{"id":1424,"date":"2011-12-24T12:19:00","date_gmt":"2011-12-24T12:19:00","guid":{"rendered":"http:\/\/localhost\/projects\/horsesforsources\/the-best-of-hfs-in-2011_122411\/"},"modified":"2011-12-24T12:19:00","modified_gmt":"2011-12-24T12:19:00","slug":"the-best-of-hfs-in-2011_122411","status":"publish","type":"post","link":"https:\/\/www.horsesforsources.com\/the-best-of-hfs-in-2011_122411\/","title":{"rendered":"The defining outsourcing moments of 2011"},"content":{"rendered":"

\"\"Well, another year goes by and HfS yet again escapes any legal action, terrorist attacks at our office, or disappearing bodies, for being thoroughly unafraid to call the industry on its issues. So let’s reflect some of the defining outsourcing moments of 2011…<\/strong><\/p>\n

January<\/strong><\/span><\/p>\n

Ditch Procurement!<\/strong><\/span><\/p>\n

Deb Kops began the year in\u00a0feisty\u00a0fashion<\/a>\u00a0by declaring war on the procurement function…\u00a0Is traditional procurement deeply involved in M&A activity? Corporate strategy? Business transformation? Not a chance. While our friends in the CPO\u2019s office have an important role to play in procurement process and governance, they cannot be the major arbiter of taste when it comes to sourcing true corporate change.<\/em><\/p>\n

RIP Joe Vales<\/strong><\/span><\/p>\n

The nicest guy in sourcing – and one of the best marketing guys you’d ever met – Joe Vales, sadly passed away<\/a>…\u00a0An avid fan of HfS, he will be sorely missed by us, and am sure many of you will be equally saddened by his passing. \u00a0He was a sweet and lovely guy, who loved his work.<\/em><\/p>\n

Impatient Premji plays catch-up<\/strong><\/span><\/p>\n

You won\u2019t see a CEO being removed after achieving a double-digit growth rate too often, but that\u2019s just what happened, when Wipro\u2019s co-chiefs Suresh Vaswani and Girish Paranjpe were replaced by TK Kurien<\/a>… \u00a0So will Premji\u2019s impatience to produce numbers as stellar as his competitors be rewarded, or has he already missed this phase of hyper-growth in offshore services?<\/em><\/p>\n

February<\/strong><\/span><\/p>\n

EquaTerra + KPMG \u2013 a new era, or a new error for outsourcing advisory?<\/strong><\/span><\/p>\n

KPMG became the only “Big 5” management consultant to buy a boutique sourcing advisor<\/a>…\u00a0The outsourcing advisory business is all about talented people, experience and relationships.\u00a0It would have been extremely messy if KPMG had tried to hire away these folks one-by-one. They have retained the top talent and have created careers for them within their organization. Quite simply, there is a really bad (and worsening) talent shortage in our industry, and KPMG has just snapped up a good portion of it in one full swoop.<\/em><\/p>\n

March<\/strong><\/span><\/p>\n

So what on earth does the future hold for sourcing advisors?<\/strong><\/span><\/p>\n

Esteban Herrera doesn’t hold back<\/a> when he declares, “Twenty-five years at EDS may have made you an expert at outsourcing IT, but it did not teach you how to run a recalcitrant back office environment that is just plain hard to optimize.”<\/em><\/p>\n

HfS takes a deep look into Latin America’s sourcing capabilities<\/strong><\/span><\/p>\n

Clients attest to lower attrition levels and fewer site visits, and when they were required, these site visits as part of the governance were much easier to do\u2014these and other soft factors impact the total cost of ownership.<\/em> \u00a0Download your copy of the report here<\/a>.<\/p>\n

How 10-year-olds explain Cloud Computing<\/strong><\/span><\/p>\n

The most concise way anyone has succeeded in\u00a0describing it<\/a>. \u00a0One has aspirations to make a video game that features a villain with a head made of cheese puffs.\u00a0<\/em><\/p>\n

