It’s perfunctory to review an old-school piece of application software. For example, if someone has a new Accounts Payable product, most any analyst knows the list of functions and features (e.g., support for 1099 reporting) that should be in the product. It’s a different matter altogether when a software firm creates products in an all-new white space.
A recent briefing with Zero was a great example of the new kind of applications out there. Zero builds AI-powered edge applications. Its initial suite of applications is designed for service firms (e.g., law firms, management consultants, accountants, etc.).
The apps they offer are quite different from the usual applications we’ve seen in business for decades. Where old applications have millions of lines of application code and a technology stack to power them, these applications require the installation of some edge processing code on a service person’s laptop or other devices. These ‘apps’ collect data that Zero’s AI-engine uses.
By way of an analogy, many readers have installed dongles in the OBD-II (on-board diagnostic) port of their car to get lower automobile insurance rates. These devices connect to the numerous computers and sensors in the car and record things like speed, acceleration rates, GPS co-ordinates, braking pressure, etc. The dongle helps capture tons of big data that can be utilized by an insurer’s AI/ML programs. And, insurers aren’t the only users of this telematic data. Marketers can find it to be a treasure trove of insights. In one spooky use case, companies can figure out who goes to visit their mother on Mother’s Day and where their mothers live.
Zero decided to tackle a difficult vertical, professional services, and improve the productivity of those who toil in that space. Yes, there are traditional applications for this vertical. These include PSA (professional services automation), Project Management, Project Accounting, Time & Expense processing, and more. That industry is also a big user of spreadsheet software (i.e., the fallback solution many service firms use to avoid buying a package). All of these solutions do help but they still leave a lot of low- or non-value-added activity on the table. Zero believes as much as 30% of a professional’s time is wasted.
Zero’s suite includes edge apps that recover time that otherwise doesn’t get billed or booked correctly. For example, their technology learns how lawyers file emails by clients and then takes over this function. The software learns how much time they are spending on specific client documents. That time is then automatically recorded on a time sheet. As someone who’s been recording client time for 30 or so years, this work is often tedious and hard to do correctly if you’ve waited until the end of the month to record/reconstruct it. This work is necessary but doesn’t come close to adding value to a client.
According to Zero’s website:
Countless hours are lost for knowledge workers on filing emails and attempting to piece together the billable time spent interacting with emails. This results in frustration, lost productivity, and, most importantly, lost revenue. Additionally, as clients are demanding more efficiency and a higher level of transparency around fees, professionals must find ways to track their billable time with greater accuracy than ever before.
ZERØ gives those hours back by filing emails, passively capturing all billable time spent on email on a mobile device, and providing additional productivity-enhancing features.
Zero’s applications rest between a user and their existing applications and office/project productivity tools. Its super light footprint also makes these apps highly scalable, too.
One of Zero’s customers documented these savings:
Now before you think that can’t be enough of a benefit to justify a new apps purchase, remember these applications require very, very little effort to implement. The software tracks information once it is installed on a person’s computing device and then the AI-tool starts utilizing the big data being generated.
This smart software learns the more it gets used and the more data/transactions it gets to review. Like RPA software, the more the tools get to understand how a specific attorney, consultant, etc. works, the more they can automate.
The new frontier in application software is in the development of capabilities in the white space beyond traditional transaction processing applications. It’s why the big valuations and investor interest is with firms like Celonis, Uptake and others. These new tools often utilize advanced technologies like artificial intelligence, machine learning, smart analytics, chatbots, RPA, and more. These apps don’t just support user data entry & validation of transactions, they may also:
- Automatically route unusual transactions or events for others to examine
- Instantly escalate certain items to the most appropriate reviewer/responder
- Recommend courses of action for a given event
- Remember past decisions and apply them on future events without human intervention
- Peruse big data files for anomalous findings
- Identify hidden trends
- Free up employees from tedious, low-value activities
- Reduce errors
- And so much more
Professional services firms are chock-a-block full of automation opportunities; however, the adoption of these is rarely where it should be. Why? Some PS firms are partnerships where few equity partners want to dilute current year earnings with a big software purchase and implementation expense. They’d prefer to kick the can down the road a few more years (and maybe retire/cash out before having to make this investment). As a result of this, you can find in PS organizations:
- Lots of homegrown applications
- An unacceptably high number of spreadsheets in use
- Firms running solutions that were obsolete years or decades ago
Professional services organizations are often like the cobbler’s children. They might help implement all kinds of technologies for clients but never seem to have the time, budget or inclination to do the same for themselves. Zero will doubtlessly face some resistance to change in its sales efforts due to this vertical phenomenon.
Longer-term, we would expect to see ZERO integrate with several PSA solutions (eg: MavenLink, FinancialForce, NetSuite, etc.). Their white space apps would help drive the sales of those product lines. As Zero expands its vertical focus, it will likely find all kinds of application partners coming to them in areas like Legal, Architecture, Engineering, Strategy Consulting, and more.