Phil Fersht — CEO and Chief Analyst, HFS Research[00:04]
My name is Phil Fersht. I’m the CEO and Chief Analyst at HFS Research, and I’m joined by Phani, who’s a senior leader at iOPEX. I’d like Phani to tell us a bit more about himself and iOPEX and what it is that you guys do, because I know iOPEX is known in the automation and AI space pretty well, but maybe in the broader context, it would be good to hear a bit more from you, Phani. So welcome.
Phani Sridhar — Senior Leader, iOPEX[00:34]
Absolutely, Phil. It’s a pleasure to join you today. Just a brief introduction: like I said, I manage what we call the strategy and insights function at iOPEX. This is sort of our sweet word for what is generally probably considered consulting, but we kind of pride ourselves in running much shorter and much more integrated cycles, in some ways aligned to the OneOffice theme that you strongly put forward.
Phani Sridhar — Senior Leader, iOPEX[01:05]
A little bit of background on me. I used to work with other global SIs in the last couple-plus decades, ran a number of functions in delivery, sales, solution selling, and consulting, previously and also now. Most of what I used to do generally tended to gravitate towards engaging with tech customers. These are typically telecoms, OEMs, or hyperscalers. So I kind of come with that mix, and hence all of the interest in solutioning and consulting over the last couple of years or so. Now, iOPEX, like you rightly said, we do a number of things, but I kind of wanted to give a sense of what we are, where we are headed, and what we do sort of differently.
Phani Sridhar — Senior Leader, iOPEX[01:49]
Number one, I think overall, we are identifying ourselves primarily as an experience engineering company. So the notion is that we sit on top of all of the business process knowledge that we have accumulated over the years. But the point then is, how do you kind of abstract this business process expertise into things that are done much more smartly through automation, through workflow services, through rearchitecture?
Phani Sridhar — Senior Leader, iOPEX[02:16]
And then what’s the end goal of all of this? Essentially getting into experience for customers, for partners, for stakeholders in general. So I think that notion of curating the experience and outcomes for businesses that we work with, that’s primarily what we do. And within that, my function is sort of really the top of the pyramid function. We tend to get excited about things that are about meaningfully identifying signals from noise in a number of process areas. And essentially also identifying those problems, prioritizing those problems, putting together meaningful solution maps, solution architectures, and solutions to it.
Phani Sridhar — Senior Leader, iOPEX[02:54]
But like I said, the drivers overall tend to be in the realm of transformation about efficiency and growth, but we tend to pivot efficiency and growth into experience, because ultimately efficiency and growth are still sort of mechanisms to achieve an end, and that end, in our perspective, is really the experience of employees, experience of customers, and then the ecosystem in general. So that’s what we do as a company and what my team does. Happy to be in the conversation with you today.
Phil Fersht — CEO and Chief Analyst, HFS Research[03:26]
It’s great to have you in the conversation. So let’s talk a bit about what’s going to happen this year. You know, we’ve been talking a lot about the autonomous enterprise and the painful journey towards it over the last decade. I think we introduced RPA 10 years ago, and our research shows that close to 70% of the industry still confesses they’re in the beginner stages of figuring this out. But one of the things that we’ve looked at, and we define these six principles of the autonomous enterprise, is leadership need to understand the data they need to be successful within an enterprise, otherwise, what are you doing, right? Everybody needs data, everybody needs it quickly, and they need it rapidly. They’ve got to have teams who know not just the processes, but also the interactions that their systems are having, that people are having, in digital detail, and have a continuously updated audit trail of these interactions and processes. And then they’ve got to have the right infrastructure in place that can break down these silos of data right across their enterprise and their ecosystem. So these are the first three things that we feel have to be in place before we can even get to what we’re calling a robust and scalable automation capability that is trusted both internally and externally. So how does a company like iOPEX really help get a company to this place, and then beyond that into AI and having a real governance capability to be effective?
