Every chapter of Living Networks is being released on this blog as a free download, together with commentary and updated perspectives since its original publication in 2002.
Reframing Digital and Professional Services
OVERVIEW: Digital connectivity and integration are dramatically shifting the role of services in the economy. Software is being provided as a service, business processes are readily outsourced, and the functions of the firm can be broken down into defined modules. Professional services now range across a spectrum of business models ranging from digital services to traditional face-to-face delivery. The same drivers are resulting in the rise of professional networks as viable competitors to established firms.
Chapter 9 of Living Networks – Commentary and updated perspectives
This chapter brings together two aspects of services in the connected economy: online software and professional services. The first of these has progressed rapidly, while the professional services market is earlier in its transformation.
The jargon in online software has changed over the last years. IT executives now refers to SOA (Service Oriented Architecture) rather than web services, while online delivery of software is usually called SaaS (Software as a Service) instead of the ASP (Application Service Provider) model. However the principles remain the same.
In the chapter I write about ‘The new modular world of business’ and its implications, a theme I’ve developed a lot further over the last years. One of the best ways of understanding how the global economy is shifting is the move to modular products and services. Business processes are being broken down into smaller and smaller elements and being recombined across organizational boundaries. The whole Web 2.0 world exemplifies this, and the rest of the economy is following suit.
Professional services has long been dealing with the impact of a connected world, with one of the primary issues a powerful drive to commoditization of many previously profitable services. However there are many effective responses, as I have described also in my Seven MegaTrends of Professional Services and Service Delivery Innovation white papers.
The chapter concludes by looking at professional networks. The trend to professionals working together in networks rather than formal organizations continues to be strong. My organizations Advanced Human Technologies and Future Exploration Network implement the principles described in the chapter on how to do this effectively.