Lloyd Borrett's Blog
Are we there yet?
Hypocrisy breeds mediocrity
Ten years ago, virtually every IT services firm latched onto Business Process Reengineering (BPR) as the Holy Grail. The combination of process improvement and technology created a jungle for clients. And opportunistic IT consultants set out to bring their clients in from the wilderness, no matter what the risk.
But in those days, no singular, large-scale IT company bivouacked with clients through the entire journey. The strategy focused companies like McKinsey and BCG would usher their clients to the precipice and then offer a hearty backslap and cheerio for a safe crossing. IT implementers, particularly the Andersens and PwCs, would offer support and a sure hand as they steadied the ropes while crossing the chasm. On the other side, hordes of IT outsourcing types like IBM, EDS, Unisys and CSC, stood ready to soothe the clients' weary feet.
Five years ago the IT services companies all hyped the benefits of using the Internet as the basis for a "new economy", advising their clients that they needed to be "e-business" enabled to succeed into the future. They trampled all over their ethical responsibilities to their clients as they grabbed greedily for their share of the rich river of rewards. The resulting conflicts of interest were soon exposed and the big accounting based companies were forced to shed their IT consulting, implementation and outsourcing units. This realignment proved more confusing than clarifying. The big may have gotten somewhat bigger, but hardly better.
Today we have large-scale, IT services companies who claim to have fully-integrated consulting, implementation and outsourcing services. They seek to hold the client's hand through the whole journey. And they are all pushing their clients towards the new "big idea" of Business Process Outsourcing (BPO). Unfortunately, nobody seems to have a clue as to how such a business should look, much less operate.
So the two biggest IT services operations (IBM and Accenture) are now locked in an epic battle with offshore companies like Infosys and Wipro to scale a new business model.
Meanwhile, traditional IT strategy consultants dabble in BPO by adopting "sourcing" practices that advise clients on the best BPO providers.
Transformational BPO has captured the fascination of IT service providers and clients alike because of potentially spectacular rewards, both for the service providers and their clients. We'll strategise on the problem and fix your process, BPO service providers say, and then we'll assume responsibility for consequences. Results with no regrets.
But in return, both sides must accept the death-defying risks of complete commitment; the notion of one service provider that takes a client from business strategy, through IT implementation, to activity support.
BPO seems a natural progression of BPR -- a sort of one-stop shop for the sophisticated client. But it still remains to be seen whether one BPO company can really cover the entire spectrum of services.
None of the major players have yet aligned all the parts into a cohesive whole, yet each one of them is praising the miracles of BPO. The hypocrisy of this is yet another example of how IT services is fast becoming a middling mass of mediocrity.