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Start consulting service

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  • 1. Rajesh Maji
    Starting an IT Consulting Practice
  • 2. Agenda
    Why consulting
    The valued proposition of consulting practice
    Few critical points
    Indian consulting market
    Few areas of consulting
    Ten technologies
    A basic business model
    Recommendations
  • 3. Why consulting
    For SIs, ISVs and IHVs, only dependence on technology is not sufficient as technology is evolving very fast and sometimes is bringing destructive innovation
    The importance has shifted from products and solutions to customers
    Less differentiating factors in products and solutions
    Rather than only technology implementations, companies are thinking of business process improvements and optimizations
    From distributor to partnership, technology companies want to move up customer relationship ladder
  • 4. Consulting ….. A valued proposition
    Doesn’t depend on technology
    Drives the revenues of existing businesses
    It doesn’t sell the product or solution, it only consults and gives credible advices to customers. It improves the customer facing outlook
    It doesn’t have tangible asset. No major investment required
    In bad economic times, it is more weathered than existing businesses
    Can give sustainable competitive advantage
  • 5. Few critical points
    It takes considerable long time to develop
    A long term planning is required to develop, compound and sustain in-house intellectual capital
    Depends on key partnerships
    No barrier to entry. Strong knowledge base will create a competitive advantage
    Cannot be valued in monetary terms. Market cannot predict the NPV of consulting services properly
    Many many companies aspire for but very very few become successful
  • 6. Indian Market
  • 7. Consulting, Development & Integration Service Market, India*
    CAGR 16.8%
    CAGR 11.5%
    In Billion INR
    * Source: Gartner1US $ = 45 INR
  • 8. Business consulting and IT consulting, India*
    In Billion INR
    * Source: Gartner1US $ = 45 INR
  • 9. Few areas of consulting
  • 10. IT Strategy Consulting
    Business Vision
    Financial
    Goal 3
    Goal 2
    Goal 1
    Customer
    Objective2
    Objective1
    Objective3
    Business
    Learning
    Project Plan & Budget
    Objective 1 ------------------- Cost
    Objective 2 -------------------- Cost
    Objective 3 --------------------- Cost
  • 11. Enterprise Architecture Consulting
    Business Architecture
    Application Architecture
    Information Architecture
    Technology Architecture
  • 12. Business Agility Consulting
    Orient
    Market Information
    Decide
    Observe
    Act
    Boyd Cycle
  • 13. Few technologies, companies can bet on
  • 14. Top 10 Strategic Technology*
    Cloud Computing
    Advanced Analytics
    Client Computing
    IT for Green
    Reshaping the Data Center
    Social Computing
    Security – Activity Monitoring
    Flash Memory
    Virtualization for Availability
    Mobile Application
    * Source: Gartner
  • 15. A brief business model
  • 16. A Brief Business Model
    Key Partners
    Key Activities
    Key Resources
    Value Proposition
    Customer Relationship
    Cost Structure
    Revenue Stream
  • 17. Key Partners
    Major ISV, IHV, SI, IT Strategy consulting and Management consulting companies. Partnership is important for knowledge sharing and developing in-house capacity. A win-win situation has to be created for both. In return of knowledge base, the company will promote the product and services of its partners
  • 18. Key Activities
    Promote consulting practice with existing product and service offerings
    Develop vertical and horizontal consulting knowledge base
    Uninterrupted information and knowledge sharing within organization as well as with partners
    Consulting practice should be owned by all department heads and they should make joint investments to build, grow and sustain this practice
    A structural change in the organization is recommended where all department heads will jointly set the target for this unit and a business management unit will monitor and evaluate this target
  • 19. Key Resources
    People and knowledge will be the key resources
    This department should hold the knowledge base of
    Industries
    Business processes
    Technologies and products
    Partners
    Customers
  • 20. Value Proposition
    Consulting practice will help its customers in growing their revenues and/or reducing the costs of operations and make them adaptable to any business process change by effective utilization, optimization and introduction of technology
    Packaged offering of product, services and consulting
  • 21. Customer relationship
    By introduction of consulting services, the company will share considerable risk with the customers, this in turn will increase customer loyalty
    A one stop shop for all helps
    One to one customer interaction
  • 22. Customer segmentation
    Initially, profiling of all customers of existing businesses and identification of key customers
    By mid term, develop industry verticals and target customers accordingly. Development of key partnerships with a number of enterprise customers is important
    Long term strategy to market on demand consulting services to a wider market to make this service self sustainable
  • 23. Cost Structure
    Only major cost is in acquiring, developing and maintaining human and non-human knowledge base
  • 24. Revenue Stream
    Negotiable pricing depending on the portfolios of customers and service and product offerings
    Initially, consulting should be prepackaged with existing product and service offerings to build its own portfolio
  • 25. Recommendations
    Initial free offerings of consulting services with the existing products and services to the existing customers, then cross selling and in the mid to long term, as standalone service
    Key partnership building
    In house knowledge base development with the help of partners
    Building a practice on future business process change and technology
    Make this service line a profit center for the company
    A change in organization structure shown next ….
  • 26. Representative organization structure
    CEO
    Reporting to
    Business Mgmt. Head
    Setting of Targets
    Service Line 1 Head
    Service Line 2 Head
    Service Line 3 Head
    Consulting Head
  • 27. Thank You!
    Reference taken from Gartner, Businessmodelgeneration.com and CIO Best Practices by Joe Stenzel