Phani Sridhar — Senior Leader, iOPEX[05:03]
Absolutely. So if I may take a little bit of liberty in answering that question a little bit in an abstract manner to begin with, and I’ll sort of directly get to the question that you asked. I think in general, my opinion about not just how enterprises function, but if I take a little bit of liberty and extend that to how human experience works in general, I think there is always that beautiful dance between vertical disruption — and it can be any type of manifestation, and you can go back and use the often-used connotation of invention of fire, invention of wheels. So these are vertical disruptions that keep happening in a fairly rhythmic manner. And then there is the application of the vertical disruptions that is sort of horizontally spreading across multiple implementations or manifestations of it. I think fundamentally, if you kind of reflect on it, it’s also about, for humans in general, all about the seeking that they have, that for a lot of people manifests into spirituality, meditation, and other things. There is the sort of dance with the scientific endeavor that mixes with it. But the notion is, over a period of time, the vertical disruptions and the horizontal application need to kind of go hand in hand. Otherwise, in general, there is imbalance of sorts.
Phani Sridhar — Senior Leader, iOPEX[06:27]
Again, going back to that example, notions of human existence can become dogmas if they don’t have the right level of balance between both. Similarly, theoretical physics doesn’t exist in isolation unless you couple that with experimental physics. So moving from that backdrop to what you asked, Phil, I think each of these interventions or inventions or disruptions that are happening — I think the pace of those cycles between the vertical disruption and the horizontal applicability of that disruption is what is really energizing for us. So I think if you look at it at this point in time: about four or five years back, when I was engaging with Microsoft as a company, as a supplier, that was probably the first time I heard anything about the notion of citizen application development, or democratization of IT, or democratization of applications. Now at that time it seemed a little bit of, wow, this is how it needs to be, but so, are we kind of ready for it?
Phani Sridhar — Senior Leader, iOPEX[07:30]
I think each of the interventions and disruptions that we’re seeing in the last couple of years, and more recently in the last one year or so — I think for that concept of somebody creating a vertical disruption but the ecosystem kind of coming together and creating the applicability of all of that. So from an iOPEX standpoint, Phil, I think the way that we work sort of in sync with the industry, but also a little bit different from our peers, is we don’t necessarily identify ourselves as a systems integrator. We look at ourselves as being much more of an experience integrator. And so what that means for us is, while there are a number of players that are going and potentially building big rocks in an organization — ERP systems, CRM systems, and so on — our role that we identify for ourselves is really, how do you connect the dots between all of this into a meaningful experience for whichever stakeholder that process is for? And so that for us translates into building a lot of automation interventions, building a lot of workflow interventions beyond automation, and the level of newer technologies that are coming.
Phani Sridhar — Senior Leader, iOPEX[08:43]
I think if you look at both the existence of ChatGPT and the general hype around it, but also equally what Microsoft and the other players are bringing to the market in terms of Copilot, I think the mix of both of this is again, to me, a fundamental disruption. The question for both systems integrators and experience integrators such as iOPEX is, how do we leverage that into real-world use cases and bring that to applications? So I think that’s where we are hyper-focused on utilizing some of this. And I think, what you kind of opened this with about the autonomous enterprise field — for us, the notion really is that again is a vertical manifestation of your previous principle of OneOffice. In some sense, the OneOffice concept is probably going to get a lot more actualized with what you’re now putting forward as the autonomous ecosystem, and I think we are building on layers of abstraction, but I think it is bringing the velocity that the industry very well needs.
Phil Fersht — CEO and Chief Analyst, HFS Research[09:43]
Right, right, yes. And, you know, did the pandemic and what’s happened since the pandemic, has that changed thinking within clients, do you think, within the customers? In terms of, like, if you’re a CIO or an ops leader now, you’ve got to be able to drive an automation and AI initiative. Do you see companies really changing at this point, or do you think it’s still a big struggle to get them moving, and moving forward more aggressively with this autonomous approach?
Phani Sridhar — Senior Leader, iOPEX[10:19]
I think it’s fundamentally a combination of things that are coming to play, and in my opinion, Phil, I think every change is a good change. It just is an element of what we make out of it. There are obviously external factors such as the pandemic and everything that tends to kind of put a spoke in the wheel and spoil the show, but I think all of these issues that happen from time to time are also opportunities if you look at it from a different lens. And I want to kind of answer what you asked in terms of your fourth pillar, which is your trusted and scalable automation capability. So that notion of trust, Phil, I want to kind of dwell on that a little bit, on what happened during the pandemic and what we are seeing in our customer base. Before the pandemic — actually, I want to rewind a little bit more, if you can kind of go back to maybe 2012, when I believe your team first coined the term RPA, and I think the industry picked it up quite well.
