Clientstoriesandexamples?

PartnerStrategyandUseofAcquisitionsHoweffectivelydoestheserviceprovideridentifyandarticulateproblemsandissues,andprovidesuggestionsorpartnertoexploresolutions?Is theserviceproviderofferingorprovidinganalytics?

IntegratingDesignThinkingWithinAs-a-ServiceEnvironment/CulturalShift

HowwelldoestheprovideruseDesignThinkingto createandmaintainan As-a-Service(e.g.,businessoutcome-oriented, flexible) environment?

Service Provider Analysis


Design Thinking Value Chain

BuildingConcept

• StrategicCommitment

• DesignThinkingFramework

• Empathy• DivergentThinking

Investments

• BuildingAwareness• Training• Method• Prototype/ProofofConceptBudgets

• InnovationCenters/Labs/Studios

• ExperiencedHires

TalentandCulture

• ExperientialTrainingandCoaching

• IntegrationintoOrganization

• FlexibilitytoIterateSolutions

• EmbeddedintheIndividualDevelopmentPlan

Practice

• Brainstorm • Integrate with

Analytics• Collaborate and

Co-Create• Create Client

Awareness

Implementation

• Salesactivitiessuchasproposals

• Projectstoenhanceservicedeliveryandtodevelopnewserviceofferings

• SuccessStories

Operationalizing Design ThinkingThisvaluechainshowsthebusinesscharacteristicsandactivitiesrelevanttoincorporatingDesignThinkingintoaserviceprovider’swayofworking,fromlaunchingitwiththerightlevelofsponsorship,investinginresourcesandtalenttosupportit,practicingit,andusingittodrivespecificbusinessactivities.


Operationalizing Design Thinking: Progress Among Service Providers in This Study

ServiceProvider InternalOperations

ClientDigitalTransformation

ClientBusinessOperations Sponsors

Accenture CEOPierreNanterme;ChiefStrategyOfficerOmarAbbosh;ChiefLeadershipandHROfficerEllynShook

Capgemini Noonesingleowner

Cognizant CEOFrankD’Souza;ChiefStrategyOfficer&CMOMalcolmFrank;PresidentCognizantDigitalBusinessGajen Kandiah

Concentrix SalesandConsultingSVPRickRosso

EXL CTOMikeToma;GlobalHeadofConsultingSuren Kumar;ChiefGrowthOfficerNagarajaSrivatsan

Genpact ChiefInnovationOfficerGianniGiacomelli;GlobalHeadofConsulting&Solutioning andChiefDigitalOfficerSanjaySrivastava

IBM CEOGinni Rometty;GlobalGMPhilGilbert;VPGlobalBusinessServicesJasonKelley

Infosys CEOVishalSikka;HeadofCorporateDesignSanjayRajagopalan;DigitalLeadScottSorokin;ConsultingLeadRajeshK.Murthy;Learning/DevelopmentLeadNavin Budhiraja

Sutherland PresidentofDigitalAndrewZimmerman;ChiefEngagementOfficerDarinWright;GlobalHeadSutherlandLabsOwenDalyJones;DirectorofDesignStrategyBenLittle

TechMahindra/BIOAgency CEO- TheBIOAgencyPeterVeash

Wipro CEOAbid AliZNeemuchwala;GlobalHeadWiproDigitalRajan Kohli;Designit Founder&ChiefVisionaryOfficerMikal Halstrup

Use of Design Thinking in: Depth of Integration & Use

Internal Operations None Shared

Client – Digital Transformation Examples Shared

Client – Business Operations Examples and Results


Major Service Provider Dynamics: HighlightsEXECUTION

• Sponsorship:AlltheparticipatingserviceprovidersshowcommitmenttousingDesignThinkingprinciplesbroadlyintheirwayofworking.AnumberofCEOsaresponsoringtheseefforts,representingachangeinculturebroadlyintheorganization:IBM,Accenture,Cognizant,Infosys,Wipro.

• CreatingAwareness:IBM andInfosys haveintroducedDesignThinkingtoclientsthroughvariousevents.Capgemini andTechMahindra hostroundtableswithindustryandthoughtleadersoninnovation.Sutherland bringsDesignThinkingintonewbids,QBRs,andclient/accountteamactivities.Accenture isbringingDesignThinkingmethodtoselectclientopportunities,withexamplesofresults.

