A few unconnected thoughts and bon-mots this week about goings-on in Silicon Valley, as well as the (increasingly) obvious symbiosis of automation to analytics. Let’s start with a couple of fun vignettes…
When the Bankers Come to Silicon Valley: What’s going to happen to Wall Street when all their young bankers want to head west, to join the ranks in SF and Silicon Valley? Tech and finance have had a long and storied symbiosis for decades. And for a Bay Area native and Gen Xer (like me), statements like the following have an remarkable echo of 1999:
“If you go out in the Marina or the Mission on a Friday night to a bar with beer pong tables in the back and Jäger bombs on the menu, you’ll see them: an army of well-scrubbed 25-year-olds, mostly male, fist-bumping and talking about restricted stock units.”
At the end of the article, the vignette of the campus recruiting video at the Stanford Faculty Club by Goldman Sach’s Lloyd Blankfein sums up the attraction perfectly: a “dream about newer, shinier things”. History in Silicon Valley has a way of repeating, but with the financial elite now flocking west, like a good movie intro: “This time… it’s for real”.
The Google StreetView Car is in the Next Lane: Speaking of film – it was like being on a set of “Code Halos: the Movie” last week. My colleague Ben Pring was in town for a client visit with me. Ben jumped in my car to make the short hop from his hotel over to the meeting, and who should we encounter on the freeway next to us but the Google Streetview Car itself. I’ve had a number of sightings of this white whale the last few years, but when the co-author of the imminent “Code Halos” also happens to be riding shotgun armed with his iPhone camera to “image the imager”, it’s like life imitating art. (Photo courtesy of Ben, riding shotgun in my Volvo…)
The Race to the Bottom, to Get to the Top – The Interplay of Automation and Analytics: Automation seems the watchword of 2014 in the business process services market. In fact, I blogged recently about the “Beer Robot” from Siemens; it was a very cool story about the use of automation for major business growth, scale and impact.
But why is this discussion of automation happening now? The ability to maintain progressive efficiency gain in BPO contracts by sending more work offshore has plateaued. That’s why discussion of retrofitting automation into business process has become so prevalent. (Some researchers suggest that automation, running 24/7 can replace offshore, human FTEs at 1/3 the cost.). But it seems like an all-encompassing focus on cost reduction – a “race to the bottom”, if you will – misses the point. Leaders need to prioritize business outcomes based on strategic change and innovation – a “race to the top”. But the two are in fact in symbiosis: the explosive information yield applied to complex algorithms (analytics) comes from progressively deeper investments in automation.
Buyers – as well as providers – that solely fixate on the cost reduction benefits of automation won’t make their businesses smarter. Leaders in the BPS market that understand the symbiosis of automation and analytics – tied to the dual mandate of running their businesses better AND running them differently - will rule for the next decade. Those that don’t will “race to the bottom”.
This article is a guest post contributed by Robert H. Brown, AVP, Center for the Future of Work.