Phani Sridhar — Senior Leader, iOPEX[11:23]
The notion of automation really back then was either PowerShell, PowerScript-based automation, or in many ways Selenium on steroids. People just used QA automation tools, repurposed them for other purposes and everything at that time. But I think in the last five years or so, we have seen most of the orchestration platforms coming together to kind of tie that dream of automation into something that is meaningful. So we are not really doing point-specific automation, but we are doing a much more cohesive, integrated automation that is actually useful. So that’s one thing that we’ve seen even before the pandemic started. What also started happening is, I want to say about five or six years back, but I want to give you an example. We were working on a project where we were trying to read purchase orders coming in from B2B partners into an OEM, and the challenge there was, the formats were not locked. You really had any number of incoming formats that you had to process and everything.
Phani Sridhar — Senior Leader, iOPEX[12:24]
And while there was a lot of interest and enthusiasm in using AI and ML for problem statements of that nature, the maximum accuracy that we could achieve, after quite a bit of interesting work, was not beyond 25 to 30% maximum. Now, the same scenario now, with the tech coming through — and I think this is a parallel development, the same pandemic timelines — is that we are able to achieve a much higher level of accuracy in the outcomes as well. So what this has meant, this is the second dimension — first is the RPA, second is the AI/ML — the third part is this notion of, in general, in the last decade, I think a lot of enterprises invested beautifully in moving to the cloud, in extensive data estates in whatever form or fashion they exist. Not all the time could one create a traceability between, hey, why are you investing in this data? Are you really using it? What percentage of utilization do you have from the data that you’re already using? Are you harvesting in the right manner? So, irrespective of those questions, I think data estates have become larger.
Phani Sridhar — Senior Leader, iOPEX[13:26]
The consumption of data has become much more easy because of the widespread implementation of cloud. Now, if you kind of mix the notion of automation, notion of newer technologies, and notion of general availability of systems to kind of play around with and do cool things, I think the level of trust in interventions or solutions has increased phenomenally. So if you look at pre-pandemic time, a lot of ops leaders would take a general interest in automation, general interest in tooling, beyond what they do for service management and operations management, but I think that has become a lot more real for us, and the curation of that experience in terms of, are we investing in the right use cases? Are we seeing the right ROI? During the pandemic, we have silently but surely seen a lot more powerful validation and ROI of the several automation interventions, that I feel we are at the cusp of this potentially becoming a much more explosive outcome for all operations processes within companies.
Phani Sridhar — Senior Leader, iOPEX[14:19]
But I think if nothing else, the pandemic also has put a lot more pressure on the need for that change to happen much more faster. But I think the tooling and the ecosystem in general has also scaled up silently but surely within the same time frame. I’m sorry, that’s a bit of a long-winded answer, but I thought that’s how I see it, essentially.
Phil Fersht — CEO and Chief Analyst, HFS Research[14:47]
No, I think you take us through the journey quite effectively. So what’s next in this space? Because I think, you know, when I look at AI, it’s about how can you generate patterns from data? How can you have machines start to help make decisions that humans would make? How can you really leverage it to have systems run much more autonomously? How do you take humans out of loops where you don’t really need humans anymore? How do you see that evolving? Because I see automation and AI really coming together now, as one construct and one attitude on how to run a business. But how do you look at it, as you look down the road with AI adoption and taking humans out of these loops? How do you see that evolving? Is it going to accelerate, do you think, now, or do you think it’s still going to be a sort of slow treadmill like we’ve been through for the last decade?
Phani Sridhar — Senior Leader, iOPEX[15:52]
Maybe three or four elements to that question, Phil. Number one is, going back to what I was saying earlier about layers of abstraction and leveraging those layers of abstraction. What has become very evident with both things like ChatGPT and also Microsoft Copilot and other generative AI tools is essentially two things. Number one, we have now got that ability to kind of build on layers of abstraction that we can rely on. Earlier you could do that — a lot of experimentation involved, longer cycle times — but now the confidence of using these types of interventions in a much more effective way, in a much more agile way, in much more collapsed timelines, I think that has fundamentally changed, number one.
