covid-19 impact on global service delivery models “reality …€¦ · outsourcing company. she...

SPONSORED BY

COVID-19 Impact on Global Service Delivery Models

Business Resilience emerges as key objective

“REALITY BITES”

“REALITY BITES”2 |

- C O V I D - 1 9 A N D S H A R E D S E R V I C E S -

AUTHOR

DEBORAH KOPSPRINCIPAL, SOURCING CHANGE

Deborah Kops is a member of SSON’s Global Advisory Board. Her sweet spot is helping enterprises develop new target operating models for a range of business functions by rethinking work content, structure, scope, solutions, organizations and roles in the face of rapid digitization.

Her career includes managing directorships at FleetBoston Financial’s (now Bank of America) Technology and Operations Group, reporting to Vice Chairman, and Deutsche Bank; consulting partnerships at Arthur Andersen and PricewaterhouseCoopers; and CMO of an Indian-legacy outsourcing company.

She sits on the advisory boards of several tech startups, and has led operations of two private equity-funded SAAS businesses. Deborah also founded Liberty Source PBC, a U.S.onshore BPS company harnessing the talents of military spouses. She speaks and writes frequently, and was the presenter of SSON’s HardTalk series.

CO-AUTHOR & EDITOR

BARBARA HODGEGLOBAL EDITOR, SHARED SERVICES & OUTSOURCING NETWORK (SSON)

The Shared Services &Outsourcing Network (SSON) is the largest and most respected forum for executives tasked with promoting and delivering optimized business services.

Barbara joined SSON in 2000, having started her career in capital markets, before joining Armstrong Information, a specialist publishing group. She is responsible for sharing best practices and thought leadership with SSON’s 170,000+ member base, as well as promoting the value of the network worldwide.

- EDITORIAL TEAM -

CONTENTSINTRODUCTION 3

BUSINESS IMPACT NOW HEIGHTENED WITH IMPLICATIONS FOR PRODUCTIVITY MORE PRONOUNCED 4

SERVICE CAPACITY ALSO ERODING 6

“ABILITY TO DELIVER” INCREASINGLY IMPAIRED 7

BCP ONE MONTH IN: SOME ASPECTS WORKING, SOME NOT 8

AUTOMATION DRIVES RESILIENCY 9

ADAPTING THE MODEL TODAY: WORKFORCE NOW IMPACTED BY THE CRISIS 10

A DEEPER LOOK AT AUTOMATION - FUNDS NOT AVAILABLE FOR THE MAJORITY 12

LOOKING FORWARD 13

DECISIONS BASED ON BUSINESS GOALS – NOT TASKS 14

AND ABOUT THOSE LOCATION STRATEGIES… 16

SHIFTS IN TALENT SOURCING APPARENT 17

OUTSOURCING PROVIDERS MORE CHALLENGED 18

PLANNING FOR “RE-ENTRY” 19

AND FINALLY, HOW WILL SHARED SERVICES EVOLVE? 20

mailto:[email protected]?subject=COVID19%20REPORT&body=

https://www.linkedin.com/in/deborahskops/

https://www.ssonetwork.com/content-hub/sson-hardtalk

mailto:[email protected]?subject=COVID19%20REPORT&body=

https://www.linkedin.com/in/barbara-hodge-702b255/

| 3“REALITY BITES”


INTRODUCTION What a difference one month makes! Over six weeks into a global shut down, and most of the world is in, or planning to come out of, an unprecedented lockdown of non-essential businesses. We’ve sent Shared Services and Business Process Outsourcing (BPO) team members home with laptops. Collaboration, fueled by technology, is keeping vital business processes running. Bandwidth challenges have for the most part been solved.

But what are Shared Services operatives now experiencing when it comes to capacity, productivity and business impact? And what changes are they putting in place to cope with what is an unprecedented disruption of the economy – and society – as we know it? When do they see an end in sight – and what will that end likely look like? Virtual, automated, nearshore, inhouse?

In order to monitor the impact of COVID-19 on Shared Services operations, identify the actions leaders are taking, and anticipate the way the industry could evolve, SSON completed a second pulse survey during the period April 10-18,

approximately one month after taking an industry-first snapshot of the initial response to the crisis. While many of the questions repeat our first survey, as new challenges have surfaced, we’ve focused on other areas of inquiry to better understand how leaders are managing.

A note to readers whose pulse on the industry may be contradictory to our survey findings: There is no single truth, however. As the crisis continues, it’s apparent that there is substantial variation not only in the experience of practitioners, but also in the response of their business process outsourcers. Some Shared Services and provider organizations report no drop in productivity or adverse business impact, while others are struggling to deliver. It’s increasingly clear that a range of factors contribute to this: industry, model maturity, delivery footprint, geography, extent of outsourcing, approach to people management, degree of automation, etc. – all of which impact responses. Please consider these survey results as a vital assessment of performance, attitudes, and tactics over time as Shared Services operations strive to meet the challenges of COVID-19.

