| | By Mick James
"Software house
launches consulting
division" is hardly
headline news these
days.
As Rick Matthews,
head of Amdocs
Consulting puts it:
"There are a number of
vendors out there hiring
guys to sell their stuff
for them. That wasn't
Amdocs’ intention."
Amdocs itself is a
major player in software
and services, primarily
in CRM and billing work
in telecoms.
"The challenge was
that in Amdocs you have
a company that has a 70%
share of projects in the
$200m plus bracket,"
says Matthews. "These
are major transformation
projects by their very
nature. And Amdocs
wanted to have more
control of the execution
of its projects."
While Matthews agrees
that every vendor wants
to get into the "trusted
advisor" space, he
believes that the unique
approach to software
Amdocs has adopted makes
it both highly
appropriate for it to
offer consultancy and
also gives it a clear
differentiation from
other firms.
"The classic approach
to these projects is to
start with a white sheet
of paper," he says. "In
many ways that is
religiously what we
don't do."
Based on its work
with a large number of
telecommunications
companies, Amdocs has
been able to create a
process model that is
highly generic.
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"The only reason to
modify this model is to
differentiate yourself
from competitors," says
Matthews. "Pick cost,
pick vendor management.
We'll modify the model
to give you a unique
model – don't just
modify the model for the
sake of it."
This model has
several advantages – the
most obvious being
speed. Amdocs was able
to complete one client
project in two weeks
instead of the scheduled
four months. But there
are other more subtle
advantages.
"If two people are
both using the same CRM
suite, the only way you
can compete is by whose
is nicer, Sally's or
Bob's," says Matthews.
"The problem with these
products is that if the
vendor comes up with a
solution for one client
then the next release
will support it and
everyone's going to get
it."
By combining this
approach with some of
the elements of ‘Big
Four’ consultancy,
Amdocs felt it could
build a "better
mousetrap and offer
something new to the
market".
"Essentially, Amdocs
gives the software away
and makes the money on
differentiation," says
Matthews. "That's a
model very akin to
consulting."
Amdocs Consulting has
grown by 50% per year to
reach more than 1,000
consultants. Matthews
believes one of the
intriguing things about
the model is that it | |
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problems inherent in
scaling professional
services. Unlike
software, where the work
of a few very smart
people can be
distributed to thousands
or even millions of
customers, consultancy
is delivered in a highly
one-to-one fashion. It's
a problem many
consultancies have
struggled with, leading
to huge investments in,
for example, knowledge
management systems.
"Amdocs is a
product-based company.
We know how to reuse
stuff," says Matthews.
"But we do not call what
we do knowledge
management. We use the
term ‘consulting
products’. What
everybody else calls
knowledge management, I
call the closet. People
throw all their stuff in
the closet, then later
pull out a PowerPoint of
something that was done
in Bulgaria."
This approach does
not mean that Amdocs is
looking for low-level
skills to implement its
consultancy products. On
the contrary, Matthews
says that hiring "smart
people with loads of
neurons" is key to the
strategy and that right
now he would happily
take on another 400
people with the right
combination of
intelligence and
experience if he could
find them.
The key is to have
something to add to
that, rather then
expecting consultants to
be "uniquely brilliant
over and over again".
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"You can lock up 30
people in a conference
room and, by God, there
will be some
intellectually
stimulating stuff, but
it's not grounded in
what customers want to
do, it's naïve," he
says. "The value
proposition of many
parts of consulting is
in question. What's
powerful about what
Amdocs has done is that
it's all about
differentiation and
achieving velocity."
While Matthews may
fret about the ability
of the market to provide
him with enough talent,
it has not so far put
too much of a brake on
an impressive great
curve. In Europe this
has been both more rapid
– from 30 to 230
consultants in 18 months
– and more
consultancy-led.
"We do more strategy
and process work in
Europe," says David
Groom, head of Amdocs
Consulting EMEA. "There
are less of those big
projects to piggy-back
on. We also do a lot of
work around business
deployment which goes
outside our product
domain – Amdocs doesn't
do everything everywhere
– and clients take us
into new areas as well,
such as project
management with
non-Amdocs technology."
Groom says he is
still recruiting
aggressively, and the
European arm should
double in size again in
the next 12 months. The
strategy has been to
focus on major clients
in markets where the | |
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significant mass, and
the firm has succeeded
in attracting senior
talent from other
consultancies and is now
starting a graduate
programme.
"The feedback I get
from recruits is that
they are far more
challenged here and have
significantly more
opportunities to prove
themselves," says Groom.
"That means that they
are more trusted and
empowered, and have more
ready access to the real
clients."
In the future Amdocs
will begin to look at
other verticals. The
company has already
established a foothold
in financial services
and convergence is
naturally leading them
into the entertainment
industry. There is also
significant interest
from other industries
where there are deep
process similarities
with the areas Amdocs
already works in.
"So far we've focused
on establishing
credibility and growing
out from there," says
Groom. "We've been
really well received by
clients who value our
experience and
specialisation. We knew
they wanted it – the
only question was would
they be prepared to pay
for it from a firm that
was perceived as a
software company."
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