Part of the IDC Outsourcing Forum Midwest Report
 The Williams Companies is a Fortune 200 energy company that currently distributes 12% of all the natural gas consumed in the United States and is a major employer in Tulsa, Oklahoma. Marcia MacLeod, Vice President of Business Process Outsourcing, and Karen Caldwell, Director for Energy & Utilities at IBM, explained how the company pulled a Houdini in the early 2000s, using outsourcing to survive a near-death experience in which its stock dropped from $48 to less than one dollar. This case reflected outsourcing’s potential in dramatic turnaround situations while confronting some outmoded stereotypes about its impact on local employment.
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Part of the IDC Outsourcing Forum Midwest Report
IDC analysts Brian Bingham and Barry Rubenstein cited extensive IDC research to describe how outsourcing is developing as a business practice. Although they didn’t explicitly delve into adoption itself, their treatment of ITO (IT outsourcing) and BPO (business process outsourcing) provided significant insight into how outsourcing is being adopted by global enterprises. ITO is several years ahead of BPO for several reasons, namely that IT has traditionally been managed as a support function and cost center in most enterprises and, as such, it has been a textbook candidate for outsourcing. BPO is often more intertwined with the business’s core competencies; in addition, it almost always requires sophisticated IT support. Clearly, ITO had well publicized failures in the early 2000s, but this proved to be part of the normal learning curve, and ITO successes have emboldened buyers and providers to push further into the business. This contrast between ITO and BPO patterns is particularly instructive.
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At the turn of the 21st Century, converging social, technological and political changes demand profound changes in how organizations relate to their customers. These changes question many of the assumptions on which 20th Century businesses are built. To turn this situation to their advantage, executives need to approach how they create value for their customers, quickly and proactively. They must build a collaborative network of partners to discover, design and deliver differentiated experience to customers.
The new meaning of customer experience Pervasive e-business and global sourcing are creating new centers of excellence for knowledge, services and manufacturing around the world—these clusters of people and companies are technology-enabled, well educated and highly motivated. They will impact incumbents in several ways: 1) they represent new collaborative resources that can add significantly to the enterprise expertise network; 2) they are developing into high-growth consumer markets; 3) they will create new offerings that may change the rules of your business since their companies do not have legacy organizations and cost structures. Web 2.0 is mobilizing customers in high-value mature markets—”Web 2.0″ technologies are user-friendly, collaborative tools and work processes that enable customers to connect with each other and collaborate spontaneously. Examples are […]
Clear Outsourcing Adoption Curve Emerges
The IDC Outsourcing Forum Midwest convened sourcing thought leaders from global enterprises, world-class outsourcing providers and IDC’s leading analysts in Chicago September 11-12, 2006. They shared pioneering experiences that are pushing the transformational boundaries of outsourcing, one of the most important management practices to emerge in the 21st century. Case studies from the Williams Companies, AOL, Lucent, Barry-Wehmiller and Procter & Gamble explained how to use outsourcing to satisfy multifaceted business objectives, and a clear adoption curve is emerging that describes how outsourcing is reshaping the world’s largest organizations.
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Surprising Manufacturing Case Study Featured at IDC Outsourcing Forum shows how outsourcing is creating more onshore manufacturing jobs.
 Readers of U.S. and European press are too familiar with the plight of manufacturers—and how outsourcing is increasing cost pressures and sending even more jobs overseas. What is less known is that leading edge manufacturers are beginning to use outsourcing to increase local employment by making local companies more competitive.
Forum attendees will hear how Midwest U.S. manufacturer Barry-Wehmiller, which was featured in BusinessWeek’s The Future of Outsourcing, is creating a new business that turns around manufacturers by improving their business processes, which makes them more competitive and ends up increasing local employment in many cases. Forum presenter Vasant Bennett is President of Barry-Wehmiller International Resources (BMIS) and a chief architect of BWIS’s emerging service offerings. He spoke to the Global Human Capital Journal last week.