April<\/strong><\/span><\/p>\n

Are you ready for\u2026 The HfS Private Cloud Challenge? \u00a0Answer = No<\/strong><\/span><\/p>\n

Not a single provider or buyer could answer Esteban’s warcry<\/a> to prove they had a “Private Cloud”. Private Cloud makes my blood boil. Private Clouds are a cynical oxymoron. The whole point of a Cloud is that you share resources and don\u2019t have to own the capacity you need, because its available on demand, so you can pay by the drink. Well, if you own the resources and the capacity, it is inherently limited to what you own, and you\u2019ve already paid for everyone\u2019s drinks at the bar whether they consume them or not!\u00a0<\/em><\/p>\n

Forget the Magic Quadrant, you can now get covered in the HfS Research Painsharing Paradox<\/strong><\/span><\/p>\n

<\/strong>At HfS, we\u2019d had enough of service providers and their clients raving about how bloody wonderful they all are. \u00a0Enter the Painsharing Paradox<\/a>. \u00a0We figure out which providers have the biggest budgets, and then produce a draft PP \u2013 the bigger the marketing budget, the further they are positioned over to the upper-right corner of the grid. \u00a0Then the bidding process starts. \u00a0Depending on how much we like them, how many first class boondoggles we\u2019ve been treated to, and how much hard cash they\u2019re prepared to pony up, we\u2019ll maneuver them down the grid towards that hallowed lower-left quadrant, where everyone wants to be.<\/em><\/p>\n

HP\u2019s strategy: is it plotting, or losing the plot?<\/strong><\/span><\/p>\n

Phil Fersht takes no prisoners when questioning\u00a0L\u00e9o Apotheker’s curious decisions<\/a>. \u00a0Was he onto\u00a0something?\u00a0If HP isn\u2019t plotting a radical move to buy SAP, or some other ERP business, it seems to be letting itself down badly \u2013 the firm needs new thinkers who can drive innovation and a new direction into the business, because right now, most industry observers are left scratching their heads trying to figure out what the game-plan is.<\/em><\/p>\n

<\/em>May<\/span><\/strong><\/p>\n

Buyers are saving money, but aren\u2019t seeing a whole lot more<\/strong><\/span><\/p>\n

Our “money slide” of 2011, where 347 buyers revealed they were happy with their outsourcing cost-savings, but the other business benefits were proving elusive<\/a>. A defining chart for the outsourcing industry. Our concern at HfS is that costs are like hedgerows \u00a0– once trimmed they always grow back. \u00a0Providers cannot afford their clients to struggle. \u00a0After their transition to a working operational outsourcing model, corporate leadership isn\u2019t going to keep reminding their shareholders about \u201cthat stellar 30% we took off the bottom-line three years ago\u201d. \u00a0They are going to be looking for their next improvement metric<\/em><\/p>\n

It\u2019s hard to be CSC<\/strong><\/span><\/p>\n

<\/strong>A perennial subject of acquisition chatter, CSC<\/a> has built in poison pills in the form of gnarly government contracts with lots of limitations on who can own them and what can be done with them. It lacks the scale of IBM and HP, the brand and loyalty of Accenture, and the relatively low overhead of the leading Indian IT providers. It is, effectively, stuck in the middle.\u00a0It\u2019s hard to be CSC…<\/em><\/p>\n

June<\/span><\/strong><\/p>\n

Will the industry analyst business be dead in five years?<\/strong><\/span><\/p>\n

Phil Fersht rocked the troubled analyst world with this defining post<\/a> that even inspired Gideon Gartner to chime in<\/a>.\u00a0I\u2019ve seen analysts ride waves and become rock stars, and then lose the plot somewhere along the line before either exiting the industry altogether, or plodding along on the vendor-briefing circuit, eking out their paychecks towards retirement. \u00a0I also know level-headed analysts who quietly go about their job and produce decent stuff \u2013 never making a lot of noise, but effectively doing their job. \u00a0I\u2019ve also worked with egomaniacs who pander to paying clients and scare the living daylights out of anyone who dare criticize them \u2013 or refuse to buy their services. I\u2019ve also worked with absolute numb-skulls who somehow remain employed, despite knowing very little about anything. \u00a0And I\u2019ve worked with analysts who really know very little, but somehow persuade the world they are visionary thought-leaders.<\/em><\/p>\n

