PSA solutions can help consulting firms gain a competitive edge

05 September 2016 Consultancy.uk

Technology has over the past years become increasingly important for the management of consulting firms – its role has, if applied successfully, developed from being a facilitator of operations to a key enabler. The emergence of the latest technologies is taking professional services automation to the next level – consultancies today face an opportunity to leverage cutting-edge solutions to gain a competitive edge in, among others, project management, profitability and new business development.

Across industries technology is disrupting business and operating models. While consultancies are one of the first to be called in to help organisations harness the power of the latest tech developments – ranging from the Internet of Things and automation to Industry 4.0 and artificial intelligence – technology is at the same time also changing the playing field in their own back yard. One of the areas which is enjoying a renaissance under the helm of technology-led innovation is professional services automation (PSA) – the technology that forms the backbone of internal operations of consulting firms, from front-end aspects such as business development to the very heart of the business, project management and delivery, as well as the back-end processes that facilitate the operations.

Against the backdrop of rapid change that is transforming the face of the consulting industry, the role of professional services automation is becoming increasingly crucial within the market. Competition is heating up, putting pressure on margins, clients are demanding more and more transparency and risk-sharing models, and a new generation of consultants are changing the nature of engagement staffing and career trajectories, among others.

PSA solution in consulting

Having closely watched the key developments in consulting, and having worked with many of the leaders of the pack, Fergus Gilmore, managing director of Deltek UK, has formed a deep insight into the value of PSA. In his view, a cutting-edge PSA solution today has the ability to provide consultancies with a competitive edge vis a vis peers, highlighting three key domains which typically are positively impacted.

Project management
The top reason to build PSA capabilities lies in the additional visibility and control which it provides to a firm's number one revenue generator: the project. “Adopting systems and tools to better manage front office activities such as project management and resource utilisation gives consulting firms the insight they need to prosper.” Besides boosting engagement-related work, the technological edge enables firms to align decisions with overarching strategic goals. “Focusing all processes and data into the project and then linking all projects with back office processes means they are able to make project-related decisions that will strategically guide the business and take it in the direction they want it to go.”

Market analysis conducted in recent years shows that consulting firms will continue to face stiff competition. “Data highlights* that top performing have taken action. Almost 73% of the best professional services firms have a standardised methodology and tooling for delivering projects, compared with just 27% that do not. They for instance use PSA to create better cost estimates, impress new clients by analysing past project performance information and use what they find out to establish new revenue streams by crafting new, modern products and services," Gilmore says.

Profitability
PSA technology is also helping advisory companies fight back against squeezed margins – another major challenge in today's consulting sector. Pinpointing where consultants are being utilised and then assigning them to projects that generate the best revenue will improve profitability. They are also, adds Gilmore, using tools to support time and expense tracking and improve customer retention through enhancing service reliability and offering useful project insight. “The top performing professional services firms invest in technology that increases their focus on developing profitable new business and maximises the profitability of every new project.”

PSA solutions can help consulting firms gain a competitive edgeThey have, among others, developed superior processes and systems to harvest knowledge, manage quality, schedule resources and manage changes. “They focus on developing repeatable processes which they can manage in real-time, so they are better at estimating and ensuring projects are delivered on time and on budget.”

Winning and retaining clients
The third edge PSA can provide lies in the commercial arena. Top consultancy firms are using professional services automation to win and retain new business which is a major contributor to growth and a priority for any sized firm. “Spotting and retaining the right type of clients – those that will benefit most from a firm's particular skill set and will in turn reap the most reward – will continue to be a real challenge for firms moving forwards,” says Gilmore. “Best in class firms are relying on their PSA platforms to analyse past and present data to reveal where the most profitable business is and how to get more business out of existing clients.”

Gilmore concludes: “Top of the bill PSA solutions can improve project visibility and control, as well as link front of house activities with back office processes so that better, more strategic decisions can be made. With these tools in place, consulting firms can look forward to releasing themselves from the confides of their own bureaucracy and support their growth aspirations.”

For more information on how PSA can act an enabler for growth in consulting download the free 'PSA for Dummies' guide.

* Sourced from the 2016 Professional Services Maturity Benchmark survey.

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Accenture's push into the creative sector is an identity crisis

18 April 2019 Consultancy.uk

In its latest push into the creative sector, Accenture Interactive acquired New York and London-based ad agency Droga5 earlier this month, adding illustrious clients such as HBO, Amazon and The New York Times to its roster of clients. With the latest in a long line of similar purchases, Accenture Interactive further demonstrated its ambition of becoming the globe’s leading trusted advisor to chief marketing officers. Yet according to Ben Langdon, Chairman of Class35, Accenture’s strategy may be heading in the wrong direction.

