Customer-centric digital transformation: What’s up with that?

An exclusive review of TBR’s Digital Transformation Customer Research and Digital Marketing Services Customer Research

Customer experience (CX) optimization remains a natural first channel for digital transformation, providing test cases for data synthesis across the organization and new methods of engagement that can inspire future initiatives. Join us Dec. 19 to discover what vendors need to know to compete effectively for CX-related opportunities in the fast-evolving digital transformation market.

Join Jen Hamel and Boz Hristov as they dig into how enterprise adoption of digital transformation solutions is evolving, with a specific focus on the CX function. Based on enterprise adoption research, TBR will give a snapshot on today’s digital transformation and digital marketing services marketplaces.

Don’t miss:

  • The state of adoption for digital transformation technology and services
  • Insights into CX as a starting point for digital transformation, including who buys or influences solutions
  • Market maturity and opportunity, as well as winning vendor strategies, in CX


TBR webinars are held typically on Wednesdays at 1 p.m. ET and include a 15-minute Q&A session following the main presentation. Previous webinars can be viewed at anytime on TBR’s Webinar Portal.

For additional information or to arrange a briefing with our analysts, please contact TBR at [email protected].

UiPath Forward Americas

UiPath brings robots ‘to life’ through business-first approach

Under the slogan “a robot for every person” UiPath’s CEO and Co-founder Daniel Dines’ vision for automation takes a pragmatic approach and furthers Bill Gates’ 1980 Microsoft mission of “A computer on every desk and in every home.” While UiPath and/or any of its competitors are far from making this vision a reality, it certainly summarizes the company’s total addressable market. As UiPath executes on its vision, the company’s comprehensive portfolio of attended and unattended robots as well as a SaaS orchestrator solution meet current market needs for solutions addressing brokerage and management of structured and unstructured data across the front, middle and back office. Additionally, UiPath’s approach to automation through a business lens makes it an appealing vendor that can help consultancies and other alliance partners better target line-of-business leads, especially clients with backgrounds in Six Sigma and Lean methodology training.

While UiPath will continue to have the tough task of overcoming skepticism around the public perception that automation will eliminate jobs, educating the market on the broader ROI from the use of RPA, including increased productivity, improved accuracy and compliance, can help it counteract initial resistance and accelerate adoption. Use cases, such the one with a Japan-based bank that deployed 1,000 UiPath robots to optimize the work of 700 FTEs with the long-term goal of creating capacity for 4,000 employees and saving $500 million over three years, make for a tangible impact on operations and the bottom line.

As the pendulum continues to swing between hope for and fear of automation, accelerated by hype, UiPath’s value proposition and go-to-market strategy enables it to illustrate that automation is not a jobs killer but rather a jobs creator.



TBR attended the second annual UiPath Forward Americas conference in Miami. TBR interacted with executives from across UiPath and its partners and clients. With over 1,500 attendees, including 500 partners and client executives, the conference was three times larger than the first UiPath Forward Americas event a year ago. During the sessions, UiPath highlighted its exponential success over the past three years, with a fair dose of energy but balanced with humility. UiPath provided an update on its financial performance and portfolio road map and laid out new initiatives including the launches of UiPath Go, the Academic Alliance, the UiPath Venture Innovation Fund and the UiPath Partner Acceleration Fund. These new initiatives connected well with the discussions about the need for democratization of automation and collaboration among business leaders, IT and the partner ecosystem.

Engaging with clients’ business side to address mission-critical challenges

TBR perspective

“Capgemini is overall in a good shape relative to the market,” said Capgemini CEO Paul Hermelin during the opening keynote session at the company’s Global Analyst and Advisor Day 2018. Over the past six quarters, Capgemini has accelerated its revenue growth, reaching 8% year-to-year in constant currency in 1H18, and improved its profitability, aiming for an operating margin before other expenses of between 12% and 12.2% in 2018, owing to growth in scale of digital projects, automation, low-cost leverage and cost management. However, there is always room for improvement, and Hermelin pushes Capgemini’s management team to do more. Over the past several quarters, Capgemini has made changes to its portfolio, organizational structure and sales model to address rising demand coming from clients’ business side instead of their technology side. TBR believes Capgemini has a competitive portfolio and global services capabilities that will continue to move the company in the right direction. Capgemini is notably well established in India, not only for outsourcing but also for digital and cloud, and is able to provide fast-growing and emerging solutions at scale while continuing to address clients’ outsourcing needs with revitalized core offerings.