• TalentDevelopment: Learningeffortsvaryfromonlinecoverageofprinciplestoexperientiallearning.AtSutherland,staffrotatethroughthelabs. Training-basedinitiativesatIBMDesignStudios aresupplementedbyamentoringprogramandthebeginningsofacertificationprocess. Genpact istrainingitsSixSigmaBlackBelts tohavecomplementaryteamsofprocess-orientedindustrializationandinnovation.Accenture istrainingandmentoringitsownandclientprofessionals.

• ExperiencedPersonnel:Uniquestrengthsareshowingintheserviceproviders,suchaskudostoWipro’sDesignit forsimplifyingcomplexitiesandstorytelling;Cognizant’s IdeaCoutureforflexibilityandcreativethinking.TechMahindra’sacquisition,BIO,isnotedforbeingparticularlyeffectiveat“activelistening.”Accenture andIBM arepowerhousesinthisareawithdepthandbreadthindesigning,developing,andsolutioning forindustryrelevanceandbusinessoutcomes.

INNOVATION

• VisionforUseofDesignThinkinginOutsourcingServices:IBMwithitscognitiveorientationandAccenture’sfocusonindustryandbusinessoutcomesmostclearlyandcomfortablyarticulateDesignThinkingasawaytohelpclientsdescribeandsolvebusinessproblemsandopportunitiesandimpactbusinessresultsusingtalentandtechnologyfordigitaltransformationandbusinessprocessservicesandoperations.Capgemini,Cognizant,Genpact,Sutherland,andWipro areprogressing.

• ServiceDelivery: Forinnovation,managingcomplexityandthetransitiontoexecutionplayasignificantroleinthevalueofDesignThinkingforservices.Capgemini hasfacilitatedworkacrossclientsfromthinkingtodoinginbusinessprocessservicessupport;andGenpact sharedexamplesinfinanceandordermanagement.TechMahindra’sBIOAgencyreceivedkudosforthewayitbreaksdowncomplexproblems.

• CulturalShift:Alloftheseserviceprovidershaveeffortsunderwaytochangethewaytheywork,fromtacticalexampleslikethejourneymapsthatarecoretoEXL andConcentrix work,toco-locatingWipro Digitalengineerswithcreatives fromitsacquisitionDesignit tocrosstrain.PrinciplesofDesignThinkingbeingincorporatedintothefoundationofthewaythatIBMworksismostprogressive.Infosys hasinvestedsignificantlyinshiftingitsworkforcetobemorecustomer-centricandquestioning,andit’smakingprogressalongtheselines.

• UseofInsightsandAnalytics:Cognizant’s StrategicForesightisauniquetoolhere.ClientsalsoreferencedtheuseofanalyticsbyIBM inDesignThinkingworkshops;Infosys throughAIKIDO;andAccenture andGenpact inon-goingservices.


HfS Blueprint Grid: 2017 Design Thinking IntegrationINNOVA

TION

EXECUTION

ExcellentatInnovationandExecutionInvestinginInnovationtoChange

BuildingAllCapabilities ExecutionIsAheadofInnovation

AS-A-SERVICEWINNER’SCIRCLE

EXECUTIONPOWERHOUSES

HIGHPOTENTIALS

HIGHPERFORMERS

Accenture

Cognizant

EXLGenpact

Wipro Capgemini

IBM

ThisgridrepresentsananalysisoftheuseandincorporationofDesignThinkingintooutsourcingandoperations.

TechMahindra/BIOAgency

InfosysConcentrix Sutherland


AcquisitionsandPartnerships RepresentativeClients ServiceDeliveryOperations Frameworks/Tools

Acquisitionsinclude:2nd Road(2016),ChaoticMoon(2016),Karmarama (2016),Fjord(2013)Partnershipsinclude:MassachusettsInstituteofTechnology(MIT),DukeUniversity,IndianInstituteofTechnology,PurdueUniversity,StanfordUniversity,UniversityofCalifornia,Berkeley

• LargeEuropeanBank• GlobalPharmaceuticalCompany• GlobalInsuranceCompany• NorthAmericanHealthcarePayer• NorthAmericanHealthcareProvider• GlobalEnergyFirm• SpanishBankingGroup

• 100,000+trainedonDesignThinking(DesignThinkingAcademy,DesignThinkingOnline)

