Examining the characteristics and managerial challenges of professional services: An empirical study of management consultancy in the travel, tourism, and hospitality sector

Abstract

This paper finds that OM's 'one-size-fits-all' characterization of professional services, namely high levels of customer engagement, extensive customization, knowledge intensity, and low levels of capital intensity, does not hold when carrying out a 'deep dive' (to the best of our knowledge, a first in this area of OM) into consultancy in the US travel, tourism, and hospitality sector. We analyse mixed-method data (semi-structured interviews, focus groups, and a besteworst choice experimental survey) and observe that consultancy can actually be quite remote and passive and that any periods of face-to-face 'engagement' will typically be time limited and focused on specific project phases. Moreover, and further confirming the value of a study that allowed us to investigate professional service operations in a specific market context, our data suggest this may often be at the behest of the client. The significant variation observed in levels of customization we interpret as confirming Maister's (1993) notion of a portfolio of brains, grey hair, and procedural work. We also observed relatively high levels of capital intensity; reflecting perhaps the vintage of most OM characterizations and the dramatic ICT-related changes that have occurred in all business operations in the last 20 years. The work also demonstrates the necessity of a more contingent perspective on PSOM. We assess the impact of both firm (scale, specialization) and individual level (leverage) characteristics to demonstrate significant variation within what might be expected to be a relatively homogenous group of professional service operations. For example, investigating the effects of specialization (via a typology of consulting operations: superspecialists, generalists, deep knowledge traders, deep market knowledge traders) revealed that relative degree of interaction may be dependent upon degree of expertise, such that it was the super-specialists in our sample that spent less time with clients and the more generalist firms who were complementing their limited expert status with high levels of interaction (networking, etc.).

Co‐creating value using customer training and education in a healthcare service design

“…Based on their study of legal services, Lewis and Brown (2012) also recognized problems created by customers' lack of knowledge, maintaining that professional‐customer interactions varied widely even within one type of professional service. Brandon‐Jones et al. (2016) examined consulting firms to understand how they differ in terms of customer engagement as well as customization, knowledge intensity and capital intensity.…”

“…On the other hand, much of the value co‐creation research argues that effective customer participation improves service performance (e.g., Xue and Harker, 2002; Prahalad and Ramaswamy, 2004; Vargo and Lusch, 2004; Sampson and Froehle, 2006; Spohrer and Maglio, 2008). This paper takes the view that professional services are complex operations and outcomes depend on the task performance of both the customer and professional (Harvey, 1992, 2011; Dobrzykowski et al., 2016; Brandon‐Jones et al., 2016), so that variability in customer knowledge, skill and motivation affects both the success of the service and the reputation of the professional. For example, the treatment of chronic health conditions, such as diabetes, requires knowledgeable, skilled professionals to direct patient treatment over long periods of time, and also requires patients to comply with treatment protocols.…”

Organizational identification and independent sales contractor performance in professional services

“…Professional services, in general, include diverse fields such as accountancy, advertising, architectural, medical/health, recruitment, insurance brokerage, investment banks, legal, management consultancy, media production, medical information, real-estate brokerages, research and development laboratories and software design (Brandon-Jones, Lewis, Verma & Walsman, 2016;Finch et al, 2015;Koku, 2015). Brandon-Jones, Lewis, Verma and Walsman (2016) contend that professional services firms share several common operational traits including significant levels of customer engagement, customization, knowledge intensity and relatively low capital investment.…”

“…Brandon-Jones, Lewis, Verma and Walsman (2016) contend that professional services firms share several common operational traits including significant levels of customer engagement, customization, knowledge intensity and relatively low capital investment. However, externalization in professional services involves ANTECEDENTS OF INDEPENDENT SALES CONTRACTOR PERFORMANCE 6 some unique management challenges including: quality control and consistency, ensuring a positive customer experience, recruiting/retaining staff and staff training (Brandon-Jones, Lewis, Verma & Walsman, 2016;Schmenner, 1986). One challenge in professional services is the iterative nature of the engagement and service customization between a firm and its clients.…”

Multiperiod Stochastic Resource Planning in Professional Services Organizations

“…Resource planning involves (a) the breakdown of current and potential projects in the PSO's pipeline into tasks based on the work breakdown structure and (b) matching these tasks to skilled resources, often a mix of internal and contingent resources, subject to operating constraints (Hargaden & Ryan, ). The projects tend to be knowledge intensive (Brandon‐Jones et al., ), highly customizable, and customer centric (Lawrence et al., ). An RP application also accounts for multiple attributes of resources and tasks including service delivery role, skill type, proficiency level, and geographical location.…”