A recent independent survey of over 250 professional services firms has uncovered the impact of these realities on the service-oriented firm. These findings highlight significant disconnects between the ultimate desired operational state of the services firm and their current ability to execute to achieve that state. These findings clearly illustrate a trend in the services industry that includes:
The achievement of acceptable processes and automation of tactical resource planning/management has resulted in a shift towards considering the strategic impact of the manner in which the talent inventory is managed.
Aggressive prioritization of service line profitability in order to ensure the acquisition, development, retention, and integration of talent pools drives firm success.
Active search for areas of possible improvement over the management of the talent inventory that will positively impact the firm’s ability to improve service-line profitability while decrease operational inefficiencies.
The nature of these trends seems to suggest that service firms are beginning to identify a need to treat the talent inventory with supply chain-like discipline, but are poorly prepared to optimize day-to-day operations of the talent inventory that would permit a true talent supply chain.
The survey indicates that professional services firms must evaluate their business processes, project outcomes, and internal systems to identify gaps that preclude them from better integrating talent strategies with service line objectives. By asserting greater control over internal resources and procedures, while measuring and sustaining customer satisfaction levels and enhancing their talent pool in order to anticipate and meet future demands, the typical service firm can expect to:
- Enhance revenues by improving delivery performance and speeding client response
- Improve talent productivity at lower costs
- Fine-tune forecasting precision and shorten planning cycles
These survey findings will identify the industry-reshaping challenges that are compelling innovative professional services firms to improve the return on their investments in talent with a holistic, end-to-end, optimized process. In addition, this survey highlights the outdated, internal processes professional services firms must modernize to make the most of their talent resources and grow their profits.
While manufacturing companies have invested millions in more efficient processes and technologies to optimize their supply chain, the professional services industry has been slow to apply a fully optimized supply chain management process. 80% of respondents from the survey indicated that the processes they use now for business development, resource management, and HR management were only somewhat or not at all integrated.
There is sorely limited advanced planning in the professional services industry overall. Inefficient staffing decisions prevail, prompting the unnecessary use of third-party contractors. More than half of the survey respondents identified squandered revenue opportunities and a decrease in client satisfaction as the key problems associated with improperly forecasting client demand based on available skill sets.
Most firms realize that optimizing talent management is crucial. 68% of surveyed firms acknowledged that, when taken together, core talent management – including retention, recruitment, training, and knowledge management – outshine performance and compensation when it comes to staff development. These results crystallize the importance of these tasks to a firm’s success. However, in a surprising disconnect, 85% rated their talent management and staff development programs as standard, rudimentary, or, even worse, nonexistent. In short, services firms are not satisfied with the current processes critical to their success. There is a significant opportunity for services firms to improve these talent management areas – and reap the benefits of doing so.
Professional services firms must address a wide range of operational, organizational, and planning challenges if they are going to optimize their talent and improve profit-enhancing performance. These vary from offer development and supplier management to retaining the best and brightest, planning resources effectively, and increasing visibility in the sales pipeline.
To improve operations that impact profits, professional services firms must also hack through three thorny market thickets: globalization, the focus on individuals over the brand, and client sophistication. To do so requires that professional services firms think in terms of a holistic, talent supply chain management environment. To extend market reach and improve the bottom line, these firms need to look at the whole talent supply chain, ensuring that they are retaining the talent needed – and optimizing their own talent reserves – to meet ever-increasing client demands for quality, delivery, and speed.
