It Consulting Sameer V1

IT Consulting – By Sameer Ahuja Introduction : •

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Technology consulting traces its roots back to several parents. As information technology (IT) grew in complexity in the early 1990s, management consultants found that their strategic recommendations often involved complex and costly internal IT changes. Consulting clients demanded information system implementation assistance along with high-level business advice, so management consulting firms like McKinsey and Booz Allen Hamilton built up practice areas to provide it All of the major U.S. accounting firms also created consulting practices that could leverage their massive existing client bases, offering both business strategy consulting and IT consulting expertise to private sector and government clients Moreover, software firms like Oracle have moved into the consulting field to capture some of the enormous new demand for design, implementation and management of all sorts of technology-based business information processes Finally, newer "pure play" IT consulting firms such as Infosys and DiamondCluster have formed their entire business models around providing clients with technology strategy advice, systems implementation support and/or outsourcing services

Market Overview: • • • •

The total market for IT services reached $250 billion by 1999, with the global IT Consulting/Systems Integration industry accounting for about half of the that market at over $135 billion In 2005, a report from Kennedy Information indicated that the technology consulting market as a whole will expand 8.8 percent annually through 2009. According to an IDC industry survey in January 2007, spending on tech services will grow at a 5.8 percent compounded annual rate through 2010 Analysts forecast that globalization, increasing international deregulation and the need to align business processes with IT systems will drive a consistent demand for IT consulting

Drivers of IT Consulting : System integration When two companies merge, or a single company wants to implement new hardware or software, they turn to consultants to make all the technology compatible. Outsourcing

Some companies find it easier and more cost-effective to pay somebody else to manage their technology for them. The consultants, in effect, become the client's IT department. Enterprise solutions Sarbanes-Oxley compliance , Supply chain consulting are major types of enterprise solutions consulting. IT strategy IT consulting engagements that involve a broad view of the client's business or high-level technology decisions are usually called simply "consulting" or "strategy" projects and often involve aligning a client's IT infrastructure with its overall business strategy. Business Process Reengineering Many technology strategy engagements fall into the business process reengineering (BPR) category. When a company decides to purchase a new software package, or to simply improve its business processes, the result is not just a new IT system of some sort, but usually a dramatic shift in the way people interact. Web services Web services include e-commerce implementation and other secure-transaction work, though consultancies do some page design and site hosting as part of their overall deliverables as well Research and development Some consultants spend their time in the lab creating new hardware and software. Often, this work is geared toward creating new products (servers, analysis software and the like) that will help the consultancy sell work or complete the engagements it undertakes.

Major players in the sector: Systems Integrators Accenture, PriceWaterhouseCoope rs (now a part of IBM), Cambridge Technology Partners (now a part of Novell), and IBM. Web design firms

Large system implementation and integration projects. Tend to conduct higher-priced projects, where they could leverage their scale. Individual firms usually specialize in either technology or strategy. Smaller undifferentiated firms that emphasize technical delivery with little focus on business strategy.

Reinvent themselves by spinning off separate ebusiness consulting divisions, acquiring smaller firms that had ebusiness experience, and using aggressive hiring programs to build Internet capabilities. An estimated 4,500 firms in this category launched specifically for the delivery of web-enabled applications. The number now is considerably less—

Interactive agencies Agency.com, Razorfish, and Modem Media Management consultants McKinsey Boston Consulting Group

Pure e-Business Players Scient, Dimension Data Holdings Application Service Providers (ASPs) Oracle, SAP, and Peoplesoft

Enter the industry from advertising. They tout their creative design, branding, and marketing expertise. View web strategy as an extension of their traditional business strategy roles. They used their powerful brands and high-level client relationships to move into the e-business space, but rarely go beyond strategy into actual application development. Their “pureness” results from being new firms Formed to provide ebusiness services, with no legacy of skills and methods from previous eras. Offer the equivalent of software rentals. Customizes an application package to a particular client’s needs, and then charges back for it through an up-front installation charge and a monthly fee.

probably less than 500 survived to the present. To these firms, web-site design and development was a natural extension of the services they already offered to their clients. These companies continue to lead with strategy and organization consulting. IT consulting remains secondary to strategy.

By offloading the difficulties of developing and operating an ebusiness, ASPs claimed to make it easy for any firm to conduct business on the Internet.

My Analysis : IT consulting, as much as any product or service, creates its own demand. A high degree of industry adaptation in the IT consulting industry will be required in the future. By introducing innovations and educating the market about the competitive benefits of those innovations, IT consulting invents and "earns" its opportunities for growth. This ability of IT consulting to lead and to adapt is a key to its robust development

References: •

http://hbswk.hbs.edu/item/3402.html http://www.vault.com/nr/main_article_detail.jsp?article_id=2641532&ht_type =5

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http://www.hbs.edu/research/facpubs/workingpapers/papers2/0203/03069.pdf

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