Phani Sridhar — Senior Leader, iOPEX[16:45]
And I would kind of react to what you just said in terms of, where are we in that journey. Number one, I think we have seen a lot of real-world use cases that are already being identified. In fact, within our organization, there are teams that are tinkering around and playing extensively on — for example, if you take ChatGPT specifically, there are teams that are very actively interested in working on the whole notion of knowledge management in an enterprise. If you take the domain of either customer service or customer success, for those sort of use cases as opposed to smarter search engines, some level of conversational AI — how are you kind of short-circuiting a typical conversational AI rollout? The field for us would be, start with an AI agent that is giving you sort of a question-answer response, get to a second level of maturity where you’re giving threaded responses to a particular topic and handing off to an agent, for example, if it’s a customer success conversation or a customer service conversation, and then going down to FAQs and subsequently to knowledge articles.
Phani Sridhar — Senior Leader, iOPEX[17:57]
Now, what the newer tooling has potentially brought to the table is cutting down those layers and potentially getting to an intelligent answer much more faster, and we feel there is a real promise of potentially transforming everything that everybody does in the customer service space, specifically on how you kind of — and this can be product support, this can be process support, but I think it’s much more tuned to product-support kind of scenarios, where you will have a large core corpus of knowledge within the organization. It is kind of being leveraged in multitude domains: where can you effectively harvest that knowledge, not kind of keep humans in the loop to do the curation manually, but kind of rely on humans just sort of curating the engine, not the responses particularly, and then doing something bigger. So that’s one dimension to what you said. The second one that I see, Phil, is this whole notion of citizen application development.
Phani Sridhar — Senior Leader, iOPEX[18:54]
I have an opinion on it. I see interesting things happening in that space, and I also strongly feel that organizations cannot be successful in the future without actively encouraging lines-of-business teams to get involved in developing applications themselves — lightweight applications, workflow applications, and such. And in that realm, I think the view that we have is, for example, iOPEX is a company where — do we play a role in citizen application development? For example, we kind of see our role as a player that is potentially providing sort of two bookends sitting on a shelf. The shelf is really the platform where technology providers like ServiceNow, Salesforce, Microsoft, Google, all the hyperscalers, all of you, and UiPath and other automation platforms come to play.
Phani Sridhar — Senior Leader, iOPEX[19:45]
The bookends are really, how do you curate that experience to begin with, in the sense of, can you identify the right use case? Can you kind of design it well? Can you make sure that adoption is thought of first before you start getting into implementation? Are you kind of bringing stakeholders and actors together into agreeing on what is the transformation that they’re expecting out of a set of conventions, and so on? So that portion, I think, is still heavily human-intensive, and I think the notion of simplifying some of the development activities is only helping us focus more on the more important experience and consumption of what we’re trying to build. So I think that’s one role that players like us are heavily invested in. The second one is really the governance, I think, which is probably your sixth tower: how do you kind of curate this experience, make sure how this works well?
Phani Sridhar — Senior Leader, iOPEX[20:30]
Because essentially we’ve seen examples of automation done wrong. We have seen examples of that initial hype of citizen app development kind of fall flat pretty fast, because we see a lot of individuals pick up things for development, very little attention paid to security, reusability, refactoring, reharvesting, and so on. And when that happens, I think the initial hype cycle kind of comes to a fall pretty soon, and we see our role in curating that experience also: providing the guardrails, providing the trust, providing help in terms of security, and more fundamentally providing training and creating that ecosystem for things to develop faster. So I think those are the two or three layers where we see what is going to happen maybe in the next year or two. I think it’ll be pretty arrogant for anybody to kind of say, I know exactly what’s happening in the next couple of years, but I think this is the general direction of what we see as a company about how the industry is developing, right?
Phil Fersht — CEO and Chief Analyst, HFS Research[21:19]
Yeah, definitely with you on the governance side, and, you know, I think people involved across all key decision touch points, ensuring the effectiveness, is so important. And I mean, this creates real exciting opportunities for people to unleash their creativity, their high touch with clients, leverage data, make decisions faster, and that sort of thing. So we really see this as an attitudinal, cultural shift for businesses more than anything else. So this has been fantastic, Phani. I think you’ve really explained a lot about iOPEX and the sophistication of experience around the automation and AI cycle that you can deliver, and I look forward to sharing this with everybody on our network at HFS.
Phani Sridhar — Senior Leader, iOPEX[22:21]
Absolutely, absolutely, thank you.
Phil Fersht — CEO and Chief Analyst, HFS Research[22:21]
Yeah, fantastic. Thank you so much for your time.
