{"id":1033,"date":"2015-05-30T18:29:00","date_gmt":"2015-05-30T18:29:00","guid":{"rendered":"http:\/\/localhost\/projects\/horsesforsources\/four-foundations-as-a-service-2_053015\/"},"modified":"2015-05-30T18:29:00","modified_gmt":"2015-05-30T18:29:00","slug":"four-foundations-as-a-service-2_053015","status":"publish","type":"post","link":"https:\/\/www.horsesforsources.com\/four-foundations-as-a-service-2_053015\/","title":{"rendered":"The Foundations of the As-a-Service Economy (Part 2): Avoiding getting burned without a burning platform"},"content":{"rendered":"
\"What<\/a><\/p>\n

What do you mean, we “have to change”?<\/p>\n<\/div>\n

In Part 1<\/a> of our Four Foundations<\/a>, we discussed the challenges and opportunities facing enterprises which are not taking better advantage of outsourcing relationships to help plug their talent and capability shortcomings.<\/p>\n

However, while it’s one thing to talk about the delights that await ambitious enterprises when they make definitive plans go down this path, it’s another to assess whether they truly recognize the\u00a0burning platform<\/em> to take themselves through this period of pain and complexity to get there.<\/p>\n

Foundation III. \u00a0A Burning Platform for Change: \u00a0As operational efficiency becomes a commodity, operations professionals\u00a0need to strive for that next threshold of value, or find themselves rendered irrelevant<\/strong><\/span><\/p>\n

Our brand new study that delves into the Ideals of As-a-Service (stay tuned for the full release very soon) reveals some startling home truths as to what’s likely coming next. My biggest fear in our\u00a0the industry is for those people just sitting around literally\u00a0waiting<\/em> for change, as opposed to squaring up to the commoditization and automation of legacy processes to provide their firms with new ideas, new ways of doing things and adding value, beyond simply keeping the operational lights on.<\/p>\n

One alarming trend coming out of this new study, which covers the dynamics and viewpoints of more than 700 industry stakeholders, is the delta between the desire<\/em> to change the model from business leaders (SVPs and above) and their middle-managers and below:<\/p>\n

\"Click<\/a><\/p>\n

Click to Enlarge<\/p>\n<\/div>\n

The middle layers and down need to step up – or step out – of the picture<\/strong><\/span><\/p>\n

Why is it that over half of senior managers view As-a-Service dynamics as critical, while only 29% of their teams under then feel the same? \u00a0Answer – most people are comfortable<\/em> with their daily grind – they stare at metrics on spreadsheets, ensure exceptions are handled and the corporate engine keeps running. \u00a0They turn up at meetings and say all the right things, avoid challenging the status quo (while acknowledging there can always be improvement), but deep down have settled for adequacy and a steady treadmill drumbeat of efficiency without too many fireworks or drama.<\/p>\n

Why would they want to learn how to collect and interpret data more intelligently? \u00a0Why would<\/em> they want to find problems, as opposed to solving them when they crop up? \u00a0Why would they want to mimic manual processes into scripts to have them run robotically, when they can patch over these inefficiencies\u00a0with cheap offshore labor? \u00a0Why would they want to explore the potential of artificial intelligence and self-learning computing capability when they can just do<\/em> these things themselves (or at least pretend to do them). \u00a0Answer – they have no burning platform<\/em> to change the way their\u00a0do their jobs.<\/p>\n

But there is one significant burning platform that will burn<\/em> them, if they are not willing to adapt to the As-a-Service world: they will be irrlevent<\/em> in tomorrow’s corporation. \u00a0Yes, they may be lucky and survive in legacy organizations that can get away without changing, or they may be in their late 50’s and only care about lasting a few more years until retirement, but – for most – if they cannot adapt to As-a-Service, their bosses will shift them on and either replace them with a service provider staffer, or just simply phase out their legacy job, as it was not really needed anymore.<\/p>\n

The As-a-Service Economy is forcing\u00a0a shift from Efficiency to Capability<\/strong><\/span><\/p>\n