About the survey respondentsA few words about our survey. Almost 200 organizations, headquartered around the globe, took the time to respond. Roughly 3/4 of respondents are corporates. Most claim global footprints, with half of the enterprise respondents having operations in APAC (including China and India), compared to 2/3 of BPO respondents.

Enterprise GBS or Shared Services 75%

Business process outsourcing provider 25%

Our delivery model is global; we have centers in every region where shared services are delivered

45%

Our model is focused on European locations 9%

Our model is focused on APAC (excluding India & China)

19%

Our model is focused on India locations 9%

Our model is focused on the Americas locations 18%

What best describes your captive and / or outsourced services delivery footprint?

What category best describes the type of organization in which you work?

45%

19%9%

9%

18%

25%

75%



BUSINESS IMPACT NOW HEIGHTENED WITH IMPLICATIONS FOR PRODUCTIVITY MORE PRONOUNCED


It seems we were in a different world when we first ran the survey in March, more or less at the outset of the crisis. At that time, 40% of respondents stated that they experienced no business impact, implying that any effects might be mild and short-lived. A month later, the data now tells a very different story. Less than 10% of those surveyed are seeing no COVID-driven implications on the business. As the effects of a virtual

global shut down hit just about every enterprise, respondents cite that “show me the money” is the biggest impact, as the decline in collections has accelerated dramatically.

After cash, respondents note that supply chains are increasingly being affected, followed by increases in the cost of operation.

Decline in collections

Increased cost of operations

Gap in ‘back office’ service delivery/

processing capability

Supply chain disruptions

There has been no impact

Other

Which of the following is your most significant business impact as a result of the COVID-19 outbreak?

7%

30%

11%

14%

17%

20%

16%

22%

40%

9%10%

5%

20%

10%

40%

30%

March 2020 April 2020



Two months in, Shared Services leaders report that their ability to hit Service Level Agreements (SLAs) on time is markedly reduced: As of April’s industry pulse check, 37% of practitioners were hitting SLAs on time compared to 60% a month ago. Even achieving today’s results is due to a number of decisions most leaders are increasingly taking to adjust SLAs, prioritize mission-critical work, and defer the transition of new scope to centers.This finding seems to run counter to comments touting the productivity of the work from home (WFH) model. Indeed, there are leaders in a number of organizations, primarily those with mature, captive-centric models, that say that they’ve had

their best quarter closes ever, or haven’t missed a single deadline. Certainly, days at the laptop are lengthening as staff (primarily those without young children) are spending more time on video calls and in front of the screen, thus contributing to these results in some SSOs. Yet others cite that – as shelter in place grinds on and quarantine fatigue sets in – there has been a palpable reduction in productivity.

It’s fair to say that a number of factors – culture, location, preparedness, organizational maturity, captive versus outsource, and team cohesion, to name a few—impact operations.

We are hittingall our SLAs

on time

We have prioritizedmission-critical work

but have deferred other less critical tasks,

delivering selective process/SLA

We haveadjusted all

our SLAs

We aremissing SLAs

We have deferredtransitioning new

scope to ourcenters

Other

How would you gauge the impact of the virusthus far on your center’s productivity?

60%

37%

21%

28%

6%

17%

3%

12%

7%

3% 3% 3%

20%

40%

60%




Compared to your service capacity levels before the COVID-19 outbreak, how much of your service

capacity has been lost at this stage?

When it comes to operating challenges, there is divergence between enterprise and BPO respondents. WFH is the overwhelming challenge for providers along with availability of staff. BPO providers score themselves more adept managing challenges such enabling technology, connectivity and system bandwidth, but do admit to somewhat greater challenges in getting laptops to team members.

April 2020March 2020

We lost <25% of our capacity

94%

We lost 25-50% of our service

5%

We lost >50% of our service capacity

1%

We lost <30% of our capacity

78%

We lost 30-50% of our service

5%

We lost >50% of our service capacity

17%

SERVICE CAPACITY ALSO ERODINGIn March, the overwhelming percentage of respondents (94%) reported less than 25% reduction in capacity as a result of COVID-19. As the implications of the virus on Shared Services operations grind on, we added some granularity to the question in order to track the numbers more precisely. Today, the reality is more nuanced: While 28% say there is no loss of capacity, nearly a quarter cite losses of more than 40% (14% have lost more than 50% capacity – compared to less than 1% last month). It’s clear that while WFH has generally been a BCP success, travel and regulatory restrictions and the human realities of lockdown are starting to impact capacity.

