How digital transformation is changing professional services

Oct 18, 2019

Ross Timms explores how the current digital transformation is driving professional services to embrace new technology and how that technology has evolved into new sectors of growth.

According to the IDC Worldwide Semiannual Digital Transformation Spending Guide, $1.18 trillion is predicted to be spent globally on digital transformation technology and services in 2019. The opportunities for professional services are manifold. From competitive differentiation, fighting the in-sourcing trend and more efficient acquisition, to the switch to outcome-based contracts rather than hours worked, digital transformation is fast becoming a driving force in the industry.

From this changing environment comes two key trends – increased servitisation and a move towards an on-demand workforce. As clients demand more value, more quality and more efficiency, 41% of consulting practices, according to consultancy.co.uk, cite ‘providing more value at the same cost’ as one of the top challenges.

Three types of transformation

We typically see three distinct types of transformation, each with their own characteristics:

Changing how you do business

Organisations should respond to changing customer expectations by offering the same core business functions but delivering them in new ways, through new processes and new technology.

For example, PwC UK recognised the opportunity to offer value to an untapped audience with a combination of on-demand expertise and intuitive technology. Partnering with Sage, itlaunched My Financepartner – a subscription-based accounting service aimed at small, growth-oriented companies.

Using cloud-based technology paired with expert accountants, small companies can tailor the accountancy support they need, whenever they need it. According to PwC UK’s annual report, its overall revenue was up by 7% ($41.3 billion) in 2018, with assurance providing 41% ($17 million) of this – an increase of 4% for this area of the business.

Change your business

Another type of transformation is to modify your business' offerings to meet changing consumer needs and solve problems in new ways, often with new products or services.

Accenture evolved its offering using digital as an integrated growth platform to position itself as a one-stop shop for digital needs with its Interactive Division. Success in this division is based on a reciprocity of skills – large consultancies bring strong existing client relationships, global and local opportunities and bigger budgets, while digital and marketing communication agencies bring creative talent and technological innovation. Accenture Interactive revenue is increasing at well over 20% this year and is on course to pass $10 billion with most of that growth being organic.

Change your market

Disrupting the fundamentals of a market or creating a new market altogether is the last key transformation.

TrademarkNow has been a disruptive force in intellectual property law with its automated trademark management software. It replaces manual research by providing name and image trademark search, watch and analysis. Its AI model takes real world complexities into account, covering 180 countries’ trademark registries as well as a slew of common law data sources. In 2016, the company almost tripled in size. In May 2019, TrademarkNow launched a self-serve pay-per-search offering that made tools accessible to any anyone in the world, further disrupting the industry

What these three examples all have in common is a single point of focus – a guiding star for how to leverage their brand and shape customer experiences to meet evolving demands. For professional services, digital transformation unlocks new areas of growth – building on the sectors’ existing strengths to identify opportunities to redefine and streamline their offerings which, in turn, brings clients more comprehensive, intuitive and valuable solutions for the future.

Ross Timms is the Head of Strategy in Rufus Leonard.