How ERP in the cloud can benefit management consulting firms
Visibility, control and agility are key drivers for consulting firms. To keep up with project management delivery, competition and innovation, management consulting firms are transitioning their ERP to a cloud environment, according to a new report from Deltek.
A report by Gartner states that 30% of service centric companies will move the majority of their ERP apps to the cloud by 2018*. “Such a system hosted in a cloud environment brings significant advantages and return on investment to managing internal processes, service delivery and prepare for digital disruption,” says Fergus Gilmore, Managing Director UK and Central Europe at IT services firm Deltek.
Management consulting firms rely on their employees to deliver profitable projects on time and within budget. However, projects are increasingly becoming more complex due to globalisation, customers’ demands, market changes and digital transformation. With innovative technologies providing a growing potential for consultancies to improve their performance, analysts are increasingly touting technology strategy as a factor that firms must get right to be successful. Gilmore: “Digital transformation is not a passing trend, but a reality as companies strive to remain competitive, better enable employees to deliver exceptional projects and expertise, and prepare to overcome future challenges.”
Consultancies across the globe are picking up on the trend. According to IDC, worldwide IT spending of professional services firms* has risen year on year in the recent period, with a growth of 6% forecasted for 2017. “The increase in spending by consulting firms is mainly aimed at ensuring that they can do more, faster and cheaper,” explains Gilmore. “Technology enables partners to get control of processes in an agile manner, get an overarching view of portfolios and projects, and it sets the fundament for optimal project delivery and performance.”
Consulting to the cloud
An essential part of digital strategy is the transition from traditional server-intensive models to cloud-based way of working. With 22,000 clients Deltek is one of the world’s largest providers of enterprise software and solutions for project-based businesses. Gilmore says that he sees that the trend is also rapidly gaining momentum in the consulting industry. The development does not come as a surprise; in a 2014 survey by Deltek, the researchers found that 73% of consulting firms were planning to or in the process of moving their systems to a cloud environment. A similar trend is visible across the IT services landscape, with Gartner research stating that the ‘cloud shift’ will affect more than $1 trillion in IT spending by 2020.
Based on his experience at Deltek, Gilmore enumerates some of the reasons consulting firms are moving to cloud ERP. He highlights that an important element of a project-based business is to maintain one version of the truth across the entire organisation to improve vision, efficiency and better informed decision making. “This can only be done by unifying data to link people, processes and information.”
Employee accessibility, mobility and collaboration is another crucial reason. “The best project-based businesses provide their employees with the best tools to efficiently do their job. Cloud ERP software provides instant project data, accessible anytime and anywhere, offering greater collaboration between colleagues.”
One of the biggest incentive he says is the cut down of IT requirements: “the IT team doesn’t need to manage numerous local servers, data security and upgrades. With cloud technologies, the IT team can be concentrated on value-added initiatives.” Customers also appreciate the value of rapid development and upgrades without the need to redeploy the software. They want quick updates that won’t take the system off for long periods of maintenance.
Data protection is another area for concern. With the introduction of GDPR in 2018, consulting firms require many new controls over data, including location, security and management of regulatory issues. “A cloud-based ERP system help address these issues and offers the agility to manage such changes, now and in the future”, he remarks.
Looking at long term value, innovation is an important incentive. Visionary consulting firms are already looking at how artificial intelligence and robotics will enhance their offering. A cloud infrastructure is a foundation to add more technologies and expand a firm’s capabilities and reach.
Millennials and technology
The evolution of employee demands show a growing number of millennials in the workplace are simply not attracted to employers who run legacy business software. “Many of these millennials are digitally connected and only know the cloud state,” says Gilmore, and, as a result, companies are finding they have no choice but to cater for these digital natives or run the risk of losing out on top talent to competitors. “Technology is not optional, but rather critical for attracting and retaining the talent from this generation.”
In this respect, Gilmore strongly recommends adopting cloud ERP with mobile apps capabilities for employees. This will, among other benefits, allow consultants to check schedules and enter time and expenses while on the road, access important business apps on their smartphones and run their training apps with the touch of their fingertips. “Today’s workforce expects the latest and greatest mobile-enabled technologies and when evaluating future employers, this can be a deciding factor for many people.”
Gilmore concludes, “the pace of which digital technologies evolve can be frightening. Consulting firms must keep the momentum to remain competitive. Cloud solutions such as project-based ERP are especially important for consultancies where there is a need for visibility, agility and continual innovation for ever changing projects.”
For more information on Deltek’s vision on how cloud ERP can help consulting firms deliver more value, download the firm’s latest report.
* The Gartner report is titled ‘Predicts 2014’. The IDC data is sourced from he firm’s most recent ‘Worldwide Semiannual IT Spending Guide’.