Transforming portfolio, organization and sales will drive revenue growth in the coming quarters

Following a disciplined portfolio management approach, Capgemini is reshaping its offerings to provide solutions, such as digital, cloud and cybersecurity, that enable clients to build their digital models. The company revitalized its core infrastructure, application and business services offerings, such as through launching next-generation ERP solutions to reimagine enterprise core systems to fit in the digital world, and infusing automation and AI across the portfolio to increase value for the client. Partnerships with technology vendors, startups and academic institutions are a key lever for expanding Capgemini’s portfolio and filling in capability gaps instead of always developing its own intellectual property, which can lead to increased costs and slow down the company’s digital and cloud portfolio expansion. From an organizational standpoint, Capgemini has shifted to a unified go-to-market approach that presents one face to the client and sells the entire Capgemini portfolio. From a sales perspective, the company has been pushing initiatives to foster strategic client relationships by deepening the engagement and offering all dimensions of Capgemini’s portfolio. The objective is to have an established group of strategic relationships in which Capgemini ranks among the leading IT services vendors for those clients to address their mission-critical challenges. This relationship approach in which Capgemini is the strategic supplier somewhat resembles Accenture’s (NYSE: ACN) Diamond Client structure.

TBR attended Capgemini’s annual Global Analyst and Advisor Day, held at the company’s combined Applied Innovation Exchange (AIE) and Accelerated Solutions Environment facility in New York City. The facility opened in October 2017 and is part of a global network of 16 locations that enables clients to explore, discover and test new solutions in collaboration with Capgemini and an ecosystem of technology partners, startups, academic institutions and venture capitalists. The event featured plenary and breakout sessions on topics such as portfolio strategy and management; Capgemini’s artificial intelligence (AI) ambition and portfolio; Capgemini Invent, the company’s newest global business line; digital; cloud; and North America. Client cases and demos on AI Insurance, AI Digital Ops, AI Manufacturing and economic Application Portfolio Management (eAPM) exemplified Capgemini’s activities with clients and provided insights into delivered results.

Impact of L3-Harris combo ripples far and wide

For many of the pure-play government IT firms, Technology Business Research analyst Joey Cresta said the L-3 Harris transaction’s effects will not be significantly felt, but businesses that operate in certain areas of overlap with large platform players could see some impact.

“It will certainly be a big deal for pockets of companies like Leidos and CACI International that perform in the intelligence, space and electronic warfare realms, as well as at some of the more specialized services divisions of large primes such as Raytheon IIS, which will compete directly with L3 Harris for opportunities to support the modernization of national airspace,” Cresta told me via email.

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Maturing offerings, vendors and customers prompt long-term IoT vendor growth

The continued interweaving of the technology component market with Internet of Things (IoT) techniques delivers a well-defined path to long-term sustained growth for many IT and operational technology (OT) vendors, especially those vendors that are best able to differentiate their portfolio and position themselves as critical partners for a wide set of IoT solutions.

The hype surrounding IoT has only served to confuse and overwhelm customers and vendors, but efforts by both parties to cut through the hype is driving the growth of installed IoT solutions. As the hype fades, vendors are better able to rationalize their go-to-market strategies and messaging, particularly around how to assemble IoT solutions, leading customers to better understand how to apply IoT.

However, while it is becoming easier to assemble an IoT solution, it is still challenging to design and implement the IoT technique. We don’t expect a huge explosion of revenue; IoT itself isn’t a “killer app,” but it will enable moderate and slowly accelerating revenue growth for the various components involved in an IoT solution.

In our 3Q18 reports and thought leadership, TBR will focus on three topics that we believe are currently the most impactful on the wider IoT ecosystem: the increasing maturity of the IoT technique, the growing consolidation of generic platforms, and how increasing commoditization around IoT is working in favor of economies of scale and enabling the growth of installed solutions.

