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Find your truth! Why you need Professional Services Automation

Scott Brown Profile picture for user Scott Brown April 4, 2023
Todays business leaders know the reality of automating Professional Services is a challenging one. FinancialForce's Scott Brown shares examples from two companies who have made the most of visibility and data to make decisions based on evidence, not anecdotes.

Finance Report Accounting Statistics Business Concept © - Shutterstock
(© - Shutterstock)

Today’s services organizations, whether they are professional services firms or companies that have a large services practice within their organization, face a myriad of challenges across all facets of the business environment. These range from attracting new business to strengthening client relationships… from optimizing revenue streams to managing finances and operations… from recruiting top talent to creating a collaborative culture across the regions and business units.

With so much to juggle, it’s no wonder that leaders’ efforts across these areas are often challenging and not ideal for fast-paced decision making. The metrics are concerning – according to the recent professional services maturity benchmark report from SPI Research, in 2022, areas such as project margins, on-time project delivery, standard delivery methodology and billable utilization, professional services firms’ performance declined year over year.

FinancialForce embedded table

Reversing the trend

With services now comprising the bulk of global commerce, suboptimal business performance is unacceptable. So, how can last year’s downward trend be reversed? I believe it takes two core attributes – visibility and insight. Today’s most talented and successful services leaders have elevated their capacity to identify trends and themes that emerge across the business.

Of course, that’s no easy feat. It means utilizing real-time data and estimates to identify how the business is performing. It means swiftly recognizing commonalities and disparities in service offerings, target customer sets, business units and operating geographies and markets around the globe. It also means analyzing differences between net new services implementations, follow-on services and managed services projects. (As a sidenote, this often uncovers scenarios in which business lines are less profitable than previously thought.)

Most business leaders are fully aware of the importance of assessing their services portfolio to spot trends and applying those learnings across the business. The rub is when, especially as a business grows, they know the remedy must lie in a technological solution, but they don’t know what kind of solution is appropriate for them.

As we found from a survey carried out for FinancialForce by MGI Research last year, the most forward-thinking services leaders already have the automation tools they need to progress. With a sophisticated Professional Services Automation (PSA) tool that’s purpose-built for their industry, today’s leaders can get to the right level of granularity and insight about their business — and the right level of certainty to be confident about the decisions they make and actions they take.

Without an effective automation platform, other organizations lack the capacity to innovate, differentiate themselves and achieve robust growth and profitability. The numbers in the SPI Research benchmark report bear that out. In 2022, among firms with at least 20% annual growth and profits, three in four use a commercial PSA solution. And among firms with at least 20% annual growth, nine in ten reduced their project overruns to less than three percent and reduced their revenue leakage to under one percent. Those numbers are difficult to argue with.

Finding one’s business truth

In the current services economy, foresight is an imperative. But thinking about tomorrow is a challenge if you can’t first determine what’s happening across the business right now. The right systems and processes must be in place to understand current conditions – that is, your business truth.

Finding and leveraging one’s business truth requires that accurate, reliable, timely data  be aggregated, then fed into an advanced PSA platform that can translate the data into analysis and action. Business leaders can improve their business from two key perspectives – external and internal.

The external (customer) perspective. Whether new, follow-on or managed services, today’s business imperative is to build and maintain strong relationships with customers. After all, satisfied customers mean renewals, account growth and a continued healthy revenue stream. With the right automation tools, a service business leader can analyze the company’s portfolio, drill down into it to spot the trends, understand what corrective action should be taken, and build that back into upfront, customer-facing processes. 

The internal (organizational) perspective. With a powerful, purpose-designed PSA tool, company resources can be better managed across different roles and regions, with the right mix of resources to deliver on customer expectations. You can explore employee growth opportunities, facilitate rewarding career paths and ensure people are happy and regard themselves as valued members of the team, promoting employee loyalty and reducing attrition. Of course, happy employees draw a direct line to happy customers – that is, great employee relationships engender great customer relationships.

Analytics over anecdotes

This is why leaders consider the data-driven automation of PSA a must-have. It’s the way to find one’s business truth using actual, leverageable analytics instead of anecdotes. With a powerful tool in place, you can track and analyze metrics, adjust in real time based on market conditions, identify gaps and recommend solutions with broad applications.

By deploying a suitable automation platform and the industry-specific best practices that come with it, tasks are completely right the first time and business benefits multiply. Win rates improve. Invoices become more accurate and timely, so DSO declines. Billing disputes are avoided, and so are corrections and write-offs. And the bottom line is positively impacted.

Conversely, professional services businesses that lack effective tools compromise their visibility into business performance, customer service, forecasts and strategic scenarios. And, given the direct correlation the research has shown between PSA success and customer success, they very quickly find themselves at a competitive disadvantage.

Two examples

Let’s take a look at how two companies, in different parts of the world, have leveraged PSA tools to gain visibility into their operations and enhance the customer experience.

London-based consulting and technology firm Efficio experienced pain due to disconnected front- and back-office operations, and reliance on spreadsheets and legacy accounting software. Time-consuming routines, cumbersome workarounds and lengthy meetings failed to provide needed visibility across the company's global regions. As a result, project cost control was a challenge and headcount planning was a headache. Dedicated resources spent considerable time each month producing business reports.

Resolving to transform its operations toward customer-centricity, Efficio built a PSA platform to provide a single source of truth, fed by accurate, up-to-date data. Leadership now has a better, clearer, more comprehensive picture of operations and resources. Plus, by centralizing project management, the company empowers managers to make informed decisions to better manage performance and profitability.

Efficio has unlocked business efficiencies by freeing employees from manual tasks, while realizing stronger controls from sales opportunity to revenue reporting. The new platform has also powered a culture change that promises to transform the company's future.

BeyondTrust, the Atlanta-based cybersecurity software provider, needed to streamline operations, satisfy customer expectations and close projects quickly so it could recognize revenue. 

By implementing an automated PSA solution, the company’s Professional Services team has gained unprecedented visibility into projects. Project managers can easily schedule engineers based on skill set, availability and geography. Customer success managers are automatically alerted to proactively reach out to the customer when a project manager flags a project. Engineers appreciate the improved visibility of their assignments and the ability to easily submit timesheets.

That all translates into a superior customer experience, because the company can build customer-centric activities into project templates, capture feedback and measure customer sentiment. This timely insight provides the Professional Services team with the information it needs to deliver better customer outcomes.

A competitive must-have

Services now comprise over half of all business commerce worldwide. Leaders of services organizations can no longer afford anything less than a single, reliable source of certainty from which to base their business decisions. That makes today’s most advanced PSA tools a competitive must-have for operational and customer success.

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