We, Mandeleo, spent the early days of the pandemic testing our hypothesis: professional services will require serious business and digital transformation to navigate through (and beyond) the pandemic. All partners have worked extensively in or around the professional sector in our prior jobs so it was relatively easy for us to identify key areas of concern within the sector from our perspectives:
- Lack of differentiation:
With the increase in competition, many professional service businesses find it difficult to differentiate themselves from their competitors. Beyond reputation and previous experience, there isn’t much that existing operators showcase to stand out amongst a sea of competitors.
- Commoditisation:
Another problem is commoditisation when businesses offer services that become indistinguishable from the same services offered by another company. While differentiation speaks more to the business, team and brand, commodification refers to the services themselves. Most services in the market look and feel the same.
- Low barriers to entry:
The current market also has extremely low barriers to entry, which means that there are a plethora of new businesses popping up every week, offering the same list of professional services. With the three issues stated above, how is one supposed to make an informed decision to pick an experienced right team with bespoke services suited to your needs?
- Fragmented market:
The professional service market is also heavily fragmented. Independent operators/outfits live in their own space while bigger conglomerates inflate prices and reduce any ownership for their staff and professionals.
- Lack of trust:
Trust is an issue that gets compounded when you add all of the above. Should you trust an independent firm or a conglomerate? Will you get a better price with the former or the latter? What about trusted reviews? Eventually, as a client, you’ll leave with decision fatigue without choosing a winner.
With all that taken into account, we needed to address each point one by one and create a playbook for future investments and portfolio companies. There is no one-size-fits-all answer to this question since the professional services sector is composed of many different types of businesses, each with its own unique needs and challenges. However, we can use some common themes and strategies to help digitally transform the professional services sector.
- Focus on customer experience: One of the most important aspects of digitally transforming the professional services sector is focusing on improving the customer experience. This can be done by investing in technologies that make it easier for customers to interact with your business, such as online booking systems, online quoting tools, and live chats and support.
- Enhancing communication and collaboration: Another important aspect of digitally transforming the professional services sector is enhancing communication and collaboration between businesses and their clients. We aim to invest in technologies that make it easier to communicate and collaborate, such as proper video conferencing, project management software, and online collaboration tools.
- Automating processes: Our ethos is centred around investing in technologies that automate repetitive tasks, such as customer relationship management (CRM), resource planning, and workflow management software. It’s easy to say but hard to accomplish and our choice of platform or software will change and evolve as we scale. It’s important to implement scalable solutions from the start to focus on delivering our services rather than the operational burden of creating new processes.
- Improving data flow and analytics: The final aspect is improving data analytics. We must invest in technologies that make it easier to collect, analyse, and use data, such as business intelligence (BI) software, data mining software, and data visualisation software.
As with all areas of business and life, the theory is often much simpler than the execution. As we continue down this journey, our efforts in the early days will be to convince the existing stakeholders that our solutions can improve their lives and performances. To grow and nurture alignment, we need individuals to buy into our strategy, ideas and, most importantly, our team.
Until next time.