July<\/span><\/strong><\/p>\n

Europeans love money, but hate change<\/strong><\/span><\/p>\n

We managed to upset some Europeans with this one<\/a>.\u00a0Ah\u2026 mes amis! \u00a0Let\u2019s rip out ze costs, but for \u2018eaven\u2019s sake, don\u2019t make any changes to our mother-ship. \u00a0By all means, sack all the expensive foreign staff in the vorldvide offices and sheeft ze vork to India or Les Philippines, but \u2013 we repeat \u2013 don\u2019t CHANGE anything! \u00a0<\/em>Judging\u00a0by the Eurozone paralysis, how wrong were<\/em> we?<\/p>\n

August<\/span><\/strong><\/p>\n

Is the outsourcing industry really still that clueless about cultural issues?<\/strong><\/span><\/p>\n

Esteban lets loose once more<\/a>, this time at Brandi Moore’s revelation in Outsource Magazine that the outsourcing industry\u00a0doesn’t\u00a0understand cultural issues. \u00a0She manages to disparage an entire industry, ignore the facts, offer tired examples as brilliant self-aggrandizement, and demonstrate a poor understanding of her supposed field of expertise (culture).<\/em>\u00a0Brandi declined Outsource Magazine’s offer to host a debate between Esteban and Brandi to discuss the issues openly.<\/p>\n

September<\/span><\/strong><\/p>\n

Just because buyers aren\u2019t always in a rush to outsource, doesn\u2019t always mean they are too \u201cshort-term focused\u201d<\/strong><\/span><\/p>\n

Our latest research revealed<\/a> that many buyer executives are, in actuality, in violent disagreement with many provider and sourcing advisor executives that their business leaders are too \u201cshort-term focused”. \u00a0You do start to wonder whether many advisors and provider executives really have much understanding of their clients\u2019 business pressures beyond cost-reduction \u2013 and our recent survey data, discussed above, supports this viewpoint.\u00a0\u00a0<\/em><\/p>\n

<\/em>October<\/span><\/strong><\/p>\n

70% of buyers are sitting on the fence with their outsourcing plans in the current climate<\/strong><\/span><\/p>\n

The rocky economy isn\u2019t helping drive definitive behavior<\/a>, with seven-out-of-ten buyers expecting either little change in focus when it comes to outsourcing, or they simply do not know what they are going to do. Are companies panicking and screaming: \u201dHelp! We must hurl as many of our fixed administrative costs out of the window asap and deploy as much low-cost service delivery as we can, regardless of the consequences\u201d? \u00a0Of course they aren\u2019t…<\/em><\/p>\n

The major driver behind outsourcing is no longer immediate cost reduction<\/strong><\/span><\/p>\n

<\/strong>New research reveals what is motivating buyers<\/a> to outsource in this current climate, and while eliminating cost is still is a core fundamental, buyers are even more focused on achieving greater flexibility to scale their global operations. Many buyers have some version of “failed lift and shift” on their unofficial outsourcing resum\u00e9s today \u2013 they\u2019ve realized that once they\u2019ve shifted it, there\u2019s little money, or board-level volition, left to invest in improving process and technology. They know that their chance to rip out the rot is with<\/span> the lift and shift \u2013 not at some divine point in the future when corporate leadership is suddenly going to issue a holy decree that they are going to make process optimization their number one prority..<\/em><\/p>\n

<\/em>HfS is awarded IIAR Analyst of the Year for second year in succession<\/strong><\/span><\/p>\n