IoT is growing up: Increased ecosystem maturity will lead to increased customer adoption

TBR, through discussions with vendors and customers as well as our use case databasing, is noticing growth in installed IoT solutions, whether from net-new deployments or expansions of existing IoT deployments, signaling improved maturity. IoT maturation is not so much about the components of IoT as it is about businesses developing their ability to leverage technologies and techniques that are increasingly applicable to a growing number of business problems.

A major driver of this maturity is greater clarity around IoT techniques, led largely by go-to-market realignment and improved messaging by vendors, organization around IoT by customers, shifts from competition to coopetition by vendors, and general improvements in the construction of the technology that facilitate advanced usage of the IoT technique.

What a Leidos corporate reorganization signals to the government contracting market

Joey Cresta, an analyst with Technology Business Research Inc. in Hampton, New Hampshire, who closely tracks the government services market, says that being known as an innovative company — and demonstrating a track record of such — will become even more critical moving forward. That’s because government contractors will be challenged to truly differentiate what they do and how they do it as the technology stacks of today and the future continue to evolve. 

“As computation, storage and now the network become virtualized, they become more of a commodity, just as automation commoditizes legacy services,” Cresta said. “More value will be placed on a specific set of skills around writing algorithms leveraging mission or customer knowledge to solve specific client pain points.”

Cresta sees Leidos utilizing this push to potentially grab high-end, government-funded R&D work in areas like intelligence, surveillance and reconnaissance (ISR) as well as data analytics and AI — all things Defense Department officials in particular talk up as crucial to winning on the battlefields of the future, both real and virtual.

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HCL Technologies (HCLT): IoT NXT Summit

Working with leading technology vendors to develop emerging technology offerings in areas such as Internet of Things (IoT) challenges HCL Technologies (HCLT) to differentiate from peers. However, leveraging its deep engineering expertise integrated with vertical capabilities enables HCLT to be more competitive, driving business transformation for new and existing clients with IoT-based services solutions.

TBR perspective

HCLT’s IoT WoRKS business unit benefits from demand for IoT, primarily among existing customers. The company has some advantages in the IoT business and will continue to expand its IoT practice as it generates IP that will prove useful as IoT becomes an increasingly important part of both build and run services.

HCLT has a long history in electronics and mechanical engineering and continues to provide engineering and R&D services beyond the usual scope of IT-oriented companies. TBR has written extensively about HCLT’s engineering heritage and offerings, noting the company’s engineering and R&D expertise serves as a key differentiator within the broader IT services space. Our white paper HCLT’s Intelligent Sustenance Engineering Service Line Unit delivers data insights to extend the product life cycle discusses the impact of engineering and R&D expertise on the value of HCLT’s data analytics services through differentiation. HCLT’s history and continued use of engineering and R&D help the company navigate customers’ operations technology (OT) areas in both technical and cultural engagements, a necessity in IoT. Nevertheless, in IoT, the company engages primarily with customers’ IT organizations, and HCLT’s advantage in the IoT space enables it to efficiently implement IoT-driven solutions using more complex OT factors. However, as OT is far more diverse than IT, one type of OT expertise does not imply knowledge of another. Although HCLT’s established engineering experiences, combined with its IT services for IoT environments, provide an advantage for the company, adding OT skills would bridge any gaps within OT areas and create a simple but strong advantage. TBR believes that OT organizations will continue to initiate IoT solutions, but will evolve to integrate IT-based practices focused on security, scalability and manageability.


On Aug. 22, 2018, TBR attended HCLT’s IoT NXT Summit at the company’s recently opened IoT COLLAB innovation center in Redmond, Wash. The center is located on the same property as HCLT’s Lab 21, which was opened in collaboration with Microsoft (Nasdaq: MSFT) around artificial intelligence (AI) and Cortana Analytics in the Azure Cloud. The analyst event centered on HCLT’s 3-year-old IoT WoRKS business unit and featured demonstrations of HCLT’s IoT solutions and how the company works with its partners to develop IoT portfolio offerings as well as extensive discussions with HCLT’s IoT WoRKS industry leads. During the event, HCLT emphasized its focus on existing assets, enhanced by partners and vertical expertise, which, combined with growing demand for cloud-based infrastructure services, enables HCLT to transform clients’ business operations with IoT solutions, providing scale and speed at the edge.

