The inherent customer-focused nature of the professional service industry has induced significant changes and innovations within the entire space. As professional service automation statistics have shown, the industry is changing, and fast. Notably, there are rapid technology developments, changing employee needs, and emerging client demands.
Consequently, there is an increasing urge for professional service firms to implement robust professional service automation software. As an industry player, you also need to keep your eyes firmly fixed on the changes taking place in the industry.
In this article, we’ve compiled the most critical professional service automation statistics you should know. The goal is to help you remain abreast of the fundamental industry changes and succeed in this increasingly competitive sector. Having these data at your fingertips will help you adapt to changes with ease and devise ways to improve service delivery.
Professional Service Automation Statistics Table of Contents
The tide is steadily changing, and customers have become the focal point of the professional service industry. Apparently, today’s customers are empowered, have high expectations, and are authoritatively driving change in the service industry. As a result, the need to meet customer expectations has become an important metric, one that service businesses should endeavor to achieve.
Client expectations are increasing in quality of work (51%), speed of service delivery (50%), cost of work (48%), transparency (37%), and accountability (37%) (Mavenlink).
Also, according to a more recent professional services report by Mavenlink, a whopping 85% of service businesses acknowledge that client expectations are increasing (Mavenlink, 2019).
69% of customers expect a company to offer new ways to get existing products and services, such as offering digital versions of traditionally in-person experiences. (Salesforce, 2020)
Additionally, professional services industry statistics show that 84% of customers say that they would purchase more from a company that offers excellent service. (Gladly, 2020).
By 2023, consumption expenditures on professional services will hit $600 billion in the U.S. (MarketResearch.com, 2020).
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Top 5 Areas Where Client Expectation Is Increasing
Top 5 Areas Where Client Expectation Is Increasing Quality of work: 51%
Quality of work
Top 5 Areas Where Client Expectation Is Increasing Speed of service delivery: 50%
Speed of service delivery
Top 5 Areas Where Client Expectation Is Increasing Cost of service: 48%
Cost of service
Top 5 Areas Where Client Expectation Is Increasing Transparency : 37%
Top 5 Areas Where Client Expectation Is Increasing Accountability: 37%
Meeting customers’ expectations remains an essential factor for a long-term service business strategy. This is because, with the increased expectation, customers are more likely to seek services from a firm that demonstrates relevant expertise to meet their needs.
Besides, today’s customers have shown a subtle inclination towards services that are offered on a per-project basis. For these reasons, if you are looking to earn continued business, you must expand services and optimize processes. Besides, you should run a business with added agility to raise satisfaction levels. More importantly, you must know the techniques for improving customer experience to enhance service delivery.
2. Professional Service Automation Software Market Statistics
Up until the last few years, the impact of disruptions and innovations on the professional service industry was less visible. However, recently, the marketplace has experienced rapid growth, and the speed of change is poised to continue to accelerate. This is mainly due to the agility of service providers and the call for higher speed and quality services by customers.
The market size of professional services automation (PSA), currently valued at $877.93 million, is expected to reach $1679.72 million by 2026 (Mordor Intelligence, 2020).
Meanwhile, the global PSA software market size is predicted to grow at a CAGR of 8.2% and reach over $15.1 billion by 2027 (ReportLinker, 2020).
The communication and marketing firm sector is expected to grow at the highest CAGR of 15.5% during the focus period 2019 to 2025 (Grand View Research, 2019).
The IT professional services market size is expected to expand at a CAGR of 8.4% to reach $1.070 billion by 2025 (Grand View Research, 2019).
Of the five professional services industry segments, embedded software and SaaS dominated in 2019 at 16.1% in terms of annual revenue growth (Kimble, 2020).
According to IDC, the global public cloud services market expanded by 26% year over year in 2019 to reach $233.4 billion (IDC, 2020).
Interestingly, professional service marketing statistics indicate that over 75% of service businesses have implemented professional services automation solutions (Projector, 2020).
Additionally, organizations that use a professional services automation (PSA) tool have a better annual revenue per project at $168,000 versus the $112,000 posted by businesses that have not implemented a PSA solution (SPI Research, 2019).
According to SPI Research, companies that use professional service automation software have a better employee billable utilization rate of 70.9% compared to those that don’t use a PSA solution at 68.3% (SPI Research, 2019).
What do these stats mean?
Change has become part of the professional service industry, and growth has taken a strikingly similar pattern across all sectors. The market is proving to be a rich goldmine, and going by the statistics, its size will grow enormously.
To respond, software providers have seized the opportunity, developing innovations to counter the growing demand. Competition amongst developers has intensified, and this is goods news for service firms. As it stands, startups and small businesses can now afford solutions that were exclusively reserved for industry behemoths.