HfS Research won the individual award for \u201cAnalyst of the Year\u201d for a second year in succession<\/a> (some individual called Phil Fersht now sporting an ego so insufferable, it\u2019s rumored he can\u2019t even stand his own company). In addition to the individual analyst award, HfS Research topped the charts for \u201cOutsourcing, BPO and Maintenance Analyst Firm of the Year\u201c. And this time, HfS Research was a runner-up for the overall \u201cAnalyst Firm of the Year\u201d, behind the formidable Gartner. Over 260 analyst and influencer relations specialists took part in this year\u2019s survey \u2013 by far the greatest number to date, who voted on all the major research analyst organizations, such as IDC, Forrester, Ovum and so forth. We would like to offer anyone who voted for us a cocktail on us when you see us at some upcoming conference, which we will be able to pay for out of the 20% price hike we\u2019re gonna add to our services.<\/em><\/p>\n

Eight top tips to prevent outsourcing providers committing harakiri\u00a0<\/strong><\/span><\/p>\n

It simply had to be said… Dear Providers – we love you. Without you there would be no outsourcing industry and we would not have jobs. More than anything, we want to see you succeed. Why, oh why, must you insist in compromising your own success by practicing death by PowerPoint<\/a> on your prospects?<\/em><\/p>\n

<\/em>November<\/span><\/strong><\/p>\n

HfS and Sylvan advisory launch HfS Consulting\u00a0<\/strong><\/span><\/p>\n

HfS Consulting is a unique coming together<\/a> of acclaimed research, benchmarking analytics, market insight and strategic consulting expertise. \u00a0It is revolutionary in the fact that enterprise clients can access ongoing analysis, data and expert advice via an annual, affordable and on-demand subscription relationship model, as opposed to solely buying costly \u201chourly billable\u201d consulting services.\u00a0We lead with our proven research brand and analytical capabilities and have the ability to apply these to our clients with consultative advisory programs. \u00a0So we strategize, we apply our unique data and insight and then we execute.<\/em><\/p>\n

\u00a0Why outsourcing professionals must stay in touch with the 99%<\/strong><\/span><\/p>\n

Phil Fersht fires a warning shot<\/a> to the outsourcing industry that it faces a backlash if outsourcing executives are overly-complacent. These issues are going to move beyond buyers simply improving business processes and cutting costs \u2013 they are going to become \u00a0centered on how companies are managing their workforces. Governments are very capable of passing measures very quickly to restrict outsourcing if things get really bad \u2013 and they won\u2019t have much choice if the 99% demand it.<\/em><\/p>\n

December<\/span><\/strong><\/p>\n

@The_Whole_Outsourcing_Industry: Labor arbitrage built your house of cards. #Bubble What\u2019s next?<\/strong><\/span><\/p>\n

And what better way to cap off 2011 with HfS’ EVP of Research, Tony Filippone, simply calling it how it bloody is<\/a>. \u00a0The road to our future is unclear. \u00a0As buyers begin to line up for higher value services, their shift in demand will dramatically affect the marketplace. \u00a0Service providers that cannot develop IT-enabled BPO platforms, provide insightful analytics, or drive high value business outcomes will lose market share and be relegated to second tier \u201ctactical\u201d supplier status.<\/em><\/p>\n

Well… that’s pretty much all from HfS Research for 2011. \u00a0Hopefully, we can continue to keep you entertained, and drive more topical debate in 2012. \u00a0<\/strong><\/p>\n

Peace out!<\/strong><\/p>\n

The HfS Research team<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Well, another year goes by and HfS yet again escapes any legal action, terrorist attacks at our office, or disappearing…<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[48,840,81],"tags":[303],"organization":[],"ppma_author":[19],"class_list":["post-1424","post","type-post","status-publish","format-standard","hentry","category-business-process-outsourcing-bpo","category-horses-for-sources-company-news","category-it-outsourcing-it-services","tag-enterprise-irregulars"],"yoast_head":"\nThe defining outsourcing moments of 2011 - 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\/the-best-of-hfs-in-2011_122411\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The defining outsourcing moments of 2011 - 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