John O'Brien
John O'Brien (Research Director)
Massimiliano Claps
Max Claps (Research Director, IDC Government Insights)
Ewa Zborowska
Ewa Zborowska (Research Director, AI Europe)
Martin Sundblad
Martin Sundblad (Research Manager, IDC European Skills Practice)

Automation is complex and challenging for many services providers’ strategy and business development leaders. The breadth of applications, tools and diversity of personas to involve — and the fact there is no chief automation officer in the business — make it exceedingly difficult.

Automation in one form or another spans almost every area of the business, from IT to software development, to business functions and operations. Automation’s remit is only going to expand over the coming years.

If we needed any convincing, the COVID-19 pandemic has exposed just how many areas of the business could have remained online if they had been able to “switch to automatic.” IDC’s COVID-19 wave sentiment surveys have shown that two-thirds of European organisations now see automation as a priority across their horizontal business functions, and this is highest for customer services (75%) and IT (85%).

Automation Enabling New Sources of Business Value

Automation is not an outcome in itself. Automation must be seen as an ingredient in broader digital transformation (DX) and change — and an enabler of new sources of business value. Many organisations still see automation as a threat due to the impact it has on current job roles and current business processes and because it is difficult to foresee the consequences it has on the workforce. But that would be short-sighted. It needs to be about optimising resources — how to reskill teams where job roles have changed and how to enable data to be used more intelligently. Automation needs to be measured in ways that capture this value.

So, it’s not just about hours back to the business, but also about what people then do with that time to drive more responsive and empathic customer service, make operations more resilient, innovate products and services, and embrace new business models that involve ecosystem partners.

At IDC Europe, we have created a squad to explore these ideas in an agile way, specifically to address questions being asked by service providers and their customers as they seek help in redefining their businesses and expanding their automation services portfolios.

We believe there are five key factors that service providers need to consider:

  1. Where could service companies add value through automation?

The challenge: Most business processes operate suboptimally in some way because they have been changed, adapted, reengineered and integrated in a rather organic (sometimes chaotic) manner, rather than being transformed as a result of a strategic road map.

Advice: The opportunity for automation to transform processes is huge and can be identified anywhere organisations are under pressure because of resource constraints or sub-par performance, or where there are untapped opportunities to explore. For service providers this covers a wide range of services that could add value, from business and technology consulting around process redesign to development and integration of automation tools to automated business process provisioning. Opportunities are therefore not limited to companies offering automation tools and related services only — with the right capacities and offerings, any service provider from consulting companies to system integrators to business process outsourcers can create value.

The value itself may have a different form: a shorter operation time, improved quality, embedded compliance or lower cost. This is where robotic process automation (RPA) in particular has captured a lot of attention. In an automated BPO process, for instance, one robot is estimated to cost a ninth to a third of a full-time employee working in the US, Western Europe or India.

  1. How could services companies best organise to add value through automation?

The challenge: Many service providers still lack a unified strategy across automation, as it applies to the business and IT user domains. Many firms are focused on creating centres of excellence around specific technologies, rather than looking at unifying teams and expertise around customer use cases and outcome needs.

Advice: Service providers need to take a multifaceted approach to their investments in the automation area. They should acquire or nurture skills and build automation teams that specialise by industry. Many big names in Europe, such as Accenture and Atos, have been making significant acquisitions in related areas that support automation delivery — for instance, in cloud-native application development and platform as a service (PaaS) to capture a high growth opportunity to build services around industry platforms and hyperscaler solutions.

Adoption of automation will follow the same maturity curve that any new technology with big impact has followed, such as cloud technologies and the Internet of Things. It’s first phase starts off with departmental, uncoordinated pilot projects and proofs of concept, and then it moves on to departmental projects, but with a centralised coordination team that supports the implementation with expertise and platform choice.

As maturity grows, the centralised programme team evolves, chooses partners, platforms and methodology, and acts as the implementer for the departments. At this time, executive management starts to drive the implementation to ensure optimisation of outcome.

The final stage is when the technology is mature enough to be embraced by the business. At this stage it has become mainstream and part of day-to-day business. Automation service providers need to recognise the evolution and respect it.

A larger service organisation needs to experience the maturity stages, otherwise it will fall short on lack of internal skills and experience and will never be able to reach the final stage of embracing the new technology.

  1. Who should services companies work with to add value through automation?

The challenge: Automation is a transformation enabler for both business and IT teams. However, this is often where service providers come unstuck. Organisational complexity, rigidity in existing processes, lack of documentation, internal politics and often mismatched priorities make finding the right personas within customers incredibly challenging.

Advice: Automation only really works when the right people are bought into the programmes and can support the internal/external engagement and building out of teams. There are big opportunities for service providers that can provide this important navigation and advisory role for their customers.

One example of this in action is Accenture, which worked with T-Mobile Czech Republic and Slovak Telekom to deploy automation into their customer service processes. The idea was to help front-office contact centre workers do their jobs more easily while automating more tedious and repetitive back-office tasks. Process experts from both operators worked together with Accenture specialists as one team to ensure the results meet customers’ expectations.

  1. Who should service providers partner with to add value through automation?

The challenge: Service providers are often themselves still hampered by siloed teams and internal competition, particularly in pivoting to fast-moving early-stage sectors like automation. They need to be able to unify teams across IT and business and across technologies and put the customer need front and centre in the way they go to market.

Success is going to depend on being the honest orchestrator of solutions and services for the specific use case at hand, rather than being committed to one solution or another.

Advice: Many automation solutions start with the technology and work backwards. This must change. Successful service providers here are taking an outside-in view of the customer challenges, through design thinking led ideation and prototyping, multidisciplinary teams and co-creating with the customer and industry and technology experts. The choice of technology becomes one of the outputs of the ideation and design, not the starting point.

  1. Should service providers create their own IP?

The challenge: Without IP to differentiate from the competition, service providers are going to struggle to win business. IP is about creating a unique defensible proposition that brings together best practice methodologies, tools and industry expertise for the client.

Many service providers are building their own automation IP — think of DXC Bionix, TCS Ignio, Infosys Edgeverve, HCL DryICE, Wipro HOLMES and Accenture MyNav — and an ever-growing number besides. These come ready built, often infused with AI, with the aim of providing a faster, more preconfigured and therefore cost-effective services provision, ultimately driving faster time to business outcomes.

Advice: Flexibility in both offerings and business models is key to IP-led delivery. Service providers will therefore need to constantly innovate here to stay ahead. Don’t try to be a one-stop shop, as no single provider can claim to be the best at everything.

Many providers are now having to change strategy to embrace a multipartner ecosystem within their platforms, managing both their own IP and third-party products to ensure maximum choice for customers. This has made IP creation and orchestration a necessary part of the automation services armoury.

What Next?

Over the coming months, IDC’s squad on automation services will dive deeper into these and other related topics. Please let us know what you think about these topics and let us get the conversation started.


To learn more about our upcoming research, please contact John O’Brien, Massimiliano Claps, Ewa Zborowska, or Martin Sundblad, or head over to and drop your details in the form on the top right.

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