Will the largest services firms of the future have no employees? For years, the industry was built on the “leveraged talent” model: teams of highly educated people would grapple with a problem for a client and charge fees based on time and materials. Today, that model is giving way as professional services firms automate basic tasks, develop digital knowledge-based products, and rely more on a network of non-employee workers.
Never before has technological advancement offered more innovation and transformation opportunities for this industry. Intelligent technologies allow firms to grow revenue without increasing headcount. They can also empower employees to provide higher-value services for their clients.
But the question remains: how do organizations in the professional services industry move forward to become intelligent enterprises? The following strategic priorities are critical for making the transition.
Clients today expect professional services firms to deliver engagements where payment is based on a predefined set of outcomes rather than on the effort expended. Such outcome-based models transfer much of the project risk from the client to the service provider.
To minimize this risk, firms seek to implement frameworks for delivering outcome-based engagements successfully. They are starting early in the engagement process and leveraging capabilities such as intelligent deal-scoring, intelligent bid management, strategic execution, and post-delivery processes.
Critical to success is a smart, regimented bidding process that makes sure proposals are rigorously developed and accurate and use insights from past engagements to ensure that the outcomes can be realistically delivered with the planned effort. Firms are moving toward predictive analytics to monitor progress throughout the engagement to ensure that services are delivered as intended and that margins are realized.
Experience management technology is also playing an important role – enabling firms to quickly get accurate insights on the key drivers of the client experience. Based on data collected, firms can generate insights and implement programs to drive better business outcomes and deliver services more efficiently.
Knowledge as a service
Technology advances are allowing firms to innovate at speed and deliver expert knowledge in a digital package at scale. The goal is to unlock nonlinear growth by driving new revenue streams through innovative digital services that are instantly available, accessible, and affordable on an agile digital platform.
Today, firms are opening up their intellectual property to better monetize their institutional expertise via relevant digital services – such as tax or legal advice dispensed with help from intelligent natural-language processing.
By providing access to digitalized expertise, professional services firms are rewriting the underlying economics for their business. One critical capability moving forward is the need to understand the full lifecycle of the digital service – including the initial cost to develop, ongoing support, and lifetime revenue. For the knowledge-as-a-service model to work, firms also need to adopt a continuous innovation process and a digital cloud platform that contains all the required components. These components comprise a data platform, readily available business services, client feedback mechanisms for the product or solution experience, and intelligent technologies under the umbrella of an innovation system.
Today’s workforce is undergoing a massive cultural shift toward talented young professionals wanting a new work experience as free agents. The result is that traditional resourcing models are being disrupted.
Faced with the need to flexibly scale their workforce according to demand, professional services firms need to tap into talent networks to secure the right skills and resources at the right moment. Digitalization has enabled the emergence of an open talent economy that brings together people and work in a borderless workplace. Talent is readily accessible on a global basis, driven by the gig economy, crowdsourcing, and global platforms and networks.
Professional services firms, accordingly, are starting to use talent networks as an extension of the firm and seamlessly deploy these resources alongside their own employees, allowing them to flexibly scale resource capacity and access scarce skills. But execution depends on enhanced resource-management processes that enable a paradigm shift from “Who do I have with skills available?” to “Who is the optimal person (internally or externally) to deliver the service?”
Integrating talent networks, along with internal resource pools and even applicant profiles, will enable firms to make sophisticated “staff, hire, or contract” decisions that are based on a combination of skills, availability, cost, quality, and strategic criteria. Intelligent onboarding and personalized learning processes, meanwhile, are being used to integrate external talent with the company’s culture and working methodologies, key internal knowledge, and expertise. This is critical to provide clients with a consistent brand experience and level of service.
The future is bright
Ultimately, the basic value proposition of services companies – providing specialized expertise to their clients – will not change. But moving forward, the intelligent enterprise will prosper based not just on what they know but also how they deliver that knowledge.
Remember, too, that professional services companies are instrumental in helping their clients undergo digital transformation. Now is the time for those same firms to transform themselves.
Join our virtual event to learn more
Want to find out more about the latest trends and innovations in today’s global professional services business? Register today to join our flagship 60-minute virtual industry event:
SAP Industries Forum 2020: Professional Services
Experience the Intelligent Enterprise
Thursday, March 26, 2020
9:00 a.m. PDT | 12:00 p.m. EDT | 5:00 p.m. CET