Digital service firms need greater agility
Service providers need to change their traditional sourcing strategies to ‘adaptive sourcing’ to succeed in the digital world, advises analyst firm Gartner. This will require using a layered, agile and collaborative approach, it says.
The problem with traditional sourcing strategies is they are too centralised or not centralised enough; too customised or too industrialised. As a result, they actually reduce, rather than enhance, agility, says Susan Tan, research vice president at Gartner.
The service firms that are succeeding in the new digital world are ones that embrace adaptive sourcing. It addresses the shortcomings of existing traditional sourcing strategies and management by using a three-layer approach to services: innovate, differentiate and run.
Each of the three has different service requirements and competencies, and different criteria for things like governance, architecture, value expectations and vendor and risk management.
The ‘innovate’ layer has elements of agility, speed and business-aligned innovation. Flexible, scalable and adaptive technologies like private and hybrid cloud are ideal here.
‘Differentiate’ requires industry and process expertise, thought leadership and vision. Technologies such as process automation, IoT and Big Data analytics can help business to get the edge here.
‘Run’ involves efficiency, scale, reliable execution, and industrialisation. Having an agile, scalable data centre infrastructure will help here.
Tan explains that the three layers – innovate, differentiate and run – are present in every client’s IT and process environment, and a provider may play in one or more layers, either directly or through partners.
“Because of the need to integrate data and systems across different layers, service providers will need to work more collaboratively with other providers in multi-provider environments,” notes Tan.
She adds that adaptive sourcing layers are not static. “A service initially introduced and offered in one layer will migrate over time, requiring a different focus and expertise and, possibly, a different service provider.”
“Service providers that embrace the adaptive sourcing model will be better positioned to participate in their clients’ digital journey, demonstrate relevancy, bring the right value, address the needs of their expanding audience of buyers/influencers and position themselves as innovation partners,” concludes Tan.
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