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Genpact earns its CFO Consulting stripes as it seeks to pioneer disruptive F&A services in the digital era

 

The Business Process Outsourcing industry is going through a significant evolution from a labour-led business model to one that is now a blend of global talent combined with automation, artificial intelligence, and digital technologies.  This is especially the case with the financial function, where CFOs are under immense pressure to deliver the next wave of productivity and value from automation and richer data.

Genpact as a pioneering BPO provider in the era of Digital Finance

Genpact has always been ahead of the disruption curve in the finance and accounting function, being the first to disrupt the market with aggressively affordable and effective offshore solutions in the mid-2000s, taking a significant stake in the market in its journey to becoming one of the largest pure-play BPO providers to service the CFO’s office today.

In recent years, the firm has quietly developed its own consulting capabilities, which now account for close to 10% of its revenues, where it is supporting clients with its unique flavour of digital design consulting with its Lean Digital offering, its robust operational and process consulting capabilities and a sizeable focus in robotic process automation and artificial intelligence, including touchless machine learning, which is bolstered by its new acquisition of artificial intelligence platform Rage Frameworks.  In addition, its CFO Services consulting line is now involved in piloting some Blockchain implementations and an increasing involvement in Supply chain, risk management and order management transformation initiatives.

Moving beyond the table stakes

The most progressive service buyers consider process standardization, quality levels and cost savings as table stakes. As our recent study, Finance In The Digital Age shows, finance executives are challenged to better manage regulatory compliance and financial reporting, better use financial and non-financial data, make the close cycle more efficient, and have paperless audit trails. Further, at the top of the finance and accounting function, today’s CFOs are more ambitious than ever to become more involved in driving future growth for their organizations, beyond oversight on controllership and bookkeeping.

So it is unsurprising that our last analysis, the HfS F&A As-a-Service Blueprint, focused on As-a-Service design and delivery in finance among 18 leading F&A service providers. The resulting Winners Circle service providers have collaborative engagements with clients and are making recognizable investments in future capabilities in talent and technology to continue to increase the value over time. These providers are also leading in incorporating analytics as a service into Finance contracts.

Making the shift to being a consultative BPO provider

In the Blueprint report, we positioned Genpact as a part of this As-a-Service Winners Circle category. Compared with the other service providers in the Blueprint, Genpact is one of the top two, leading in both the Execution of actual services and client management and Innovation to drive future value in the form through the use of talent and technology. With 18 years in the market, Genpact has evolved its traditional Lean Six Sigma process excellence methodologies into what it calls Lean Digital, a framework for working with clients to use design thinking for identifying, aligning and addressing issues and opportunities. It’s a transformative approach to align digital technology and talent with desired business outcomes from F&A delivery. HfS hears encouraging feedback from early client work.

Furthermore, Genpact has developed vertical-specific strengths in pharma, CPG, and manufacturing. Its “CFO and Transformation Services” approach is addressing the key needs of CFOs, which is in line with the market needs we outlined earlier.

The combination of Genpact’s Lean Digital, CFO, and transformation services has helped its sales teams take a consultative approach with F&A, particularly with new clients.

This has accelerated Genpact’s market performance in F&A, reaching double-digit growth in 2016. Clients in our Blueprint research ultimately point to Genpact’s “feel good” culture, where through extensive interactions with practice leaders, SMEs, and delivery teams, the service provider drives cultural alignment with its clients. HfS believes that Genpact is a good fit for enterprises that are considering operational redesign in their finance and accounting function, particularly in CPG, pharma, and manufacturing.

Genpact was rated highly in the Blueprint for the following criteria:

  • Collaborative Engagement
  • Incorporating Feedback
  • Delivering Industry-Specific Solutions
  • Investing in Future Talent & Technology
  • Use of Technology to Support Business Processes

(Cross-posted @ Horses for Sources)

Digital Transformation with Accenture Digital

As an organization undertakes digital transformation, opportunities arise to rethink business models, operations, and relationships with customers and ecosystems. It’s a complex dynamic with many moving parts and pieces.

By taking advantage of these opportunities, an organization can change how it does business today. Innovation is associated closely with digital transformation precisely because of the great benefits that change can bring.

The innovation of digital transformation relies on technology coupled with rethinking the company’s relationship to customers. Technology and platforms enable new capabilities, for example, the ability to gather data at scale and use it to personalize interactions with customers.

At the same time, adopting a customer-first mindset is the engine behind innovation and rethinking what’s possible. The forward motion of transformation lies in the realization that we, as a company, can and must evolve to face new customer expectations and competitive shifts in the market. The journey combines technology with culture shift under the leadership of mindset oriented to change and innovation.

With all this, no wonder digital transformation is one of the most exciting and fascinating areas of business activity today.

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Mike Sutcliff, Group CEO of Accenture Digital, is one of the most accomplished digital leaders in the world. Accenture Digital employs 41,000 people, has revenue over $9 billion, and grew 40 percent last year. It’s truly a digital transformation behemoth.

