A forward-looking approach to value

Mohamed Kande, PwC

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We often talk about “value” as if it were a fixed point in the sky, a North Star that firms since time immemorial have been striving towards. But the reality is somewhat different. Value is, in fact, something of a moving target. As client expectations change—driven by a changing business and technology landscape—so too will the meaning of “value”. A firm that wants to maximise the resonance of its value proposition needs to make predictions about how the interests of their clients will evolve over time, and needs to be prepared to continually revise the way it operates to respond to those changing circumstances.

Mohamed Kande is a Vice-Chairman of PwC and the firm’s US and Global Advisory Lead, and knows from personal experience the importance of crafting a value proposition that reflects what clients are looking for. We sat down with him to discuss how PwC is future-proofing its approach to value. 

'Value' can be hard to pin down in a consulting context. What does it mean to PwC?

Value has to be defined by clients themselves, not by consultants. In the past, value was usually viewed in terms of cutting costs and improving efficiency. But as a result of all the changes brought by technology, the value clients are looking for from consulting firms is now often defined in relation to the speed with which we can deliver and the extent to which we can increase the probability of success. 

Value is still driven by the quality of the work we do, but there’s now a second aspect of value that’s increasingly important and this stems from our ability to manage the risks of adoption. The scale of clients’ ambition today is huge—they want their organisations to do everything better, faster and cheaper—but they don’t know how to manage the level of change involved. Their initiatives are failing, not because the ideas that underpin them are wrong or even because they’ve been poorly implemented, but because the changes aren’t being adopted by employees.

How do you see those changing client ambitions impacting on the value-creating role that consultants have to play?

As consultants, we don’t simply have to manage the execution or the plan, but also adoption, so that, when we leave, we leave behind something that’s working. 

And that’s changing how we work, too. Historically, it’s been possible for individual experts to create value, but the problems clients are asking us to solve are now so complex that success depends on pulling together different competencies. You can’t, for example, just focus on technology and process change, but need to look at how that’s aligned to the strategic objectives of your organisation and the way in which employees and customers will experience change. Our BXT methodology is designed to do just that, to pull business, experience, and technology skills together in a collaborative framework. Value is only delivered when we bring multiple competencies—different sets of experts—together. It can’t be delivered by one consultant with just one area of specialisation. 

This new definition of value also depends on having strong relationships right at the top of clients’ organisations. If you want to articulate that type of value and get the right result, then you need to work with people who have a vantage point over multiple functions—any value statements will necessarily be cross-functional. Consulting work that’s focused on just one function will become a commodity. 

However, while being able to work effectively across functions will be important, the future basis of competition in the consulting industry will be the cultural acumen that underpins multidisciplinary work. In order to engineer the connections between functions within our organisation, and to overcome the cultural differences that have kept different practices from working together in the past, we’ve created a playbook on how to collaborate, and we train all our partners and other senior people to understand that value cannot be delivered by a single individual working in isolation. We’re changing our organisational model and incentive structure to reinforce this. 

And has this changed the way you go to market?

Competencies aren’t a useful way to organise a firm, so we’re organising instead around our go-to-market teams, and we’re focusing on solving problems clients have defined, rather than trying to sell a specific service. We’ve simplified our marketing messages and changed our narrative to talk about value. We’re not talking to people about our services, but how we can help reduce costs, generate more revenue, and transform a client’s business, for example.

We’re also looking at how we measure the value we add. Most attempts to do this have focused on lagging indicators—the costs cut, or the revenue generated. But we need to be thinking more in terms of leading indicators—adoption rates—as these will become the predictors of future value. If you’ve helped implement Salesforce for example, you can measure the value in terms of behavioural change today, as a proxy for an increase in sales tomorrow. The stronger such indicators are, the greater the level of financial value is likely to be.  

If a client’s strategy depends on greater internal collaboration, we can identify where—and why—their systems aren’t driving positive change. That means that we can reframe the conversation we have with them and engage them in a broader discussion around cultural change and transformation. Clients tell us that we end up solving bigger problems.

One of the biggest challenges for many firms is finding a way to precisely measure the value they create. Do you see that measurement process changing as well?

Technology can really help with this, not least because it’s not enough to measure leading indicators around adoption at the top level only. If you only measure what’s happening to an organisation’s senior executives, then you tend to focus on issues such as incentives. At lower levels, you need to look at the everyday interaction between employees, processes and technology. If you’ve created some collaborative platforms, are people using them? How frequently are they doing so? 

Do you find that taking that approach makes it easier to link value to impact?

We think this approach will help clients understand the trade-offs they’re going to make when hiring a firm, when they always have to weigh the costs of a particular firm against the potential impact. When I tell them that there’s a way to measure a set of leading indicators of value at the front-end of a project, that gets their attention. I’m a consultant by training but I’m also running a business on a day-to-day basis, and I understand how important it is for a leader to get a sense of how things are likely to progress. If you wait for a report on the impact that’s been delivered, then it’s too late to change anything. By contrast, if I can see the adoption rate, and I know that this is a good predictor of future impact, then I’m going to feel far more in control.

Moreover, there always needs to be a personal incentive for people to change – and the consulting industry hasn’t always given enough thought to that aspect. Whether it’s the chance to work with the latest technology, or financial rewards, people at all levels in an organisation need to see what’s in it for them. We need to be able to articulate value in a way that everyone can personally relate to it. 

The only way for any company to understand whether they’ll have the right people doing the right things in the future is to look at change at the receiving end. How can we help companies do things in such a way that they don’t leave anyone behind? And a good way to demonstrate our commitment to doing this is to look at how we’ve transformed ourselves over the last three years. We wouldn’t have been able to talk credibly to clients if we hadn’t already demonstrated that we can transform PwC. 

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