Technology is moving to the center of attention across professional and business services – and firms are spending more and more, not just absolutely but also relative to their revenue. If solely treated as a cost position, it becomes a race to the bottom. Instead, if considered a revenue driver and managed as an integral part of your firm’s P&L, technology paves the way for new business models, growth, and profitability.
Is the next generation of competitors even visible to a traditional lawfirms or the providers of consulting, tax or accounting services?
Many established players seem to have a hard time recognizing the underlying shifts in the market, which can be observed upon closer inspection of demand and spend patterns of professional services‘ clients. Or in other words: They are invisible – unless firms truly listen to clients, tune into the technological change and embrace the emerging digital future and opportunities across the professions and beyond.
As the world is bracing itself for the impact of #COVID19 on our nations, economies, companies as well as individuals and societies, #professionalservices firms (#legal, #consulting, #accounting) are both positively and negatively impacted at once.
While it is clearly necessary to deal with the serious short-term implications of this terrifying situation, it may also be strategically important to think through the mid- to long-term implications for professional services in general and individual firms in particular.
So, here are three first hypotheses regarding the #Corona aftermath:
With the shorter and darker days of winter approaching, many indicators across industries, geographies and economies reflect growing uncertainty – and the threat of an economic downturn or even recession. So, we have asked ourselves: How will Professional Services as an industry be impacted and respond? Which Legal, Consulting, Accounting or Technology Services firms will suffer or decline … and which firms will thrive? Download our thinking right here:
Is your firm prepared for an economic downturn?
ProfessionalServices have largely flourished since the 2008/2009 recession. But how well Professional Services Firms will be able to continue to “score”, will depend on the degree of resilience within their revenue structures and their ability to grow and occupy new market space amidst an unfolding economic downturn.
In order to unlock scalable growth, professional services firms must shift management attention from dividend payouts to firm value – a fundamental and necessary shift in the financial management mindset of Professional Service Firms (PSFs).
While the term „product management” may still sound foreign and incompatible with the fuzzy and often ill-defined (lovingly called “bespoke”) professional service business, its essence is already emerging in many forms, roles and organizational setups. Embracing the role of solution managers consciously and adjusting the organization surrounding them must be a key workstream within the digital transformation journey of any professional service firm today.
The innovation engine of many firms seems to lack power… and the future readiness of many firms appears questionable. Why is that? After all, there is no lack of talent, analytical and strategic capabilities or money in this highly profitable industry.
“You can’t manage, what you can’t measure” – and the #solution view is here to stay as a key business object for #ProfessionalServiceFirms, which needs at least the same kind of management attention as the two core traditional “business objects”, clients and human resources.
Cross- and up-selling in professional service firms has become less of an art but more of a systematic method and data-driven approach that facilitates new growth and scalability.
Traditional business models for professional services are about to expire.
Both established and new players venture into new ways of delivering tangible value to clients and finding smarter ways to charge clients for their work – or rather: the value delivered.