At the intersection to the operational future
At the intersection to the operational future
The more processes in companies are digitalized and networked, the more consulting services are needed. Especially in medium-sized businesses, it is hardly possible to keep the necessary know-how for the digital transformation of business processes in-house. Without IT consulting companies, the path to the cloud-based future is a very bumpy one. As a result, the need for consulting services is increasing and ensures solid revenues for IT consultants. According to Analysehaus Lündendonk, the market has seen double-digit growth in recent years. Consultants are brought into the company primarily for classic system integration. But IT consultants are also in demand for the implementation of agile application development, the implementation of cloud services and the first steps towards the use of artificial intelligence, Internet of Things and robotic process automation.
Malicious tongues claim that IT consultants primarily solve problems they have created themselves. In fact, the implementation of a modern IT architecture can hardly be accomplished without external specialists. According to a recent study by the analysis company Lünendonk, IT consultants are in greater demand than ever before. The digital transformation is finding its way into the economy and this is also becoming noticeable in small and medium-sized businesses. Companies are investing in the digital future. Uniform software and interface standards are indispensable due to the increasingly networked value chains. However, internal company processes cannot always be completely customized. Customized clothing is the solution. Standard where it is possible and individual solutions where necessary. Assessing this, developing and implementing practicable solutions is the job of IT consultants.
IT-consulting is a specialized orientation of management consulting, which is mainly concerned with the conception and implementation of projects in information and communication technology. In practice, the boundaries to system integration are sometimes blurred. While IT consultants tend to take over the conceptual part, system integrators are responsible for the implementation. Accordingly, the market is large and confusing. In addition to a few large internationally positioned IT consulting companies, which are often also involved in more general management consulting or strategy consulting, there are highly specialized medium-sized companies and flexibly operating small businesses.
All of them are not only participating in a huge market worth billions, but are also involved in the digital transformation of companies with many small set screws. Because many companies consider their own digital competence to be only mediocre, IT consultants play a key role at this point – they are the ambassadors of the future. After all, the integration process of a new IT infrastructure and more agile information processes can be seen by some companies and IT management as a kind of fundamental turn of an era. This is far more than just replacing PCs and using a powerful fiber optic service.
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Because such changes do not happen overnight, but take an average of five to seven years, according to Forrester Research, solid project planning is particularly important. The result will be a fast and powerful enterprise IT system that is both capable of supporting a company in meeting customer needs and, in the first place, capable of understanding and mapping business processes. In the future, companies will not function by means of an IT infrastructure, but through it. For 70 percent of the companies, the reorganization of IT is one of the central tasks in the coming years. In other words, a heyday for the guild of IT consultants?
In his annual industry study, Lündendonk anticipates somewhat weaker but still dynamic growth. Growth rates of more than ten percent are also expected in the future, because large parts of the economy are still not prepared for the digital future. The biggest shortcoming is the need for skilled workers, or more precisely the shortage of skilled workers. The analysts at Lünendonk see this as one of the biggest growth inhibitors for IT consultancies. In recent years, more and more consultants have had to turn down customer orders because they no longer had any free personnel. Even the large consulting firms had to turn down around eight percent of project requests. In the market as a whole, this rate was close to twelve percent.
There are good prospects for the next generation of IT consultants, who can often decide whether they would rather work in a consulting firm or in the in-house consulting department of a large industrial group. In addition to traditional consultants, data analysts and AI experts are in particular demand. However, in IT consulting, the boundaries to traditional management consulting are becoming increasingly blurred. Successful business models and corporate strategies of the future are simply no longer conceivable without information technology, artificial intelligence and global networking.
This also leads to changes in the market for IT consultants, because the transformation of the economy as a whole does not stop at the consultants’ doors. They have to sell digital transformation as a consulting service listing and at the same time adapt their own processes to the new times. Agility is also in demand in the consulting industry, which is lagging behind. Around 45 percent of IT projects with external support are managed by agile teams, and more than half still function according to the traditional waterfall model of software development. Consultants therefore also have to put their own house in order to be perceived as credible consultants.
This leads to distortions in the market on the one hand, and to new players on the other. While more and more large corporations are setting up in-house consulting, the large auditing firms (also known as the Big 4) are trying to expand their business models to include digital skills, while at the same time digital agencies are penetrating the consulting sector.
However, IT consultants with years of experience and special industry knowledge do not need to fear the new competition. Work is for everyone and experience is still in demand among consultants. And this is no longer necessarily tied to big names. Especially the former consultants from the well-known IT consultancies have good prospects for lucrative contracts with their own small companies or as specialized freelancers. They often also have good opportunities to find qualified new recruits, because they are less interested in an 80-hour week than in a good work-life balance. This is more likely to be achieved in the smaller consultancies.
Companies looking for suitable IT consulting services in Germany have questions. Here are some answers.
Good IT consultancies can put together agile teams for their clients, which on the one hand have special industry knowledge and can adapt to the client's requirements. Good IT consultants can identify the IT consulting and adaptation needs and build a comprehensible scenario for the transformation. In most cases, there is not one right way to digitize and optimize business processes. It is therefore much more important for IT consultants to propagate open solutions with which a company can quickly adapt to new developments. IT consultants who take this into account and at the same time have an eye on the needs of employees and future users can already fulfill the most important requirements of good IT consulting.
The services offered by most IT consultancies are based on their specialization. They can focus more on strategy or implementation. Large IT consultancies can also put together teams in which both orientations are present as part of end-to-end consulting. Thematically, many consulting firms specialize in the system integration of ERP systems such as SAP. They also offer consulting approaches for cloud-based business processes, artificial intelligence and the Internet of Things.
Good IT consultants should speak the language of their customers. This means the industry focus on the one hand and the company view on the other. Communication is the key to successful IT consulting projects. At the beginning of each consulting project, a goal is set and an as-is analysis is carried out. From this the consultants derive their concept for a transformation to the target state. Feasibility studies and performance tests can indicate the feasibility of the concept at an early stage. At this point, the greatest possible transparency and open communication are indispensable for the success of a consulting project. IT consultants who refuse to communicate transparently should not be used for large consulting projects.
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