The “outsourcing” market, as we know it, is changing at a faster pace than ever, and it is aligning with the Digital OneOffice. In many forward-thinking organizations, organizational silos around the front, middle, and back offices are collapsing to create organizations where only one office matters—one that caters to the customer.
Exhibit 1: The Digital OneOffice Experience
In fact, new research across 254 global 2000 organizations shows that operations leaders are increasingly focused on the OneOffice philosophy with 70% aiming to achieve OneOffice goals within three years.
Exhibit 2:Seven-out-of-ten enterprises seeking to achieve OneOffice within three years
Source: HFS Research 2019
Sample: 254 Enterprise Operations Leads (Global 2000)
Enterprise leaders should be seeking to partner with services firms that are responding to these changes by making big bets and investments in talent, technology enablement and service delivery quality to step up and service their customers within a digital OneOffice environment. That means whether you’re going straight to digital or taking steps in between, your partners need to have the pieces in place across the front, middle, and back offices.
We’ve had our eye on a resurgence in interest and investments for the front office, particularly where many technology and Indian-heritage companies are making plays in the contact center space. The most recent example of this is Infosys’ acquisition of Eishtec, a 1,400-person contact center firm based in Ireland, one of the top attractive areas for operations investment. The competition is heating up for front office services, which we assessed earlier this year in our Top 10 Front Office Customer Engagement Operations Services 2019 (see Exhibit 3). Most of the Indian-heritage IT services firms with strong BPO delivery arms are gravitating back to contact centers because they see the potential for aligning intelligent automation and cognitive assistant solutions with their global base of talent for supporting their enterprise customers. Some examples of this are with the likes of Tech Mahindra in telecoms and Infosys with order management. Cognizant, Wipro, and HCL, for example, are also competing for call center work. BPO firms that have been more focused on non-customer-centric areas are gravitating aggressively back into the market, such as WNS, EXL, Hexaware, and Genpact. Even IBM has recently flirted with a few opportunities, despite selling its call center business over four years ago.
Exhibit 3: IT Services firms are creeping up the customer engagement operations ladder
Source: HFS Research, Customer Engagement Operations Services Top Ten Report, 2019
OneOffice transformation requires a shift from labor to talent—which will this acquisition bolster?
Having that ability to lead the customer front line and support those customer needs with real-time speed and intelligence is core to business operations, and service partners that can deliver this have never been so crucial. The question for Infosys and Eishtec is whether the acquisition is meant just to bolster Infosys’ labor force, or if, instead, it adds critical front-office talent to the firm. In a world where contact center agents are literally being displaced by “straight to digital” work that replaces repetitive and mundane interactions, the humans that remain are needed for genuinely human interactions—those requiring problem solving, data analysis, and empathy.
Automation is an essential piece of the front-office transformation
When “digital” is ultimately about new ways of doing things, the contact center is in a more precarious and important position than ever. The contact center for companies that want to stay competitive in a hyper-connected economy must learn how to embrace intelligent engagement, using the keystone change agent of automation to become a strategic hub that empowers both customer service professionals and the customers they support. As such, the partners that you engage with not only need to provide the means for connecting front and back offices, they also need to have the capability to embed automation into operations intelligently. Service providers take heed also; if you aren’t able to partner effectively for this type of OneOffice experience, you risk losing your business to insourcing, another provider, or just straight-to-digital automation (Exhibit 3).
Exhibit 4: Most engagement services contracts are in flux
Source: HFS Research supported by KPMG, "State of Operations and Outsourcing” 2019
Sample: Global 2000 Enterprise Leaders = 355
Enterprises must navigate the changing of the guard for intelligent customer experience services
It’s a seismic shift, particularly for organizations that are aligning to OneOffice, and why we see such a different competitive set than we have in the past. Fundamentally different capabilities are coming into play in the realm of intelligent customer engagement, with bold moves like SYKES’ acquisition of Symphony Ventures shaking up the space with some real RPA capabilities. Firms like Infosys, Tech Mahindra, HCL, Wipro, and CSS Corp are embedding automation into engagements, often in the form of cognitive assistants. We even see some action in this space from the likes of Accenture, which came in with a CX consulting slant and then operationalized to support the design, or from firms with an industry-specific capability that they’re supporting with customer interaction operations.
The Bottom Line: To develop a customer-centric digital organization, you need partners who can help you connect the front office to the back office.
Time will tell how many of these recent investments, such as Infosys’ acquisition of Eishtec, are true talent plays or primarily for scale and geographic expansion. While certainly attractive from a location delivery standpoint (and purportedly a boon for the domestic Irish market), we bet that Infosys is making a targeted play around front-office talent that will improve its ranking from No. 10 in HFS’ 2020 customer engagement services Top 10 refresh. Its localization strategy in the US also points to some intelligent, long-term investments in developing local labor markets in targeted US cities. So bear this in mind as you evaluate partners to help you connect your organization from the front office to the back office: The partners you choose must be equipped to help on your journey to deliver on intelligent customer experience.
You need a partner to help you design, digitize, automate and self-remediate your processes to stay ahead of their customer needs, as you simply cannot survive treading water in today's environment. As we recently pointed out, 75% of enterprises will demand significant changes to their services partnerships when they next evaluate their contracts. So providers thinking most of their clients will tolerate them not making significant investments in delivering digital services are going to be in serious trouble (and some are and are fast realizing it). Let’s hope this investment indicates Infosys BPM is not one of these partners!