3. Industry Challenges Statistics
Like every other sector of the economy, the professional service niche has its challenges. The industry is fraught with a host of problems that carries the potential to derail the growth of service businesses. However, data has shown that challenges emanating from project and resource management are the most prevalent.
Another report by Mavenlink intimated that 50% of service firms turned down work because they had no resources to get them done. In total, approximately 65% of service firms have turned down a project for various reasons. Besides, 31% of projects are not completed because of inadequate budget, and 30% of clients’ projects are not completed in time (Mavenlink, 2019).
According to Mavenlink, 70% of businesses in the services industry saw increased competition in the past 12 months (Mavenlink, 2019).
32% of professional services firms find it difficult to forecast their staffing needs based on the impending demand for service (Mavenlink).
Recent surveys report that for professional service industry companies, the challenges that impact their organization most include the optimization of the client experience (25%), skill shortage (18%), and capacity planning (14%). (Alithya Group Inc., 2020)
In light of the COVID-19 pandemic, only 27.8% of professional services firms report that they can continue their operations without the need to restructure or cut budgets. (Grant Thornton, 2020)
Top Challenges Facing Businesses in the Professional Service Industry
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Source: Mavenlink, 2019
There is no denying, challenges to the professional services businesses are aplenty. However, some of the challenges are of your own making, and thus, the remedy must come from within.
For example, you must evaluate your firm and learn how to manage your project teams more effectively to boost productivity. Besides, you should align your staffing resources and new tools to address typical challenges decisively. This can be achieved by implementing tools that empower you to creatively find employees online and offline. Most importantly, you must improve the service offering to raise satisfaction levels and expedite business growth.
Leading Professional Service Automation Software
monday.com. Centralized storage and access to all information regarding projects are possible with this application. Get to know what makes it a top professional service automation software in this monday.com review.
Wrike. This cloud-based software is dedicated to professional services and streamlines workflow with its automation capabilities. Read this Wrike review to learn more about what it offers.
BigTime. Get rid of arduous processes using this integrated time management and billing software. Details are here in this BigTime review.
QuickBooks Enterprise. Growing businesses can benefit from this accounting platform that automates estimates, proposals, and other documents. This QuickBooks Enterprise review can help you better understand the software’s capabilities.
ProjectManager. Project planning and scheduling tools are the core features of this application. See what else it can do in this ProjectManager review.
4. Adoption of Modern Technology Architecture Statistics
Technology harbors immense promise for all sectors of the economy. The professional service niche is no exception. However, unlike in other areas, the service industry faces unique technology infrastructure challenges. For this reason, it’s becoming increasingly crucial for all leaders to adopt professional services software with caution.
For example, a lot of manual work is still needed to synchronize systems and ensure the delivery of high-quality services to customers. If systems are not in sync with the way a business works, they can easily stifle the potential of that business and hinder the accuracy of service delivery.
Systems currently implemented by service firms include corporate financial management (94.5%), client relationship management (81.3%), professional services automation (80.9%), human capital management (62.4%), business intelligence (49.7%), CRM integrated with CFM (40.6%), PSA integrated with CFM (54.7%), and HCM integrated with CFM (30.8%) (SPI & Kimble, 2020).
Only 30% of the services industry has implemented a PSA solution (Mavenlink, 2019).
Moreover, a more recent survey reported that 40% of organizations in the industry do not have an automation tool at all. (Alithya Group Inc., 2020)
The leading software acquisition priorities for professional services are CRM, Analytics and BI, and collaboration. (Alithya Group Inc., 2020)
The top technological infrastructure challenges faced by service businesses include lack of clarity between systems, data accuracy issues, and manual work (Mavenlink, 2019).
When they are implemented without a well-orchestrated policy, technological innovations can easily complicate business. For instance, applications meant to improve efficiency can easily cause the opposite effect when they are not seamlessly integrated.
For this reason, businesses in the professional services sector must know the outcomes of their technology architecture. Besides, they must adopt the perfect blend of systems to improve efficiency even as they strive to usher in relevant change. Most importantly, small businesses should prioritize solutions that support basic operations and scale as your business grows.
5. Remote And Distributed Workforce Statistics
The demand for a more extensive selection of services from professional services providers has changed the way firms work. Also, the need to find relevant talent regardless of the location has intensified the influence of distributed workforces. Even more, the standardization of skills and expertise has inaugurated the widespread use of distributed teams and contract workers.
As such, it is not surprising that 73% of hiring managers acknowledge the value of remote work. (Upwork, 2020)
Besides, Buffer found that 98% of remote employees plan to work remotely, all their career (Buffer, 2020).
