Outsource Magazine Issue 34 - (Page 30)
CHAIRMAN INTERVIEW
KEEPING UP WITH...
With decades of experience right across the space and with a record of huge
success behind him, Richard Jones is one of the most recognisable and respected
figures in outsourcing. Currently chairman of procurement outsourcers Proxima
and a board director of robotics radicals Blue Prism, he is involved at various levels
with numerous other ventures and retains a unique perspective on outsourcing and
the future of business. We caught up with Richard earlier this year for a series of
interviews: here are some edited extracts of those conversations...
outsource: Richard, a lot of the
work you're doing is with organisations
which are at the cutting edge of
automation technology in one way
or another. Why is automation so
important right now?
Richard Jones: It's very important for
outsourcing business models to start to
push out the processing into technology
- if you look at the difference in valuations
between these body shop-type models
and genuine big process models you'll
see much higher multiples. If you operate
an outsourcing business in any market
where you've got a very high staff turnover,
it gives you immense problems as far as
the cost is concerned. It's very costly to run
people in those first years of employment if
they're not 100 per cent productive. There's
also the threat of your IP walking out the
door every time someone leaves - and in
some markets they often go and join your
competitor. So, it's really important that
outsourcing businesses that think they've
got a long-term future start to push process
and lower-value activity into technology
engines. It gives you a much stronger
position and probably a much higher
quality of service. Arguably all outsourcing
businesses, no matter what point of the
market they're in, have to tackle that. You've
seen the way that outsourcing businesses
can grow: it's perfectly feasible to start in
Poland or a local region somewhere and
there's such competition for talent that you
exhaust the local labour pool. So you have
to start dealing with pushing work into the
technology, really quite early.
o: Do you think that's something which
the majors have got their heads round
yet?
RJ: Well generally speaking I think that
they're still on - not the old approach but
the prevailing approach, which is more
and more automation of existing systems.
At Proxima right now for example we're
looking at the layer which goes just above -
what I call the hypervisor layer. We can use
multiple tools and make it look to the user
like it's one process. Of course that gives
you the ability to tailor by client, and if the
clients want different underlying engines, on
a P2P engine or something like that, you can
still make it look the same to operate. So
that's very, very important to the model.
Most of those are about making your
technology and your process go faster - but
the Blue Prism robotic-based approach is
to come in and straightforwardly identify
opportunities to put virtual people where
you've got physical people. That starts
to provide you with the same kind of IP
protection and pushing knowledge into
technology and so on. It yields a prize in
a different way. So many people have put
in huge ERPs and then turned round and
said "let's shed the people now" but then
they can't find out how to shed the people.
Whereas the Blue Prism approach - which I
think is far more the next generation model
for outsourcing - is very, very laser-focussed
on providing another type of labour.
o: As providers move up the value
chain, and as the capabilities that they
have get more and more complex,
presumably a similar thing's going to
happen with activity that currently is
considered outside the scope of much
automation? Is there going to be a
point where you could have even the
highest value work taken out of the
human loop altogether?
RJ: I think the first part of the answer is,
it'll depend on which outsource tower
you're dealing with. In a Proxima case
there's a very high requirement for faceto-face, stakeholding negotiations. For the
moment I can't see that that's ever going
to be done in any other way. We might see
more teleconferencing for instance, but it
basically needs a human interaction.
If you take an outsource model out of
Western Europe or North America it's
probably mostly processes, and they're
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"The danger of the past was that men became slaves. The danger of the future is that man may become robots." - Erich Fromm
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Table of Contents for the Digital Edition of Outsource Magazine Issue 34
Challenges and Champions
Outsourcing in a Troubled Economic Environment
Richard Jones
High Stakes
In Transition
The Bigger Picture
Numbers, Numbers Everywhere...
NOA Round-Up
Struggling To Get Through?
International Commercial Disputes In Outsourcing Agreements
Is Infrastructure Necessary?
Global Freelance Platforms Grow Up
Trumping Price – Only with Best value
Kerry Hallard
Technology Investment in 2014
Water Will Always Find A Way
The Right Time Is Now
You, Robot?
The Legal View
Top Ten
NelsonHall Round-Up
Online Round-Up
The Deal Doctor
Inside Source
The Last Word
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