78%94%

17%1%

5%

Compared to your service capacity levels before the

COVID-19 outbreak, how muchof your service capacity has

been lost at this stage?

We have lost no service capacity

We have lost <10% of our service capacity

We have lost 10-15% of our service capacity

We have lost 16-30% of our service capacity

We have lost >31-50% of our service capacity

We have lost >50% of our service capacity

Enterprise GBS or Shared Services

BPO provider

36%

15%

31%

15%

20%

26%

15%

22%

10% 30%

1%

7%

8%

4%



While most of the inhibitors have not changed significantly from the March pulse check, the data indicates that the virus’s challenges to Shared Services operations are very much concentrated around people. The availability of infrastructure and bandwidth are still significant, but almost half cite significant challenges in managing remote teams, while staff health and availability are also limiting factors. People, not technology or infrastructure, present the most significant limitation.

Understandably, BPOs have greater concerns with regards to workforce: Roughly 75% concede that their service delivery is severely impacted by challenges around managing the workforce (i.e., remote teams) compared to just 42% of enterprise respondents. Similarly, availability of staff is a much more significant concern for BPOs than it is for SSOs/GBS.

This likely explains the more significant impact COVID-19 has had on BPO capacity levels compared to those of captive operations. BPOs are also feeling the impact of the crisis on their cost of operations: 27% cite higher cost of operations as a business impact, compared to just 11% of inhouse centers.

Insecure networks Lack of system bandwidth

Inadequate infrastructure / hardware

Challenges managing remote teams

Mental and physical health of employees

Availability of staff Other

10%

30%

50%

60%

40%

20%

What is currently limiting your ability to deliver shared services?

[multiple options chosen]


BPO provider

18%

36%

38% 42

%

45%

29%

24%

26%

41%

48%

48%

22%

7%

74%

What is currently limiting your ability to deliver shared services?


Challenges managing remote teams

Inadequate infrastructure / hardware

Mental and physical health of employees

Lack of system bandwidth

Availability of staff

Insecure networks

Other

49%

39%

37%

31%

31%

18%

27%

10% 30% 50%

“ABILITY TO DELIVER” INCREASINGLY IMPAIRED

2m 2m



AUTOMATION DRIVES RESILIENCYSateesh Seetharamiah, Vice President and Global Product Head at EdgeVerveQ: How is automation supporting more resilient service delivery in the face of current business disruptions? Can it provide immunity from further COVID-19-like crises?

Sateesh: We’ve seen from SSON’s surveys that organizations had already been targeting digitized service delivery models before the events of this spring. What COVID-19 has done is accelerate that move.

To maintain service levels, which of the following are you currently considering?


Automated service delivery models – even virtual service delivery models – are now recognized as part of the solution to the vulnerabilities many Shared Services experienced as a result of the virus. Of course, there are many complementary technologies that run alongside RPA – automation on its own is not a silver bullet. It will play a key role, however, as one of the strategies that will build more resilience in service delivery for the future.

There is, however, a critical shift that we’ve witnessed over the past 6 to 8 weeks. Namely that, as businesses seek solutions to guide them through the crisis, the dialogue has shifted from efficiency to resiliency. However, it’s not just about leveraging automation to manage through the current crisis.

Automation will play a crucial role in supporting businesses as they recover, and re-enter the market. I think we’ll see many organizations attempting to recoup lost time by scaling up their automations to support spikes in activity – because managing those spikes will be a challenge, unless you are already planning for them now.

There is also significant interest in “de-risking” delivery models. Too much, we now see, had been taken for granted pre-COVID-19. Risk management has become a business-critical priority, and automation can play a key role in supporting this.

To share an example of how automation is helping organizations adapt to pressing challenges now: We work with a large telecoms customer in Europe that had already adopted automation across the enterprise. As a result, the company was able to leverage the solution to highlight those customers that were at a high risk for COVID-19, and ensure they received prioritized services. Because the business was already operating in an automated environment, it was able to pivot quickly. We are seeing, across the board, companies that have already invested in automation having an advantage. While the original decision to invest may have been for efficiency reasons, they are now benefiting from improved resilience and other factors that support service delivery.

