Member Article

UK’s largest organisations report innovation through outsourcing

Contrary to common perceptions, over three quarters (77%) of senior outsourcing buyers say they have already achieved business innovation through outsourced operations.

More than four fifths (82%) also believe their current outsourcing suppliers actively encourage innovation and ideas, according to a new report from sourcing advisor, Aecus (formerly Alsbridge plc).

Paul Morrison, Head of Outsourcing Innovation at Aecus, comments: “Aecus defines innovation as creating value by doing things differently. With tight budgets and new technologies offering up new ways of working, keeping buyers happy with the level of innovation they get from outsourcing has typically been a major challenge”.

“However today, relationships between outsourcing buyers and supplier are providing considerable grounds for optimism. Not only are leaders aware of the types of innovation actively being pursued by outsourcers, but they can see how these partnerships are already having an impact on business outcomes.”

The Innovation Reality report explores the innovative practices UK businesses are implementing in their outsourcing agreements. It is based on 100 in-depth interviews with senior outsourcing buyers.

Taking steps to innovate

Outsourcing buyers are already actively implementing processes and tools in order to innovate through their outsourcing partnerships.

In contrast to perceptions of inertia in these relationships, two thirds (63%) of respondents currently have incentives built into their outsourced operations to encourage and reward innovation. The same proportion say they actively work with outsourcing partners to drive innovation.

In turn, three fifths (58%) of senior outsourcing buyers believe their own company now has a culture of innovation. Nearly half (45%) of respondents regularly meet their supplier to discuss innovation and how their operations can meet requirements.

Innovation wish list

Despite the steps being taken to achieve innovation through outsourcing, there is often a marked difference between the aspirations of outsourcing buyers and what they have already implemented.

Four fifths (80%) of senior outsourcing buyers express a clear desire to implement digitisation in their outsourced operations, but only around a third (35%) have actually adopted it into their partnerships.

In terms of future investment, robotic automation has emerged as one of the most sought after trends amongst outsourcing buyers, with over two fifths (44%) of respondents planning to implement it in the next three years or beyond.

There is also currently a strong appetite for multi-channel engagement. Almost half of respondents (47%) have already implemented it while others are likely to do so over the next 12 months (33%).

Reaping the rewards

Respondents report a number of benefits as a result of innovating their outsourcing practices. Over half (54%) say they have achieved customer satisfaction in their wider business through their outsourcing agreements. A similar number (45%) suggests innovation has an impact on their revenue growth.

Paul Morrison comments: “For outsourcing buyers, innovation is becoming an increasingly important consideration, and this will continue gather momentum as the tangible benefits to businesses become ever clearer.”

“At its root, innovation is the result of creating and executing a well-designed process, and consistently nurturing this over time. It is a reassuring sign that organisations understand how accessible these changes really are.”

This was posted in Bdaily's Members' News section by Aecus .