Intelligent automation poised to transform workplace outsourcing

Sourcing and vendor management leaders must prepare to restructure these services and renegotiate contracts, advises Gartner.

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Replacement of human labour by such mixed services can only occur if the automated services offer a cost reduction for the service provider.

DD Mishra, Gartner

“Intelligent automation will alter the provision of managed workplace services over the next few years, increasing service quality at a lower price,” says DD Mishra, research director at Gartner.

“Sourcing and vendor management leaders must prepare to restructure these services and renegotiate contracts to leverage intelligent automation,” says Mishra.

“Automation-driven improvements in service delivery and pricing will allow sourcing and vendor management leaders to select a wider range of moving managed workplace services (MWS) outcomes that will improve quality and cost simultaneously.”

Gartner defines intelligent automation services as the umbrella term for a variety of strategies, skills, tools and techniques that service providers are using to remove the need for labour, and increase the predictability and reliability of services while reducing the cost of delivery.

Moving MWS functions from ones that are solely resourced by humans to functions that have a mix of humans and intelligent automation services (IAS) will create benefits in both pricing and service quality, says Gartner.

But it says the replacement of human labour by such mixed services can only occur if the automated services offer a cost reduction for the service provider.

Many service providers recognise they cannot continue to resource MWS by simply adding more service heads and thus are investing heavily in IAS for this reason.

As IAS provision becomes part of MWS, providers will pass on part of the resultant cost savings to clients in an attempt to win business.

For services such as service desks, intelligent automation tools can be up to 65 per cent less expensive than offshore-based staff. Up to 2021, Gartner expects the costs of commodity services to decline by 15 per cent to 25 per cent annually, as they move toward this price range.

Ongoing reductions in outsourced head count due to intelligent automation will eventually force sourcing and vendor management leaders to redesign the workplace services for their organisations' users, concludes Gartner.

Gartner says this will result in a corresponding drop in the numbers of staff required on the service desk, so that when 70 per cent of the workload is dealt with by IAS, only 30 per cent of the staff will remain.

Eventually, the potential for vendor lock-in, driven by a dependency on new tools and the IP they create, will require sourcing and vendor management leaders to incorporate new risk management provisions in MWS contracts.