Anyone in the software consulting services sector is aware that today’s organizations. Face a slew of business issues, both old and new.
The forces that drive change are varied and diverse. The marketplace is being transformed by disruptive technology. The rise of new business models. And the pressures applied by fierce global rivalry. This is in addition to the massive disruption caused by the COVID-19 epidemic. At Hinge, we sought to develop a concentrated understanding of the key concerns.
That firms are dealing with—and what this means for the industry as a whole. As a result, we included it in our 2021 High Growth Study.
Top Business Challenges for Software Consulting Services
The top five overall business issues for management consulting firms give a vivid picture of the current market. Despite the fact that four of the top five difficulties were the same as in the 2019 study. The Figure shows that the priority order has radically shifted.
These are unpredictable times, and nearly 49 percent of respondents feel that market uncertainty is a major business concern. Respondents have undoubtedly felt the waves of new changes brought on by the global COVID-19 epidemic. With a staggering increase of 30% since 2019.
Nonetheless, for many years, management consulting organizations have struggled with unpredictability. The consulting industry is rapidly transitioning from one that relied on heavily. On interpersonal interaction to acquire new business (think networking or personal recommendations). To a level playing field online. That is increasingly where the game is being played. And purchasers are picking the winners.
Only slightly behind market uncertainty is how 47 percent of management consulting businesses are concerned. About the changing ways, buyers buy services. While our data does not provide specifics, we assume that the rising use of online search. Social media, and other non-traditional avenues to identify and evaluate consulting firms, are driving this worry.
Even the manner in which people receive referrals has altered. Today, many recommendations are produced by people. Who has never even employed your firm but have heard good things about you from other sources?
Firms are increasingly creating their online identities. Through sophisticated onsite and offsite content marketing campaigns and direct interaction in social media. Without a question, some businesses are unprepared to react to these developments. However, time is running out. If consulting firms want to compete in this fast-changing environment. They must embrace the digital revolution.
The difficulty of greater competition caused the challenge to drop a rank from last year, but remain in third place. Respondents from management consulting firms are concerned. About competition from both new firms (42%) and larger competitors (35.4%). with the emerging-firm threat outweighing the larger-competitor threat. In fact, these dangers were among the top five issues in each of the industries we evaluate.
What does this discovery imply? Many companies who aren’t major, established industry players. and don’t have a revolutionary business strategy in the works are concerned. about their capacity to compete. After all, the consulting market is consolidating rapidly, and new technologies threaten to commoditize valuable bread-and-butter services. It’s no surprise that companies who aren’t part of any of these movements are concerned about the future.
In 2020, approximately 40% of organizations saw the need for new skills as a critical challenge for management consulting firms. Firms face unremitting pressure to keep up with the ongoing change as new technologies and approaches emerge in the marketplace. If they don’t, someone else will. Keeping up, on the other hand, necessitates the appropriate individuals with the proper skill sets.
For the first time, emerging technologies like automation and artificial intelligence have made. it into the top five anticipated business difficulties, as noted by 36.2 percent of management consulting firms (AI). This is not a problem exclusive to software consulting services firms. In fact, organizations across the professional services’ spectrum listed automation and AI as the third most anticipated business challenge.
Technology that enables consulting firms to automate portions. Of their core business or marketing and sales, operations stood out as an illustrative example of where fast-growth. Firms have a competitive edge over slower expanding peers.
When we go deeper into the 2021 High Growth Study: Consulting Edition. We observe in Figure 2 that high-growth organizations are 42.2 percent. More likely to deploy automation in a more sophisticated manner.