• DeliverycentertraininginIndia&Philippines• FjordEvolution,aninternaldesign-learningInnovation/DesignCenters:• FjordRumble™- DesignThinkingWorkshops• 50+studio&deliverycenterlocations

• Fjord’sServiceDesignmethods

• AccentureInnovationArchitecturesupportedbyAccentureResearch,Ventures,Labs,Studios,InnovationandDeliveryCenters

• NewConsultingMethods

Incorporatingmoreofaflexible,iterativeanduser-centeredapproachtoitsstrong“doing,”outcomes-orientedcultureAs-a-ServiceWinner

Accenture

Strengths Challenges

• DesignThinking,DesignDoing,DesignCulture:Accenturehasacultureofdoing,sowith DesignThinking,itisaddingintheelementofobservingandunderstandingtheend-user.WiththeacquisitionofFjord,Accenturebroughtinaaglobalcapability,methodology,andstudiosthatitcanusefordesignprojectsthatchangethewayitworksinternally(suchasrevampingitsglobalperformancemanagementprogramandclientofferings)andwithclients(examplesineveryindustry).ClientsappreciatethatAccenturecantakeintoconsiderationwhattheyknowabouttheirbusinesswhentheydesignandmanagecomplexity.Thegoalis“todisruptandreinventeverything wedoandhelpourclientsdothesame,”inthe frameworkofmeasurableresults.

• ThoughtfulTalentDevelopment:Accenturewantsits wholeworkforcetoatleastunderstandtheprinciplesofDesignThinking– collaboration,human-centered,iterative.TrainingrangesfromselfstudyonwhatisDesignThinkingtotoolstouseandworkshopsforexperientiallearning.AcurrentinitiativeputspeoplewithDesignThinkingskillsinpositionstoworkwithteamsandmentor.Accentureisalsohelpingclientsbuildcapability.

• InnovationFramework:TheAccentureInnovationArchitecturesupportsajourneythatincludes,aswarranted,research,prototyping,development,andimplementationofservicesandoperationssupport.It’salsoagoodwaytogiveclientscomfortthatinnovationistiedtooutcomes—throughaprojectoron-goingservice.AFjordRumbleworkshopwillhelpateamframeaproblemandstartdownapathtogether.

• CulturalShift:Accenture’srichhistoryofconsultingandoperationsworkisfocusedondefininganddeliveringbusinessoutcomes.DesignThinkingishelpingtoshiftservicesandsolutionstouser-centricversus“bestpractices.”

• The“Doing”Mentality:Accenturehasastrongcultureofoutcomes-basedworkanddrivingtoresults.Itcancomeacrossas“directive”and“doingto”ratherthan“empathetic”and“doingwith.”WeunderstandhowAccentureandclientswanttomeasureresultsqualitativelyforeveryundertaking,butwechallengebothtoincorporatemoreoftheempathythatischaracteristicofDesignThinking.

• EarlyDaysforDesignThinkinginBusinessOperations:AccentureOperationshasalargeportfolioofclientsthatareusedtotraditional,industrializedservicedeliverythroughBPOandasolidhierarchyinplace.Therearesomeearlyexamplesof“results,”butitlacksthestorytellinganddirectclientreferencestocreatea“feeling”ofsuccess.Accentureneedstobemoreboldaboutsharingitsstoriesofhowempathy,end-userexperience,andjourneymaps,forexample,arepartofhowtheywork.

• KeepingTalentEngaged:Servicedesignisamassivelygrowingindustry, andAccentureandotherserviceproviderswillhavethechallengeofkeepingpeopleengagedandon-board.AsotherserviceprovidersfigureoutthevalueofDesignThinkingwiththeirclients,Accenture(andotherleaders)willhaveatargetonitsbackforcapableprofessionals.Accenturewillneedaflexibleandfastacquisitionandon-boardingplan.

Internal Operations

Client – Digital Transformation

Client – Business Operations

BlueprintLeadingHighlights

• DesignThinkingLeadershipandCommitment

• UnderstandingClientBusinessandContextforInnovation

• ActualSolutionsDerivedUsingDesignThinking

• FormalMethodsandTools

• VisionforDesignThinkingintheAs-a-ServiceEconomy

• UseofPartnerships&Acquisitions

Use of Design Thinking in:

Recommendations


Making Change Happen§Service buyers today have increasing choices, less time to make decisions, and higher expectations forresults. To get them, they will need to be more open and strategic with select partners. Serviceproviders will need to be increasingly nimble and proactive.

