Trust in turbulent times: data access and management as the key to IT services and consulting success in an uncertain 2019
From London to San Francisco, macroeconomic shifts and unsettled political environments in both the U.K. and the U.S. will make the start of 2019 turbulent and likely troubled for many companies, including the IT services vendors and consultancies we cover within TBR’s Professional Services practice. These companies will face harder decisions around repositioning their investments to other geographies or finding more cost-conscious investments in new areas. We are expecting a slowdown in both countries — not necessarily in revenues, but in fresh ideas and creativity, service launches, and expansion in additional markets within both economies — driven by new uncertainty and well-founded caution. The U.S. has traditionally been the largest market for IT services vendors, and no single year will change that hard, economic fact. But where we have seen IT services vendors experiment with new consulting business models that blend emerging technologies into strategy consulting and embed codeveloped IP into outcomes-based IT services engagements, we expect a retrenchment as 2019 opens, with uncertainty lingering at least through the summer. By this time next year, we expect to see more initiatives in APAC leveraging that region’s faster adoption of 5G (and all that means for digital transformation at speed and scale). And we expect the three trends described below will be demonstrably evident in the strategies and performances of the leading IT services vendors and consultancies we cover.
Underlying all of our assessments, we are developing a new appreciation for the criticality of data. Beyond the cliché that every company is a data company or that data is the new oil, we have been seeing throughout 2018 the way IT services vendors and consultancies have begun investing increasingly in data management, cleansing and protection, all with the assumption that analytics, automation, artificial intelligence and every other emerging technology starts with and relies on clean and useful data. Smarter business decisions do not come from bad data, no matter how good the algorithm or analytics package. For 2019, this means data access becomes an opportunity to extend to all IT services, up to and including digital transformation, the same trust that comes with an audit or a multiyear outsourcing engagement. Imagine a consultancy working with unfettered access to every data element across a client’s enterprise. Getting there may take a changed regulatory environment and will definitely require that boards be willing to extend trust in new ways, a human limitation that may slow this new data access. But we see it coming. If politics and economics could cause stormy weather in the U.S. and U.K., the acceleration of digital transformation through data access may be the longer-term trend, the global warming lifting all boats on rising sea levels.