Across all industries and geographies, organizations are striving for that competitive edge. Traditionally, gaining a leg up over competitors means developing new products and services, entering new markets or wringing costs out of processes. Outsourcing—IT, business operations and other functions—have all inevitably played a key role in the past. Now, organizations are looking for automation to drive additional efficiencies. Although earlier automation solutions helped many organizations achieve operational and financial benefits, initial improvements have typically plateaued as first-generation tools and approaches have reached a point of diminishing returns in their effort to reduce manual work.

Today, organizations need to look for new automation platforms that go beyond deterministic and predictive analytics to embrace a much higher level of cognitive automation to reduce and eliminate manual work in favor of robotic process automation. Artificial intelligence should be at the heart of an organization’s latest efforts to automate manual tasks, freeing up human resources for higher-value activities.

IRPA AI has written a white paper together with EdgeVerve that will help companies rethink automation for new use cases and to help drive greater business benefits.

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In a recent survey conducted by the Corporate Executive Board (CEB) of senior HR managers, three quarters of respondents said attracting and retaining talent was their No. 1 priority. This has not changed in more than a decade, since McKinsey’s initial “War for Talent” research in the mid-1990’s. So why is it that the most robust people, process, and technology tools are not being deployed in most organizational talent acquisition functions—either insourced or outsourced? And if there is so little good competition in the war for talent today, why aren’t leading companies stealing the show?

Where’s the “R” in RPO

Our new Cognirati video blog, created by IRPA founder Frank Casale, delivers a sneak peek into what CXOs are most concerned with when it comes to RPA & Intelligent Automation.  From getting clarity on industry jargon, figuring out where to started, deciding whether to make vs. buy, sorting out the pricing confusion and understanding where the real cost savings are, CXO’s are thinking hard and looking for answers.

View the Video Here

Service Design is all about…well, it’s about services. It’s a way to look at the big picture. It looks at the interaction between everyone involved in the service where they touch. It’s about looking at the whole journey, the people involved, and how they feel at different points in their journey.

Another way to think about this is as a service-focused offshoot of Design Thinking and under the umbrella of User Experience. Design Thinking is a methodology for solving complex problems and creating innovative products and services. Service Design takes it a step further and optimizes how the infrastructure of a service needs to look and function.

How Do We Do This?

The main goal of Service Design is to make customer-friendly and competitive products. One of the unique ways it does this is co-creation. This method involves the end-users in the creation process of a service. This ensures it is user-centered. User-centered means it focuses on the needs and wants of the user, while traditional companies just focus on themselves.

The principal method of Service Design is mapping where customers interact with a service, known as touch-points. This mapping starts way before a customer ever actually comes into contact with a service and continues long after a customer has finished their interaction. What makes this methodology exceptionally effective is how it looks at a service from the customer’s perspective, rather than from a company’s perspective.

Why Does This Matter?

Designing based on the customer’s perspective and feelings is what will make the difference between a functional service and a truly desirable one. Functional services will work. But desirable services work and also make their customers feel positive emotions. If your customers feel great when interacting with your services, then you’re doing the right thing. They’ll gladly use your service, recommend it to their networks, and keep coming back. If they only ever feel negative emotions, then they’ll look for something better.

No one wants to lose customers. And that’s why you can’t afford to ignore Service Design.

Service Design Takeaways:

1. Service Design is all about how to make services as enjoyable and helpful as possible.
2. Service Design is user-centered, meaning it puts the customer first.
3. Service Design maps each time customers interact with a service and makes that interaction the best possible.
4. If services are desirable, enjoyable, and useful, customers will come back for more.

Aurora Coya, Williams Lea and Matt Swain, InfoTrends discuss trends in strategic document outsourcing, market demand and case studies.

You want to make products and solutions that work as soon as possible. The faster you can get your product out there, the faster you can start seeing ROI. The faster you can see a problem fixed and happy customers and clients.

There are two common ways to develop products and they are both wrong.

The first way involves churning stuff out as soon as possible, spitting it out into the world, and moving on. This way, you get a lot of cheap stuff, cheap apps and half-thought out solutions.

The second way involves spending a lot of time designing a product as thoughtfully and carefully as possible, making sure it is absolutely perfect before you launch. Your product might be better, but you’ve invested so much time into it, you have to ask yourself if it’s really worth it. And with our rapidly changing world, by the time you launch, your product might be obsolete or someone else might have done it already.

And for both ways you run the major risk of ending up with a product or a solution that people just don’t want to use.

