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After Outsourcing … Info-comms?

by Rolf Jester  |  May 1, 2013  |  Comments Off on After Outsourcing … Info-comms?

A fictional tale. The year is 2023.

Celia Young is COO of Tranzco, a midsized distribution company.  She’s also, like all of us, a consumer, has a family, a personal life.  At work she’s responsible for operations, the critical processes that enable sales, supply, delivery and the backoffice functions that support the business.

In this world of 2023, she’s an ordinary middle-of-the road user of the Information Services that pervade life in most of the world.  Her uncle sometimes still reminisces about a time when people talked of “tech-savvy” people, about “digital natives” versus “digital immigrants”.  None of that matters anymore in Celia’s world.  Information Services are ubiquitous and taken for granted.  No special skills are needed to use them.  Young and old have taken to them naturally and intuitively.  It just seemed to happen unobtrusively over the past decade.  The consumer appliances and the services they provide access to just kept getting better, easier for real people to get value or fun out of.

There are still, of course, people who love the details of technology – designers, useability engineers, even people who build the actual devices, infrastructure and services.  It’s still an important industry.  But using these tools for everyday life or business is more important for most people.

Celia, like all her family and friends, effortlessly uses all the information and service resources around her, at home, on the road, on public transport, while shopping, out and about, and at work.  The information she needs in her private and work life is simply “out there” and the devices to access it are everywhere.  The tools (once called “apps”) she needs are either in those devices or accessed through those, she doesn’t really know or need to know.  She invokes the services and functions she needs: the rest just happens.  Information, applications, tools, communication services – they are all “just there” at her fingertips or by a gesture and word to a device that recognizes her face and voice.  This is what she, and her family takes for granted.

It’s no different at work. For her personal tasks at work, she uses much the same sort of tools, devices and means as at home.  Many of them are exactly the same.  They’re in every room of the office building, at every workplace, office, meeting-room.  Of course this was already beginning to happen in the previous decade, but it’s ubiquitous now, pervasive, taken for granted, an unobtrusive part of the fabric of everyday life.

Today, in Celia’s world in 2023, the business services behind the scenes are also like the ones she uses as a consumer.  She has an info-com provider, her simple gateway to all the communications links, information tools, resources and capabilities she needs.  In the old days these were called telephone service providers and “IT providers”.

Some of those same info-coms, and others, provide the services that Celia’s company needs.  Like every business, Tranzco uses information and process services at various levels.  To support the staff in their daily work, it uses communications and collaboration services from its main info-com provider.  So all the video, voice and text communications and collaborations are served by that provider.  The workers access those services from desks, other locations around the office, while on the move, wherever they are. So do customers and partners.  The office facilities company that manages the building provides the in-house infrastructure, cabling, servers, wireless servers and infrastructure software,   — the plant and equipment – to make this communication possible.  They, like all companies in the property and facilities business undoubtedly use an information services subcontractor for that.  That’s a normal part of office infrastructure.

Other providers take care of the essential backoffice functions that every business needs.  An example is the HR function provided by an HR specialist firm, delivering access to the online information and services needed by Tranzco executives, HR specialists, line managers and staff.  The HR firm delivers against stringent service levels, security and privacy rules, and it sources its infrastructure services behind the scenes to achieve that.

These are actually all functions for which Celia Young, as COO, is responsible.  She has a small but capable sourcing team who manage the whole sourcing strategy and lifecycle as well as relations with the providers.

But some business functions are central to Tranzco’s competitive positioning.  Its chosen strategy is to compete on the operational excellence of its global distribution network.  Its competitors have different strategies – some compete on deep understanding of their customers’ industries and specific needs, some on price.  But as a result of Tranzco’s strategic choices, COO Celia has the responsibility for ensuring that the company is always at the leading edge of distribution best practice.  That means that those processes have to be sourced internally, maybe with occasional external specialist help.  It means constant development and refinement of the business processes that are central to that operation, including of course the information and information services (“applications”) that are the embodiment of those processes.  Thus a key part of Celia’s operation is a pro-active team of information and business-process specialists who work with all parts of the company and constantly seek to gain competitive advantage for Tranzco through the excellence of its operation.  But they do this only for the key competitive processes.  The rest are provided by best-in-class external providers.

For the central processes that are controlled in-house, Tranzco needs information infrastructure – secure communications and reliable, secure processing services.  Based on its sourcing strategy, it has chosen to use another info-com provider for this, so as to maintain some competitive tension, and because this provider could demonstrably offer the very high levels of availability and security that Tranzco needs.  Celia and her team of information specialists are convinced that the security delivered by a provider who is specialized in that is always going to be far greater than she could conceivably achieve by trying to hire her own security team.  Her information services manager could never afford to maintain a sufficient team of constantly up-to-date experts with enough capacity to cover absences, allow for staff turnover, peaks of demand and security crises.  She figures that a specialist provider can always do a better job as long as you demand it of them, pay them appropriately and manage the service level outcomes.  That’s her decision, though some of her competitors may have made a different set of sourcing choices.

The info-com providers and the business services providers deliver access to resources that are “out there” in the same way as the personal resources that Celia and others use.  Her uncle said that a decade ago people talked about these functions as being “in the cloud” but that term became passé quite quickly.  In fact Tranzco , Celia and her staff know exactly “where” those services are: they aren’t in some vague nebulous nowhere, but managed by well-known and trustworthy providers with whom Tranzco has a solid relationship.  These are providers who provide those services for a living, for thousands of customers.  They can afford not just the best infrastructure and facilities, but the best processes and above all, the best people to manage them, and enough to cover all eventualities. (Of course in 2023 almost no-one cares anymore where the bits are physically recorded.)

There was a time, Celia knows from her uncle, when all of this applied only to telephone services.  But although that might have been only a bit over a decade ago in calendar years, when she talks to her older relative it seems like another era.


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Tags: future  it-services  outsourcing  

Rolf Jester
Vice-President, Distinguished Analyst
16 years at Gartner
46 years IT Industry

Rolf Jester researches the business of IT services, particularly business and marketing strategy and best practices for IT services providers. He focuses on the IT outsourcing business globally, and also on the IT services market and service providers in the Asia/Pacific region. Read Full Bio

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