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 Consendre mod eugait alit luptati sisisisit augait num iusti facidunt ipsumsan el eraestrud exerat ad onulla cor ing eumsandre ex elit "The danger of the past was that men became slaves. The danger of the future is that man may become robots." - Erich Fromm atetue tet ulla feu feum niamconEm ea commodiam ad tem dolortio Utat lum quisim et, quissi.Volobore m iurero dolobore. 30 ●●●● www.outsourcemagazine.co.uk http://www.outsourcemagazine.co.uk

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

Outsource Magazine Issue 34