By Ravi Vasantraj, SVP & Global head of Business Process Services, Mphasis
As we enter the first quarter of a brand-new decade, let us hope that we make a quick health, social and economic recovery. On the economic front more specifically, most sectors have taken a severe beating and dwarfed earlier red-button situations like the 9/11 terror attack in the US, the 2008 financial crisis or earlier health pandemics like the 2003 SARS or the 2009 H1N1 scare.
As early as March this year, IATA, the global aviation industry body warned that revenue losses for the sector could range anywhere between $63-113 billion. Similarly, the global tourism industry is also expecting a grim 2020 with the UNWTO or the World Tourism Organisation under the United Nations reporting a loss of 67 million international arrivals and about $80 billion in revenues.
The situation is not very different in the BFSI sector that continues to dominate the fortunes of the Indian IT sector, contributing 40–50% of the industry’s total revenue. In terms of markets, the sector has taken a severe beating with the two largest geographies North America (read the United States) and Europe accounting for 70–80% of businesses continuing to operate under severe spending constraints.
Interestingly the external variables that drive the IT sector in 2020, whether it is Brexit in Europe or H1B visa issues in the US, are not very different from what they were in 2018 or 2019. What has really changed is the volatility in the market, bringing in a whole new level of unpredictability to deal with. What this means for the IT sector is that we must look beyond our own business challenges and take a closer look at the health of our customers.
Customers today, large or small, are not willing to look at anything beyond 12–18 months, which means programs that are likely to fetch results say beyond three years are simply tossed to the backburner. In other words, customers are looking for products and solutions that will help them stay afloat during these challenging times. And the only way technology companies can remain relevant under these circumstances to get a lot closer to the customers or what we call ‘shift left’ in the industry.
In the BFSI sector, for example, discussions around core banking replacements are now increasingly tilting towards modernization by creating tools and engines to start extracting data and becoming nimbler from a frontend perspective. Therefore, our ability to acquire/retain and service customers today depends a lot more on the speed at which we move rather than loyalty defined by past experiences. In this new world, the currency of competitive advantage is speed and agility, not size and legacy.
For example, one of our existing clients (A marquee Global Bank) required to urgently increase variable operational capacity to fulfill a large backlog of CARES Act Payroll Protection Program (PPP) small business loan applications, as part of a lending partnership in place with Small Business Administration (SBA). This client needed a capacity solution that could be implemented in a matter of days, not weeks or months, a partner that could seamlessly onboard and integrate with the bank’s small business lending platforms, and the flexibility to pivot between operational scopes with limited training and support.
We quickly identified and deployed a national remote workforce of multiple hundreds of full-time employees in a managed services model. Mphasis deployed the operational capacity solution at scale within one business week. We were able to rapidly support the successful client fulfillment of hundreds of thousands of PPP loans, enabling the U.S. small businesses that received the funding to continue business operations during the COVID-19 pandemic. We were able to do so while maintaining adherence to all regulatory, compliance and Quality Assurance controls.
With speed superseding size and depth of deployment, the role of the operational team has also gained greater significance in the post-Covid era. This is because the operational team is better placed to work with the customers to help define the problem statement and lead with designs instead of solutions. Another example, we managed to set up a technology centre with a couple of hundred people for a banking customer in the US in less than five weeks that would have earlier taken no less than three months. This was possible because the decision-making processes also moved away from a top-down approach and became more localized backed by the superior leadership of the operations team.
Another fallacy that is also getting dismantled is around innovation and technology. For instance, from the customer standpoint automation would make sense if we were to say that by applying automation in wealth management, we can cut down the onboarding of a customer from seven days to four hours. At the end of the day what really matters is leading with technology to help customer journey, something that is getting increasingly recognized by solution providers.
The disruption in the market created by COVID has clearly brought a sharper focus on the need for speed in understanding and providing solutions for customers’ immediate challenges and leaning on technologies that will help them navigate and survive in the current challenging times. Now the most important question is whether these changes are here to stay. If this ‘shift left’ approach delivers more bang for the buck for customers,then the answer is a resounding yes.