Regarding immunity, you need to remember that automation is about optimizing the Human + Digital workforce. At EdgeVerve we refer to this intelligent automation evolution as Automation Singularity – partly defined by the fact that RPA is becoming a critical part of enterprise business strategy. By implication, enterprise processes will be more resilient – or immune – to disruptions as the ability to switch work from humans to the digital workforce evolves. In addition, automation can scale up or down to meet random, rapid changes in volume – in contrast to the more cumbersome shifts of a human workforce. For example, many customer service or contact center teams have found themselves inundated with significantly higher volumes of calls in the past two months. Again, enterprises already

Increased automation of processes

Recalibration of service delivery model

Adoption of cognitive / AI capabilities

N/A

Renegotiating SLAs

Moving work back onshore

Other

56%

24%

23%

21%

12%

44%

10% 60%30%

5%



committed to an automated environment have been able to react quickly, by shifting to digital resolutions. A final point: The remote workforce is becoming a stark reality, and some aspects of it may not fade away but rather form part of a future workforce strategy. The challenge that has emerged is how to stitch this disparate workforce together to maintain business continuity. Again, automation is one of the solutions that can act as the “glue” in holding a remote workforce together. In addition, enterprises will need help in monitoring the activities of their remote workforces. We are already hearing the need to get visibility to remote activity, workforce productivity and compliance, where process mapping solutions like AssistEdge Discover are helpful in monitoring how users interact with systems and opportunities to optimize.

Q: How has the current crisis impacted customers’ expectations regarding automation solutions? What are their priorities?

Sateesh: One of the things that has happened as a result of COVID-19 is that enterprises have started discovering the capability of process automation beyond its traditional use. When RPA first emerged in the market, it was predominantly unattended, which served back office processes well. Significant benefits were derived from transferring work to unattended bots. While attended automation has its own play, this crisis has amplified the strategic possibilities of attended automation. This is particularly notable in customer service, where the impact of COVID-19 has been largely felt, and where attended automation in the form of Human + Bot is connecting the end-to-end process. So what we are seeing is more interest from enterprises in an automation platform that allows them to move between the attended and unattended f automation.

Another trend we are seeing is that crisis management has brought more mainstream processes into automation’s scope. These include front-office activities that touch the customer, or processes that impact revenue directly. So there is suddenly a lot of interest in driving improved resilience through areas that were not traditionally

seen as candidates for process automation but are now being prioritized.Finally, with the crunch on OPEX and CAPEX, there is more pressure on justifying investment dollars and that has shifted the conversation to measurable outcomes. So there’s been a pivot towards results. Case in point: We are currently working with an enterprise in the agricultural sector and have pioneered an outcome-based delivery model, which is very exciting. I expect we will be doing more of this in future. Q: As enterprises seek reduced exposure to potential risk factors associated with humans or locations, how might automation play a role in this?

Sateesh: RPA led automation introduced the possibilities of moving human work to digital workers. This along with other complementary technologies such as AI enabled workflow, NLP driven text analytics, low code platforms etc. has brought in innovative human-digital worker collaboration. These changes had kick started the discussion on newer models to deliver work packet, servicing customers etc.

In light of COVID 19 crisis enterprises have been forced to rapidly evolve their workplace and accommodate large remote workforce. Companies that had invested in automation and successfully automated critical processes have been able to weather this transition better.

In the long term, I think this trend will only increase, in that insights from humans will drive additional process automations. As automation evolves as a feed for real-time enterprise interaction data, it will enable future command centers for live operations. So from a service delivery point of view, you could say that automation will take on more and more work that humans are currently doing, releasing them for other activities, and “location” itself will become less of an issue.



BCP ONE MONTH IN: SOME ASPECTS WORKING, SOME NOT

Insufficient time to mobilize in light of the scale of the pandemic is shining a light on Shared Services leaders’ challenges. With a month’s further reflection, April’s pulse check indicates that the reality of implementing BCP is now more keenly felt, especially on the people side of the business. The conduciveness of physical

space to WFH is cited as a more difficult challenge this month (31%), followed by the stressful effects of lockdown now at 28%. Connectivity and security challenges are on par with last month (30%), with a small decline in concerns about infrastructure and hardware, some of which may now be sorted (Shared Services leaders

apparently did a reasonable job in arranging laptops and WIFI).

Respondents are now more acutely aware of the challenges of not being able to implement fallover plans (20% in April – more than twice the 9% in March), and we are also seeing a tick up in restrictions against off premises operations.

What are your major BCP challenges?

17%31%

30%30%

22%28%

20%28%

9%20%

24%19%

11%15%

5%6%

Our staff do not have access to space conductive to work remotely

Our connectivity and security environment is not sufficiently equipped to remote work

Panic and general hysteria is affecting productivity/ causing staff to take

unnecessary measures

We did not have sufficient time to mobilize

Our infrastructure and hardware does not allow people to work from home

We cannot shift work as alternate centers are also shut down

The business does not permit off premise operations (e.g. data privacy)

Our staff are infected; we do not have sufficient human resources/manpower


10% 20% 30%



ADAPTING THE MODEL TODAY: WORKFORCE NOW BEING IMPACTED

In this month’s survey we expanded our questions to ascertain what steps Shared Services leaders are taking today to manage both scope of work and workforce. Not surprisingly, almost 40% cite automation as their solution of choice, while 22% are keeping on, doing nothing to change the way they operate. Contrast this with the March pulse where almost 60% saw no long-term impact on their service delivery operations.

