Intelligent automation will transform workplace outsourcing according to Gartner, Inc. (www.gartner.com). Sourcing and vendor management leaders must prepare to restructure these services and renegotiate contracts to leverage intelligent automation, according to the research group.

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 labor, and increase the predictability and reliability of services while reducing the cost of delivery.

“Intelligent automation will alter the provision of managed workplace services over the next few years, increasing service quality at a lower price,” said DD Mishra, research director at Gartner. “Sourcing and vendor management leaders must prepare to restructure these services and renegotiate contracts to leverage intelligent automation. 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.” 

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. The replacement of human labor by such mixed services can only occur if the automated services offer a cost reduction for the service provider. Many service providers recognize that 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% less expensive than offshore-based staff. Up to 2021, Gartner expects the costs of commodity services to decline by 15% to 25%t annually, as they move toward this price point.

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 organizations' users. This will result in a corresponding drop in the numbers of staff required on the service desk, so that when 70% of the workload is dealt with by IAS, only 30% 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.