This can be optimized
Digitally-enabled enterprises are investing heavily in their platform technology stack. As we discussed in a previous blog, technology and business operations are becoming increasingly interdependent and intimate. This calls for talent continuity in technology teams, which has a major impact on the relationships enterprises build with third-party service providers as well as the makeup of their internal teams.
With talent continuity, companies can achieve more effective platform implementations that are better aligned with business needs and much more efficient from a productivity perspective. The problem is that the existing structures of companies are primarily set up in a way that makes talent continuity unfeasible.
Platforms are constantly moving because business capabilities are constantly evolving to meet competitive needs and there are ongoing efforts to implement new technologies. Companies need to continually add and reconfigure their technology stack or technology platform to meet market challenges. Business operations also need to change to adapt to changes in the technology stack. All this is because there is a very close, or increasingly close, relationship between the technology stack and business operations.
For example, as companies move forward with their generative AI implementation, generative AI tools become an extension of the customer platform. They complement sales capabilities, not fundamentally change them. For example, they improve the effectiveness of lead generation activities, email creation, and customer intelligence, but they don’t fundamentally change the underlying platform.
What is different about today’s technology investment environment?
Historically, companies have adopted new technology and then used it for several years before reaping the true benefits. What’s different about today’s technology environment is that companies must continually invest. Tweaks and additions are constantly being made. For example, companies can’t just add a CRM to their sales tools and be done with it. They need to have teams in place that are constantly evolving and more closely aligned with business operations to evolve the platform.
How this new environment impacts third-party services
One impact of this new environment is how companies traditionally think about using third-party consulting firms. System integrators and outsourcers in this environment will have to change their practices.
Typically, companies envision a world where each technology or business consulting project stands alone and is completed as a contracted sprint or event.
The system integrator or outsourcing company then effectively puts together a team, and once the team has completed the project, the company disbands the team and moves the people to other ongoing projects – that’s the traditional approach.
The problem with this practice in this new world is that the platform and associated business operations are constantly changing, so the technical services team (whether a third-party or in-house team) needs to remain relevant going forward.
It would be a huge waste to create a new team or bring in a different team every time. Probably up to 80% of their time would be spent learning new tech stacks, technologies, and business operations.
The technical or technical services team implementing any new technology needs to understand the existing technology stack, business operations, and how it’s all evolving so they can implement the technology properly and ensure the entire platform works well in the future.
When a company lacks workforce continuity, it will produce poor implementations that don’t effectively deliver business value or cost significantly more than they could have. In contrast, teams with talent continuity can implement these components quickly. Not all talent needs to be complementary, but the core of that talent needs to be complementary. For example, a company can add generative AI engineering capabilities, but they must be added to an existing team.
This is a bit esoteric, but a really important observation. Typically, companies think of relationship continuity as having the same service provider and handing them off to the next project. The misconception is that service providers are actually shuffling teams. They tear apart talent, reassemble it in a new configuration, and send it off to other projects. This doesn’t provide continuity of talent and insight. So provider relationship continuity doesn’t help much.
Having the same team continue moving forward is highly beneficial, so companies need to rethink how they design this talent continuity both within the organization and with external providers, bringing in the same talent that understands the dynamic platform environment.
There will be constant adjustments going forward, with the opportunity to keep a large portion of the talent in place for several years. This is a familiar concept in agile environments, where there is an ongoing backlog of initiatives or sprints that are sequenced for any given week or month in light of available capacity and the product manager’s goals for the product the company is developing.
One of the ironies of this situation is that if it stays this way, companies can pay more for talent. Productivity increases dramatically when third-party service provider teams stay on a specific customer platform instead of moving from project to project. This operation is much more effective than delivering value through cheap versions assembled just to complete a specific set of sprints, projects, or initiatives.
I am calling for businesses to rethink how they buy services in this new technology environment. The need for talent continuity has profound implications for how companies build relationships with service providers and how they structure their own teams internally.
