AI trends and political change drive consultants' predictions for 2024
After a year of uncertainty, many businesses are entering 2024 with an air of caution – as geo-political tensions, supply chain issues, and rising costs and a tight labour market continue to bite. To help clients prepare for the future, consultants from a range of different specialisms have offered their views on what the key to thriving in the 12 months may be – with a particular emphasis on technology.
2023 was tough for clients and consultants alike. Rampant inflation continued deep into the year, along with lingering supply chain disruptions, meaning growth across many leading economies remained slow. As a result, many organisations paused spending on major projects, and scaled back staffing efforts – impacting the levels of work offered to consulting firms in the process.
However, a number of key trends also emerged, which present major opportunities for growth in 2024. While British companies are still battling to overcome a productivity crisis, the rise of one particular form of technology in the last 12 months has seen business optimism steadily grow – amid the increasing hype surrounding the potential of machine learning and generative AI.
Automation
With this in mind, it is no surprise that many experts from across the consulting sector see AI as one of the defining factors of the coming year. According to Will Gosling, UK consulting growth leader and partner at Deloitte, this will also lead to opportunities for consultants as clients look to get the most from their technology spending.
“Technology leaders everywhere will continue to be under pressure to deliver value and growth for their business,” says Gosling. “Delivering value at pace and getting quicker return on investments will be key, and as consultants that’s where we need to be adding value. However, implementing and creating value from new technologies, whether that’s a cloud system or a generative AI tool, can face many potential pitfalls.”
To that end, Deloitte’s ‘Measuring Value from Digital Transformation’ – where 1,600 global business and technology leaders were surveyed – found that three-quarters of UK organisations believe that digital transformation is the single most important investment they can make. But there are still multiple barriers facing firms, with 37% identifying legacy systems and 33% saying difficulty funding were the leading obstacles – ahead of 31% who said either insufficient data or cross-departmental silos were the biggest issue.
In response to this, Gosling explains that it is crucial that organisations first develop an understanding of the barriers they face to digital transformation. Only once the barriers are fully understood, can they be alleviated allowing organisations to maximise value from their current digital capabilities, while opening the door to new ones.
He concludes, “Organisations should consider value in a holistic way, putting in place a strategy which reflects the multifaceted nature of digital transformation. Focusing on a wider range of KPIs can give a better view of the wide-reaching consequences and adopting a broader outlook on the consequences of digitisation can also reinforce confidence in investment decisions. To achieve the best outcomes, organisations need to balance short term value delivery while not losing sight of and focus on the long-term benefits - the results of true digital transformation are worth the wait.”
The increased adoption of AI technologies was also something which Mark James, an Airwalk Reply senior architect, anticipates will make a major impact in the coming year – automating routine tasks, allowing companies to focus on higher-value activities. This will include the expansion of AI-driven chatbots and virtual assistants with advanced natural language processing capabilities and a better understanding of customer preferences, but he also believes that financial operations functions will see a transformative impact from AI in 2024.
“AI will begin to transform various industries,” he notes. “In 2024 we can expect further integration of AI into financial operations, including risk assessment, fraud detection, customer service automation, and portfolio management. AI-powered algorithms will continue to improve decision-making processes and streamline operations. It's still relatively early days so expect to see unintentional data leaks and increased awareness of what we should, and should not, expose to AI.”
Indeed, like any implementation of new technology, organisations will need to take care they do not open the doors to hostile actors. To that end, he foresees organisations focusing on strengthening their cybersecurity measures – but this is something AI can also play a crucial role in, helping to identify potential vulnerabilities and detecting anomalies in real time, helping to mitigate risks and maintain data privacy. Beyond this, though, firms will also have to reckon with the way wider society perceives their AI operations.
“The ethical use of AI will continue to gain traction in 2024,” James adds. “Companies will prioritise creating trustworthy and transparent AI systems, considering fairness, bias, and responsible data handling. Regulatory bodies may also introduce guidelines to ensure the ethical deployment and use of AI within the finance sector. Operational frameworks and compliance guardrails and tooling will begin to emerge that will help to provide assurance and build confidence, which in turn will build confidence and increase adoption.”
With spiking demand from all directions, there will also need to be changes in the technology sector itself. Dom Bridgman, chief commercial officer at Amdaris, contends that to meet with the changing needs of clients quickly and effectively, the key trend that the technology industry should collectively double down on in 2024 is the emphasis on collaboration and cooperation.
He continues, “Businesses who bring their developers into the ‘why’ behind their ambitions stand to best harness the talents of their team. Rather than setting developers loose on a task with the ‘why’ being waved away with an obscure or vague explanation, readily offering up the detail behind it gives a resolute focus and a different perspective, encouraging personal growth within developers. Being allowed into the inner workings and decision-making world of a business makes everyone feel valued and, again, it ticks that box of sharing unique perspectives and collaborating towards new levels of functionality and efficiency.”
At the same time, this could help lead to improved access to talent for technology operators, at a time when filling vacancies remains a key challenge. And for all the hype around generative AI and “shiny new innovations which remain a distraction to businesses”, Bridgman is keen to remind technology organisations that “people are our greatest asset.”
“In the world of technology, new innovations aren’t going to magically produce world-class products. Taking the time to understand your consumers with a product-led and design-led approach will; having the patience to embark on a comprehensive digital evolution journey will; and trusting in collaboration among real people will. By investing in our people, and seeing AI and other technologies for what they are — tools, not solutions — the future looks bright. We can only guess what 2024 has in store for us, but by adopting the right mindset and committing to learn from the past year, we have all the capabilities to meet new challenges and opportunities confidently and creatively.”