According to research done in 2019, approximately 66% of US workers feel that working from home gives them a more comfortable workplace, and makes them more productive as a result (Flexjobs, 2020).
More importantly, according to findings by freelancing site Upwork, 56.8% of teams in the US are working remotely fully or partially (Upwork, 2020).
In addition, 41.8% of Americans are currently working fully remote (Upwork, 2020).
By 2025, there will be an increase of 87% among Americans working remotely (CNBC, 2020).
In addition, for companies in the professional and business services sector, roughly 74% of their workforce are working remotely full time. (McKinsey, 2020)
50% of companies that enabled a remote workforce in 2020 aim to retain it even post-pandemic (SWZD, 2021).
This is particularly because workers in the tech and professional services industries (74%) have better access to work from home opportunities. (Glassdoor, 2021)
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6 Key Remote Work Statistics
6 Key Remote Work Statistics Hiring managers who recognize the value of remote work: 73%
Hiring managers who recognize the value of remote work
6 Key Remote Work Statistics Hiring managers who say working remotely is becoming easier: 68%
Hiring managers who say working remotely is becoming easier
6 Key Remote Work Statistics Teams that lack manpower and skills: 61%
Teams that lack manpower and skills
6 Key Remote Work Statistics Hiring managers who feel strained: 59%
Hiring managers who feel strained
6 Key Remote Work Statistics Teams who had to cancel or delay projects: 52%
Teams who had to cancel or delay projects
6 Key Remote Work Statistics Hiring managers working with independent talent: 48%
Hiring managers working with independent talent
Source: Upwork, 2020
It’s clear that the use of remote workers is poised for increased influence on the service industry. A look beyond the rising remote work models reveals another gleaming trend. Modern technological innovations have facilitated the rise and use of contract workers.
Today, both remote and contract workers are playing a massive role in the professional services business. However, connecting remote, distributed, and contract workers comes with a higher risk. It’s not surprising, then, that many organizations view effective collaboration as a critical constituent to success. As such, service firms need to use effective team communication strategies to improve online collaboration.
Besides implementing PSA solutions, businesses must learn how to use online collaboration tools like video conferencing software. This way, it will be easier for service businesses to connect and work with the right talent regardless of their geolocation.
What Does the Future Hold for the Professional Services Industry?
There you have it, our compilation of the top professional services statistics you should know. Numbers don’t lie, and from the stats above, it’s clear that the professional services industry is rapidly changing. Today, service automation solutions are affordable, and small service firms can now find the perfect solution to boost productivity and improve efficiency.
However, the industry is evidently in constant change as firms attempt to widen their scope of services and start using remote workforces more than ever. The abundance of technology has complicated service operations, and it’s now fallen upon managers to come up with well-defined strategies to build more profitable ventures. Above all, service businesses must forestall and prepare to flex even more to be able to tap into technological innovations and the imminent, liquid workforce.
That’s not all: you must remember, customers mean everything to a service business. Because of this, even as you adapt to change, you must build your business around customer satisfaction, project success, and profitability. This means adopting effective planning policies and using the most relevant staffing resources to meet growing clients’ expectations while easing the pressure on your project margins.
The professional service industry is a wide scope, one that cuts across different fields such as task management, time tracking, and field service management. We are privileged to have all the information you need to make an informed decision when selecting a PSA solution for your firm. For example, you can read our guide on time tracking software to get helpful insights into managing complex projects.
Mavenlink. (2018). State of the services economy. Mavenlink.
Salesforce. (2020). State of the connected customer 4th edition. Salesforce.
Islam, Z. (2020, May 28). Great service drives revenue in gladly’s 2020 customer expectations report. Gladly.
Microsoft Dynamics 365. (2020). Global state of customer service: The transformation of customer service from 2015 to present day. Microsoft.
Schmidt, S. (2020, March 18). The professional services market: Forecasts and trends. Market Research.
Mordor Intelligence. (2021). Professional services automation market – Growth, trends, COVID-19 impact, and forecasts (2021 – 2026). Mordor Intelligence.
ReportLinker. (2020, August 20). Global professional service automation (PSA) software industry. GlobeNewswire.
Astrid Eira is a resident B2B expert of FinancesOnline, focusing on the SaaS niche. She specializes in accounting and human resource management software, writing honest and straightforward reviews of some of the most popular systems around. Being a small business owner herself, Astrid uses her expertise to help educate business owners and entrepreneurs on how new technology can help them run their operations. She's an avid fan of the outdoors, where you'll find her when she's not crunching numbers or testing out new software.
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