In response to the current business environment and in an effort to maintain support to the business, 28% of respondents find themselves increasing Shared Services scope, and some

are hiring more staff – presumably in defensive industries where volumes have gone through the roof. However, as the economic crisis deepens, Shared Services operations are no longer immune to pre-emptive personnel actions. Nearly 15% of respondents are reducing their SSO/GBS workforce. Pay cuts, furloughs and mandatory leave are being deployed by 39% of respondents. And there are some changes in who is performing the work: 12% are transferring work back to the business while 11% are increasing outsourcing activity.

What are you doing today to adapt your service deliverymodel to the current business environment?

Move work between centers /deploying fallover plan

23%39%

Implementautomation

solutions

28%Increaseservicesscope

Implementpay cuts

16%Shift work

back tobusiness

12% IncreaseSSO / GBSworkforce

10%

Other4%

Implement furloughs and mandatory leave 23%

No change 22%

Reduce SSO / GBS workforce 14%

Increase outsourcing 11%

Decrease service scope 8%



A DEEPER LOOK AT AUTOMATION

FUNDS NOT AVAILABLE FOR THE MAJORITY

While nearly 60% of respondents listed automation as a solution to maintaining service levels, citing “increased automation” as a priority – looking deeper, the backstory is more complicated. When asked a telling question –“Given the interest in automation, do you have the budget you need right now?”—only 28% of those surveyed conflated both having the budget and actually currently investing in accelerating automation. Despite the belief of most that automation is the silver bullet for Shared Services operations, just shy of one quarter are still on the fence; either they have allocated funds for automation but have not yet decided to invest (12%) or they don’t have the budget and

have no plans to implement automation right now. Just over 40% of respondents variously believe that an investment in automation is critical, but do not have access to funds at present. Notably, 18% indicate they will not have the budget for at least three months with the majority stating that automation programs will remain unfunded for at least six months.

These numbers support the hypothesis that while increased automation is in Shared Services’ future, respondents believe cash and resource constraints will not change this year.

Given the interest in automation, do you have the budget you need right now?

We have the budget and we are already investing in accelerating automation

We don’t have the budget, but we recognize we need to invest in automation

We recognize we need to invest in automation, but won’t have the budget for at least 6 months

We have the budget, but we have not yet made the decision to invest in automation

We don’t have the budget, but investing in automation is not in the plans right now

We recognize we need to invest in automation, but won’t have the budget for at least 3 months Other

28%

25%16%

12%

12%2%

4%



Rank March 2020 April 2020

1 No long-term impact; we will deal with the current challenges and then revert to business as usual

We will aggressively adopt Future of Work concepts

2 We will accelerate our automation initiatives to reduce our dependency on physical locations / humans

We will accelerate our automation initiatives to reduce our dependency on physical locations / humans

3 We will aggressively adopt Future of Work concepts No long-term impact; we will deal with the current challenges and then revert to business as usual

4 We will rethink our global service delivery model We will rethink what is transactional work, and what should remain with the business

5 We will rethink what is transactional work, and what should remain with the business

We will retain our model but move some work back on- or nearshore (i.e., shift away from reliance on offshore locations)

6 We will increase our outsourcing activity We will increase our outsourcing activity

7 We will retain our model but move some work back onshore We will rethink our global service delivery model

8 We will decrease our outsourcing activity We will decrease our outsourcing activity

Since we took the first pulse check in April, respondents’ attitudes have evolved from “this too shall pass” to thinking about likely changes in their underlying service delivery model. While automation is still ranked highly as a tool and a solution, respondents today see themselves more aggressively adopting Future of Work concepts, recalibrating where the work is done – and by whom – more holistically.

The data also presages other changes in operating models, namely rethinking where to draw the proverbial line between what is retained in the business and what is delivered by Shared Services; the movement of work back on- or nearshore; and levels of outsourcing activity,

LOOKING FORWARD >>



DECISIONS BASED ON BUSINESS GOALS – NOT TASKSSatish Nair, Vice President and Business Head at Infosys BPMQ: Satish, you have a strong background in supporting enterprises in workflow and BPM. What are the big lessons learned in the current environment?

The past 6 to 8 weeks has seen extreme automation and digitization coupled with a need for business resilience getting front seat priority within enterprises, leading to a handful of key learnings and solutions emerging to address a post pandemic era leveraging automation.