Beyond technology
There are other areas of seismic change beyond the world of technology, too. Challenger consultancy Elixirr has spent the last year beefing up its sport consulting offering – and according to partner Bob Skinstad, the sector is about to see some key shifts in 2024 – particularly in regards to the inclusivity of sport.
Skinstad notes, “Perhaps the most impactful shift in the industry today is the growth in popularity of women’s professional sport globally. Fuelled by increased visibility, advocacy by media companies, brands and sponsors, as well as the sheer talent on display by female athletes, viewership and investment has never been higher. In fact, the average UK viewing time for women’s sport on TV increased by 131% last year. Indeed, due to high demand for tickets to see Australia’s women’s football team, the ‘Matildas’, the opening World Cup match was moved to a larger stadium, as was their Olympic qualifier.”
“All over the world, we are seeing attendance and viewing records being broken. This surge signifies a significant cultural shift towards recognising female athletic talent – however, there remains an opportunity for even faster growth. Achieving this requires organisations to maximise media coverage and access, effectively deploy digital platforms to grow engagement, and provide forward-thinking investment at a grassroots level.”
At the same time, the broadening appeal of the world’s largest sports is opening up opportunities for investment. This is leading to rapidly increasing market valuations and media rights deals, which in turn are making sports organisations an attractive financial opportunity for private equity firms.
“In the last couple of years, we have seen high profile football clubs, such as Chelsea and AC Milan, following this ownership approach, while 20 of 30 NBA teams and 18 of 30 MLB teams also have connections to private equity. Investors place an even greater emphasis on tangible returns on investment, driven by increasing commercial revenues, operational efficiency, and performance advantages on the field. As private equity continues to hone in on investment opportunities within sport, we expect to see an even greater investment in digital experiences for the fans, analytics and athlete performance, as firms continue to battle the margins to gain an edge over the competition.”
Not every sector is positioned for major growth in the new year, though. Some are facing stringent budget cuts, and the need to find efficiency savings quickly. As the UK’s education sector faces a number of major headwinds, its organisations face a number of tough strategic decisions, according to Julie Mercer, the UK office lead at Nous Group.
She states, “In this environment, the ability to work collaboratively and bring staff on what can often be an unsettling journey will be a key leadership challenge across industries. We are already seeing this play out in the higher education sector and it’s only set to intensify. Ongoing industrial relations challenges and increased uncertainty around student recruitment and retention means there is a growing need to change the business model while recognising staff are increasingly feeling destabilised by pressures on the sector.”
After significant efforts to recruit more international students as a means of boosting tuition fee income, most institutions are now aware that they can’t just grow themselves out of their current problems. According to Mercer, they must instead address their cost bases and develop more agile, responsive delivery models. This is something which will also factor into the wider public sector – especially in an election year.
“Government is grappling with financial challenges that are not going to disappear anytime soon,” Mercer added. “This requires strong leadership and a strong civil service but retention remains a challenge across Whitehall. The value proposition and career opportunities for the civil service needs to be reimagined with a strong emphasis on culture, career development and modernisation while promoting the important role staff play in designing and delivering policy options that support economic and social value creation.”
Looking ahead, addressing these types of leadership challenges successfully will necessitate consulting partners, Mercer contends. These partners can bring deep expertise and cultural empathy unencumbered by established or institutionalised approaches, “inspiring clients to think differently and to realise “a new level of aspiration to redefine success in an ever-changing landscape.”
UK consulting
This is echoed by Tamzen Isacsson, the chief executive of the Management Consultancies Association. According to her, whatever happens in the next 12 months, in the private and public spheres, the UK’s consulting industry will play a central role in helping private and public sector entities adapt.
Isacsson says, “Much will stay the same and much will change. Brilliant firms will still deliver brilliant client work. The consulting sector will continue to outperform the rest of the UK economy with growth expected at 9% according to our latest industry figures. Exports will continue to grow as clients across the globe turn to the UK as a global centre for consultancy services, with increased growth expected in the Middle East and across Europe. But there will be rapid change as our industry will drive huge efforts around the safe development and deployment of AI for clients but much will stay the same in terms of our profession’s role in providing clients with the latest innovation and expertise and trusted advice.”
Isacsson adds that the consulting industry will “continue to work tirelessly for clients,” even as “some in the media will continue to unfairly criticise it and get their figures and stats on growth wrong”. In the meantime, the MCA will continue to champion the industry and provide authoritative data – while strengthening the industry’s credentials, as the number of Chartered consultants continues to increase, amid rapid adoption of the ChMC charter.
The UK’s consulting industry has been key to answering many of British industry’s biggest questions in 2023 – something reflected by the record number of submissions sent to the MCA Awards, recognising the contribution of advisory firms to the country’s economy. Looking ahead, Isacsson expects another bumper year of submissions, as consultants continue to make the difference for clients across all sectors – in a year of lingering uncertainty.
She concludes, “With several key elections happening in 2024 and the ever-increasing frequency of destabilising geopolitical issues, as well as events highlighting our climate change risks, consultancies will continue to have to provide strong leadership and expert advice across the world. We will eagerly await the outcome of a UK election and probably spend most the year looking for answers we won’t get for some time.
