There have been many significant changes throughout the past decade that have impacted how experts in the professional service industry work. The trends associated with the industry are being driven by artificial intelligence and automation. Technology is evolving, enabling companies to expand their horizons.
For instance, telepresence has allowed employers to recruit from beyond geographical boundaries. The second trend that will dictate the future of professional services is automation. It eliminates the need for countless hours on mundane admin work. Employees can now focus on tasks that require critical thinking, such as improving service and quality.
The future of the professional service industry is here, and it looks more like a tech-enabled industry than ever before. The industry has been evolving for decades, but now we are in an era where automation has changed how many professionals work.
Artificial intelligence is impacting everything from marketing to accounting, as well as changing how some professionals manage their virtual offices. There are also new value-driven revenue models that have emerged over the last few years because clients want more transparency about what they are paying.
This article will explore these trends and more in order to predict the future of this industry.
What Are Professional Services?
Professional services are services provided by a professional to their clients. They’re very diverse and can include any industry where the client has an intangible need fulfilled via consultation, advice, or hands-on work.
Professional services are divided into two categories:
– Supporting Services – these are typically more transactional, such as accounting and finance offerings, and are usually in the business-to-business industry.
– Core Services – these are more consultative and include a wide range of industries, such as marketing & advertising services, educational services, or wellness and healthcare services.
The reason companies turn to professional service providers is for their expertise, experience, and business acumen.
This industry is heavily reliant on the talent of people. The future for professionals in this industry will involve many changes as new technologies, and business models are developed.
Businesses are looking to partner with service providers to help them take advantage of these trends or be prepared for disruptions from various innovations.
Business Strategy Realignment
The two main characteristics that set professional service providers apart from most other types of businesses include:
- They offer a customized service to their clients, regardless of the tools or business models used.
- The purpose of building and fostering a long-term relationship with clients.
Innovating within the professional services industry is an essential key to staying competitive. Learning how to use artificial intelligence and other new technologies can provide an opportunity to move your company forward. One example of advanced and robust software is the one that offers automated delivery.
The new trends emerging in the industry are pushing professional stakeholders towards more agile, tech-enabled, and value-driven business strategies.
The future of the professional service sector is now in question. What does this mean for services that are slow to change and maintain their legacy systems and old ways of doing things?
Top Trends Transforming the Professional Service Industry
The industry is in a state of flux, with changes coming from several directions. Some of the most noteworthy trends that will dictate the future of professional services include automation, artificial intelligence, virtual offices, value-driven revenue model, tech-enabled business model, and more. Let’s explore these key industry drivers now!
The Emergence of AI and Automation
Artificial intelligence and automation have been gradually creeping into the industry in recent years, but it is becoming increasingly prevalent as brands attempt to automate their services.
AI has already proved its potential for helping professionals with repetitive tasks or time-consuming ones like data entry, formatting emails, managing calendars, and more.
Automation will be a definite trend to watch out for in the coming years as it offers the industry a chance to develop new, innovative ways of delivering professional services.
AI and automation are also set to impact the industry as they help streamline processes or provide tools that make it easier for professionals to do their jobs.
The future is filled with potential when it comes to these two trends in particular because there will be no shortage of opportunities for brands looking at how AI can benefit them or those interested in what automation has in store.
One of the best ways for professional services to seamlessly solve client needs is data analysis. While effective, these practices can also be time-consuming and prone to human error.
While the onset of artificial intelligence and machine learning has only facilitated this arduous process, it is an integral part of interpreting real-time data to organize large chunks of data into usable information. Organizations are automating back-end work to allow employees to focus on more worthwhile projects.
Globalization and Proliferation of Virtual Offices
The emergence of the internet and other technological advancements has led to a significant shift in how employees communicate. As such, globalization has become more prevalent than ever before. Additionally, virtual offices are becoming increasingly popular as they provide increased mobility for businesses across borders while also simplifying onsite office space management.
Unsurprisingly, the professional service industry will have a lot to gain from this trend. As such, industry experts expect the rise of virtual offices to continue. There will be a global push for more collaborative approaches to office design to accommodate these different work styles.
In the professional service industry, technology-enabled tools have made communication across distance boundaries possible. Additionally, intuitive project and resource management tools have allowed managers to keep track of their projects from afar. Clients are approaching firms based on reputation and work regardless of where they are located.
In the past, many firms were limited to seeking potential clients in their local or regional vicinity. However, with a few exceptions, successful firms cultivate large networks of potential and current clients worldwide by recruiting valued expertise from anywhere outside of their geographic reach.
Virtual offices and remote work have become an integral part of the work culture and environment, exacerbated in recent years by the COVID-19 pandemic. Flexibility has proven to be the trend when it comes to recruiting top talent.
The skills shortage, the coronavirus pandemic, and other unavoidable circumstances have led to an increase in globalization and remote work environments.
Tax and audit services charge the client based on time and checking the accuracy of records. This billing model does not consider how much value is generated out of each task.
For example, an hour of billable work could lead to 10% tax savings for the client. But if the service provider is still invoicing the client based on the employee’s charge out rate rather than on the task’s value, the service provider sees reduced profit margins while the client fails to see the actual benefits of the project.
Firms are now opting for a different type of billing system, the value-driven revenue model, which charges based on benefits and profits.
Agency professionals are now paid for the total gains, such as tax savings, ROI, or insurance claims. This shift from time-driven billing to a value-driven revenue model allows professional service firms to get more clients and increase their profitability.
Tech-Enabled Work Culture for Team Engagement
Statistics indicate that highly engaged teams have, on average, 21% greater profitability. Engagement is also defined by how well team members can use technology and the collaborative systems that support their work.
For example, teams with access to online collaboration tools have a higher level of engagement than those without this kind of software in place. Technology has a massive impact on the way professionals interact with one another and their customers. Moreover, when teams are connected, their productivity increases and gives better results.
Therefore, professional services firms need to build a tech-enabled work environment that will strengthen employee morale and improve their performance.
These growing trends mentioned above have provided ample opportunity for professional service firms to reinvent their roles and redefine the industry. Professional service firms can now take advantage of new trends because they can offer services that provide more value than ever before, which means higher profitability for these companies at the same time as lower costs on things like overhead or rent in a physical office space. For more information, contact us directly and stay ahead of the trend curve!