1. Decision making through the lens of a business function goal or outcome and going beyond an individual task-based automation. For example, reconciliations may be a best-use implementation case however the business impact may be negligible compared to focusing on the outcome of a closing process which is critical.

2. End-to-end process view - The weakest link in an e2e process will be your point of failure. From a success perspective you absolutely have to look at the entire process and not a specific activity when considering automation, to achieve a better business outcome, beyond the focus on tactical effort reduction

3. Speed / agility of decision-making. Businesses have a burning platform that necessitates fast decisions and implementations. What’s interesting is that we are experiencing enterprises now rapidly shedding their inhibition to take decision that had been stuck in a pipeline for months. It begs the question, what was holding up the decision in the first place? We also witness organizations that have already automated weathering the situation much better.

4. Businesses suffer by working in ring-fenced silos creating disjointed environments that negatively impact decisions and implementations. It is time that we build joint task forces across Business and IT to drive digitization with the domain context and prioritization being provided by the business.

5. Enterprises need to look beyond driving

digitization only through the lens of efficiency, Instead, they need to consider the effectiveness of their actions. As in case for one of our customers, It’s one thing to be efficient in paying suppliers, the focus now was to rapidly prioritize payments to many smaller suppliers that will keep them in business and evangelizing… automation to do that? That’s not just about efficiency - That’s about effectiveness and a stakeholder Experience.

Q: Many organizations are citing “automation” as the solution to embedding resilience in their service delivery models. What’s the smartest way for them to do this in the current environment?

Satish: In the past, most automation decisions were based on ROI or simply put - arbitrage. Outsourcing was all about “your mess for less,” and automation was “mess for lesser.” As a result, efficiency featured heavily in the calculation. Now that we’re considering resiliency as key criteria, it means we have to address the opportunity from a business mindset.

For example, Accounts Payable was one of the earliest back office process outsourced, requiring significant workforce and in recent years, appeared to present a great opportunity for automation, compared to more decision-oriented process such as, month end close. But the latter is business critical, and the former is about squeezing extra efficiencies out of the process.

Organizations embarking on an automation journey have the opportunity to take a business impact and resiliency focused view beyond the short-term financial impact. Additionally, there is an opportunity to leverage the latest improvements process discovery tools that provide a comprehensive view into end-to-end business process to identify areas of automation.

Q: How can automation support digitized service delivery models? And how will this provide immunity from COVID-like crises?

Satish: One of the flaws in the past has been the



piecemeal approach to digitization. For example, for a process cutting across the front, mid and back-office, the focus of automation was often on back-office activities. What COVID-19 has done is to put the spotlight on the fact that business impact is end-to-end, the new OneOffice®. Given that the process is only as resilient as its weakest link, There is an opportunity to take an end-to-end process view and leverage automation to link all three parts of the business.

There are three key aspects I’d like to highlight.

1. Ability to correctly identify critical processes based on availability and scale. In IT, the concept of availability, and scalability is well understood unlike business services where this concept of high availability in critical processes is limited, BCP is a start but only relates to a small percentage of critical processes. In an extended lockout, there is a broader range of processes that need to be sustained. An automated environment is easy to scale, especially where cloud is the channel for deployment.

2. Ability to “change” and improve the speed to market - Given a basic bot infrastructure, if process or part of it needs to change in accordance with new business conditions, it’s relatively easy to do. Bots can be programmed fast, compared to training people which requires unlearning and new learning. A financial services client, for example, realized that the voice process was not able to support increased demand for customer service during COVID-19. This meant pushing voice calls to email, and leveraging an existing capability to respond digitally. In addition, where calls were required, customers could receive a call back instead of waiting in a queue. Given the automated environment, these changes were rapidly implemented with minimal impact on customer experience, in fact, the bank has decided to continue with the new operating model post-COVID. Where automation exists, this can be done quickly – even in hours. But without a basic automated environment it’s not possible. This is where the digital services model of human + bot stands out and provides inherent resiliency.

3. Consistency of experience for stakeholders. In the first few days, customers may stomach a deterioration in service, but it’s not sustainable. Whether your stakeholder is the finance

controller or a supplier – the challenge is to maintain a consistent experience that can be easily enabled in a digitized environment. The challenge is not to slide backwards once the crisis passes, but to retain this experience.

Q: From your clients’ perspective, how has their level of automation impacted how they have been able to support their businesses through this challenging time? What are some learnings to share?

Satish: It’s a good question, and is perhaps best illustrated via a matrix. There are two dimensions: maturity [of the automation program] and the business imperative – which extends from sustainability to growth related challenges.

