Omdia recently attended EY’s global analyst summit in April 2024 where the vendor highlighted the investments and progress it has made in a transformative journey aimed at redefining its role in the professional services space.
Omdia view
Summary
Omdia recently attended EY’s global analyst summit in April 2024 where the vendor highlighted the investments and progress it has made in a transformative journey aimed at redefining its role in a continually disruptive business environment. The core theme of the summit was aptly titled “Rethink,” aligning with EY’s efforts at leveraging cutting-edge technologies such as artificial intelligence (AI) and rethinking its service delivery and talent management strategies. This report evaluates EY’s current strategic direction with a particular focus on its AI integration and talent management, providing critical insights into the effectiveness and potential pitfalls of these strategies.
AI is central to EY’s efforts to reimagine its role in an evolving tech and business landscape
EY is poised at a pivotal juncture as the world of professional services becomes increasingly standardized and true differentiation is hard to come by. EY is embracing a technology-first, transformative strategy to redefine its role and has committed to deeply integrating AI into its services. This is demonstrated by the recent launch of EY.ai, a unifying AI platform, on the back of a $1.4bn investment in AI capabilities. EY.ai leverages leading-edge technology platforms and AI capabilities and combines them with EY’s deep experience in strategy, transactions, transformation, risk, assurance, and tax to deliver a seamless AI-driven functional transformation experience to clients. Furthermore, EY is leveraging AI to augment the skills and potential of its people with EYQ, an ecosystem of generative AI capabilities that includes secure AI assistants for general and domain-specific work. This strategic move aims to position EY at the forefront of technology-enabled professional services. This focus on technology and AI aligns EY with the broader industry trend toward digital transformation, but the firm’s approach is differentiated by how deeply integrated these tech initiatives are within its core service offerings.
However, the practical deployment of AI within EY raises a pressing need for data integrity and a balance between technology and human expertise. Past challenges in the industry highlight the risks associated with overreliance on automated systems without adequate human oversight, which could lead to challenges in maintaining the quality of judgment essential in consultancy and auditing services. Therefore, it is crucial for EY to maintain a symbiotic relationship between AI outputs and human expertise, especially in complex decision-making scenarios. The firm must also ensure continuous evolution of its AI models and embed ethical oversight into its AI algorithms to avoid biases that could compromise client trust and regulatory compliance.
Transforming talent will be critical to maintain future competencies
Professional services is a high-touch business and has always been driven by people and the critical thinking and creativity they bring. Jobs at companies such as EY are extremely sought after, and the vendor says that it receives around 5 million applications globally each year. The pandemic upended some of the high-touch aspects as an increasing number of consultants delivered remote services, and the need to be onsite has reduced significantly. However, the need for critical and creative thinking and judgment is increasing as most client organizations accelerate their transformation journeys. EY stated that its AI investments will take a lot of the grunt work out for its associates, freeing them up to deliver higher-value services. The technology-first approach also requires a rethinking of talent management approaches and requires a focus on upskilling and diversifying the skill sets of the workforce. To this end, EY stated that its global workforce now includes more than 75,000 technologists and that it has awarded more than 500,000 learning badges in specialized subjects across its workforce. This reflects EY’s acknowledgment of the critical role that continuous learning and development play in retaining competitive edge and innovation capacity.
A key highlight of EY’s talent strategy is its emphasis on diverse hiring and development programs. The launch of specialized learning pathways customized to the needs of a neurodivergent workforce not only enhances individual skills but also caters to the evolving demands of the global workforce. However, with the rapid pace of technological change, there is a potential risk of misalignment between current training programs and future skills requirements. EY must continually evaluate and adapt its educational offerings to ensure they meet the precise needs of its workforce and the industry at large. Additionally, as the workforce evolves, EY should focus on inclusivity in advancement opportunities to prevent disparities and ensure all employees have equal opportunities for career growth. As the consulting industry grapples with high turnover rates, EY’s ability to maintain employee engagement through meaningful professional development paths will be crucial.
Technology is the next frontier of competition and differentiation in the professional services space
All major players in the professional services sector are embracing technology as a key element of their future strategies. Deloitte has made heavy investments in digital and cloud services and positions itself as a leader in broader digital transformation, offering end-to-end solutions that extend beyond the traditional boundaries of professional services. PwC is carving out its niche by emphasizing cybersecurity and data analytics, integrating these services across all its operations to ensure that its digital solutions are secure and data driven. In comparison with EY, PwC places a stronger emphasis on risk management and cybersecurity as integral to its tech-first strategy, likely appealing to sectors where security is paramount. KPMG’s focus has been on “intelligent automation,” combining AI with other technologies such as robotic process automation (RPA) to enhance efficiency and reduce costs for clients. KPMG’s strategy is more about operational efficiency and cost-effectiveness, which may attract clients more interested in bottom-line improvements.
EY’s specific focus on deep AI integration to enhance decision-making and service quality stands out. This strategy not only future-proofs the firm against an increasingly digital and data-driven world but also positions it as a pioneer in leveraging AI for higher-value, client-centric solutions. EY is creating differentiation by not just adopting technology but embedding it within its core practices, thereby enhancing the quality and insightfulness of its services rather than just automating processes. This approach suggests a commitment to advancing the role of technology in professional services, aiming not only for increased efficiency but also for deeper analytical insights and better outcomes for client transformation. EY’s strategy appears to be about elevating the capabilities of its human workforce with AI, thereby creating a hybrid model where technology and human expertise coexist seamlessly to address complex challenges. EY’s ability to maintain this trajectory will be crucial as technologies evolve and as competitors likely shift their strategies in response to changing market demands.
Appendix
Author
Hansa Iyengar, Senior Principal Analyst, Enterprise IT