It’s true, in many cases, that service providers are not providing much more than basic operational offshore-centric delivery, however, that’s usually because that is all these clients\u00a0intended<\/em> to receive, when they ventured into using external services to drive out cost – and the reason why they selected service providers to provide operational efficiency, as opposed to plugging critical capability gaps.<\/p>\n

We all know the initial benefits\u00a0behind outsourcing quickly become forgotten as the C-Suite turns to its operational leaders to demand continual productivity gains<\/a> and value, however, the motivations from leadership are not changing, more the means by which to satisfy the C-Suite’s insatiable thirst for running the enterprise as cost-effectively as possible. \u00a0And this is the very essence of the As-a-Service Economy; finding new ways and means to run businesses as efficiently, intelligently and flexibly as possible.<\/p>\n

However, while a company’s leadership is always biting at the heels of its operational leadership to keep driving out the cost, the resistance<\/em> coming from the middle layers and down is clearly becoming a pressure point as enterprises realize they have to go through a more radical, painful period of transition as the As-a-Service Economy slowly becomes a reality.<\/p>\n

As research we conducted earlier this year clearly demonstrates, well over half\u00a0of enterprises, today, only view providers as brokers of Efficiency<\/em> as opposed to Capability<\/em>:<\/p>\n

\"Click<\/a><\/p>\n

Click to Enlarge<\/p>\n<\/div>\n

The good news for service providers, is a very small proportion today views them negatively<\/em> as low cost body shops (this would have been a lot higher just a few short years ago), however, most are stuck in this middle ground, where their clients only want and – expect – a service designed to scale their operations and help them be more cost efficient. \u00a0However, a third of the more senior managers (VPs and above) do<\/em> view service providers as genuine capability partners<\/em> – and that’s actually pretty good, provided the right providers can figure out how to work more with these senior people to explore value-driven relationships.<\/p>\n

So… two things need to happen to move the needle\u00a0away from stagnation:<\/strong><\/span><\/p>\n

1) Service providers seeking to deliver genuine value beyond<\/em> cost need to have a more intense dialog with that growing proportion of senior service buyers who view them that way;<\/p>\n

2) Service buyers need to recognize this genuine burning platform<\/em> to shift gears from Efficiency to Capability.<\/p>\n

The Bottom-line: We owe it to our delivery staff to give them the hard truths – the platform is\u00a0already\u00a0smoldering,\u00a0even if they can’t yet smell the smoke<\/span><\/strong><\/span><\/p>\n

The changes coming to our world are significant – and not dissimilar to when coal mines were displaced by nuclear power plants, when car plants which used to employ 5000 people now only need 300 etc. \u00a0Operations are becoming standardized, cloudified and robotized – and if we can’t reorient our staff to accept this reality and expand their capability horizons, many will be waiting tables, driving ubers or cutting hair before we know it. We don’t need<\/em> a burning platform to drive this change as it’s already on fire – many of us simply haven’t yet realized it…<\/p>\n

Stay tuned for our final part where we discuss the impact of technology on knowledge-workers…<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

What do you mean, we “have to change”? In Part 1 of our Four Foundations, we discussed the challenges and…<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[48,51,57,78,80,81,90,91,831,832,830,97,98,837,101],"tags":[146],"organization":[],"ppma_author":[19],"class_list":["post-1033","post","type-post","status-publish","format-standard","hentry","category-business-process-outsourcing-bpo","category-cloud-computing","category-digital-transformation","category-hfsresearch-com-homepage","category-hr-strategy","category-it-outsourcing-it-services","category-robotic-process-automation","category-saas","category-smac-and-big-data","category-sourcing-best-practises","category-sourcing-change","category-talent-in-sourcing","category-the-as-a-service-economy","category-the-industry-speaks","category-value-beyond-cost-study-2015","tag-as-a-service-economy"],"yoast_head":"\nThe Foundations of the As-a-Service Economy (Part 2): Avoiding getting burned without a burning platform - Horses for Sources | No Boundaries<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.horsesforsources.com\/four-foundations-as-a-service-2_053015\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The Foundations of the As-a-Service Economy (Part 2): Avoiding getting burned without a burning platform - Horses for Sources | No Boundaries\" \/>\n<meta property=\"og:description\" content=\"What do you mean, we “have to change”? 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