1. Enterprise with a mature automation program targeting sustainability. In this case it needs to maintain critical business processes and target a consistent stakeholder experience. Compliance and cost might be key focus areas, or working capital. The latter is a good example because this would entail a large quantity of data processing enabled rapidly through automation.

2. Enterprise with a mature automated environment with a growth [remember scale from my prior narrative] imperative – for example, where the number of queries are increasing as a result of COVID-19 [again, remember change requirement mentioned before]– then automation should be focused on shifting to channels to support that growth. One manufacturing organization, for example, experienced a massive surge in customer orders as the imminent lockdown became apparent. Since automation was already quite mature, they were able to deliver on this surge. If they had to rely on human workers, the problem would have imploded.

3. Organizations that are at the beginning of their automation journey with inherent inhibition to take decisions – low maturity – where sustainability is the objective, then the focus needs to be on rapid decision making and implementation of automation required to sustain business services.

4. What is more difficult is where low maturity coincides with a growth imperative. Without the appropriate automation framework, the problem is staring in your face – and one I don’t have an answer to right now!



AND ABOUT THOSE LOCATION STRATEGIES…What are industry players thinking in terms of shifts in where work is performed? Perhaps it’s still too early to tell.

With the relative success of work from home, the majority of respondents (55%) see themselves leveraging an increasingly “virtual” model,

where actual location becomes less important. Perhaps the solution is to just let the majority of staff work from home and to hire in non-center locations – akin to the way many consulting firms work.

At the same time, nearly 30% of respondents see no change

in their models as they existed pre-COVID. Whether there will be a migration of work back onshore is yet unclear; a roughly commensurate number of respondents back traditional locations and moving work back onshore.

How might your talent sourcing strategy evolve in the post COVID-19 environment?

SHIFTS IN TALENT SOURCING APPARENT“No change” state over a quarter of respondents when asked about an evolution in the way they source Shared Services talent post crisis. But for the majority, there will be marked changes in the way Shared Services are staffed. A notable number of leaders (22%) say that they intend to turn to gig workers and agile teams as a staffing

solution, likely as part of their application of Future of Work (FOW) principles. Moving work back in is likely in the cards for over 20%, while others expect to increase their use of outsourcing as a talent acquisition strategy.

19%

17%

9%23%

28% 3%

How do you expect your location strategy to evolve as a result of COVID-19?

55%28%

9%

6%

2%

Leveraging an increasingly “virtual” model where location becomes less important

Not at all / no change

Continuing to bet on traditional offshore

locations

OtherLeveraging new locations onshore

Bring more work inhouse to control knowledge supply chain

Increase use of outsourcing to provide more flexibility and access to talent

Leverage wage arbitrage via offshore locations

Increase use of gig workers / agile teams

No change

Other



OUTSOURCING PROVIDERS MORE CHALLENGEDBusiness Process Outsourcing is a key delivery strategy for many Shared Services operations. But have they stepped up to the plate during the pandemic? Although the sample size is small, the results could be considered an indication of both the successes and challenges of working with a third party. In the experience of enterprises for which the question is relevant (approximately 47% of respondents currently outsource), 6% indicate

their BPOs have gone above and beyond as a service delivery partner. The headline is that the majority of those who outsource state that service levels are either being maintained, or that service is falling into an acceptable range. A number are missing targets that impact the business (approximately 12%) . A similar number are currently renegotiating SLAs and other terms.

BPO providers are markedly less optimistic about the extent of COVID-19’s impact on operations compared to enterprise shared services respondents, with over 40% of BPOs believing that there will be no line of sight to the “next normal” for at least 6-12 months.

At the same time, almost 60% of enterprise respondents anticipate a return to some semblance of pre COVID delivery operations in 3-6 months.

If you work with a BPO, how have they performed thus far?

How long do you believe your delivery operations will be impacted by COVID-19 before you return to some

semblance of “pre-virus” operations?

Less than 3 months

3-6 months

6-12 months

More than 1 year

We will be impacted for

the foreseeable future

10%

23%

8%

41% 41%

7% 4%

58%

13%

5%1%

30%

50%


BPO provider

54%

14%

14%

7%

5%

5%

1%

N/A (we do not work with a BPO)

They have maintained normal service levelsService has fallen, but

into an acceptable range

They are missing targets causing

challenges for our business

They have stepped up to the plate

and exceeded all expectations

They are renegotiating SLAs and terms

Other



As the impact of COVID-19 become clearer, we can start to place a few early few bets. As teams adapt to working from home, physical centers as a place of work will take on less importance, perhaps even morphing into locations where staff check in from time to time (‘work from near’ is becoming a topic of discussion). The focus on people will continue, underscoring the obligation of enterprises to care for the health and welfare of their workforce. Technology – whether we unleash the

promise of automation or not – will become far more pervasive in our service delivery operations as we master collaboration tools and learn how to monitor productivity. And, if history is any indication, Shared Services will likely take on more scope and scale on the backside of this crisis.