§HfS believes that fostering a Design Thinking culture, which has an empathetic, user-centric approachand encourages trial and error through iterative solution design processes, enables organizations toreinvent themselves and stay relevant under competitive circumstances. It also provides an opportunityto increase employee engagement and figure out how to best use evolving technologies in businessoperations.

§Design Thinking must be within the context of the business strategy and objectives, and accompanied bya transition to action, business case, or something that continues to move change forward. Put the focuson a desired business result, and share the definition of a business problem or opportunity.

§Collaboration is the critical lever for increasing the value of outsourcing engagements. Buyers andservice providers need to be equally willing to invest, take risks and course correct as needed forpartnerships that will last a long time.

“Designthinkingdoesn’tendwhentheproductorserviceislaunched;itcanandshouldbeincorporatedintotheexperienceitself,andusedtocontinuouslyrefineandenhancetheexperience.Whilethehumanelementiscriticaltodesignthinking,intelligentdevicesandsensorscanprovideadditionaleyesandearstowhathappenswhentheindividualisactuallyengagedwiththeproductorservice,inawaythatwouldotherwisebeimpractical,intrusive,andunwelcome.”

-- TheoForbath andKipp Lynch,Designerslink


Recommendations for Enterprise Buyers

§ RethinkHowYouAreWorkingwithYourServiceProviderandBusinessPartners.Ifyouhaven’talready,youwillmeetthresholdsforcostsavingthatcomefromlaborarbitrageandautomation.TouseRPA,cognitivecomputing,andanalytics,youhavetoworkinadifferentway,andDesignThinkingcanhelpdetermineaflexiblesolution.Butitalsorequiresthatyourserviceproviderisinvestingtochangeanddevelopitsexecutivesandstafftothinkandworkinawaythatbalancesindustrializationandflexibility.Who’syourculturalmatch?

§ JustTryIt.Everycompanythatwantstoengageemployeesislookingforwaystodoso,andDesignThinkingisonewaytogeneratefocusandenergyaroundproblemsandtroublespots– bigandsmall.“Thisisnotjustanexercise;we’veseenrealbenefitswithmoretocome,”sharedaservicesexecutive.

§ DefineDeliverableExpectations.Whenyoudoengagewithaserviceprovider,besureyouareclearonexpectationsregardingdeliverables,whetherit'saworkinprogressora"transitiontoexecution"deliverable.Haveanactionplan,prototype,orwireframe-- somethingthatenablesyoutogetbuyinfortheideayouwanttomoveforward.

HowdoyoubringDesignThinkingintoyourwork?

Weaskquestionstouncoveranddiscoverthetrueneedsofourcustomersasitrelatestotheirbusinessandtheircustomers.

Whatthatmeansisthatweoftendigdeepertobetterunderstandthe“why”behindtheirneeds,theirmotivation.

Weaskquestionsabouthowtheworktheydoimpactsstakeholdersandcustomers,suchas:Whydotheyneedthis?Whydotheycare?What’smissing?

Thesequestionscanbeappliedtoanysituationtogetfocusedonhowtosolveproblemswithahuman-centered,customerfirstapproach,versusabusiness-centric,solutionfirstapproach.

- CharlotteBui,GlobalLead,DesignThinking,SAP

Blog:HowtoBringDesignThinkingIntoSharedServicesandOutsourcing


Recommendations for Enterprise Buyers, continued

§ EducateProcurementontheValueofYourNewApproach: Asaservicebuyeroroperationsexecutive,youmayoftenfindthinkingoutsidetheboxandtryingsomethingnewisquicklyputtoastopwhenyougettoprocurement.TryinvolvingyourprocurementorsourcingorcontractmanagementleadinaDesignThinkingworkshop;makethempartoftheprocess.

§ “WildCards”:Whenyoudoaworkshoporaprojectinternally,considerabroadrangeofpeopletobeinvolved.Forexample:Whoarethehighpotentialpeoplefromyourorganizationoryourpartners(softwarevendors,serviceproviders,evenindustryanalysts)?Whoarethemostvocalornoticedexternalstakeholders– yourclientsorcustomers?Considerthepeoplewhoareupstream,downstream,andevenoutsidethestreamofyourcurrentworkeffort.IntermountainHealthcareinvolvespatientsandphysicians;IBMbroughtintheirownemployeeswhowerecustomersofaclientforoneofthatclient’sworkshops.Peoplewillbeenergizedandinvolvedandtakeideas,feedback,andsimply“connections”backintotheirownbusinessunits,organizations,andeverydaylifeasaclientorcustomer.

