April 29, 2013
18 months ago, my first blog post at Forrester discussed industrialization trends in the IT services industry globally. I suggested then that IT services providers would have to focus their industrialization efforts on shared resources, self-service and automation capabilities.
On the automation front, most efforts till date have been incremental in nature – mostly focused on removing redundant and mundane tasks via process redesign and/or tools implementations. The recently announced Infosys partnership with IPsoft is taking these automation efforts to a whole new level. Infosys will leverage IPsoft’s autonomic based automation capabilities as part of its effort to improve the performance of its infrastructure services delivery capabilities.
Why is this partnership important?
From an operations perspective, this technology is expected to improve the competitiveness of Infosys’ infrastructure services offering. In a nutshell, the scripts used in traditional tools to automate a particular task are replaced by self-learning, self-optimizing software agents, which yield much faster time to resolve. According to IPsoft, such technology can automate at least 60% of level 0 and level 1 issues in a support environment by automating time-consuming labor such as diagnostics.
Companies like Infosys have thousands of employees in their infrastructure service practices working on infrastructure management contracts. Automation technologies like IPsoft’s IPcenter will help them accelerate their non-linear strategies and reduce the number of people they need to deliver the same amount of infrastructure support work and engage them in growth related activities. This is also important for clients as some of the productivity improvements will be passed onto them in the form of overall value delivered and increased agility.
If it ain’t broke, don’t fix it!
IPsoft, headquartered in New York, was founded in 1998 and boasts major global clients in the financial services and high-tech sectors. One can wonder why the Indian services industry has not adopted such autonomic based automation technologies earlier. In my opinion, until now, Indian service organizations have relied almost purely on internal-led, incremental innovations to reach their industrialization objectives. The past 3-4 quarterly financial announcements from Indian service providers suggest that many are struggling to conserve their margins in a tough market environment and that their non-linear innovations have not progressed quickly enough.
Over the past 12 months, IT services companies have recognized that it was probably time to fix their operating models. I see this partnership as a recognition that service firms increasingly need to leverage external partners like IPsoft to deliver breakthrough innovations to their clients.
As such, this partnership is important for Infosys because it will support the company’s non-linear strategy. But to me, the real innovation will come from expanding such automation technologies to application management and BPO delivery capabilities. Infosys will undoubtedly work on this aim as part of the partnership and I look forward to seeing more breakthrough innovations as a result of these types of collaborations.