Wharton’s @Knowledge published an alarming article about professional service disruptions. According to the article there is close to a 94% probability of accounting and auditing jobs becoming automated in the next 20 years. For tax preparation roles, this likelihood climbs to almost 99%. Cognitive AI is expected to replace 30% of business consulting resources by 2017. Should you be concerned?
The article mentions that we live in period of unprecedented disruption across all industries. “Take a look at the turnover rate of the Fortune 1000 over the last 40 years, starting from 1973. By 1983, about one-third of these companies had fallen off the list. By 2013, 70% of the companies were replaced by new ones.” Yet if we look at the big accounting firms, there were a lot of mergers and acquisitions but only one of the now big four toppled over. Similarly with law firms, most of the law firms in the 2015 AM law 100 ranking have roots that go back more than a century. Less than a handful of big law firms failed to survive. It also seems that these disasters, like Andersen, Dewey & Le Boeuf, and Howrey, were mostly self-inflicted and thus avoidable. But is technology going to bring turmoil to all of this stability in professional services?
Rate of change
The introduction of steam engines changed little in professional services; neither did the introduction of electricity. Computers made things easier but most professionals continued doing the same things, just using a screen instead of paper. The work itself did not fundamentally change.
The current technological revolution has the ability to fundamentally change how professionals work. Professionals used to thrive because the information they possessed and the knowledge they had acquired over time was scarce. However, current technologies make information abundantly available, and—by means of artificial intelligence—transform this information into useful knowledge.
Instead of seeing technology as a threat, you can see it as a fantastic opportunity. Consider health care. By 2020 it is expected that the amount of medical data will double every 73 days. It is already impossible for any clinician to keep up with all aspects of the profession. Doctors of the future will need to be taught differently to cope with this massive amount of data, as it no longer is possible to memorize all, or even a fraction of it. If we want our clinicians to have state-of-the-art knowledge, it will be important to teach future doctors how to keep track of trends, and how to use technology to filter through massive amounts of data.
Are you able to take advantage of the opportunities technology offers?
As Harvard Business School Professor Clayton Christensen expressed it very well, “If you are currently on the leadership team of a consultancy and you’re inclined to be sanguine about disruption, ask yourself: Is your firm changing (at least) as rapidly as your most demanding clients?”
Are you keeping up with your clients? Below you can find a short survey to assess your clients’ and your organization’s rate of change. Please score and write down your clients’ rate of change and that of your organization.
Should you be concerned?
A: If your organization’s rate-of-change number is higher than that of your clients’, you are a super innovator—but be careful that you don’t get too far ahead of them.
B: If your organization’s rate of change number is the same as that of your clients’, congratulations, you are keeping pace with your clients. Keep up the great work!
C: If your organization’s rate of change number is lower than that of your clients’, your clients are moving faster than you are. Now is the time to act and work on getting an innovation process and framework in place that will help you become more agile.
Organizing4Innovation is proud to offer the first innovation management approach that is dedicated exclusively to the professional services. For more information seewww.organizing4innovation.com