Brands all over the world are undergoing digital transformation as changing customer preferences and behavior are disrupting their existing business models. It’s no surprise, therefore, that the service providers that are helping such brands transform must themselves drive their own disruption.
Globant, a global professional services firm that focuses on helping brands seek better emotional connections with their customers across their customer journeys, is disrupting the digital consultancy marketplace with their Services over Platforms (SoP) offering.
The central idea behind SoP is to leverage a core set of common platforms across different client engagements in order to provide rapid solutions. Such platforms will enable greater economies of scale as compared to entirely custom solutions, while passing along the resulting savings as well as the mature capabilities of the platforms to customers.
SaaS-Based Pricing: Calculated Risk
Consultants have been leveraging internally-built software assets to build out custom solutions for customers for decades. In contrast, Globant’s true innovation with SoP is its Software-as-a-Service (SaaS)-based pricing model, combined with its ability to deliver unique, fully differentiated complete solutions to each customer.
Globant charges SoP customers per user, per month, per transaction, or per usage, depending upon the product – not only for the use of the platform, but for the professional services time Globant provides to customize each platform to address particular needs as well.
This innovative business model will likely disrupt the entire digital services marketplace. Charging customers on a pay-as-you-go, per user/per transaction basis for customized solutions is simply unheard of in the consulting world, as it can potentially shift enormous risk to the consultancy.
A traditional enterprise-level engagement may involve hundreds or even thousands of person-hours. With a SaaS-based pricing model, the firm might not break even for years, if ever.
In Globant’s case, however, it is taking a carefully calculated risk, based upon the sophistication of the two platforms that Globant currently offers as SoP.
The Two Services over Platforms Offerings
The first component of Globant’s SoP offering is I am at, a mobile digital journey platform that helps enhance the user experience. Mobile app development is standard fare for digital consultancies, but this platform facilitates tying such apps to the customer journey with gamification, social networking, and big data analytics – a more complex task than simple app development.
I am at also supports the ‘smart’ portion of the digital journey, where ‘smart’ refers to the ability to deliver highly personalized experiences – what Intellyx calls individualization. This smart individualization enables users to interact with different touchpoints, including IoT sensors like retail beacons as well as wearables on a person-to-person basis, providing digital ‘moments’ unique to each individual.
Globant’s second platform is StarmeUp, a mobile-first employee gamification platform that helps improve the employee digital journey. StarmeUp focuses on fostering peer-to-peer recognition in organizations, thus helping them grow their culture, reinforce organizational values, and bring both transparency and meritocracy to day-to-day work.
Globant built both of these platforms following a modern, architected approach that separates the configuration of the solutions on each platform from the code that underlies the platforms – essential to providing a differentiated offering for customers. In this manner, configuring each platform is straightforward and declarative, following a straightforward “if this then that” paradigm.
Globant is therefore able to manage the risk inherent in offering custom solutions via a SaaS pricing model, because the level of customization required is straightforward and simple and, at the same time, effective in delivering a product that is unique to each customer.
The SoP model doesn’t cover everything that Globant might do for a client, however. For those engagements where a customer wouldn’t benefit from either platform, Globant applies its proven professional services approach.
Best of Both Worlds
For organizations that wish to acquire software-based solutions today, there are two basic options. If they need a fully custom, bespoke solution, then they typically hire a third-party professional services firm that will build what they want, but at a price – as the consulting firm will typically charge by the person-hour for such work.
The other approach is for the organization to acquire a software-based solution as a cloud-based SaaS offering. There are a number of advantages to this approach over the custom alternative: economies of scale can reduce the price dramatically, and the SaaS-based pricing model can reduce costs even further, while also allowing the organization to shift capital to operational expense.
The downside to SaaS-based solutions is that vendors of such solutions generally provide a one-size-fits-all offering that may not be a perfect fit for the organization’s needs, and thus would never differentiate the connection between a brand and its customer. As a result, the organization must still contract with a third party consultant to make the necessary customizations.
Today’s enterprise-class SaaS offerings typically come with a certain measure of customizability to be sure. But there’s no question that even the most flexible SaaS offering doesn’t have the flexibility of a fully custom solution. Furthermore, if a problem crops up with the custom solution, the vendor of the SaaS product won’t take responsibility for it.
The Intellyx Take
With its SoP, Globant strikes a happy medium between the two extremes of fully customized and fully SaaS-based. I am at and StarmeUp aren’t suitable for every project, but the two platforms that underlie the SoP have a remarkable level of flexibility, especially considering that they are modern, digital platforms.
Other digital consulting firms should be worried about Globant’s innovation. They must either rise to the challenge, building platforms of their own, or see their business dwindle due to the fact that they can no longer be competitive on price as long as they cling to a traditional time-based pricing model.
Copyright © Intellyx LLC. Intellyx advises companies on their digital transformation initiatives and helps vendors communicate their agility stories. As of the time of writing, Globant is an Intellyx customer. Intellyx retains final editorial control of this article.