During episode 212 of the CXOTALK series of discussions with innovators, I explore these topics in an in-depth conversation with Mike Sutcliff. The video, which is embedded above, offers a detailed course on digital transformation, including:

  • How to start the digital transformation journey
  • Key components of transformation
  • Role of IT and the CIO
  • Relationships between the CIO and the Chief Digital Officer
  • What happens to marketing and the CMO
  • How digital transformation changes the Chief Financial Officer role
  • Using data science to create personalized experiences for customers

Here is an edited summary of a few key points:

How do you start a digital transformation initiative with your clients?

We traditionally start with the digital customer channel and market question, asking how their customers are behaving, how digital tools and techniques can enable them, whether there are new digital markets they need to participate in, or whether the digital channels need to be integrated differently into their multichannel experience.

They start to imagine a different capability around how they personalize and interact with customers, and then they start to dive into the experiences, thinking creatively about what’s possible in the future and how they can serve customers. Once they’ve imagined that, they come up with these fantastic ideas of what the next generation of an experience might look like.

They may find the existing operating model is not going to allow them to deliver that at scale and efficiently. So, they have to ask questions like, “How are we going to operate the company? What are the basic business processes, the organizations, the technical architectures, how are we going to take advantage of other people’s platforms in addition to the ones that we own internally?”

When they’ve gotten those questions on the table then we know they’re ready for a digital transformation that can work at scale and happen at pace.

What is a digital organization?

It’s different by industry, but there are indicators that tell us people are thinking the right way about embedding digital in their organization.

First, they think fairly expansively about digital. They don’t create a digital sub-unit and think of it as something that’s on the side, kind of an experiment over in the corner; they think about digital as something that’s going to be pervasive in the business.

Second, they stop thinking about their business as a black box that they’re going to design and operate as an independent entity. They start thinking about collaboration with the ecosystem, the platform economy, how they’re going to integrate technologies with others, etc. When they think in that manner, they see opportunities to create leverage in their business that hasn’t existed before.

It’s their openness to a more creative and thoughtful process about how they’re going to create value for their clients with the operating models, tools, and techniques needed to get there.

What is the role of IT and the CIO?

Most of the IT organizations that we speak with are very conscious that they must move past traditional systems of control into the new world of systems of engagement. Working with the marketing organization, they’re focused on customer engagement, creating and delivering different experiences. So, they’re part of the conversation.

But, in many cases, they don’t have the skills, assets, capabilities, or funding to do everything that the business wants to accomplish. So, internal IT organizations are pivoting to this different world, learning new architectures, and building new capabilities internally.

But you can’t create better experiences, connect with customers, and deliver the experience that you’ve promised through the marketing organization without incredibly strong IT. It’s no longer a luxury. IT is a core requirement not just to run the business, but to deliver the experiences that customers are looking for.

And so, the CIO is not just at the table, but are driving the conversation regarding what they can contribute. The difference is: they’re now at the table with a lot more people who are all dependent on them to help them get there very quickly. So, it’s a bigger conversation, and the CIO is critical to getting it right.

We also see many cases where a Chief Marketing Officer, or a Business Unit Executive, or a Chief Digital Officer says, “Maybe you don’t need to own the technology. Maybe I can rent it. Maybe I can subscribe to a service that exists in the ecosystem and mesh it with what we had internally. We see a lot more willingness to subscribe to services and to mix and match from the technology ecosystem.

We think that’s healthy. We think the mix-and-match approach, and the experimentation that comes with it, is allowing clients to move faster. Then, if they decide that it’s strategically important to own something they can build internally, but they’ve accomplished speed-to-market without spending the budget needed to do it from scratch.

What is the relationship between CIO and Chief Digital Officer?

We’ve seen three types of Chief Digital Officers.

In many cases, the Chief Digital Officer comes from a marketing background, and they’re focused on the digital channel and digital experience. In many cases, they’re more externally-focused and more willing to use external services and move independently from what’s happening in the CIO organization. But over time, those usually come together, because you can’t do much for the customer without access to all the customer information, all the product information, pricing information that exists in your legacy environments.

The second kind of Chief Digital Officer that we see comes from the IT world. They grew up in IT, and they’re trying to learn artificial reality, or artificial intelligence, or blockchain, or one of the emerging technology sets, and figure out how that applies to the business.

Those are all rapidly moving spaces, so Chief Digital Officers focused on the technology side of the equation usually work closely with the CIO.

They’re trying to figure out how to manage the two-speed IT question. We’ve still got to manage the legacy environment, create predictable results, manage the budgets. But we also need to experiment and be beyond the leading edge, if not the bleeding edge, of some of these technologies, to serve the needs of the business.

And then the third kind of Chief Digital Officer is business people focused on creating a brand new commercial model or disrupting an industry value chain, fundamentally changing the way business is going to execute.

That third type of Chief Digital Officer usually relies on the CIO to answer the question, “What’s possible? Can you do this?”

All three of those types of Chief Digital Officers, over time, become more and more dependent on a very productive, symbiotic relationship with the CIO to get their jobs right.

