The professional service industry as a whole has emerged as a leader in incorporating digital tools and trends in business. Compared to other sectors, business service firms have adopted digital tools at a much faster rate due to the inherently client-focused nature of the market. However, this has not been universal within the entire vertical and often proceeded in spite of traditionally-focused processes that have dominated the value systems of many firms.
Digitization, also know known as digitalization and the digital transformation, encompasses the implementation of any and all digital tools and technologically-driven methodologies into existing business practices. Applying a digital approach within professional services means digitizing any number of areas in the traditional service firm framework, such as client-facing processes, internal procedures or budgetary functions. Future leaders in professional service digitization trends will discover ways to apply digital solutions for all three segments while adapting company culture to integrate with the new digitized business world.
Here are 13 developing business trends in the professional service industry:
1. From Accounting to Legal Firms
The deployment of digital applications by various professional service firms has historically depended upon the subsector they occupy and the size of their business. Larger accounting agencies have been at the forefront of implementing digitization strategies because smaller CPAs and many law firms have not followed suit due to a mixture of budget concerns and reliance on traditional practices.
2. Room for Disruption
The current trend among professional service verticals has been to generally only adopt digital tools and practices that have caused minimal shifts within existing processes. The continuing emergence of new technology creates the potential for some firms to heavily disrupt their sectors.
3. External Drivers
The onset of Generation Z ,the first generation to actually be born into a digital world, , is continuously driving industries into digitization. Professional services will not be exempt from this and will have to adjust practices to meet true digital natives who are completely removed from traditional methodologies.
4. Digitally-powered Specialization in CPAs
Accounting SMBs have lagged larger firms in moving to digitized processes, but the transformation of the market to emphasize value delivery over commodification will empower smaller CPAs to segment themselves by specialization focus.
5. Digitization of Law Services
Legal firms are a prime candidate for digital disruption – the entire sector has slowly adopted basic digitization models, and more often on the personal level as opposed to organization-wide. There are already mobile applications that deliver legal device on demand.
6. Automated Professional Services
Automation is a key component of digitization and will become a significant disruptor for professional service firms. While there have been concerns over whether automating key accounting roles will lead to excessive downsizing and job reduction, other industries have established a precedent for leveraging automation to augment existing tasks that can be applied to professional business service positions.
7. Digitized Talent Acquisition and Management
The digital transformation increases opportunities to streamline talent management processes and optimize value delivery by skillset in a professional service setting. It enables human capital management to shift to an on-demand basis that improves contingent worker engagement for the internal processes for all professional service firms as well as particularly for staging agencies.
8. Professional Services in the Cloud
Cloud computing allows for real-time communication and collaboration, which has enhanced the viability of a distributed workforce. Professional business services leveraging the benefits of cloud software gain increased flexibility in managing remote and contingent employees, as well as the ability to alleviate time costs from traveling and working within separate time zones.
The greatest value of digitization in any industry is the enhanced ability to capture actionable data. Within the professional services industry, performance tracking powered by comprehensive analytics connected to real-time data touchpoints will deliver accurate measurements of project and personnel impact, as well as ROI for both.
10. Business Services AI and Machine Learning
The legal advice app mentioned previously represents only a fraction of the potential artificial intelligence and machine learning can provide if deployed by service firms. AI-directed bots can fulfill high-level customer service and administrative tasks to cut down on repetitive and time-consuming processes, and conduct more comprehensive, faster, and more selective data capture functions.
The migration to a digital age does come with potential dangers as networked technology is susceptible to being breached by dedicated attackers. However, this is a reality of an increasingly digitized world that many institutions are beginning to face more seriously in the wake of repeated hacks and data leaks. With regulatory agencies enforcing stricter requirements for several sectors, including financial services, firms will have to review and improve their process controls to include digital platforms within security guidelines.
12. Services as a Technology Resource
The biggest challenge for more traditionally-minded service firms will be to integrate the digitally native mindset of the younger client base and then expand upon it. Digitizing professional business services will not only demand providing customers with digital tools but leveraging expertise with modern platforms to enhance the experience of stakeholders.
13. Cutting Internal Costs
Each trend mentioned contributes to the most beneficial value capture development digitization provides for the professional service industry – maximizing ROI. Isolated examples of individual components of the digital transformation being implemented have led to huge cost savings, which reflects a greater potential to improve margins organization-wide for a fully digitized business service firm.
Technology Will Transform Professional Services
An outcome-based economy creates an even greater demand for professional services, but it also generates an expectation of service professionals to reflect a deeper understanding of the technology that enables value delivery. Digitization provides only as much value to business service professionals as they can provide to their clients.
Read through these five benefits of leveraging a modern ERP solution for professional services to learn how implementing state-of-the-art cloud software enables you to deliver increased valued to your clients.
Want to know more?