Over-servicing is a common issue among the majority of professional services firms. Too often, money is being left on the table when such firms deliver professional services projects and end up over-servicing their clients. In fact, money is left on the table throughout the entire project delivery process, from initial quoting to final billing.
In this post, we highlight the areas where project management falls short, particularly in managing project profitability, and discuss how a next-generation, unified project management system can overcome those deficiencies to maximize both project and company profitability.
To maximize project efficiency while delivering great results, project management teams need to be exceptional in three areas: data access, project control and information visibility. Yet, very often they fail to perform in all three areas.
It is commonly accepted that the easiest way to predict costs and resource needs is to view past projects, However, many project managers don’t have access to historical data. Blind spots in project management systems prevent the ability to search across similar projects (completed or ongoing) and view critical data surrounding resource utilization and costs, making them more reliant on conjecture and approximate cost and quoting estimations, which are easily negotiated down by savvy clients.
Project managers often fail to follow best practices for managing plans and people to hold down costs, and this is usually a result of their project management system lacking core features that target control. For example, many systems do not provide for Gantt planning ─ a ‘must-have’ feature to developing project timelines and deliverable goals. At the same time, many project management systems lack the functionality to enforce project rules and requirements. It’s one thing to ask people to keep project-related expenses down, for example, but it’s another thing to enforce those rules as people work and attempt to expense items. When people do not adhere to rules and requirements, projects quickly spin out of control from a cost standpoint.
Finally, project managers frequently lack the necessary depth of visibility into projects, leaving them unable to answer basic questions such as who is busy and who isn’t, whether the project is on schedule or not, and why, all of whose answers drive predictability and profitability.
There is a great need to view real-time information to shed light on exceptions that can cause delays and cost overruns.
The new generation of project management system addresses the common problems surrounding data access, control, and visibility by integrating (Enterprise Resource Planning) and incorporating all the information needed to optimize project profitability.
A next-gen project management system with a unified data source provides the data to allocate and forecast resource needs and associated costs, as well as the ability to view historical data and results from similar projects to identify their profit drivers. You can even take advantage of templates that establish much of the parameters for you.
Your business will gain more control over projects and resources, even if they are dispersed across time zones. A next-gen project management system incorporates Gantt planning along with automatic cost determinations and calendar integration, so you know exactly how to time your resource usage wisely. Rules enforcement becomes much easier, as you can apply rules via role-based access and predetermined parameters, establish workflows that must be followed, and offer mobile access to team members to streamline collaboration, approvals, and time/expense reporting. All of these new features yield greater predictability, both within and across projects.
Next-gen project management significantly improves project visibility. Within your Gantt planning, you can quickly see which resources and staff are available and when, the status of ongoing projects, with particular focus on timing and budgets, and real-time updates on the status of staff and resources.
In addition, you are also able to request alerts should exceptions occur within real-time updates on staff and resources. Ultimately, this new level of visibility into projects gives project managers the confidence that everyone on the team has the same visibility and understanding of a project, and in real time.
No one likes leaving money on the table. If you have not evaluated project management systems in a while, you are missing out on the opportunity to unify people and resources across your entire business and to optimize company-wide profitability.
One of our team will be in touch shortly.