Consultancies are adapting to the digital world

Marc Cecere

The age of the customer is characterized by customer empowerment, digital technology, and new business models. These factors are changing who buys consulting, what they're expecting, how consultants execute on these projects, and how clients pay for them. As a result, firms including Deloitte, McKinsey, Booz Allen Hamilton, Cognizant and others are changing delivery, hiring and contracting models to:

  • Enable reusable assets and software solutions to comprise the bulk of consulting projects. As clients in an increasingly fast world move away from multi year projects, they expect consultants to do the same. Prefab consulting allows consultants to come in with the majority of the work done and focus their problem solving on the issues that are the most unique to that client. This creates a partially “out of the box” solution that eliminates repetitive work from client to client and reduces lead time considerably.
  • Gradually replace technical generalists with specialists. As prefab consulting takes over the work which generalist MBA grads have done in the past, consultants will look to specialists to solve the complex and unique problems that remain after the reusable assets finish the front end work.
  • Provide near immediate access through On demand consulting. In a connected world where we are used to have everything at our fingertips, consultants are expected to be there in our moment of need as well. Consultancies will need to find the experts, make them available, provide context for the questions and connect them with the client- all at the touch of a button.
  • Change the client vs consultancy mindset through co-creation and risk based contracts. Traditional contracts create conflicting goals between the client and consultants. Value-based contracts create greater collaboration as both parties will be striving towards the same metrics.
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Update Your Balanced Scorecard With Business Outcome And Agility Metrics

Martha Bennett

We’ve entered the age of the customer, where powerful customers are disrupting every industry.  In response, companies will have to change how they develop, market, sell, and deliver products and services directly to their customers and through their partners. CIOs and their teams are crucial to these strategic responses and will have to track transformation and performance with new metrics to go beyond their traditional IT approach to include the business technology (BT) strategy — technology, systems, and processes to win, serve, and retain customers.

Existing approaches to Balanced Scorecards deliver limited value in this new environment. This is why Forrester has created an updated Tech Management Balanced Scorecard (based on the original framework proposed by Robert S. Kaplan and David P. Norton) in which we recommend an approach that addresses four components: business outcomes, agility, health, and service (see Figure).

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How To Unlock Tech Industry Digital Transformation

Nigel Fenwick

It's no surprise that tech companies are vested in the digital transformation of their customers. But many tech companies find it difficult to leave their product-centric models behind and focus on customer outcomes. That's just one of the findings from the research published on digital transformation in the tech sector.

True customer obsession demands an outside-in perspective. Tech companies must learn to see their business from the perspective of their customers; beginning with customer desires and working back to the new digital capabilities that can enable the outcomes that satisfy those desires.

But a common problem for tech companies is their business structure. Built around successful products, the P&L structure in most tech companies reflects internal strength — business capabilities if you like — the structure optimizes the ability to bring specific products and product features to market. But from the outside looking in, the product structure can seem at odds with what the customer wants. I can't count how many times the same company has treated me like a new customer, even though I already own one of the products made by the brand — my guess is you've had a similar experience.

Of course this isn't a problem unique to the tech industry. But the tech industry sits at the heart of the digital transformation of many businesses — helping their customers take advantage of their technology to transform their businesses. So you might be forgiven for expecting the tech industry to have figured out it's own transformation already. Not so much.

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BMC Wants A Greater Share Of The Digital Economy

Nigel Fenwick

Last week I attended BMC's Engage event, an analyst forum in Vegas, as a guest of BMC. Like every other technology vendor, BMC would like a greater share of the emerging digital economy.

With more and more businesses moving to the public cloud, I have no doubt in my mind that the on-prem data center market will diminish quickly over the coming years. I also expect mainframes to go the way of the dodo within 10 years, but many others have previously predicted the demise of mainframes and time has proven them wrong, so I accept I may also be premature.

BMC, a bastion of IT operations, now wants to help IT leaders become drivers of digital business. Indeed, BMC has positioned many of the current raft of product offerings to help tech leaders deliver a more efficient and agile tech capability for the business. And this is important. One of the biggest challenges for many large technology teams is their lack of agility. In the age of the customer, tech teams need to tap into every opportunity (and automation capability) to drive greater agility and efficiency throughout their technology delivery capabilities.

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Forrester Continues To Lead CX Research In China And Shares The Vision With Chinese Practitioners

Travis Wu

Forrester conducted another successful conference last Friday, September 1, at our Customer Experience (CX) Marketing Shanghai 2016 Forum.With insightful content, influential industry speakers, and great event organization, we are grateful for the excellent feedback that we received from the delegates who were present.

A total of 190 CX and marketing professionals attended this event, joined by 23 Forresterites from all over the globe. As the event host, I was approached by many attendees during the networking breaks and at the end of the event who unanimously expressed their appreciation and their willingness to work with Forrester for their CX initiatives. CX, though in its early stage in the China market, is getting traction from senior leadership in many organizations, and Forrester is definitely at the forefront of CX research in challenging thinking and leading change.

