Avinash Vashistha of Tholons has been talking to Sourcingfocus about the trends affecting the sourcing industry.

1. We went through the process of offshoring and near-shoring, is Automation bringing this to a close as efficiency is increased and costs reduced in domestic markets?

Automation is a game changer and brings with it, the threat of obsolescence for the traditional offshore and near-shore model. Increase in the use of smart and cognitive technologies and artificial intelligence will give competitive ability to do things domestically. Highly skilled and innovative smaller countries like Chile, Singapore, Canada and Israel stand to gain significantly. Automation and Artificial Intelligence is replacing repeatable processes and decision making. Significant work has been done in developing customer service robotic agents like Amelia, that probably will pass the Turing Test in couple of years and replace agents. Key is to deploy people with domain and process knowledge to learn how to configure and program these software bots.

2. Will the digital economy drastically change the structure and architecture of organisations and presage serious change in the way we work?

Digital economy is changing the way consumers consume products and services. The future will be defined by consumer experiences like travelling, living healthy, shopping, paying and producing. Enterprises are becoming smarter, liquid and intelligent. The future of work will be Co-work, the future of innovation is Co-innovate and the future of investment is Co-invest, where venture capitalist will invest alongside clients and technology partners.

3. Is the digital age rendering location a lesser priority?

Locations were important and measured by scale, quality and cost of talent. However, digital has changed the equation. Innovation is more important than scale. Design thinking is higher priority than quality. Outcome and experience is more important than cost. Even smaller countries can innovate, have the domain knowledge and bring about the value through collaboration and emerge as leaders. Boundaries of locations are crumbling. Tholons Top 50 “Digital Nations” ranking is already trending in that direction and we expect 2018 rankings to declare the emergence of digital enterprise nations without boundaries.

4. With Brexit and President Trump are we seeing a turn away from globalisation and therefore a more difficult environment for global sourcing?

Politicians and their decisions are made in support of their campaign promises. They are under pressure to demonstrate implementation of their agenda in the first year. Focus is short term instead of a longer-term approach and plan. Businesses are struggling to transform in this age of disruption by digital. This provides an opportunity and ability to even smaller countries to be a larger player in enterprise innovation and globalisation. Overall, we believe this will result in increased globalisation to a broader set of countries and companies, but not necessarily only to legacy countries like India, Philippine and China.

5. Are we looking at a new age of sourcing which requires a completely different set of rules for successful strategic sourcing?

Traditional sourcing has been in application development, support and maintenance; business process and infrastructure management. Platform based solutions and intelligent liquid applications has transformed Applications sourcing. Business process management has been significantly impregnated by cognitive computing, artificial intelligence and automation. Cloud has consumed traditional infrastructure management. Players and rules of sourcing have changed! Strategic sourcing needs to work within the digital innovation ecosystem where clients, network of start-ups, mentors, strategic partners / platform integrators and funding have to Co-work and Co-innovate.

Avinash will be speaking at the GSA Symposium this June, click here to learn more and book your place at the must attend event of the year for the sourcing industry.