Effectively handling growth means thoughtfully approaching scaling, which is about more than just piling on more people and resources. That can actually slow your professional services' firm down if you don't create sustainable business practices and processes that revolve around consistent, reliable data.
It’s a set of “problems” any company would love to have: customer and revenue growth, geographic expansion, and new lines of business. Success comes with growing pains and, ironically, can ultimately lead to a professional services firm’s downfall. Dealing with growth effectively means thoughtfully approaching scaling, which is about more than just having brains and brawn. In fact, piling on more people and resources can actually slow your firm down if you can’t operate more efficiently.
At Workday, I have the pleasure of working with and learning from customers in theprofessional services industrywho are on the front lines of these challenges. While growth strategies vary from firm to firm, successful firms have been able to scale by creating sustainable business practices and processes that revolve around consistent, reliable data.
To effectively scale, services leaders must track the sameperformance metricsacross the organization to determine how to best optimize their operations. Without a standard set of metrics, a firm can’t get a good handle on its health, which requires understanding the impact of each service line and how resources are being utilized to improve employee productivity.
For example, in order to accurately measure project profitability, a firm must charge all costs in a consistent and repeatable manner, and overhead must be allocated in the same way so that each project is charged the correct rates. Once these metrics are standardized, leadership will be able to see the true margin of their resources and projects.
Measuring the same KPIs also allows services leaders to distinguish the performance of different markets, regions, and business lines, even if they operate independently of each other. With consistent metrics, a firm can roll-up the data into an aggregate view to understand its overall performance as well as drill down to understand challenges and opportunities in specific locations or markets.
In the professional services business, it’s all about assigning the right talent to each client project and capturing the profitability they’re driving. Optimizing this process requires a data-driven model that allows separate business functions such as finance, HR, and client services to work towards the same goals of driving profitability.
When you integrate financial, workforce, and client data, you can quickly shift your strategy to meet changing business needs.
As Steve Bandrowczak, chief operating officer and chief information officer at Alight Solutions, recentlyshared with us, “HR and finance systems working together helps us make sure that we get the right people, track their time and capabilities, integrate that into the projects and services that we’re providing for our customers, and ultimately capture the right time and profitability.” Put another way, you’ve got to be able to see the whole picture, but zoom in on the parts that matter on any given day.
When you integrate financial, workforce, and client data, you can quickly shift your strategy to meet changing business needs. For instance, if management determines that the firm isn’t on track to meet its revenue goals for the quarter, they can dive into the utilization data to see whether there were any unfilled positions or projects that haven’t been billed and adjust as needed.
A firm can also understand how it’s utilizing its workforce and how to improve recruiting, onboarding, and retention, which is critical when you consider that a firm’s talent has a direct impact on client satisfaction, project margins, and revenue. Rather than assigning employees to clients based on availability, firms should be able tomatch the skillsof its workforce to immediate and future demands—some of which they may not have the right talent for yet.
Professional services firms often focus more on improving client satisfaction than optimizing their internal processes. While delivering on client expectations is important, a neglected back office with disparate systems limits the type of data a firm can analyze to increase efficiency and improve performance—both of which are fundamental to scaling the business.
As a firm grows and globalizes, the amount of siloed information can increase exponentially. Without a unified system, employees and managers alike are left piecing together data scattered across multiple systems. Aside from having to manually pull, fact check, replicate, and report on different data sets, they’re often challenged with the inability to glean insights into how the business is doing as a whole.
Firms aren’t just facing pressure from their competitors. Their own practices and technologies may be wreaking havoc on the organization.
要取得成功,需要在一个整个画面place. Joseph Fanutti, chief financial officer at Bill Gosling Outsourcing, explained that before Workday, “Numbers were always challenged, no one could agree on metrics, and people couldn’t agree on what actions to take going forward.” Using aprofessional services automation (PSA)system, firms can access information across theirservice delivery, resources, and client needs so they can assign the right talent to the right projects.
In the “Forrester Report: Now Tech: Project Business Automation Solutions, Q3 2020” report, Forrester advises that a PSA tool “ must become the communication and management hub that provides firms with transparency into resource availability and performance while supporting regulatory reporting requirements.” As Bobby Riggs, chief financial officer at Collaborative Solutions, shared, “Workday PSA helps us eliminate manual processes, staff projects as soon as they’re proposed, and increase visibility into project financials and resource demand.”
Furthermore, a cloud-based system can make it easier for employees to leverage data across the organization—accessible on any device. In the same report, Forrester notes that “firms require their people to be available to respond to project issues regardless of their current location. The right tool will also allow for autonomy across different lines of businesses and locations. With a cloud-based platform, data can be quickly pulled and analyzed to make business decisions and shift in real-time.”
In today’s competitive landscape, firms aren’t just facing pressure from their competitors. Their own practices and technologies may be wreaking havoc on the organization, and a reevaluation may be in order. By standardizing firm-wide performance metrics and integrating finance, HR, and client data into a single system, firms can empower their employees and managers to increase profitability and scale the business.
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