Data Watch: Consulting by Numbers

Knowledge Systems

Where Knowledge and Workforce Management Intersect

Consulting firms have long championed knowledge management and more recently those technologies tied to workforce management — particularly those applications in the professional services automation (PSA) arena, which enhances employee utilization and profitability.  KIRG estimates the size of the KM/PSA market to be approximately $23 billion, and that by 2004, corporations will spend almost $34 billion annually on technologies and services to enhance the flow and use of knowledge. The PSA market is a smaller but faster-growing market. It is not near maturity and will see a steeper growth curve than knowledge management.

Accessing Information

It's All About the Database

Every KM solution includes as a component some form of best practices database.  However, this particular attribute has not seemed to reach its full potential in terms of delivering value.  As shown in the chart, 72 percent and 55 percent of consulting firms rated best practices databases as having high value in their own firms, and in their clients' firms, respectively.

Value Proposition

Why Invest in PSA?

When utilized effectively, KM and PSA solutions increase market share. KIRG found twelve powerful value propositions of KM and PSA:

1. Process Improvement/Increased Efficiency

2. Increased Productivity

3. Increased Speed-to-Market

4. Reduced Operational Costs

5. Increased Ease in Assessing

Organizational Performance

6. Better Allocation and Utilization of Personnel

7. Increased Quality of Deliverables

8. Increased Quality of Customer Service

9. Improved On-the-Job Learning

10. Improved Employee Collaboration/Communities of Practice

11. More Streamlined Global Operations

12. More Intelligent Sales and Marketing Activities

Productivity

Workforce Efficiency

Increased productivity is one of the most easy-to-see benefits of KM.  As a direct result of process improvement/increased efficiency and increased productivity, this value driver shows up dramatically on a company's bottom line.