Trends to Watch in 2019: Predictions by Certified Outsourcing Professionals
By: Richard Ostrander, COP, Principal, JDalal Associates, LLC.
Cyber-attacks, Robotic Process Automation (RPA) and cloud-technologies are the top three trends to watch for in the coming year that could impact outsourcing, according to an informal survey of Certified Outsourcing Professionals (COPs).
About 90 percent of respondents said they expected these areas to have the greatest influences in 2019, followed by a talent shortage, artificial intelligence, GDPR legislation in Europe and blockchain.
Meanwhile, the professionals surveyed at the Advanced COP Workshop in 2018 said that global unrest, a stronger China and U.S. isolationism would have less of an impact in the year ahead than the other factors.
Many of the 40 COPs participating in the survey are responsible for sourcing decisions in outsourcing IT and business processes while others have leadership responsibility for the all-important relationship governance process.
The survey presented 11 topics that participants were asked to rate each on a scale of five (highly impacts outsourcing in 2018-2020) to zero (little impact on outsourcing in 2018-2020).
The following topics were taken from themes that were represented at OWS18 as well as discussion topics that generated the most interest during the customer and provider discussion sessions in February 2018:
- Artificial Intelligence
- Cloud-based process/technology (service model) offerings
- Cyber-attack (e.g., hacking)
- GDPR legislation (European privacy laws)
- Skill shortage in the technology field
- Impact sourcing
- Global unrest (e.g., nationalism, North Korea)
- U.S.A. (“America First”) isolationism
- Stronger China (as a global leader)
For simplicity of analysis, we have grouped results into two categories:
- Top three ranking – scoring of three, four or five (higher impact)
- Bottom three ranking – scoring of zero, one, or two (lower impact)
At the Advanced COP Workshop, Jag Dalal introduced a risk-based management model to counter the impact of cyber offenses. This simple process will become a requirement for all outsourcing engagement just as risk management is today.
While few in the class had implemented RPA, most felt it would be an area they expected to give greater consideration. One of the key discussion points at the workshop was about how a team could adopt RPA successfully. Dalal shared a unique team approach to managing innovations like RPA:
Global and Political Landscape
Interestingly, respondents were fairly consistent on the significance of global and domestic political environment impact on outsourcing over the next several years. Just over half of participants consistently see the effects of isolationism, global unrest and the role of China as having an impact on outsourcing.
While certainly an informal survey, the results do speak to some general conclusions that the outsourcing industry should take note of:
- Technological service delivery models are a significant enabler for outsourcing but both parties are going to spend time and resources addressing the risk of cyber-attacks during negotiations and throughout governance of the agreement.
- The dynamics of the political environment and global leadership will continue to influence not only using specialized third party providers but also impact the decision of where service delivery should be located and the need to have flexibility within the agreement to respond to changes in regulation.
About the Author: Richard Ostrander, COP is an IAOP Master Class Instructor and Principal of JDalal Associates, LLC.