“Wepre-pickedprocessareasandputteamstogetheraroundthem– expertiseinthoseareasaswellasfromupstreamanddownstreamandpeoplewhoarenotdirectlyrelatedtothoseareas.Wefeltweneededarelookathowweputtheprocesstogetherormanagedpartsoftheprocessthatwethinkwillhaveagreaterimpactontheend-to-endprocessorthecustomerrelatedimpact.”

-- DirectorofFinance


Recommendations for Service Providers

■ TreatDesignThinkingasaCapability,NotanOffering:Don’tmakeDesignThinkingastand-aloneofferingorsalestoolorpitchforservicedesignanddeliverytoGlobalBusinessServicesorforoutsourcing…thevalueofDesignThinkinginthisindustryisasanintegralpartofthewayyouwork,operate,andpartnerwithclients.

■ IntegrateDesignThinkingwithExecution: ThisiswhatmakestheuseofDesignThinkingintheoutsourcingindustryunique:theopportunitytobringtogetherthegenerationofideasthatarefocusedonend-userexperienceandbusinesscontexttogetherwithexistingmethodsforexecution.

■ TapintoYourGlobalDeliveryNetwork:Tapintothatglobaldeliverynetworkofresources.Aspeoplearelookingfornewopportunities,whatcantheydotosupportdesignthinkingresearch,prototyping,projectmanagement,etc.?Theglobalcapabilityofoutsourcingserviceprovidersisuniqueanddifferentfromcreativefirmsthatarenotasgloballylocated.

■AvoidtheJargon:ClientsandstakeholdersthatarenotusedtoDesignThinkingarefindingsomeoftheconstantuseof“jargon”frustrating.Keepitsimpleandstraightforward.

■ CulturalFit:Serviceprovidersneedtounderstandhow“ready”theclientisfortheempatheticand“humanorientation”ofDesignThinking.Weheardfromsomeclientsthatsomemethodswere“silly”and“uncomfortable.”It’satrickybalancethatneedstobewellmanagedtoensurepeoplefeelitisaworthwhileexercise.Matchtheclients’culture,andlearnhowtobestworkwiththem– pace,terminology,readinessforchange,etc.

■ RevisitTalentDevelopment:Whatskillsandcapabilitiesdopeoplewhoarelookingforandsolvingproblemsversusexecutingtransactionsneedtohave,anddoyouhavethemorareyoudevelopingtheminyourstaff?“TraditionalBPOisdefinedbylayers;wehavetore-interviewpeopletoseeiftheycantakeonaproblem-solverhat,”sharedoneserviceprovider.


Additional Research and Information“Quick Read” Soundbites and Blogs:• HowtoGetStartedwithDesignThinkinginSharedServicesandOutsourcing• FromDesignThinkingtoDesignDoing:EnablingDesignThinkingintoResults• Don’tBlameMiddleManagementforChangeInertia• PetcoMakesPlanstoUnleashthePromiseofCustomerDigitalExperience• HowtoGetStartedwithDesignThinkinginSharedServicesandOutsourcing• WhyAnOutcome-BasedAppraochCanShattertheWatermelonEffectofOutsourcingContracts• TimeToCallOutDesignStudiosPaperingOverLegacyCracks• IstheServicesIndustryReadyforaDetourwithDesignThinking?• WhyDesignThinkingcansavetheoutsourcingindustry• UnderstandingConsumersInDesignThinkingBringsProviders,ClientsCloser• FosteringADesignThinkingCulture

PoVs:• DesignThinkingCanSavetheIndustryfromObsolescence• The Rise Of Design Thinking• Design Thinking: An Imperative For Successful Analytics

Blueprint:• HfS Blueprint for Design Thinking in the As-a-Service Economy (2016)

Note:

Morethan75%ofourpublishedresearchisaccessibleforfreeandrequiresjustafewcheckboxesinoursimpleregistrationtodownload.

About the Authors


BarbraSheridanMcGannisChiefResearchOfficerandleadforBusinessOperationsResearchatHfSResearch.Barbra’sscopeofworkcoversthebusinessprocessoutsourcingandemerging“As-a-ServiceEconomy,”aswellasdivingintothemessuchastalentandDesignThinking,andindustryandfunctionalareasofHealthcareandLifeSciences.

