Where did 2017 go? We have just entered Q4 and the budgets for 2018 will now be in progress – or possibly already be ready. What were the analysts predicting for outsourcing in 2017 and were they right?
I took a look back at a good list created by Stephanie Overby in CIO magazine. This was focused on ten key predictions for the year ahead in IT outsourcing, rather than BPO or more general non-tech predictions, however because most services are now delivered using technology the line is becoming far more blurred. IT outsourcing is no longer just focused on software development – it covers a wide range of technology-enabled services.
So let’s consider 3 of the 10 points that really did hit the target, especially when considering the European nearshoring market:
- Security is top of mind; this is especially important in Europe now because GDPR enforcement will commence in less than a year. This is a huge change to data privacy across Europe and will affect how many companies do business.
- Suppliers will pivot; suppliers that focused on a single area, such as software, are creating complete solutions and even branding solutions differently to emphasise that this is something new. Solutions not individual services is the answer now.
- Cloud as normal; this has been a game-changer. Companies no longer need convincing that cloud-based services are the way forward, they are seeking out services that need no infrastructure and can be paid for only as they are used.
But the list also mentioned that call centres will fade into obscurity as automation and artificial intelligence replaces the need for human agents. This has not happened – yet. In fact the way that most companies appear to be using AI for contact centres is to enhance the performance of agents – so the agents are still integral to the call centre experience. I do expect that as voice recognition improves, we will see many more customer service calls answered directly by the AI, but it requires a very natural interaction to work well and we all know that our present-day conversations with Siri are not there yet.
In addition, I would add that a major outsourcing trend that has been developing over the past couple of years was not mentioned at all. That is the focus on partnership. Partnership used to be one of those terms thrown around by sales teams and forgotten about once a contract was signed, but times are changing.
Many of the services offered by IT suppliers today are incredibly complex. There is no question of comparing in-house against outsourcing because outsourcing to experts is the only way to deliver many solutions today. One analogy would be to ask, if you had more free time then would you service your own car? Almost certainly the answer would be no, because you don’t have the tools or expertise to do the job well. This is now the case in many areas of IT – it’s just not possible to deliver solutions without calling the experts and that is a big change from just a few years ago.