Technology In Business – Is Digital Driving Better Investments And Outcomes?
The influence that emerging technology solutions are having on profitability is substantial. It means margins, revenue and cash flow can improve and remain high, and you can provide better returns to your shareholders. It is these potentially transformative changes and standout returns that are cajoling firms to spend some hefty figures. According to 2018 SPI research and Gartner “Software spending is projected to grow 8.6 percent in 2018 to $381 billion. IT services spending is on pace to grow 4.7 percent in 2018 to reach $966 billion”
Deltek’s research ‘Insight to Action, The future of the professional service industry’ supports these predictions with 74% of firms surveyed confirming they have capital to invest in technology. As a technology company it goes without saying that these numbers make us optimistic about the impetus being put on technology as an enabler for this growth.
However, with almost every industry going through some change, for better or worse, organisations are being barraged with the buzz and hype of new (and often exciting) innovation that is resulting in a lot of pressure on firms to adapt and adapt quickly.
With the extent of choice, such as AI, big data, machine learning and blockchain we also understand how important it is for firms to consider potential issues such as the scarcity of labour or expense of technology-literate employees that could restrict a firm from achieving full potential from their investments.
Professional Services Trends Report 2018
Deltek are uniquely positioned, as a specialist in this Industry, to advise our clients on the allocation and meaningfulness of solutions. We take an uncompromising approach to excellence to ensure any adoption of new technologies not only increases efficiencies but supports the strategy of the entire organisation, away from hype and speculation. Some specific key recommendations we offer are;
1) Technology Is A Business And Not Solely An IT Initiative
Digital Transformation is an initiative that impacts an entire organisation. The word digital often puts emphasis on the technology function of a company when in reality it’s a rework for the entire organisation.
Firms therefore need to figure out how they operate within this digital environment to understand any real implication or threat. Intention must be aligned to business strategy, before any deployment can take place.
According to Deltek research 90% of professional service firms intend to invest in cloud enabled infrastructure over the next 5 years and 72% intend to invest in mobile.
This evidence is clear and enough time has elapsed to see firms fighting for survival against more agile, cloud based rivals. To deploy technology solutions like global mobile apps gives their own employees choice and freedom on the move and gives their clients convenience in how they interact with the organisation.
Companies should not be complacent about technological change in order to thrive and remain competitive, as long as they are clear on how the change will enhance their ability to meet client requirements and how it supports the collective logistics of their business strategy.
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2) Technology Is Never The Answer To All Your Problems
Our findings also show that 60% of professional services firms intend to invest in robotics and machine learning whilst 53% intend to invest in artificial intelligence.
If the adoption of AI or robotics is going to enable quicker, more accurate analysis of data to make better decisions for your organisation then it’s worth opting for these huge investments.
However, it is possible to go too fast and too far. Firstly there is a strong need for suitable financial metrics to support the case for any implementation. Firms must pay close attention to the value of the initiative and whether it is in accordance with the financial strategy set by the firm, taking into account investment, market value and sales.
Organisations must also consider the going market rate for talent to support the innovative technology, and whether they are able re-educate existing employees.
For firms with barriers to entry, merger and acquisition deals are also on the rise. But we deter against having profits trapped in trendy firms that don’t weave into the fabric of your own business and wreck the bottom line.
The rising share price of competitors will force many firms to have a visionary mind set towards new and emerging technology but experimental behaviour can only be supported by a generous cash-flow. It’s important to remember that not every technological tool will be the answer to your problems. Strategy, balance and analysis are key.
3) Smart Decisions Over Trendy Experiments
Based on our research 72% of firms intend to invest in project-based ERP software and 69% intend to invest in professional services automation. These are positive numbers that show professional services firms are not timid when it comes to an investment strategy that is fitting to their industry.
A typical approach by many companies is to partner with the right technology vendor to help them develop a coherent plan that creates value over the long term, allows them to remain commercially agile and use their resources wisely.
Making wise decisions in the current opportunistic market is more important the ever. Organisations cannot afford comparatively meager benefits considering the amount of investment new innovation is demanding.
Balance and alignment in accordance with the size and scale of your organisational strategy will always be key. Investments into technology will grow larger in the years to come, but they must be based on smart decisions that increase the robustness of the organisation, with partners you trust –not trendy experiments that blight your balance sheet.
2018 Industry Report
Professional Services Trend Report
- Agency Workflow
- Architecture and Engineering Firms
- Business Intelligence
- Change Management
- Cloud ERP
- Consulting Firms
- Deltek Customers
- Financial Management
- Job Costing
- Legal Sector
- Marketing and PR Agencies
- People and Culture
- Professional Services Automation
- Professional Services Industry
- Project Information Management
- Project Management
- Resource Planning
- Talent Management
- Time and Expenses
- Traffic Management
- Transformational Trends