Industry Profile – Russell Ives, Accenture Australia’s Operations Lead

21 April 2015, 

Industry Profile—Russell Ives, Accenture Australia’s Operations Lead

In this issue of The Sauce Mark Atterby talks to Russell Ives from Accenture. Russell leads Accenture’s Business Process Operations business unit for Australia and New Zealand. Russell has 25 years’ experience working with Australia’s leading companies across consulting, information technology and business process outsourcing (BPO). He has been involved in BPO for 10 years, assisting numerous clients to implement BPO programs across the telecommunications, banking, utilities, resources, retail and transport industries.

MA: What are the biggest changes you have witnessed in the industry in the last five years?

RI: There has been a clear shift in the last five years from ‘lift and shift’ labour arbitrage based BPO, which we refer to as 3rd generation BPO, to transformation enabling BPO that is based on high quality seamless service delivery leveraging technologies such as analytics and cloud based applications to deliver quantifiable business outcomes

Our clients recognise that simple labour cost savings is only one, albeit important, part of BPO. They now recognise that redesigning the end to end processes, transforming the retained organisation, and fully utilising technologies such as analytics across outsourced and retained functions are critical to driving sustainable business value and competitive advantage.

MA: How has the use of technology shape the industry over the years?

RI: In the majority of current 3rd generation BPO programs the underlying technologies used are inherited from client organisation. In a typical lift and shift BPO the roles move and the technology stays the same. As client organisations look at 4th generation BPO they are expecting their BPO provider to bring analytics capabilities and automation technology to generate insights and drive significant service quality and customer satisfaction improvements. With the emergence of cloud and software as a service applications, BPO providers are being asked to deliver the full managed service that embeds underlying applications and IT infrastructure into the BPO service.

MA: What are your predictions for the next 2 – 5 years? What should we as an industry be keeping our eyes on?

RI: The majority of current BPO programs are 3rd generation; fundamentally lift and shift plus continuous improvement running on client applications and systems. As organisations become increasingly comfortable with cloud based technologies the trend toward 5th generation BPO with embedded applications will accelerate. This will place increased incentives on BPO providers to build skills, capabilities and offerings based on analytics, automation and cloud based applications.

Additionally there will be an increased focus on leveraging these new BPO capabilities to drive business transformation and organisational change. Consequently both client organisations and BPO providers will need to enhance skills in these areas to ensure a sustainable competitive advantage from BPO.

MA: Can you relate the most exciting or interesting moment you have experienced while working in the industry?

RI: The top highlight for me is when our clients’ customers provide feedback on the great service that they have received. Another consistent highlight is the first visit by the client to the delivery centre to see their team—they are regularly amazed at the passion for their business that our delivery teams demonstrate.

MA: When outsourcing their business processes clients expect innovation and for providers to add strategic value. In your opinion what is innovation, how do we encourage it and how do we build it in outsourcing relationships?

RI: Innovation happens across a broad spectrum—from the very small to the very large. At the small end it might be as simple as an agent identifying a small process change that results in simplifying or improving the customer experience. At the big end it could encompass end to end process re-engineering to take advantage of capabilities such as a new cloud based application.

It important to remember that no-one has a monopoly on innovation; it can come from the client side, the provider side, the agent on the floor or the CEO. What’s critical is building a culture of innovation, change and consistently looking for opportunities to improve.

MA: What impact is cloud computing having on the solutions being offered by BPO providers? Some predict it will make a number of providers redundant. Others are talking about the potential of BPaaS (Business Process as a Service) to add significant value to clients and providers?

RI: Managed Services, BPaaS and 5th generation BPO are the key trends for the industry over the next five years. Clients will be able to reduce their traditional IT spend by taking advantage of cloud based applications (SaaS) while getting the operational and service quality advantages that BPO can provide. Clients are already requesting the integration of SaaS and BPO and providers will need to develop new capabilities to be able to respond.

MA: How will Robotics Process Automation impact the industry?

RI: Traditional BPO reduces labour costs through outsourcing. Automation, robotics or otherwise, reduces cost by increasing throughput and quality. Combining these two will have profound impacts on the industry as the aggressive application of automation reduces headcount across BPO programs. There are two significant implications here, firstly clients are expecting to see more than just labour arbitrage from their BPO provider, as they are looking for a partner who can work with them to apply automation improvements to both retained and outsourced functions—this is no longer optional.

Secondly it will change the economics of BPO programs. Providers will need to recognise and manage for a much smaller tail in the latter years of programs when the impacts of automation have significantly reduced outsourced headcount. Additionally providers will need to identify news sources of value and work with their to clients to establish commercial structures that have the right economic balance between lower value automated processes and knowledge related processes performed by higher skilled agents.

MA: Social Media, big data analytics and mobility are redefining how organisations engage with their customers. How are BPO and outsourcing providers tackling the challenges presented by these trends? What impact is it having on the traditional contact centre?

RI: Social media allows for a different style of relationship with consumers, the business and employees—both retained and outsourced. Analytics will provide new insights into customers, markets, products, processes and staff. Mobility provides new channels for customers to interact, and for staff to engage and perform work. Each of these trends has different implications depending on which processes and functions you are looking at. From a BPO provider perspective the implications can vary from broad—how can I use social media to engage and motivate my staff, to the very specific—establishing new functions to handle increased volumes of mobile queries for the new channel established by the client organisation.

There is no one answer to these trends. Each of them is having a significant impact in different ways on how organisations operate, how they interact with their customers and staff, and the richness of that interaction. Each of these trends needs to be considered in the context of the client provider relationship and services provided.

Analytics, arguably, is the most pervasive of these trends and we will see more and more insight being gleaned from the masses of data that can be accessed inside and outside of the organisation. Insights that can be applied into operational improvements, customer engagement and net promoter scores, product and marketing, channel design and optimisation, employee engagement and development. The more effective providers are in collating data and generating valuable insights the better positioned they will be to drive value inside BPO and for clients.

MA: What does this all mean for Accenture and how you work with your clients?

RI: I am very excited about this phase for BPO; shifting from the labour oriented approach of that last 10 years to a dynamic and transformative style of BPO, leveraging analytics, automation and cloud, to drive value and competitive advantage for our clients. Accenture is at the forefront of this phase shift. Our background in consulting and transformation, in technology particularly in the emerging areas of mobility, analytics and cloud, and our pedigree in high quality and innovative business process operations means we are well prepared and capable to respond to the challenge.