A press release on Accenture’s website announcing the acquisition sits next to a quote stating that “brands aren’t built through advertising” – a huge contradiction from a consultancy firm hell-bent on becoming the ‘CMO agency of choice’. It’s not alone of course. The entire consulting industry wants a piece of the creative pie right now. In addition to Accenture Interactive, recent acquisitions by PwC Digital, IBM iX, and Deloitte Digital meant that in 2017, for the first time ever, four of the world’s ten largest creative agencies were consultancies.

So just what it is that Accenture wants to achieve from this? For one thing, it’s clearly trying to be a digital transformation business. A one-stop creative shop rivalling more traditional models, it wants to lure CMOs in with the promise of lower ad spend and a “more impactful customer experience”. At the same time, though, it’s still in thrall to those same slinky, shiny branding and advertising agencies it’s attempting to disrupt. The Droga5 acquisition and that of Karmarama a few years before are both testament to this.

There’s a fundamental problem with this, though. Digital transformation businesses don’t sell to CMOs. These people have enough on their plates trying to transform their own marketing skills in order to keep up with an ever-changing market – they just don’t have the time or the energy to concern themselves with digitally transforming a whole business. If Accenture’s purpose is digital transformation, then going after creative agencies is barking up the wrong tree.Is Accenture's push into the creative sector an identity crisis?

Worlds apart

Perhaps more importantly, these two industries are worlds apart in terms of the way they think. Creative agencies are all about ideas, campaigns and consumers. Digital businesses, on the other hand, are customer-driven – they think in terms such as lifetime value, measurement, and efficiency. Customer-led thinking is an entirely different beast to consumer-led thinking.

The reality is that the arrival of digital and an all-encompassing obsession with technology, measurement and social has led to the death of agencies in a reductive, zero-sum, efficiency-focused battle with brands. Indeed, agencies have become so obsessed with the latest tech fads, they’re beginning to forget how brands work. Worse still, they’re beginning to forget how brands are built. And, by forgetting, they’re destroying their own values.

Killing creativity

All things considered, it really feels to me as though Accenture is a chip leader in a game it doesn’t understand. Expensive acquisitions like these show that they’ve got the big money, but they don’t appear to have any idea what they’re doing with it. Take talent, for example. The best talent in the creative industry right now is out in the market; it’s not tied to any one agency. Both agencies might well be at the top of their game, but why would a consulting firm waste so much money on buying them when they could hire high-quality creative talent on a contingent basis instead?

As their presence in the top 10 creative agencies shows, there is a growing trend in which Accenture, like many of the other big players, are buying up agencies as if they were nothing more than keywords. What they’re really buying, though, is a collection of credentials, clients and IP. Unfortunately, the talent that created those credentials aren’t going to stay at the business, the clients that hired the agency in the first place won’t be interested in buying what is basically just another part of Accenture, and the IP never really existed to begin with.

Droga5, for example, was one of the few agencies that did great brand work the old-fashioned way – undoubtedly something that made it attractive to Accenture in the first place. The irony, though, is that by leading it further away from the way of working that made it so special, the consulting giant will kill its creativity.

“Accenture Interactive has been dazzled by its ambitions to become the CMO agency of record…. But, in flashing its cash, it is spending millions on acquiring nothing of any value.”

If pressed, the recently acquired agency staff at Accenture will tell you just how dysfunctional the new arrangement is. They’re largely unfulfilled. Rarely do they feel their work has any sort of meaning or purpose. What’s more, the different disciplines have found little or no common ground, and find it hard to work together as a cohesive whole. It’s not surprising, then, to see talented people leaving in droves.

Beyond the window dressing 

It’s clear, then, that consulting firms and creative agencies are no easy bedfellows. But in his company’s defence, Accenture Interactive’s Senior Managing Director for North America, Glen Hartman, described its culture as being “far, far away from what a stereotypical consulting firm would look like. Our office and studios look a lot like Droga5’s.”

In demonstrating a belief that office design equates to workplace culture, this statement serves as an illustration of how confused Accenture is right now. It wants to justify its new strategy so badly, it’s started dressing like a creative agency. But if you look beyond the window dressing and see that you and your partners are speaking a different language with a different purpose, selling to different people in a different market, there’s no getting away from the fact that you’re different.

Accenture Interactive has been dazzled by its ambitions to become the CMO agency of record, and it wants to dazzle others with its new direction. But, in flashing its cash, it is spending millions on acquiring nothing of any value.

Related: Space between consulting firms and creative agencies is converging.