Fuelling innovation in the digital era

Innovation is the most sought after and at the same time the most underachieved outcome of many modern outsourcing relationships. The primary issue is that the driver for these engagements is cost reduction versus service enhancements. In the digital era we are presented with an interesting opportunity: can outsourcing deals driven by social media, mobile, cloud, analytics & big data (SMAC) technologies bring innovation back into outsourcing? While the meaning of innovation varies by organisation, there is uniformly a strong desire to translate sourcing dollars and service providers’ world-class capabilities into improvements in service delivery and demonstrable impacts to business. The Outsourcing Draft International Standard (ISO/DIS 37500) defines innovation as: “implementation of a new or significantly improved product (goods or service), or process, new marketing method, or new organisational method in business practices, workplace organisation or external relations.” Previously the exclusive domain of third- or fourth-generation (“mature”) outsourcers, today we are seeing innovation becoming the central theme of even first-generation outsourcing contracts. Why this change? Is it a fad? Are RFP “templates” driving this trend? We don’t think so – the underlying cause is the accelerating pace of change driven by SMAC technologies. It is bringing more into the realm […]