Industry Impact - The High-Tech Operations Value Chain

HfS is expanding its industry coverage in 2018 to include detailed IT and business process research on 11 core sectors, powered by extensive buyer research with Global 2000 firms. The transformation and challenges posed by digital disruption and changing competitive environments differ by industry. Subsequently, the solutions and services enterprises in different industries need to cope with change and to shape transformation journeys differ as well. Over the past few years, HfS has created in-depth industry research coverage that focuses on the rapidly changing needs of buyers and the ability of service providers to meet these needs with services built on domain expertise, industry talent, intellectual property, solutions that tackle sticky industry problems, and investments in industry-specific practices, startup ecosystems, and partnerships. We will build on this foundation in 2018, bringing expanded industry coverage, focused on key industry-specific processes and change agents, updated annually.  Our coverage sectors include:

Exhibit 1: HfS Industry Coverage 2018

Source: HfS Research, 2018

In order to give you a taste of what to expect for research in the high-tech sector, this Point of View report previews our high-tech-specific value chain and the in-scope processes and change agents we’ll be examining throughout 2018. We will release high-tech-focused Blueprint Spotlight reports in Q3 on business process services and in Q4 on IT services; these will be supplemented by periodic voice of the customer case studies, point of view analyses on change agents, and buy-side research. For more insight into our master research agenda for 2018, please refer to our recently published report on planned blueprint research.

The High-Tech Operations Value Chain

HfS developed the industry value chain concept to graphically depict our understanding of the processes and functions that specific industries engage in to operate their businesses. To truly understand the services needs of an industry, you must understand its industry-specific and horizontal processes and the relevant change agents enabling transformation. 

In an effort to focus on the most dynamic segments of the high-tech industry, we have a developed an industry value chain for high-tech operations focused on the following fast growth sub-sectors:

• As a service—Cloud-based businesses that offer access to software, infrastructure or platforms on a subscription or transaction basis;
  
  
  
• Digital natives—Technology-led companies who have built their products and services as well as their business operations based on digital technologies such as cloud, intelligent automation, and analytics.

This segmentation allows us to track and evaluate many of the emerging business processes that are driving the hyper growth of companies such as Apple, Amazon, Alphabet, LinkedIn, and Facebook. Examination of these emerging business processes is instructive for the broader high-tech sector as well as any industry grappling with digital transformation. We’ll be including these sub-sector elements in our Global 2000 survey research this year which will help us gain a more granular understanding of buyer behavior.

The traditional manufacturing elements of high-tech business operations will be covered within our manufacturing value chain and engineering services will be addressed in industry 4.0.

High-Tech Industry-Specific Processes

The high-tech value chain includes the following industry-specific processes:

• Sales and marketing—Services focused on optimizing sales and marketing operations across brands and value propositions;
  
  
• As-a-service business enablement—Services designed to enable and operate as-a-service-based business models;
  
  
• Digital content operations—Processes focused on managing and optimizing content to ensure compliance as well as enhancement of offerings;
  
  
• Third-party engagement—Proactive and reactive support services targeting the range of third party constituents essential to maintaining and growing business;
  
  
• Research and development—Functions focused on rapidly developing and improving offerings and related operations.

These functions represent the range of unique processes undertaken by as a service and digital native high-tech firms to conduct their core business. Our research will evaluate the depth and breadth of service providers offering industry-specific services in these categories and the impact of enabling technologies.

Horizontal IT and Business Processes

Enterprises in all sectors have a range of consistent business and IT processes that are essential to running their businesses but are executed similarly regardless of industry. We refer to these as horizontal processes and have segmented them by IT and business functions as outlined in Exhibit 2. Horizontal business processes include elements such as customer engagement and HR. Internal IT processes include functions such as application development and infrastructure management. Our industry-specific coverage of these areas will focus on instances where something unique has been developed for the industry such as user generated content management services or algorithm training for cognitive agents. In addition to industry coverage of these horizontal topics, they will also be well covered as part of our functional research dimension.

Enabling Technologies

Lastly, but of vast importance, we have included a value chain section dedicated to enabling technologies, depicted in Exhibit 2. As high-tech companies are generally the ones actually disseminating innovation to the world, examining their own use of enabling technologies is always instructive. In-scope enabling technologies include RPA and AI, internet of things (IoT), and augmented reality. We view them as horizontal as they can be used across high-tech enterprises and leveraged for both horizontal and industry-specific processes. Our research on these topics will focus on how they are being utilized within high-tech, which service providers are bringing them to the table, and what real business impact is being realized.

Exhibit 2: The High-Tech Business Operations Value Chain

Source: HfS Research, 2018

Note: Product manufacturing processes are covered in the manufacturing industry value chain

Bottom Line: Enhanced High-Tech Research to Help Make an Impact

As we dive into 2018, HfS’ enhanced research coverage of major business operations trends by industry will help identify and articulate business impact in motion. Our coverage of the high-tech sector will examine core value chain processes across industry-specific and horizontal functions with an emphasis on the impact of enabling technologies.