Sourcing Superstar Series: Disruptive Ideas

You cannot make your processes more effective if your pathways are blocked. Here, Infosys’s delivery lead for Business Transformation Services – Madhukar Tata – shares what he’s seen over multiple client engagements – and offers a few pointers. BH: Madhukar, I know that much of the BPO work you undertake involves an element of transformation. Let’s start at the beginning: what is this transformation all about? Define it. MT: Sure, so it’s essentially about taking the current state of a function or a process to its desired state. The desired state could be described as best in class or what an organization aspires to be. But let me talk for a moment about innovation. Innovation implies that you are expecting something outside the ordinary, outside the known: a new technology, a new way of working, something that creates change in the world. For example, think about when the platform model came about, and vendors became owners – not just of the process, but the process technology and infrastructure. Now you have the cloud coming in. So in some sense, disruptive ideas change the game; I call that innovation. But moving a process from point A to point B, I call that transformation. And these disruptions, as you call them, are they having a big impact in terms of the services you provide? Yes, but you have to remember that what is today’s innovation is tomorrow’s transformation. The new become table stakes overtime. What are the innovations or disruptions causing change now? Right now it's all about mobility. Today, most approvals happen on the mobile, so our clients are expecting us to support mobility. In other words: the new technology trends are defining how we look at transformation, because you need to take into account emerging client dynamics, as well as end user dynamics. And if the user wants things to be approved over the mobile this is driving us to change our model to support these objectives. "Disruptive ideas change the game; I call that innovation." I've read a lot about global optimization, as opposed to local excellence. What does this mean for you? Let me answer that this way: One of the approaches companies take, is to drive best in class processes, and this increasingly means end-to-end, cutting across geographies. So the transformation has to be considered within an end-to-end context, and will naturally cut across functions. For us, this means that you need to look at it from a global perspective rather than a local perspective. What’s an example of a global optimization versus local? Let's look at the accounts payable process. One of the problems people face is that approvals are not happening on time. One way to solve that is by identifying the problem and moving the approvals to the front-end. Looked at differently: You need to analyze where in the approval process there is a breakdown and take ownership of that. Instead of saying it's a problem at the front end, you can grow into the front end of the process, whether upstream or downstream. So you don't restrict yourself to the four walls of the process; instead, you look at the complete end-to-end process. And in some cases this even means extending to the vendors. What are examples of some of the more interesting work that you are doing with forward-thinking clients? How is this paying off for them? As the industry has matured, clients’ expectations have changed from efficient value delivery to effective value creation partner. Clients today are looking for partners who can join them on their larger transformation journey and help them achieve their strategic business goals. We proactively assess these shifts in client expectations and develop an eco-system to keep ahead on the curve. A case in point is our Innovation & Transformations board that we’ve implemented with a few of our key clients, with just the right representation and co-ownership to drive value creation. Through these I&T boards, we focus on specifics that are relevant to the customer and what they are trying to achieve. We help the client create the transformation roadmap and partner with them in implementation and value realization. The shift here is profound and important. For example, for a global electronics major, we co-created a "fit-to-grow" transformation roadmap for their processes that cut across geographies and business units with a vision to achieve a single user experience across the organization. Multiple of these projects have already been completed resulting in significant value realization to the client. Looking at the trend towards end to end … what’s limiting practitioners inhouse? And how are they overcoming these hurdles? Functional processes in today’s global enterprises are highly complex. They are more interconnected, cut across multiple functional areas, and report to executives across multiple regions or business units. Most of these "functional areas" have defined their individual measures of success and value-proposition, creating local optima, which at times doesn’t add to the organization’s throughput, and which in turn holds them back from tapping their true potential. We help clients by defining logical pieces of processes and subordinating functions, departments, measurements and technology to the process needs. This "beyond the boundary" approach offers tighter control over business outcomes and helps manage businesses in an effective and predictable manner, resulting in a definite competitive edge in the marketplace and helping deliver the utmost important thing – "The Value". Without an executive board mandate, what can a shared services leader do to nevertheless move towards end-to-end? By virtue of delivering services across geographies/business units, a shared services leader is in an ideal position to visualize the larger picture, the strategic objectives of the organization, and how various processes/functions fit into the scheme of things. It helps them develop an end-to-end view of the process and analyze the impact of any activity on the organization’s throughput. What are 3-4 tips to removing barriers relating to internal silos/hurdles?? Today all businesses are focused on how to remain cost competitive, how to deliver best-in-class services to internal and external stakeholders, how to grow revenue, and how to innovate and transform existing process. To drive these focus areas, a true end-to-end process view is critical. Every functional area has a link with downstream and upstream processes; without understanding those linkages, true transformation is incomplete. Here are four key steps to strengthening these linkages and removing barriers related to internal silos Set up global process owner models and regional centers of excellence in geographic hot spots Put in place an end-to-end performance management framework Use technology to better facilitate stronger organizational performance (thereby reducing silos) Engage people properly, through a series of recurring change management initiatives Bottlenecks are one of the main hindrances to end-to-end process effectiveness. What are some tips that you can share on identifying and dealing with them? One problem is the absence or lack of technology – specifically, technology that caters to an end-to-end view. This is common for companies that are stuck with legacy applications and that are not able to move forward. Another bottleneck relates to the way people are measured. If you measure a person according to local output criteria, then that's what they will focus on. If you add a metric based on driving end-to-end transformation, then behaviours start to change. A third bottleneck relates to the people side of change. The concept of virtual teams, or a virtual end-to-end process, is difficult to adopt for many people used to the "old" way of working. Where you want to get to is the kind of position a global process owner takes who clearly takes ownership across multiple geographies. How can you give a customer the confidence that you are taking a customer centric view, that you completely understand the priorities of a customer? One advantage that we have as service providers is the fact that we work with a lot of clients. This practice led approach helps us to bring best practices and learnings to the table. The advantage is that we can quickly understand where the bottlenecks are and suggest fixes. This context actually increases over time as our proximity to the client and the business increases. How is this debate relevant to today’s global organizations? As most organizations scale up, their processes do get complex and tend to cut across functions and in many cases, across geographies. This approach addresses the bottlenecks discussed and helps in breaking the functional silos to a great extent. Changing the culture from managing businesses as functions towards managing them as processes is a step change for people. The team is no longer within the four walls – it is now global, virtual and matrix. The entire ecosystem has to evolve to support this. It's important that organizations continuously revisit their structures and open up to emerging technologies and best practices. Is there a possibility that organization structures are rewritten as processes and not as functions? Let’s see what the future holds. Thank you, Madhukar, for your time. [inlinead]

Sourcing Superstar Series: Disruptive Ideas

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