Consultancies and IT services vendors face uncertainty in a shift to data and automation for 2019

As we start the final three months of 2018, TBR’s Professional Services Practice (PSP) has begun wrapping up analysis on the year as a whole and thinking more about what 2019 will bring, specifically in the areas of healthcare IT services, data management and consulting. Top-of-mind issues for TBR’s clients and the PSP analysts reflect today’s driving trends and set the stage for the next few years.

Now: Cloud, competition and emerging tech uncertainty unsettle HITS vendors

TBR’s healthcare IT services (HITS) practice has noted rising interest in electronic health record (EHR) systems and other health IT solutions, for example, patient data storage and application hosting in the cloud, tempered only by ingrained concerns about data privacy and security. EHR-centric companies aggressively cross-selling emerging solutions to their existing installed base of EHR clients have simultaneously captured new EHR work in the vast white space of latent demand for EHR systems outside the U.S. Complementing those efforts, increased cloud adoption generates opportunities for systems integrators to digitally transform payer, provider and life sciences organizations alike. For example, community hospitals eager to digitize and better connect with other providers in the healthcare ecosystem have become a growth engine for many HITS vendors, a trend that favors small-scale EHR providers, especially those that have pivoted to cloud, compelling leading vendors to scale down flagship EHR platforms and adopt small- to mid-market deployment models.

TBR closely monitors and analyzes the impacts to the business models for key HITS vendors as new pressures compel a shift toward different clients and markets, including the following development:

  • Will cloud-based EHRs, infused with automation analytics for care and administrative processes, artificial intelligence (AI) for genomics-informed medicine, machine learning and telemedicine become more commonplace?
  • How will executives at HITS vendors approach retrofitting existing EHR systems with these emerging solutions, in addition to integrating human-centered design into new EHR platforms?

5G drives network transformation

The shift from connecting people (pre-5G era) to connecting everything (5G era) will require an architectural overhaul of telecom networks. A true 5G network will not only leverage new radios but also be inherently cloud-native, virtualized, programmable and automated and provide near-limitless capacity at ultra-low latency. This will require transformation across the entire network, not just at the access layer.

Network transformation moves from industry buzz phrase to reality

The telecom industry has discussed network transformation for years, though its amorphous meaning is beginning to take shape and materialize. TBR is seeing communication service providers (CSPs) transform into digital service providers (DSPs) propelled by ICT convergence, NFV/SDN, cloud, 5G, big data and analytics, and artificial intelligence (AI) and machine learning. These trends and technologies are helping operators evolve their networks from being rigid, slow, static, reactive and closed to being flexible, fast, dynamic and open.

Some of the trends contributing to this shift include moving from on-premises/physical networks leveraging black boxes to cloudified/virtualized networks leveraging white boxes. Hardware-defined networks were capex-driven, whereas the future of the network is software-defined and opex-driven. This evolution allows operators to more quickly and easily launch offerings for new revenue streams and reduce network costs over time.

Though NFV and SDN adoption has been slow, some Tier 1 operators are progressing with their plans and reaping benefits. Integrating NFV and SDN capabilities will enable operators to more effectively support network technologies that will become prevalent in the 5G era, such as network slicing and edge computing, which will play a pivotal role in supporting 5G use cases such as advanced Internet of Things (IoT). Operators are under pressure to invest in NFV and SDN to reduce total capex and opex spend as well as introduce new services and stay competitive in the data-driven digital economy, which is increasingly dominated by webscale and over-the-top players.

5G is taking up greater mindshare as commercial deployments begin

Operator networks must ultimately be overhauled to fully realize the potential 5G has to offer, though it will take operators many years to evolve their networks end-to-end. In the meantime, the current focus, and 5G-related capex spend, will be on 5G radios. The potential cost savings offered by 5G is spurring operators to accelerate their deployment timelines, pulling them forward by as much as two years. Efficiency gains remain the main driver to deploy 5G, as a viable business case for operators to grow revenue from 5G has yet to materialize (with the exception of fixed wireless broadband). 5G, which is expected to provide between four- and 10-times greater efficiency on a cost-per-gigabyte basis compared to LTE, will enable operators to more cost-effectively add network capacity to support the prevalence of unlimited data plans as well as continued connected device additions.