According to the survey, global SSO practitioners are recognizing the opportunity – or caving in to the imperative – to recalibrate service delivery. As part of reentry planning, the

largest segment of respondents (31%) are taking the opportunity to rethink their models, believing that every aspect of delivery should be put on the table. At the same time, a just slightly smaller number are taking a “wait and see” attitude, hoping that the proverbial dust clears soon before evaluating the model. Health and welfare of the workforce figures prominently in the plans of over 27% of respondents, while others surveyed are more concerned about shoring up their BCP planning.

PLANNING FOR “RE-ENTRY”

What is the major focus of any planning for “reentry?”

31%

27%

26%

14%1%

We believe that reentry planning is an opportunity to rethink our delivery model, and believe that every aspect of our operations must be evaluated.

We are already planning for reentry with a focus on the health and welfare of our workforce, developing medical guidelines, social distancing limitations and shift planning

We are more focused on current challenges and

expect to tackle reentry issues when we have more

clarity on the business

We are already planning for reentry with a focus

on BCP planning

Other



AND FINALLY, HOW WILL SHARED SERVICES EVOLVE? Although many global SSO practitioners are consumed with the day-to-day implications of running Shared Services operations remotely, given the previously unimagined challenges that were experienced at the beginning of the year, respondents are starting to think about the next evolution of the model.

As the implications of the crisis on people, production, technology, and performance become clearer, conceiving GBSNext is becoming a topic of conversation in the industry.

The headline here? There’s been a 30% increase in the belief that Shared Services as a model will become more important (from 24% last month to 32% this month). There’s history backing this belief:

As a result of the 2008-2009 recession, there was an increase in the adoption of the SSO model to more than 7,000 global centers today (as per SSON Analytics’ Shared Services Atlas).

At the same time, in April as in March, the same percentage of respondents (20%) believe there will be no significant change in focus, scope or importance.

The data detects an increased strain of pessimism in respondents, with 10% expecting a retrenchment of work back to business – double the 5% of last month.

Will we see a deepening of these trends? Stay tuned for the next pulse.

What impact will COVID-19 have on GBS/SSO’s value proposition?

32%

29%

20%

10%

5%

GBS / SSO as a business services model will become more important

GBS / SSO models will become increasingly digitized

No change

GBS / SSO models will retrench and certain work

will move back to the business / be centralized

GBS / SSO will be relegated to transactional operations

GBS / SSO will aggressively move up the value chain

3%

https://www.sson-analytics.com/sson-analytics/data-tools/shared-services-bpo-atlas



ABOUT THE SHARED SERVICES & OUTSOURCING NETWORK (SSON)The Shared Services & Outsourcing Network (SSON) is the largest and most established community of shared services and outsourcing professionals in the world, with over 140,000 members.

Established in 1999, SSON recognized the revolution in support services as it was happening, and realized that a forum was needed through which practitioners could connect with each other on a regional and global basis.

SSON is a one-stop shop for shared services professionals, offering industry-leading events, training, reports, surveys, interviews, white papers, videos, editorial, infographics, and more.

ABOUT EDGEVERVEAt EdgeVerve, we are making constant strides towards transforming enterprises by providing AI enabled business applications, leveraging the Infosys Nia™ Platform with capabilities across the automation continuum. With the advent of cognitive automation, we believe this three-pronged strategy will drive our clients to the future. Visit www.edgeverve.com to know more.

ABOUT ASSISTEDGEAssistEdge offers a cohesive automation platform that enables enterprises to scale in their automation journey. It offers enterprises with a comprehensive suite of products enabling them to drive initiatives around process discovery, intelligent automation and digital workforce orchestration. AssistEdge has helped enterprises unlock value in the form of reduced service time, faster sales cycles, better resource allocation, accelerated revenue recognition and improved efficiency among others. Visit www.edgeverve.com/assistedge to know more.

ABOUT INFOSYS BPM LTD.Infosys BPM Ltd., the business process management (BPM) subsidiary of Infosys Ltd. (NYSE: INFY), was established in April 2002. We offer integrated end-to-end transformative BPM services, and have journeyed through the table-stakes of effectiveness and efficiency with an ever-increasing focus on enhancing stakeholder experience and empathy. We consistently deliver enhanced business value for our clients and enable them to navigate their digital journey. Visit www.infosysbpm.com for more

www.edgeverve.com

www.edgeverve.com/assistedge

www.infosysbpm.com

covid-19 impact on global service delivery models “reality …€¦ · outsourcing company. she...

Documents