The best way to design products is by combining these two methods. That’s basically what rapid prototyping means. You create prototypes, or concepts, as fast as possible and test them with sample customers. Then you go back and make a new prototype based on their feedback. You work quickly and test often.

For digital products, you’ll create versions of software that function minimally so that you can make sure it actually does what the customer wants it to do before you invest so much time into developing it.

In the end, by using rapid prototyping, you’ll end up with products and solutions that have been tailored and fine-tuned, but without the risk that they’ll flop once you’re finally done. You want to see a solid return on your investment? Make sure you know you’re making a valuable product.

I recently read an article about a twelve-year old boy who scored higher than both Albert Einstein and Stephen Hawking on the Mensa Test. Immediately, I thought of how many companies are already lining up to hire this bright young mind; possibly even before he ventures on to college.

I went on to think about the importance of knowledge and education as my own daughter recently departed for her freshman year of college. Fortunately, she graduated top of her high school and was accepted to some very select universities. After the sticker shock of paying her first semester’s tuition, I smiled realizing the bright future she will have. After all, a solid education and high intelligence is what the market has always sought, right?

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As we come back from holidays, we tend to reflect on what 2016 will bring, trends and upcoming changes on how buyers and service providers engage. Recently a lot has been said and written about two prominent trends: digital and automation. However little has been discussed about the commonalities between these prominent trends and the outsourcing industry.

Digital and automation are two of the most prominent trends influencing the outsourcing industry.

Below are some ideas and considerations organizations may wish to consider before placing emphasis on one versus the other:

The organization’s strategy sets the direction: Having a clear understanding of the organization’s strategy and goals will directly determine the linkage between digital, automation and outsourcing. As simplistic as it sounds, a balance between these can be hard to achieve. A good way to approach this is to think digital as the environment, automation as an enabler and outsourcing as a way to deliver services. As part of this approach, organizations will also require higher emphasis in other important pillars such as governance, risk and internal staff skills

Digital is a reality organizations shall not ignore: Service providers are supporting the digital transformation by and large, as it does increase their portfolio of services and revenue. For organizations, the implications of a digital environment to services, if well implemented, tend to be positive. The biggest challenge lies on the organization’s community and clientele. For example, let’s think about the recent trends in retail banking and the opportunities digital will continue to bring with direct positive impact on operational costs. Other industries that may benefit from digital are insurance and telecom, as those have usually higher volume of services and effort associated with their service delivery models. A recent article released by The Economist magazine titled “Tech pundits’ tenuous but intriguing prognostications about 2016 and beyond” provided some mind bogging predictions, including the following: “By 2020, predicts IDC, a third of today’s IT companies will no longer exist in their current form, swallowed up in a wave of mergers and takeovers. And although demand for cloud computing will soar, many smaller contenders will fall by the wayside. Within five years the market will be dominated by perhaps half a dozen global giants, from American ones such as Amazon and Microsoft to Chinese ones like Alibaba.”

Automation is evolving rapidly: There is no doubt automation will continue to grow and evolve over the next few years. As service providers opt to automate vs. labor in, commodity services are already in high demand to be transformed through automation. In my latest CIO article I wrote about BPO being renamed as BPA – more can be found by clicking here. In a nutshell, the benefits associated with automated services can help organizations to realize value in a much faster and effective way – while services providers minimize their existing labor risks. Another important factor to consider is that machines now can “learn to execute” with little guidance and oversight from humans. A very interesting article published by Shivon Zillis provided a very insightful picture of the current state of machine Intelligence across different industries.

Manage the organizational changes associated with these trends: It is common to see the excitement big transformational trends such as digital and automation bring to an organization. For those who live and breathe change, this might be heaven. For others, this can be a very stressful time in which future is somewhat unclear. As such, organizations should not underestimate the level of effort required to manage changes associated with these trends. The key here is to, from internal clients to service providers and the organizations clientele, monitor and manage changes appropriately so that the organization’s strategy can be adjusted accordingly.

The importance of governance and risk management should not be understated: With multi-sourcing becoming more evident and increased regulatory pressures, organizations will continue to need to invest heavily on appropriate governance and risk management practices. Notwithstanding the fact automation and digital are new trends, there is a bit of learning curve for both organizations and services providers taking place. The fact of the matter is that, when determining value for money, organizations should factor in the service providers ability to deliver services while complying with the set organizations’ governance and risk protocols for their relationship. At the same time, organizations shall be able to effectively assess their risk appetite, protocols and reputation so that the desired outcomes can be realized. What organizations should not compromise is their ability to comply with their respective regulatory requirements, as this can have a significant impact to the organizations’ reputation and bottom line.

