Ten years ago, virtually every IT services firm latched onto Business Process Reengineering (BPR) as the Holy Grail. The combination of process improvement and technology created a jungle for clients. Opportunistic IT consultants set out to bring their clients in from the wilderness, regardless of the risk.
However, in those days, no single, large-scale IT company was involved with clients throughout the entire journey. The strategy focused companies like McKinsey and BCG would usher their clients to the precipice and then offer a hearty backslap and cheerio for a safe crossing.
IT implementers, particularly those like the Andersens and PwCs, would offer support and a steady hand as they navigated the ropes while crossing the chasm. On the other hand, hordes of IT outsourcing companies, such as IBM, EDS, Unisys, and CSC, stood ready to soothe the clients' weary feet.
Five years ago, the IT services companies all hyped the benefits of using the Internet as the basis for a "new economy", advising their clients that they needed to be "e-business" enabled to succeed in the future. They trampled on their ethical responsibilities to their clients as they greedily grabbed their share of the rich rewards. The resulting conflicts of interest were soon exposed, and the large accounting-based companies were forced to divest their IT consulting, implementation, and outsourcing units. This realignment proved more confusing than clarifying. The big may have gotten bigger, but it was probably better.
Today we have large-scale IT services companies that claim to have fully-integrated consulting, implementation and outsourcing services. They seek to guide the client through the entire journey. And they are all pushing their clients towards the new "big idea" of Business Process Outsourcing (BPO). Unfortunately, nobody has a clear idea of how such a business should be structured, let alone operate.
So the two biggest IT services operations (IBM and Accenture) are now locked in an epic battle with offshore companies like Infosys and Wipro to scale a new business model.
Meanwhile, traditional IT strategy consultants dabble in BPO by adopting "sourcing" practices that advise clients on the best BPO providers.
Transformational BPO has captured the fascination of IT service providers and clients alike due to the potentially spectacular rewards it offers, both for the service providers and their clients. We'll strategise on the problem and fix your process, BPO service providers say, and then we'll assume responsibility for consequences. Results with no regrets.
However, in return, both sides must accept the death-defying risks of complete commitment; the notion of a single service provider that takes a client from business strategy through IT implementation to activity support.
BPO seems a natural progression of BPR — a sort of one-stop shop for the sophisticated client. However, it remains to be seen whether a single BPO company can truly cover the entire spectrum of services.
None of the major players has yet aligned all the parts into a cohesive whole, yet each one of them is praising the miracles of BPO. The hypocrisy of this is yet another example of how IT services companies are quickly becoming a mediocre mass.