Publication: Analytics Insight
How digital transformation is critical for professional services businesses
There is a dramatic effect on professional services businesses post-adoption of digital transformation
The professional services industry has been organized around a few tenets which are now being challenged. Whether it’s the high emphasis on individual expertise or its focus on billable hours, professional services businesses are seeing the need for change. The industry is rapidly scaling and adding offerings as well as multiple modes of delivery. It is now addressing, in general, a more varied audience, and more evolved client preferences. And with that, there is a need for reducing the emphasis on manual work, better tooling, and ability to add expertise at will, and also the ability to bring together the work of many different people from different locations or from different cultures.
While these changes are not necessarily new, the Covid-19 pandemic has brought home the urgency. Digital transformation has become critical. Increased connectivity, technology awareness, and digital nativity have made new ways of doing business possible:
- Evolved customer experience: No longer the professional services industry can rely on mere personal interaction by a few account representatives. The interactions have broadened with multiple touchpoints, both in terms of people connected and the mediums. Online visibility, digital presence, social media, etc., all now are legitimate channels of experience delivery, and excelling at all of them—and being consistent across—is essential for the professional services firms.
- The increasing speed of business: As the demand—and need—for professional services has increased immensely, businesses are unable to keep track of operations and face problems scaling operations. They require a solution that would assist them in streamlining the process from client inquiry through service delivery, all while keeping the customer informed and updated. Professional services businesses are now working with solutions like end-to-end work order management and project portfolio management tools. These tools assist firms in managing operations as they scale, streamlining the process from client inquiry through service delivery, all while keeping the client informed and updated.
- Digital delivery of services: Digital delivery includes contracted out electronically mediated services and digitally facilitated distributed work within firms, in which business services inputs are supplied electronically. Digital delivery allows professional services suppliers to combine richness and reach–combine greater market reach with the ability to engage in better interactions with clients. Along with that, with cloud solutions, professional services can be availed from anywhere on the globe, enabling the ability to tap into new markets and diverse sources of talent. Well-planned and integrated deployment of relevant cloud services can streamline work execution, deliverable creation, and the actual delivery of services.
- Remote work operations: Professional services businesses are increasingly operating and working with teams remotely. Remote team operations are effective if they have a modern workplace solution that keeps the teams connected and increases productivity. Moreover, modern workplace solutions ensure that documents—and people—are always available and reachable.
- The shift to an outcome-based business model: The traditional hourly rate model which relied on a defined set of competencies made available to a supervised environment is increasingly getting challenged. Customer businesses are increasingly demanding much more accountability and responsibility, as well as, “skin in the game”. Professional services firms now need to build value and define engagements—and then track and monitor them—with strict service level agreements. These mean adoption of sophisticated work, outcome, and milestone measurement techniques, as reliance on time-sheets, is no longer sufficient. This also requires more advanced engagement management, capability management, and talent development, which can be facilitated by digital technologies which integrate with the way teams work. Better ways of aggregating data would lead to better and more meaningful visibility to both executive management and clients.
Overall, it is clear that, in light of changing times and market situations, firms must transition from traditional business management approaches to more digital and data-driven services operations. Professional services firms experience many benefits of digitalizing their operations if digitalization is done right.
Manish Godha, Founder and CEO at Advaiya