There are myriad ideas for new network use cases that 5G could enable, but ROI remains suspect. The most economically viable use case thus far for net-new revenue generation from 5G is fixed wireless broadband. In 2020-2025, which TBR believes will represent the “renaissance” phase of 5G, there will be a plethora of new use cases for the network, particularly in the areas of augmented reality (AR)/virtual reality (VR), smart city, IoT and robotics.

Realizing the full benefits of 5G requires significant investment across the network, not just in the access layer. Operators will invest in fiber, spectrum, massive MIMO (multiple input and multiple output), carrier aggregation, NFV/SDN and cloud RAN (C-RAN), which will provide opportunity for vendors. Though positioned well in key early 5G markets, incumbent vendors are threatened with disruption from NFV/SDN-centric firms, particularly firms in the areas of virtual RAN and mobile core. TBR estimates over 85% of 5G capex spend through 2020 will be driven by operators in four countries: U.S., China, Japan and South Korea. Most Tier 1 operators in these countries have aggressive 5G rollout timetables and intend to leverage the technology for fixed wireless broadband and/or to support their mobile broadband densification initiatives.

TBR covers these topics in depth in its operator, vendor, 5G, NFV/SDN and webscale research streams.

Four by four by four equals four

Four straight weeks of traveling for work, to four different cities to meet with four different clients, brought out four thoughts about where the IT services and consulting markets stand as we move into the autumn rush of 2018.

First, the next few years will finally bring the shift in the consulting model that we’ve been anticipating for the last decade (when I worked Deloitte and the partners tasked our team with understanding the other Big Four firms’ moves back into consulting). Outcomes-based pricing won’t become the norm because clients want transparency or because consultancies readily put their own fees and reputations at risk, but because the technology around assessing, measuring and even metering outcomes has improved dramatically in the last couple of years. And asset-based consulting will become the norm because consultancies can finally fully marry their intellectual talent to repeatable, scalable, configurable solutions infused with more than just methodologies and industry knowledge.

Second, the word “maturity” has started creeping into conversations about emerging technologies such as artificial intelligence, enhanced analytics, Internet of Things and even blockchain. The smart consultancies have recognized the buzz around emerging tech has produced clients that have enough experience, both good and bad, to think of themselves as more than just novices needing consulting help to understand the emerging new-world customer and employee. These clients don’t want to be amazed by cool tech. They want their experience to be acknowledged and built upon, and they want to move faster. Recognizing maturity means talking about deeper, more lasting — and more expensive — engagements, much to the benefit of consultancies.

Third, I anticipate an era of internally splintered consultancies competing with globally managed firms, creating a weird market with nominally global players drifting toward highly localized operations, while a couple of large consultancies maintain centralized, uniform cultures and organizations. Mirroring the political, economic and demographic forces behind the recent rise of populism and nationalism, some global consultancies could see local and regional practices pressured by trends in data sovereignty and cybersecurity, combined with a spillover from political populism and accelerated by agile technologies that can be spread rapidly and customized for micro-differences more quickly than before. If this trend develops, the consultancies opting to go all-in on one approach or the other will succeed. Those slow to decide or trying to muddle through a middle-ground arrangement will see the market surpass them.

And fourth, I come back repeatedly to leadership, a topic I’ve written about extensively in our analysis and in a couple of blog posts and special reports. Leading a consulting or IT innovation or systems implementation team today requires mastering new technologies, understanding a client’s industry and their position within it, and navigating shifting centers of budget and decision making. None of that differs greatly from previous generations of IT, except that today the diversity of talent demands more capable leaders and the speed of technological change demands increased humility and adaptability, plus a greater willingness to form, manage and lead flexible teams. Companies I see that recognize the talent shift, including changes brought on by millennials, and understand the impact on their leaders — and the company’s imperative to train and equip those leaders — repeatedly stand apart from the pack.