See the list of upcoming CXOTALK episodes and learn from the world’s top innovators.

(Cross-posted @ ZDNet | Beyond IT Failure)

Welcome to Judgement Day, where the real future of Outsourcing and the Digital OneOffice will be decided in NY this week!

Dear Friends,

Our day of judgment is upon us! Can we really “unlearn” the last two decades and change how we buy, sell, behave and operate? Do we really have what it takes – deep down inside – to get ahead of this maelstrom of change and come out the other side with wealth, happiness and another two decades of double-digit growth?

Of course we can! But only if you book your last-minute spot to the services event of the year, in Midtown Manhattan next week… Join me, my colleagues and the industry’s finest as we engage in the richest dialog yet on how to tackle the most crucial transition our industry has ever faced, and how to come out the other side re-energized and happy to go to work again.

Service Buyers get complimentary access – only a few seats left, so apply now!

To name a few companies which will be represented…

And a few of the power brokers debating the big outsourcing reset in New York…

 

Find the full line-up here. See you in New York this Thursday, I hope!

Cheers,

 

(Cross-posted @ Horses for Sources)

Why these lawsuits should have started two decades ago

MillerCoors is suing HCL for a botched SAP project. As usual there will be plenty of finger pointing and analysts saying everyone is to blame – the customer, SAP and the SI. Probably true but as in an auto accident we should be able to apportion a reasonably precise amount of blame across each of the parties.

In SAP Nation, I dedicated a whole chapter to such major failures starting in 1997. You see respected brands like Hershey, ICI, Nike and countless others mentioned in that chapter. I commented “Two decades of SAP implementation experiences would suggest that problematic projects such as those above should be slowing down, not spiking.”

What was interesting was few of those high-profile failures  went to court. I found them in quarterly earnings reports, in news reports, through my work with SAP customers.

Not that I particularly want to enrich attorneys, but I wish each of these projects had been dedicated a detailed, and public, post-mortem.

We have to quit making excuses for such failures – year after year. As an industry we have to get better, much better

What scares the heck out of me is most of these relate to failed projects. There are X times more customers which did “go live” but have other “failures” – over priced application management, hosting and MPLS contracts, limited service levels, botched upgrades etc. You hardly hear about those.

For the book, I built several models of the SAP economy. I went with a $ 204 billion a year number. That was scary enough – puts the economy in the Global Top 50 GDP range of countries like Ireland and Portugal.

I did mention “I did not add amortization/write-offs to my model, with the assumption that the expense from previous years would roughly be offset by current year capitalizations. In Chapter 7, we will see a spike in public stories about SAP failures in late 2013; if that indicates a trend of increased write-offs, my model also understates that expense.”

That’s the honest truth. For a smart industry we have been fxxking up year after year, and instead of loud, public trials we have been making excuses for each other.

(Cross-posted @ Deal Architect)

The 10 Things I’d Tell My Younger CEO Self to Do Better Next Time

We’ve hit some of these points before, but what are the Top 10 things I’d tell myself to do better, if I could go back in time?

My top list:

  • Slow down big decisions — when you aren’t sure. You have to move fast and break things, but if the pit in your stomach says “maybe don’t do that” — slow that decision down. My biggest mistakes was when I said roll the dice, but my gut wasn’t sure the downside risk was worth it.
  • Budget an extra 6–12 months beyond the longest timeframe you have budgeted. We raised 18 months of seed money. We needed 30, or at least, 24 months to get to a true business. It always takes longer.
  • Slow down the initial team formation phase if you don’t have it right. Fire fast doesn’t work so well with co-founders. No one has a perfect team to start, or ever. But if the initial team’s goals aren’t aligned … that never gets fixed. It’s OK to wait another 3 months to say GO if that means the team is stronger.
  • Charge from Day 1. Free users and “customers” provide terrible, distracting feedback.
  • Pay Up. Even when cash it tight, paying an extra $20k a year or more for a resource than is 2x-5x better is the best investment you will ever make.
  • Charge more. Your product either has value, or it doesn’t. Charging 20%-50%-100% more than you’d planned will help you learn that faster, and get to a viable business faster. Don’t charge less to get the ball rolling. That only helps with commodities.
  • Fire anyone that isn’t 100% customer-centric. Later, not everyone has to care about customers. But in the early days, everyone does. They will let the whole company down in SaaS if they don’t.
  • Resolve founder conflict. Founder conflict kills start-ups, though often slowly. You gotta fix this early.
  • Pay yourself as soon as you can. Working for free is OK in the early days, but later, it gives you an excuse to just “do your best”. Your best isn’t good enough. Winning the market is good enough.
  • Get better mentors — and pay them. You haven’t done it all before, at least not everyone. And even if they are centimillionaires — pay them (at least in equity). A so-so mentor or advisor is in the end a waste of time. But 1 or 2 folks that can truly help you think through the tough decisions — they are worth their weight in gold.

(Cross-posted @ SaaStr)