BPO, the cloud and the future of the analyst firm

What's happening in the BPO world and how is HfS Research shaking things up. I had a conversation with CEO Phil Fersht to find out.

Last week I took the opportunity to catch up with Phil Fersht, CEO, HfS Research, a Boston based firm that is growing rapidly. Now in its third year, HfS has a total headcount of 47 researchers, consultants and analysts built into a multi-disciplinary team. While it may not have the bulk of a Gartner or Forrester, HfS is recognized as the research authority on global Business Process Outsourcing or BPO.

During our conversation, Fersht explained how the world of BPO is changing with more C suite executives considering the cloud as an alternative BPO enabler. The arguments over whether the cloud is safe and secure have given way to discussions around how cloud technologies can be leveraged to not only 'lift and shift' cost, often overseas to India, but how the cloud can be used to transform business processes.

Fersht believes the early adopters are going to come from mid-range companies over the next couple of years, while large companies ponder what to do.

Fersht's firm is the first of its kind that doesn't do 'pay for play' among the vendors, preferring instead to learn and develop principally from its buyer community of more than 63,000 subscribers. Like all research firms, it derives some income from the vendor - or as they prefer to call it - the supplier side, but this principally comes n the form of report distribution.

I like this model. It appeals to my sense of fair play in a world where vendors often have the upper hand. It lends itself well to the idea that while buyers come first, there is a place for vendors, albeit on a controlled basis. Most important, it avoids the problem of analysts becoming hostage to the vagaries of vendors and effectively turning into anal-ysts.

The combination of careful use of social media techniques/technologies and keeping close to the community of buyers presents what Fersht believes is a better way to help those needing information: "Talking to us is like having a chat with your mates down the pub...we make it easy to reach us." I asked him about the HfS blog as it often deals with topics in not only a candid but humorous way: "Adding in a touch of humor is always a good way to deliver a message," he says. Here's one of my personal favorite examples from the recent past where Fersht introduced the promotion of Tony Filippone to head of research:

Tony’s role, is to ensure all our research is communicated to the buyer (and not the puffy stuff only advisors and providers pretend to understand).

Quite. If you are in the market for BPO services, HfS will be the firm to watch in 2012 - says he with a Gartner probability of 0.82.

Enjoy the video - we had a fun time shooting it.

Disclosure: I've know Phil Fersht many years. Back in the late 1990s, he was a researcher for a consultancy to which I provided content. We have no commercial relationship but he did buy me a very good lunch.