Tiger<\/strong>: Yes. I see three changes. First, there has been a natural evolution as more and more clients see examples of where outsourcing works. Therefore they have a higher degree of comfort that it can be done. Now the conversation is less about \u201cCan you do this?\u201d especially in traditional areas and more about \u201cHow are you going to do this? What do I have to do?\u201d<\/p>\nThe other thing [second] that has changed: a lot of clients understand this is not just about labor arbitrage or efficiency. It\u2019s also about effectiveness; how do you drive better outcomes? Clients are more educated. We have been educational in this journey.<\/p>\n
The third thing is the recession. It has changed the lens people use. Earlier, it was \u201cLet\u2019s do the whole thing in a three-year journey.\u201d Now it is: \u201cYes, I want to undertake that journey.\u00a0 I am going to evaluate you on whether you can handle that whole journey. But I am going to break it up into three parts because I want an immediate payback.\u201d That\u2019s the tough part.<\/p>\n
Today, large corporations are dividing up the work to get a faster payback. They want a bigger bang for the buck.<\/p>\n
A lot more companies that have never outsourced before are jumping in, especially in Europe where people have been pushed to the wall. Companies that wouldn\u2019t have thought about outsourcing in the normal course of affairs are thinking about it now and want to do it.<\/p>\n
There is a range of changes in client expectations and how suppliers are providing solutions. Clients are now cleverer. Many more people know how it works. This is still a small group. Sometimes they undertake this key journey with outsourcing advisors. That can be good or bad. It\u2019s bad when it takes a long time.<\/p>\n
Our focus is: How do we get maximum value and outcomes for our client using end-to-end and smart enterprise processes? It has made a huge difference about how we think about what we do. It\u2019s made an even bigger difference in how clients think about their journey. It\u2019s taken on a different transformational agenda.<\/p>\n
Phil: We have been through so many<\/em> secular changes. When we look out to 2020, what do you think the world will look like? What will our industry<\/em> look like?<\/span><\/strong><\/p>\nTiger<\/strong>: The fundamental belief we have\u2014which is why the industry is so exciting\u2014is this a long term, secular direction where most global corporations are going. They are asking: What are the core competencies and intellectual capital I need to hold on to? What are the things I don\u2019t need to do?<\/p>\nThis is no different than the transformation that manufacturing did 20 years back. Now most manufacturers don\u2019t make all things that go in an automobile or an iPhone. Today Apple does the intellectual capital of the what, the how and the design. They also do sales and marketing. But not much else.<\/p>\n
I think services are going in the same direction. But it will be a long journey. Today we do complex work for some clients, but some clients are not there. We think the world will get to a situation where services are bought and sold between corporations where each has a core competency around a set of services that it sells. Those corporations are focused on their own intellectual capital.<\/p>\n
A focus on outcomes and business income will soon gather momentum. \u00a0It will be how expectations are set. \u00a0It will take time to really be the way that services are sold and delivered.<\/p>\n
This is a very segmented industry today. But there will be some bigger winners. But it won\u2019t happen in a hurry. There is such a wide range of services, industries and geographies. Consolidation isn\u2019t going to happen in a hurry. It\u2019s just too nascent. But it will happen at some point. The strong will become stronger.<\/p>\n
This will change the way companies compete. There are companies we deal with in emerging markets. They have an invention that they want to start selling. They want to focus on that product and keep improving it. They want to buy everything else from someone else. They buy best of class from day one. They go to the cloud because they don\u2019t have any legacy IT. They have incredible speed because they are not hampered by finance, HR, IT or procurement. They become a highly virtual organization.<\/p>\n
This gives these new incumbents in certain industries structural advantages older companies don\u2019t have. New incumbents in emerging markets and new incumbents in established markets with new technologies will aggressively take out the older companies in a far faster cycle.<\/p>\n
Data. The ability to capture it, keep it and use it will get better and better. Then the question is: How do you get insights from it? How do you help corporations make better decisions? Some companies are going to get much smarter at making decisions using these insights.<\/p>\n
Some companies will use all these as levers to become far more successful than others. This will benefit them hugely. For us, it\u2019s important to position ourselves in some of these services and be part of the solution and be part of the innovation in the space. We need to be the reason to drive this change. This will also change the way companies run.<\/p>\n
Stay tuned for Part II<\/a>, where we delve deeper into the pace of change in today’s sourcing industry…\u00a0<\/span><\/strong><\/p>\nNV \u201cTiger\u201d Tyagarajan (pictured) is Chief\u00a0Executive\u00a0Officer for Genpact. \u00a0You can view his full bio by <\/em>clicking here<\/em><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"NV "Tiger" Tyagarajan is President and CEO, Genpact (click for bio) If you thought the business services industry was hurtling…<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[48,835,63,78,81,88,832],"tags":[773],"organization":[],"ppma_author":[19],"class_list":["post-1316","post","type-post","status-publish","format-standard","hentry","category-business-process-outsourcing-bpo","category-f-a","category-global-business-services","category-hfsresearch-com-homepage","category-it-outsourcing-it-services","category-outsourcing-heros","category-sourcing-best-practises","tag-tiger-tyagarajan"],"yoast_head":"\n
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