Barbra’smorethan20yearsofexperienceinthisindustryincludes:

• Researching,analyzing,andadvisingonmarketandcompetitivemovesandmeaning

• Developingorganicandinorganicstrategiestodrivegrowthofnewandmatureofferingswithbusinessprocessservices

• Buildingpartnershipsandstrategiesforjointsuccess

BarbraearnedaBachelorofArtsdegreeinEnglishwithHonorsandwasrecognizedforoutstandingleadershipinVolunteerismwiththeChetPagniServiceAward,fromtheUniversityofSanDiego.She’salsocompletedpost-graduateexecutiveleadershipworkatNorthwesternUniversityandSmithCollege.

Barbra Sheridan McGannChiefResearchOfficer,HfSResearch

[email protected]

@sheridanmcgann


[email protected]

Hema SantoshisaPrincipalAnalystatHfSsupportingresearchinfinanceandaccountingandrelatedbusinessservices,andglobalin-housedeliverycenters.ShehasheldseniorresearchpositionsfororganizationssuchasInformationServicesGroup,Accenture,Wipro,andITFinity Solutions.Herjourneyasaresearchprofessionalhasevolvedover14yearsbyworkingacrossfacetsofMIS,businessplanning,marketforecast,marketanalysis,competitiveintelligence,andlargestrategicinitiatives.

Hema understandsthenuancesanddynamicsoftheBPOandtechnologyindustry.Herexperiencerangesfromcustomresearchandquantitativestudiestoqualitativesecondaryresearchconductedamongfinancialservices,governmentandmedia&telecommunicationindustries.

Sheholdsabachelor’sdegreeinCommercefromtheUniversityofMumbai,anMBAspecializinginMarketingfromManipal University,andacertificateinfull-time‘ManagementProgramforWomenEntrepreneurs’fromtheIndianInstituteofManagement(IIM),Bangalore.

Hema SantoshPrincipalAnalyst,HfSResearch– Bangalore,India


About HfS ResearchHfS ResearchisTheServicesResearchCompany™—theleadinganalystauthorityandglobalcommunityforbusinessoperationsandITservices.Thefirmhelpsorganizationsvalidateandimprovetheirglobaloperationswithworld-classresearch,benchmarkingandpeernetworking. HfS Researchwasnamed"IndependentAnalystFirmoftheYearfor2016"bytheInstituteofIndustryAnalystRelationswhichvotedon170otherleadinganalysts.HfS ChiefAnalyst,PhilFersht,wasnamedAnalystoftheYearin2016forthethirdtime.

HfS coinedtheterms"TheAs-a-ServiceEconomy"and"OneOffice™",whichdescribeHfS Research'svisionforthefutureofglobaloperationsandtheimpactofcognitiveautomationanddigitaltechnologies.HfS' visioniscenteredoncreatingthedigitalcustomerexperienceandanintelligent,singleofficetoenableandsupportit.HfS’ coremissionisabouthelpingclientsachieveanintegratedsupportoperationthathasthedigitalprowesstoenableitsorganizationtomeetcustomerdemand- asandwhenthatdemandhappens.WithspecificpracticeareasfocusedontheDigitizationofbusinessprocessesandDesignThinking,IntelligentAutomationandOutsourcing,HfS analystsapplyindustryknowledgeinhealthcare,lifesciences,retail,manufacturing,energy,utilities,telecommunicationsandfinancialservicestoformarealviewpointofthefutureofbusinessoperations.

HfS facilitatesathrivinganddynamicglobalcommunitywhichcontributestoitsresearchandstagesseveralOneOffice™Summits eachyear,bringingtogetherseniorservicebuyers,advisors,providersandtechnologysuppliersinanintimateforumtodevelopcollectiverecommendationsfortheindustryandadddepthtothefirm’sresearchpublicationsandanalystofferings.

Nowinitstenthyearofpublication,HfS Research’sacclaimedblogHorsesforSources isthemostwidelyreadandtrusteddestinationforunfetteredcollectiveinsight,researchandopendebateaboutsourcingindustryissuesanddevelopments.

HfS wasnamedAnalystFirmoftheYearfor2016,alongsideGartnerandForrester,byleadinganalystobserverInfluencerRelations.

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