Hosted Client Solutions - Scaling Profit through Products
A Proven Driver of Revenue and Increased Profitability
When selling advisory and consulting services the biggest cost to profitability and price competitiveness is the labour cost of delivery. To solve for this, automation and digitisation technology is leveraged however this often requires the IT department of the client to be engaged and for a CAPEX spend creating a friction in the sales process. To solve for this consultancies and SI’s can offer solutions that they host on behalf of the client. This strategy has a proven track record in accelerated sales as the client business function can buy the service as a subscription from an OPEX budget with minimal to no engagement with their IT function.
Benefits Realised
•Commoditisation of expensive technical labour.- Selecting the right tools for the platform allows for graduates or low cost developers with no technical background to rapidly build web and mobile apps, advanced data science algorithms, rich interactive visual analytics and complex data manipulation & governance.
•Proposition scale out – Existing manual, Access or Excel based propositions are rapidly converted to digital applications enabling rapid sale and distribution to clients and prospects. This is complemented by the new propositions enable by the capability.
•Unbeatable rapidly built demo’s – Having access to skill commoditising rapid build technology and a trained graduate and lower grade base allows for high end demo’s to be built and iterated in days that beat out slideware, or Access and Excel demos.
•Variabilised cost of infrastructure and tools – Selecting the right Infrastructure solution and tools means that the upfront investment (Fixed Costs) are minimal and low risk. Cost is designed to grow on a usage basis (Variable Cost) as you sell solutions.
•Business purchase verses IT purchase – More often than not advisory services are sold to the Business. Market evidence shows that being able to sell a hosted solution that doesn’t involve IT engagement leads to higher sales volumes and quicker sales.
•Capex vs Opex – In offering a hosted solution as a subscription, clients can purchase out of more readily available Opex budgets. Clients also like the idea that the have the safety net of being able to cancel a subscription even though evidence is that subscription cancellation is less than 5%.
•Organic proposition development – Putting this capability into the hands of the ‘execution’ grades is proven to lead to significant organic bespoke and generalised proposition development with resources enable to solve complex and large client challenges.
Predictable subscription revenue – The “selling” grades are able to build into their revenue portfolio a predictable component that has no resourcing cost or resourcing management.
Core Components of a Hosted Capability
Mobile & Web Apps – Leveraging the capabilities of a low code platform such as OutSystems enables the rapid building and hosting of advanced data capture applications, case management tools, user interface wrappers for data science solutions, etc.
Data Management - Leveraging subscription licensing with a data management vendor enables hosting of ETL, Data Quality, Multikey Record Matching, Master Data Management and Data Governance capabilities. Vendor partners to consider include Informatica, Mulesoft, AWS and Google Cloud.
Visual Analytics – Clients expect to be able to self service interactive and response reporting and dashboarding. Qlik and Tableau represent the current market leaders in commoditising dashboarding skills. The hosted web versions readily integrate into OutSystems web and mobile apps.
Data Science – Python and R provide low cost tools and libraries for building and executing models. Wrapping these in visual analytics and/or a web/mobile interface creates powerful use cases and compelling propositions. One of the most costly and hard to retain resources are Data Scientist, commoditising this skill using platforms such as DataRobot reduces the time to produce models and the skill to produce a model. Integration with the Data Management tool allows for the rapid and automated preparation of the data for analytics.
Building a Successful Capability
The methodology for deploying and growing a hosted client solution capability is well understood with support available from the team who successfully deployed this capability globally at Deloitte and Experian.
The key deliverables for a successful capability build include:
•Vendor provided online training means staff can be trained with no impact to resourcing base. Key to building up a delivery capacity quickly.
•Variabilised cost allows for a minimal entry budget.
•Awareness and sales training for SM to P grades to drive sales pipeline
•Demo build environment available to all staff to allow demos to be built in hours or days.
•Establishing a low cost support function.
•Single sign on capability so clients sign into hosted applications with the same experience as their internal applications
•Establishing a database of client cloud onboarding questionnaires.