Ashley Miller explores how professional services organisations can reap the rewards of real insight into project profitability
Many of us are familiar with the age-old adage that ‘money doesn’t go on trees’, with some of us finding ourselves already repeating it to our own children. This concept of working hard to earn your money and the need to take full control of your own finances is a vital lesson passed on by parents, standing the next generation in good stead when it comes to their financial future. Where the personal leads, the professional should follow, applying the same, if not more stringent, financial control to businesses and projects. However, it’s amazing just how many businesses have a lack of visibility into project profitability, as well as limited access to information on business margins when needed.
For professional services organisations in particular, this is a vital business capability. Such businesses are only cost effective, and therefore profitable, if they bill a high percentage of their performed services, making it crucial to have a handle on all aspects of the project, including project planning, time tracking, accounting and project analysis. The challenge faced by many professional services companies is that multiple software applications are used to manage the numerous project elements. So there might be one financial solution, another system for managing staff timesheets, another for purchasing and yet another for analysis. For those firms still labouring under traditional and disparate record-keeping and accountancy solutions, in order to garner an all-encompassing view of the project, it requires the amalgamation or re-entry (often done manually) of all the information, a process which is time-consuming and prone to error.
However all is not lost, it’s all about sourcing the right software solution that provides comprehensive control of projects, with ongoing analysis built-in, to ensure business managers can keep track of projects at all times. By automatically integrating data from CRM systems, procurement and project planning, these solutions help to not only calculate projects economically, but also enable ongoing project reviews and edits to ensure profitable results, without losing time transferring data between different systems.
The unprecedented levels of financial control that such solutions offer allow businesses to manage the calculation and planning of resource management, purchasing, time recording and billing, as well as analysis and business reports. Due to the fully-integrated nature of the systems, while planning resources for example, costs and revenues are automatically added into the plan. The same benefits apply when it comes to providing quotations too, with all services stored in one system alongside purchase and sales price, meaning that it’s possible to check with just a few mouse clicks whether a quotation is profitable.
When billing projects, the system takes into account all recorded and approved data. The fact that employees can capture project hours remotely, or in the office, means there’s no need for a time delay in collating all the relevant information too, again saving time and reducing the margin of error that accompanies multiple data re-entries. The real-time access to all critical project information at all times results in up-to-date progress reports and project analysis at your fingertips, enabling business leaders to quickly and easily ascertain if a project is profitable. Ongoing project evaluation via analysis and reports, which can be tailored to focus on specific areas of the project, allows amendments to be made throughout the duration of a project, keeping it on budget and guaranteeing profitable results.
As margins are currently squeezed tighter than ever before, with clients demanding more for less, it’s vital that professional services organisations maintain full control of their finances. The technology is there to facilitate total oversight and visibility of all aspects of project management, resulting in the availability of real-time, business-critical information at the fingertips of key decision-makers. It’s only with this depth of knowledge that professional services can ensure optimum results, saving both time and effort, and turning a healthy profit in the process.
What to look for in a project management solution for the professional services industry?
- Look for a partner with experience in the industry. They can advise the best solution to suit your specific business needs.
- Mobile access is a must, particularly if you want to reap the benefits of true real-time reporting and information.
- To ensure maximum business buy-in, you want something that’s intuitive and easy-to-use.
- Make sure the system is comprehensive enough to deal with all your project needs – from calculation, resource management and purchasing to time tracking and billing.