DIGITAL TRANSFORMATION – A NEW OCEAN FOR THE PROFESSIONAL SERVICES INDUSTRY
Digitalization is emerging around the globe and is changing how people live, work and relate to one another. Words such as hyperconnectivity, virtual, mobility, social networks or big data, are words that are becoming part of our daily conversation. It is our current industrial revolution and is universal, affecting every sector of the economy, including the Professional Services industry.
Why is Digital Transformation relevant?
Digital transformation is not so much about technology as about redesigning business models and changing the style of doing business.
The features of digital business models are relevant because they have a huge impact on company valuations. The very significant reduction in the cost of technology is allowing us to venture into new areas or enhance some already existing features in a cost-effective way. Why do platforms like Airbnb or Uber have higher valuation than their traditional peers?
There are numerous examples of how new technologies will transform or disrupt different industries – for example autonomous cars in the transport industries, 3D print in manufacturing, robotics in logistics, and the network economy on hospitality services. Other key innovation accelerators include the Internet of Things, virtual and augmented reality, and cognitive computing.
We must understand that Digital is a change, but is not more than one further change. New markets, new channels, new needs, new technologies, new ways to connect with customers, new legal requirements, new competitors… In short; new frontiers.
It is interesting to note however, that the needs which must be met by management at all levels, have not changed. They should continue giving higher value to shareholders, sustainable and profitable growth, customer satisfaction, improve loyalty, improve efficiency, motivate and lead staff, generate competitive advantages and provide for, and influence, the future.
Are professionals ready to adapt technologies that may disrupt their own markets in the short term? Probably not. Strong sponsorship at board level is vital if a company is to truly embrace opportunities presented by digital disruption and a digital culture is increasingly important to help executives become effective leaders.
What are the implications for Professional Services?
Professional Services play a critical role in helping it’s clients set their strategic direction, remain compliant, predict future risks, recruit talent, and produce and audit their financial results.
The sector has an unprecedented opportunity to transform business models but, if we practice what we preach, many of the Professional services firms must go through their own digital transformation before they can truly help their customers. They may be proficient at evolving it’s offerings to clients’ changing needs in the vanguard of digital transformation, with high levels of digitalization across most aspects of the sector.
According to recent studies, the impact of new technology will affect certain segments depending on the varying degree of disruption, with Accounting and Audit the most affected, and Big Law the least. Consulting firms are transitioning to more transformational work, helping clients execute their vision through short-term, iterative steps. Human capital firms are changing the way they map and source talent. In addition, legal firms are thinking about the risks associated with digitalization for their clients, and Professional Services multinationals are considering how to quantify the financial impact of digital transformation.
That is why there is a wave of investment in the sector and many firms are turning to digital mode:
Product / Solution
|KPMG||Shared Services and Outsourcing Advisory (SSOA)||Support the enterprise such as finance, HR, IT, facilities and purchasing|
|EY||Synapse Platform (Analytic-as-a-Service)||Delivers standardized as well as customized solutions which businesses can access through the internet on laptops or any mobile device|
|Baker& Hostetler||ROSS||Built on Watson, IBM’s cognitive computing platform, is the first artificial intelligent lawyer|
|PWC||Data Analytics Marketplace||Portfolio of analytic apps and platforms, alliances, and joint business relationships to unlock data possibilities and make better and faster decisions|
|BCG||Digital Ventures||A corporate investment and venture development firm focus on building, incubating and scaling disruptive digital businesses|
|Equidam||Valuation Platform||Gives you the tools to instantly determine the value of a company and prove it to the world|
|Mckinsey||Digital Labs||Enables organizations to capture new value from digital-creating products, experiences, and businesses through new capabilities|
|Kaggle||Crowdsourcing||A platform for data science where statisticians and data miners compete to produce the best models for solving data-based problems posted by companies and researchers|
|Cuatrecasas Law Firm||Acelera LegalTech||The first accelerator program for startups to be launched by a European law firm|
New roles, new skills
Augmented reality could transform how employees and clients collaborate around the globe. With about 40% of workers expected to freelance in the future, working environments will need to be a seamless blend of the virtual and the real.
From our perspective as Talent Management Consultants, it is especially challenging when the future may bring, as yet, unimagined roles requiring new skills in artificial intelligence, data science, learning machine, intuition, pattern finding, and dealing with complexity and change management. Positions as Design Director, Agile Advisor, Cyber Solutions Client Development Manager or Big Data Architect, are being incorporated in many organizational charts.
Professional Services firms must take into account the mindset of the upcoming generation of employees. According to Accenture, nearly three-quarters of future talent would choose to work at an organization with an engaging, positive social atmosphere, even if it meant accepting a lower salary. Only one in seven graduates wants to work for a large company, believing smaller employers provide the opportunities and social culture they seek. Large corporations will therefore need to adapt their culture to attract fresh talent and we are here, to find and grow these new leaders.
Like in an ocean of opportunity, Digital Transformation creates immense scope and challenges business will have to face, from legal to accounting, from auditing to consulting, from real to virtual. Companies that can anticipate change and react faster than competitors will stay ahead of the curve. So, are you ready to swim?
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