Forrester analysts and our distinguished guest speakers shared their insights into the following topics with the audience:

  • Innovation. From the latest digital trends to design thinking, companies now have access to an arsenal of methodologies and tools to improve their CX and drive sustainable business growth with CX excellence.
  • Social. Social media is indeed an integral part of our lives, and CX and marketing pros ought to leverage it to take their CX to the next level. Speakers from Tencent, IHG, Decathlon, and Social Touch showcased their thought leadership in this area and demonstrated that social media can help up your game and generate tangible results.
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Frugal Innovation Supports Customer-Obsessed Innovation

Dan Bieler

Photo: Indian By Design

The age of the customer demands that businesses drive innovation at ever faster speeds and with limited budgets. More than ever, innovation is of the essence, and innovation must be cost-effective. Frugal innovation offers an alternative approach to driving innovation as it is based on the tenet to do “more with less” in contrast to the widespread practice to increase the R&D budget. Frugal innovation:

  • Opens opportunities to cater to people “at the bottom of the pyramid.” Traditional R&D often ignores those customers with lower purchasing power. Frugal innovation specifically targets this customer segment, opening up opportunities for new revenue streams.
  • Is complimentary to traditional R&D, not a substitute. Frugal innovation will not replace traditional innovation, but it will add a new approach to drive innovation.
  • Requires a change of mindset and a different approach to innovation. The frugal innovator’s mindset sees constraints not as a disadvantage, but an opportunity. Frugal innovation supports and furthers a mindset for global innovative collaboration.
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How To Solve The Digital Dilemma

Nigel Fenwick

There's a fundamental difference between companies that apply digital technology as a bolt-on (frequently adding an eCommerce site, social media, or customer mobile apps) and those that take a more holistic approach to transforming the way the company uses technology to deliver better customer outcomes and drive revenue. 

Transformers are more likely to succeed because they recognize their customers' expectations are evolving. The executives in these companies redesign their business to evolve alongside the expectations of their customers. These companies are obsessed with helping their customers achieve their desired outcomes, and they continuously explore new ways to do that profitably. This is why transformers are destined to become digital predators while bolt-on companies are more likely to become digital prey.

One of the distinguishing characteristics of many transformers that caught my attention back in 2013 remains a challenge for many companies in 2016: delivering digital operational excellence (DOX). DOX focuses on the ability to use emerging technologies to change operational aspects of the business (those not directly touching the customer) to create business agility in service of the customer. Why is this important? Because without the ability to evolve quickly, your company will fail. This is the digital dilemma.

I use this simple equation to illustrate my point:

The Digital Dilemma. Formula: Perceived Value equals experience over expectations. Source: Forrester Research @NigelFenwick

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Big Data, Big Growth, Big Promises

Jennifer Adams

In the age of the customer, insights-driven businesses use big data solutions to gain business insights, create differentiated customer experiences, and drive competitive advantage. In our recently published Big Data Management Solutions Forecast, 2016 To 2021 (Global ), we take a more in-depth look at the software solutions to manage big data.

Big data management solutions address data sets that are so large and complex that traditional data processing applications are inadequate. Nonrelational databases are one of the key tools to manage and search the increasingly large and diverse types of data. Scaling is built into nonrelational databases, allowing them to support millions of users and hundreds of terabytes of data. The cost of a nonrelational database is typically only 10% of the cost of a comparable traditional relational database.

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Cisco Takes Next Step To Becoming A Partner For The CIO's BT Agenda

Dan Bieler

Cisco's declared intention to further invest in key priority areas in its portfolio, such as security, IoT, collaboration, next generation data center and cloud, did not come as a great surprise to Forrester.

Last year, we evaluated Cisco’s efforts to transform itself  from a network business to a global provider of business technology (BT) -- the technology, systems, and processes to win, serve, and retain customers -- and a strategic partner to CIOs and CTOs. Cisco launched several programs to change its operational set-up, its business culture, its compensation incentives, and also its skillsets.  

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Bosch Software Innovation Offers Lessons For Digital Transformation

Dan Bieler

Traditional manufacturing businesses must rework the structure and culture of their organization to address rapidly changing client expectations. Bosch is a fascinating example of how a traditional manufacturing firm can successfully transition into a leading digital business. Our discussions with Bosch highlight that:

  • The shift from selling products to outcomes-as-a-service requires business model change. In order to sell business outcomes, Bosch combines business process expertise with technical know-how and an outside-in approach.
  • Digital transformation depends on successful cultural transformation. Bosch’s digital transformation is based on a fundamental cultural transformation that takes every Bosch employee and customer along.
  • Bosch’s software engineering division acts as a catalyst for digital transformation. Bosch believes in a central coordinating role for its software engineering division as part of the digital transformation process.
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