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Part of the IDC Outsourcing Forum Midwest Report
Midwest executives will have an excellent opportunity to learn how to take their outsourcing strategy to the next level next week, when IDC will bring their Outsourcing Forum to Chicago. Themed “Reinventing your business through BPO and ITO,” the Forum will feature speakers from Proctor & Gamble, Lucent, The Williams Companies, NiSource, Goodyear, Barry-Wehmiller and Hydro One Networks. In addition, world-class outsourcing providers such as Capgemini, IBM, Hewlett-Packard will offer practical advice, and several of IDC’s lead analysts will offer their insights.
I was able to catch up with event chairman Bob Welch, who previewed some of the Summit’s key themes. I also have information on a special registration deal.
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The Silver Lining in India’s Infrastructure Gap posits that India’s poor infrastructure face force it to develop more lucrative Knowledge Economy assets.
India is often described as a mixed proposition with respect to its future promise. Although few would question its brilliance as a “burgeoning technology economy,” most people temper this with somber remarks about its lack of “infrastructure.” However, I will argue that India’s limitations with physical infrastructure will actually help India get further ahead than if it didn’t have such problems.
In the popular view (see Indian Raj and its quote of The Houston Chronicle), India’s technology expertise, language skills and legal sensibilities are its trump cards, but this is compromised by its lack of roads, transportation of all kinds, network infrastructure, electricity, and so on. High tech companies have to build their own generators and network infrastructure, and leading providers have created islands of world class capability to assure their global clients that they don’t depend on the country’s infrastructure. China, on the other hand, is generally seen as a paragon of world-class infrastructure, especially physical infrastructure. Woe is India.
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Bryan Doerr, CTO of IT services powerhouse SAVVIS, pulled off quite a feat at the Technology Executives Club Outsourcing Update in Chicago last week: in 30 minutes, he explained how visionary CIOs were increasing the value of “IT” by making it vanish. “IT” is not merely being commoditized but must entertain an even more ignoble fate—being virtualized—and this is an exceedingly good thing.
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Dr. Clotaire Rapaille served a delectable elixir to a packed room of B2B marketers at BIGfrontier yesterday. His talk spanned business in China, investing in India, a new value proposition for shampoo (think “breastfeeding”), why people drive Hummers to the mall, why French people don’t work and myriad others. Rapaille (“Rah pEYE”) lists half of the Fortune 100 has retained clients because he has a track record with helping them understand the inner structures of consumers’ minds and, therefore, how to communicate with them. Moreover, many of these inner structures hold true across cultures which can enable companies to develop offerings that will hold true globally. Sound impossible? Read on.
As usual, I will share my notes from the meeting and follow those with some of my insights but, unlike the usual custom, I have also interspersed some material from one of his major books to fill gaps. The topics he addressed were intricate and complex, and there wasn’t time to delve into the details of the background research.
Background
Rapaille, a Frenchman who subsequently became virulently American, began his career as a psychoanalyst working with autistic children in Switzerland, which gave him insights into how the brain worked and […]
Accelerating Forces Buffet the Enterprise
Volatility of customer wants and diversity of markets around the world will increasingly demand that enterprises innovate if they want to remain relevant because their current product introduction and innovation processes are woefully insufficient. In addition, several “structural enablers” are driving down the cost of collaboration—globalization, enterprise software maturation, e-collaboration tools and BPM solutions. I think it’s beyond dispute that “emerging” markets around the world look at India as a model, and there will be a cascading wave of new outsourcing providers entering the market in the years ahead, keeping downward pressure on supplier prices and forcing increased innovation across the supplier value chain. For example, many educated young people in these markets are native with e-collaboration tools, which should lead to new models of collaboration. SOA and Web services are increasingly ingrained in enterprise software, opening up legacy and new solutions to web-based, granular sharing of information. BPM, because it digitizes an increasing spectrum of the business process, is an enabler of outsourcing.
Reposition Outsourcing as Iterative Transformation
Outsourcing in 2006 is where e-business was in 1998, when the Internet was a tech playground in the mid-late 90s. The mission of “e-business strategy” was […]
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