Innovation and sustainability: A dynamic duo for Professional Services
As business leaders, it is important to stay abreast of the most pressing topics of the day, and two of the most significant topics for professional services organizations (PSOs) are innovation and sustainability. Firms can remain competitive and secure long-term success by harnessing innovation while overcoming legacy barriers and committing to sustainability strategies despite the changing economic picture.
In this blog, we will explore these two areas of innovation and sustainability and how they can be used to help professional services businesses gain a competitive edge. We will also look at some of the results of the 2023 PAC report on this topic and what it means for service-based companies.
In our evolving business landscape, innovation is crucial for professional services businesses to stay ahead of the competition. With technology and digital transformation driving major shifts in the industry, firms must recognize the importance of embracing innovation. It is no longer enough to rely on traditional practices and outdated systems. Innovation allows businesses to streamline processes, improve efficiency, and enhance client experiences. By embracing innovative solutions and staying ahead of industry trends, professional services businesses can position themselves for long-term success.
Overcoming legacy barriers to innovation
Innovation is key to staying ahead in the professional services industry, but many businesses are held back by legacy barriers. These barriers can include outdated technology and resistance to change. Firms must embrace digital transformation and leverage new technologies to overcome these challenges. By investing in modern tools and systems, businesses can break free from outdated practices and open themselves up to new opportunities.
In the 2023 PAC report, the study states that PSOs plan to ramp up their investment in many aspects of technology in the year ahead, but tech is also identified as a major barrier to innovation. More than three-quarters of business leaders (79%) view legacy applications as a significant barrier, and the challenge is felt most among architecture and engineering firms and IT services providers. The overall proportion of business leaders identifying legacy systems as a barrier has increased since last year’s study, which suggests the problem is becoming more acute and urgently needs addressing.
The second big obstacle highlighted by business leaders is a lack of integration between applications. Over the last decade, many firms have been through a period of aggressive M&A activity and have also leveraged cloud-based tools and platforms to develop new applications in an often scattergun manner. As a result, many IT leaders at service-based firms are now trying to drive greater standardization and integration across the software estate to support corporate efficiency goals. Just over three-quarters (76%) of firms identify this as a challenge, led by firms in the financial services and “other” business services categories.
Why sustainability should be a priority for PSOs
Sustainability should be a top priority for professional services businesses. Not only does it align with the values of environmentally conscious customers, but it also provides a competitive edge. By implementing sustainable strategies, businesses can reduce their carbon footprint, increase efficiency, contribute to a greener future, and be of more interest when looking to recruit and retain employees. Additionally, embracing sustainability can lead to cost savings and improved brand reputation. As the world becomes more focused on corporate social responsibility, professional services firms that prioritize sustainability will be well-positioned for long-term success.
The 2023 PAC study found that more than three-quarters of firms said their ambitions at least remain at the same level as they did 12 months previously, while less than a quarter (22%) state that they have become less of a priority. This positive picture reflects the growing number of organizations in the sector that have reaffirmed their decarbonization targets in recent months. Some 39% of organizations in the Benelux region state that their ESG strategy has become less of a priority, compared to just 15% in the UK. In comparison, 40% of US and DACH region organizations state that it has become more important to their business in the last 12 months.
From an industry perspective, architecture and engineering (23%) and financial services firms (22%) believe ESG issues have increased in importance, while management consulting firms are more sanguine. For many professional services firms, achieving Net Zero status can be as far off as 2040 or even 2050. More than half of business leaders (56%) view transitioning towards renewable energy sources as one key area, and it is an area where many firms have made new commitments in recent months.
Key takeaways from the 2023 PAC Report
Innovation is a critical topic given that the high proportion of firms participating in this study see the launch of new products and services as a key aspect of their growth ambitions in 2023. In the recent PAC report, 44% of those surveyed plan to invest in their digital transformation strategy. And despite economic challenges, most business leaders maintain their commitments to decarbonization and are even accelerating their ambitions, presenting a promising opportunity for sustainable companies.
However, many businesses need more insight into operational metrics to develop offerings and target clients. Legacy applications hinder innovation and pose a challenge for professional services firms. And transformational change requires organization, planning, and implementation. Firms must consider future requirements and recognize that new systems may require new processes to simplify, reduce manual tasks, decrease errors, and boost resilience.
Modern platforms are in demand for project and workforce management but must be integrated with other key applications for greater efficiency and insight.
How Unit4 can help your organization become more innovative and sustainable
In the future of professional services, innovation and sustainability will be the driving forces that shape success. By embracing innovation, businesses can stay ahead of the competition and provide superior client experiences. By prioritizing sustainability, firms can contribute to a greener future and align with the values of environmentally conscious customers and employees. As technology continues to evolve and the need for corporate social responsibility grows, it is clear that innovation and sustainability will be essential drivers for the future of professional services businesses.
Unit4’s software is designed for organizations like yours. Our comprehensive suite of solutions gives you the tools you need to strengthen resilience while driving innovation and sustainability.
You can check out our suite of solutions here for more information.
