In March 2017, business process outsourcing (BPO) provider Genpact completed the acquisition of Massachusetts-based RAGE Frameworks, an artificial intelligence (AI)-based automation platform vendor, for an undisclosed sum. Genpact will absorb RAGE's 500 employees and gain additional delivery capabilities in the US and India. This acquisition provides Genpact with the capabilities needed to extend its efforts in providing transformational services beyond back-office functions.
Genpact aims to embed itself in a more strategic role within the enterprise
Traditionally, BPO providers have focused on the back office – optimizing and, increasingly, automating processes to streamline an enterprise's operations – and many a BPO provider has struggled in efforts to move into more strategic roles within the enterprise. Making such a move is an overall imperative for providers in the current market, as enterprises consolidate their number of IT services suppliers, indicating a preference to work with those that are truly strategic to their business goals. With this acquisition, Genpact is adding the capability to provide financial institutions with a no-code automation platform that can help transform traditionally manual business processes into automated ones.
RAGE's AI platform is used by enterprises from the financial services, hi-tech, consumer products, logistics, and consulting sectors, leveraging its no-code platform to automate knowledge-based processes. RAGE's clients use the platform to read and extract insights from sources such as SEC filings, balance sheets, contracts, and news reports to derive insights that are used to drive decision-making in areas such as insurance underwriting, commercial lending, and investment research. Genpact plans to integrate RAGE's platform across its entire portfolio of offerings so that clients can capture and analyze data from internal processes and external sources, and ultimately drive automated decision-making (the cognitive part) to provide, for instance, early warnings or trigger notification for manual intervention. RAGE also owns 18 intelligent machines – ready-to-deploy virtual machines that address major challenges in enterprise automation, as well as natural language processing (NLP) and natural language understanding (NLU) tools. Both these intellectual properties will significantly bolster Genpact's enterprise offerings when integrated into its portfolio.
This is a timely acquisition for Genpact and makes it one of the few BPO providers with a strong AI platform under its umbrella that can add a layer of intelligence to its process optimization expertise. In a time when growth of the traditional cost arbitrage model has slowed and the industry is facing strong headwinds in the form of political and economic policy changes, the assimilation of RAGE's platform offers Genpact the ability to steer the conversation toward the business value of transforming front- and middle-office functions. By combining automation and cognitive intelligence into its portfolio, Genpact is attempting to push back against the forces impacting offshore BPO, and position itself as even more strategic to customers looking to transform.
India IT Services Vendor Quarterly, 4Q16, IT0019-003618 (April 2017)
"The Internet of Things will drive demand for transformative services," IT0019-003615 (April 2017)
Hansa Iyengar, Senior Analyst, Large Enterprise Services