TREND WATCH

The professional services market has gained significant importance with the end-customer demanding for high-degree of customization and increased predictability of the product. This has also created a significant opportunity for the product companies to drive back the expenditure flow as services revenues.

However, setting up and maintaining a dedicated professional services team is not free of challenges. The software product companies are facing a myriad of challenges, such as technology, delivery, business models, and people management.

Professional Services Challenges

• Manage variability in revenue with appropriate resource staffing
• Low margins by high fixed cost of PS resources
• Attracting junior/mid level PS resources
• High cost of customer acquisition resulting from demo/POC cycles
• Rapid product implementation to meet the flourishing market requirements
• Lack of geo-blended team with short ramp-up time
• Mature global delivery model
• Reduce the risk of deploying new technology
• Enhance the usability of software solutions

Trends
The quality and predictable implementation is key for a product’s success. Key trends that are shaping the PS market are:

1. Changing technologies and their business models from licensing to services creating increased need for innovation in sustaining the revenue inflow
2. Changing the traditional thinking by offshoring professional services to drive down the product implementation costs
3. Global sourcing and global delivery models for rapid product implementation
4. Creating outsourced PS teams (built by product engineering partners) to reduce the dependencies on system integrators and drive back the expenditure and increase the services revenues through offshoring
5. Enabling the product architectures to make them more customizable to meet the end-user demand for higher degree of customization and interdependency of their systems

What you need is a partner with comprehensive PS strategy, execution track record, and business model with risk/reward sharing. The selection criterion has also changed from the traditional technology understanding and presence in the offshore location. Today, a professional services partner should be able to:

1. Strategize efficient resource structure to handle peaks and valleys
2. Provide engineering services throughout the SDLC
3. Reduce the implementation cost to drive competitive TCO for customer
4. Meet the resource requirements through trained on-demand resources
5. Drive proven delivery capabilities and execution methodologies
6. Provide innovative on demand, online implementation support for PS