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January 27, 2015updated 21 Oct 2016 5:31pm

The SAAS revolution in Professional Services

Professional service outfits are risking the business by failing to heed their own data

By Sam

It used to be called eating your own dog food. Now it would probably be called downing your own apps or more appropriately for the Professional Services world – automating your own processes.

Professional Services Automation has been around for a while but it has been restricted to use in large consultancies. The ticket price was just too high for smaller players.

That left a gap. As a sector Professional Services has traditionally been backward in looking at its internal data. So it is makes decisions on what happened in the last month, or three or six months in terms of utilisation, revenue and margin.

But for consultancies to survive, grow and capitalise on a market that’s expanding, they need to look at the demand that’s coming and resource up the correct skills based on market needs.

Professional Services Automation solutions can look forward and guide the business user in terms of the key things happening in their business and surface that data in a meaningful way through something called guided analytics.

It is able to put some interpretation on top of data and KPIs.

With markets such as Financial Services looking for analytics and other big data skills (see below) PS firms risk losing business if they don’t recognise in advance exactly where the market is going.

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CBR asked Sean Hoban, CEO of Kimble Applications about the impact of SAAS on how Professional Services businesses are run?
SH: "Professional Services Automation (PSA) as a concept has existed for a decade or more but to date it has only been utilised by the larger firms. This is because pre SAAS the ticket price, the in perpetuity licence price, was prohibitive for anyone operating below the 300-man-plus size consultancy. It was only the elite who could afford it and they typically built a home grown solution because they felt that they were unique. The reality is that PS firms have a common set of processes. What they sell is unique but their processes are common," says Hoban, CEO of Kimble Apps which has built a PSA suite on the Salesforce Force platform.

CBR: What does PSA deliver?
SH: Diagnosing the trends, both future and historic to inform the actions people should be taking in a business.
So for example if a Professional Services firm can see a healthy pipeline in a certain area which for example means they will need particular technical architecture skills PSA will be able to see the evidence for that in their pipeline and alert them to any capacity shortfalls.
And over time, the intelligence in the system will work out the likelihood of them winning those deals so they’ll work out a weighting of the pipeline. For example should 70% of the pipeline land within a certain timeframe, then the system provides an action.

CBR: What are professional services missing without PSA?
SH: As with the SAAS based CRM revolution from ten years ago which brought enterprise level software to the mass of SMEs now the whole PS sector has access to a tool via SAAS model allowing them to have access to the vital data within their business. Professional Services firms internal systems are comparable to plumber’s taps – which we know are always dripping. PS firms have not necessarily focused on their own processes. They are more focused on the processes and systems within their clients. The access to the type of systems to provide that insight wasn’t readily available but it has been facilitated by the SAAS revolution which has allowed PS firms to understand that data. Progressive PS firms are looking inwards to ensure they are driving efficiency within their own operations to ensure margins are maintained.

CBR: Why does SAAS have something to offer in PS?
SH: What Kimble Apps has done is to understand the processes of professional services firms.

These are common whether you are a 20 person business or a 20,000 person business – not everything is relevant to both but if you build a configurable system then one set of software can support that range of business from the small to enterprise scale.

The 20 person business is now on a pay-to-use SAAS model. In the licence world the cost would have been just too prohibitive. Now they can get rid of silo’d systems such as spreadsheets which is typically what they were using to run the business and be more like a large consultancy.

And just like Salesforce did in the CRM world, PSA provides the forward visibility enabling consultancies to understand what they will be invoicing in six month time. It is hugely important at both ends of the spectrum.

The Demand Side
See next page for what is happening in financial services and in roles such as Chief Data Officer and Data Scientist

 

The Demand Side

CBR: In terms of Chief Digital Officers and Chief Data Scientists, are PS firms skilled up for that?
SH: The niche guys are but I don’t think that the big consultancies can yet say they are. The big firms are using independent contractors to fulfil requirements on their projects. There is a shortage of those skills. There is a shortage and they’re not geared up for it.

The consulting firm of the future is not geographically dependent on access to skills. People with the skills to fulfil those big data roles may not reside in your local geography but that doesn’t mean you can’t utilise them on projects as needed. There are people globally engaged across time zones who are not restricted by distance. They have those key skills and you have to ensure you can get them onto your project when required.

CBR: Take Financial Services – what type of projects are they trying to fulfil.
SH: Banking sector strategic initiatives are generally around big data. The banking sector got rid of many of the people who they would normally turn to execute these type of projects. So they are turning to PS. They are going to Systems Integrators and Management Consultants to deliver these projects or to augment what remains of the inhouse resource.

Those transformation projects need to have access to the right skills at the right level at the right time. The PS providers need to ensure those resources are available. They need to have forward visibility in order to look forward and see what the customer wants.

The supply side of Professional Services

CBR: What’s happening in the current market environment?
SH: We have a lens on the market from our existing customers. We see how our customers are expanding as they hire new consultants. In our customer base we’re seeing a 25% expansion YOY, so there’s clearly a demand for management consultants and IT services firms. This has come about from a period of stagnation and inertia. Now transformation projects and legislative projects are coming to the fore. Where end user organisations have sat on their hands for five years, they can’t any more. And they have to go to the wider market for fulfilment.

CBR: Describe the Professfional Services Automation risk versus opportunity, within a PS set up and in the context of market demand
SH: The real risk for PS is having the wrong type of resource in place. And if they don’t have clear visibility of the market requirements in terms of the type of projects that are out there and are coming – then they may have the wrong profile of staff and contractors. They risk missing out on hiring and deploying the right kind of people.

Historically, PS firms have tended to sell what they have. They may have a 100 consultants who are a mixture of analysts, developers and consultants and that’s what they sell. But what they should be doing is looking at the real opportunities in the market in their segment and making sure they have enough of those skills to sell.

So that might mean changing the profile of the firm to take advantage of the opportunities in areas such as Big Data or IOT or Mobility. But as a PS firm you won’t know that unless you are really tracking trends using guided analytics which produces granular data allowing to exploit the opportunities.

CBR: How can a well run PS shop streamline and use guided analytics to respond to market activity?
SH: I think there are characterise two core competencies of a well run PS firm are the ability to sell and to deliver. Sounds quite basic but it is true.

Sales should be selling what the market wants and should be able to categorise the opportunities at a fairly low level of granularity and have ideally a good six month view of that pipeline going out.

Then the delivery side has a clear idea of who they will need in order to deliver the opportunities that are sitting in the pipeline. A well run PS firm has a joined up CRM and resourcing function.

It is not a lead to order sell and throw it over the fence to delivery. The smart PS firms have an integrated single process that says when I’m selling I’m automatically feeding into a process that says I know what I will have to be able to deliver.

 

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