Unit4 has published research on operational inefficiencies in professional services firms, finding that companies using modern cloud-based platforms report fewer errors than the wider market.
The survey, conducted by Pierre Audoin Consultants, polled 500 respondents from professional services organisations in management consulting, IT services, business and professional services, and architecture and engineering. Participants came from companies with 250 to 5,000 employees in the US, UK, Nordics, Benelux, Germany and Canada.
The findings point to rising pressure on the sector. Six in 10 respondents said work volumes would increase or become more complex over the next 12 months, while many also reported delays, rework and overtime caused by weak internal processes.
Across the sample, 30% said operational inefficiencies frequently or regularly delayed project delivery. That rose to 34% among IT services companies, compared with 25% in business and professional services firms.
Regional differences also emerged. Respondents in the Nordics were most likely to report regular interruptions to project delivery, at 34%, while Canada recorded the lowest level, at 26%.
Fragmented systems
A large majority of respondents said they still work with disconnected software environments. Some 66% said they rely on fragmented application estates, while 19% use multiple systems that require manual work and spreadsheets. In Germany, that figure reached 30%.
Those technology gaps appear to feed directly into longer working hours. Reasons cited for overtime included monthly or quarter-close bottlenecks, identified by 68% of respondents, inconsistent data models at 59%, and outdated technology at 55%.
The data also suggests time is being diverted from client work to administration and corrections. Nearly half of respondents, 47%, said they are forced to spend time correcting timesheets, while teams also work overtime on accounts reconciliation, project cost and profitability management, and project timeline management.
More than a quarter of client-facing specialists, 28%, said they spend more than 30% of the working week on administrative tasks instead of core work. IT services firms appeared to face the greatest strain, with 40% regularly working beyond core hours to complete tasks including timesheet management, budgeting and forecasting, and accounts reconciliation.
Against that backdrop, the research highlighted a smaller group of companies already operating on modern integrated cloud-based platforms. According to the study, 33% of global respondents fell into that category.
That group reported lower levels of errors in finance reporting and in budgeting and forecasting than the global average. In finance reporting, 29% of those firms reported errors, compared with a global average of 37%. In budgeting and forecasting, the figure was 28%, against 36% overall.
Adoption levels differed by country and subsector. The US showed the highest level of cloud-based system adoption at 36%, while Germany recorded the lowest at 22%.
By industry segment, business and professional services firms were furthest ahead in moving to the cloud, at 43%, ahead of IT services at 36%.
"Professional services firms are facing possibly the biggest inflection point in a lifetime as technology disruption and volatile economic conditions encourage clients to reevaluate their use of consulting expertise," said Donna Dobson, Director, Professional Services, Unit4.
"PAC's research shows why modernisation of core processes is giving leading firms an advantage in terms of productivity and reduction of time lost on manual processes and error correction. As competition heats up, firms understand that limiting the impact on their workforce is crucial to retaining talent and delivering projects more efficiently," Dobson said.
Investment priorities
Respondents said their main goals for the coming year were to increase revenue, retain staff and improve cost efficiency. To support those aims, they identified three main areas for near-term investment: modernising operating models, automating repetitive manual work, and improving integration to create a single, consistent view of data.
Support for better data integration was particularly strong. Some 88% said this would improve processes, while 86% said it would improve the predictability of business performance.
Even so, the study indicated that automation remains limited in many organisations. A quarter of respondents said they have yet to automate more than 20% of their core systems, and that figure rose to 30% in resource management, recruitment and talent management, and skills development processes.
Many participants also expect artificial intelligence to change operational work. More than 60% said AI would have a beneficial impact, with 33% saying it would fundamentally change project and resource management processes and 43% saying it would improve their ability to analyse critical data and enhance forecasting.
Nick Mayes, Senior Consultant, at Pierre Audoin Consultants, said firms would need to pair technology adoption with broader workflow changes.
"Many professional services firms are being pushed by clients to transform commercial models to better serve their needs, but this is only possible if firms embrace modern cloud-based systems," Mayes said.
"This will give them the agile, scalable foundations to deliver process automation and adopt AI tools, but it will require investment to optimise and integrate existing workflows so that companies have a single view of company-wide information," he added.
The survey also linked these operational issues to workforce retention. With 59% saying keeping their best talent is a strategic priority, the findings suggest firms see reducing administrative burdens and overtime as part of a wider effort to improve working conditions.