The importance to invest on the organizations staff skills: While organizations invest to enable digital and automation, they should also invest on their internal staff skills and capabilities required to effectively manage and support their transformation. Many times there is a consent this should be considered a priority, however it usually tends to get lost – as it is hard to execute any type of business transformation. If we take into account the organization’s team as a critical element for success, it is imperative that internal staff have the right skills and knowledge to effectively execute their roles going forward. As much as learning while executing is possible, organizations should not place themselves in situations that could represent a higher than normal level of risks or with significant impacts to their clientele.

The conclusion: 2016 is going to be an exciting year for the outsourcing industry, with great opportunities for buyers and services providers to collaborate and contribute on how to best enable their digital environment, use automation as an enabler to promote services and continue to use outsourcing as a way to obtain and deliver services. Stay put.

Digital Transformation is hot, no question about that. Every company knows they need a digital strategy. Every competitor is seeking a digital edge. Hundreds, no thousands of companies are out there right now, ready and willing to help you find your digital way. Talent is twice, no ten times more marketable when RPA or AI appears somewhere on the resume. And so we will all march off to become digitally transformed. What that means depends on who you ask.

Ask a room full of leaders from across many industries, both consumers and providers of digital services, and you will get a very wide range of answers, as I did when I posed that very question at an automation conference last week. But there was a common thread in their responses, suggesting a limit to what digital transformation is for – efficiency. Many see digital as just as the newest version of business transformation, supplanting shared services, offshoring, and outsourcing as ways to make work more efficient. Bots, placing their digital “hands” on virtual keyboards will take on all those manual, repetitive office tasks, enabling the elimination of associated costs. Contributing to this perception is the messaging of many Business Process Outsourcing (BPO) and Robotic Process Automation (RPA) companies, positioning their new digital offers as shiny new hammers for the same old cost takeout nails. While there is no question the new digital toolkit can dramatically reduce the cost of human labor associated with business processes, to believe that is mostly what it is for is to largely miss the point.

• Driverless cars are amazing not because they eliminate the cost of a human driver, but because of what they liberate humans to do when the car drives itself.
• A full service mobile banking app is revolutionary not because it eliminates maintenance cost of ATM’s, but because it allows people to do banking transactions anywhere, anytime – expanding services to parts of the globe that have never had that capability before.
• Digital companions like Amazon’s Alexa are not top sellers because they reduce the cost of searching the net for recipe ideas, but because we can now do that while at the stove, preparing dinner, signalling a new era of convenience in the home.

The bottom line is digital transformation is about a lot more than the bottom line.

Company leaders and those looking to start new companies who grasp this insight are focusing on new business models, services and products – and this approach is paying off. “Unicorns,” startup companies valued at $1B or more, like Uber and Airbnb have achieved explosive growth with innovative business models that capitalize on digital business capabilities.

Note that when Airbnb launched in 2008 the technology to book a room online already existed. What was new was the idea that the room or apartment or house was being offered by an owner directly via an easy to use, robust, secure online platform.

A challenge for existing firms is can they adopt the startup mindset and open the strategic aperture beyond their existing business models? Can they imagine wholly new offers that while directly flowing from their core competence have the potential to redefine their industry – or will they take the easier course, focusing only on the low hanging fruit of automating out the waste in their existing processes? But it does not have to be a choice between optimize or transform. Why not opt for both, using savings from the quick wins that can be generated through an RPA deployment to fuel next generation efforts in analytics, IoT and AI?

Based on what we hear at conferences on digital transformation, many firms today are launching “random acts of automation,” tempted by the latest tech shiny penny. What is needed is a strategic step back, double-clicking out until the big picture is revealed and new possibilities emerge.

To begin the process of creating a digital transformation roadmap that goes beyond cost reduction, and starts to identify new value creation opportunities, consider three questions:

1. What new services can be delivered based on emerging tech?
2. What roles previously reserved to humans can be migrated to digital labor
3. What new technology “mashups” create the opportunity for new business models?

Then imagine a future state very different from the way things are done in your industry today – one in which dramatic growth comes from your organization creating new value.

To learn more about how digital transformation is changing our world, join the conversation at The Outsourcing Institute’s Special Interest Group on Digital Transformation Strategies.