As a professional services firm, your ability to deliver for your clients and stand up to the increasingly competitive landscape is a constant challenge.
And that’s even more true today as you enter a time of disruption.
New technology, evolving business models and globalization have made it easier for clients to find services cheaper and faster.
In the same way that ridesharing apps and food delivery changed the game for their industries, it’s only a matter of time before you see the maturation of a “Tinder for legal services” or an “Uber for IT.” You can see apps like Fiverr already changing how companies reach social media audiences or hire freelancers.
While these may never replace a massive contract that you have with a client, they may chip away at your revenues.
Pair this with technology allowing firms the ability to do more with less, and you face threats from all sides. Firms are already implementing AI solutions for contract or financial analysis that allow them to do twice the work in half the time.
In order to respond to these threats, front-office professionals and consultants need tools that can make their jobs easier, and those in the back office need to leverage technology to make it easier to schedule, price, manage and track everything about the business.
Four challenges to address
Knowing this, there are certain areas that executives and back-office professionals need to control if they hope to push their business forward and unlock value from their staff.
Transparency has become the name of the game. Clients want to know what they are paying for, making it more important than ever to have a clear picture into the pricing versus services-provided picture. Firms need to evaluate and understand their market environment to properly price their services and create competitive bids that provide satisfactory margin.
To make this happen, you will need to gain a clear picture of the prices you charge and the services you provide, and benchmark these with the rest of the industry. It’s important to find a sweet spot: Charge too much and risk losing a client, charge too little and you may end up missing revenue.
If pricing your services is one thing, ensuring that billable hours are well-spent is another. There’s a strong need to efficiently use resources and assets to eliminate unproductive, nonrevenue-generating idle time.
This means matching the right person to the job quickly and easily and tracking every single component of a project to ensure timely and profitable project delivery. Your ability to track utilization during and after the project is key to avoid surprises and make sure that everyone benefits — customers get what they expect, people aren’t scrambling to get a job done and your firm increases both revenue and profit.
Crisp operational execution with on-time, on-budget performance usually spells the difference between success and failure. When you promise a service, you need to be able to deliver or risk the consequences.
Services firms live and die by the quality of the work they do, and any lapse in a project is going to reduce client confidence in your ability to deliver services.
To make this happen, your firm must embrace the financial infrastructure of tomorrow, a system that provides comprehensive — but simple to use — functionality to bring finance, projects and reporting/analysis together. That means breaking down silos to create end-to-end, compliant processes for project-based accounting, time/expense capture and approval, billing, and revenue recognition — instead of the weekly spreadsheet scrambles, billing errors, lost T&E dollars and slower manual workflows.
In today’s market, standing still is failing; you have to keep moving forward. Firms must proactively manage growth, ensure and retain profitability and customer satisfaction, and avoid unprofitable, low-margin business.
Ultimately, this means being able to identify which kinds of customers make you the most money, which market segments will make your business more profitable and which projects you want to focus on in the future.
How to tackle these challenges
While the challenges you face may seem overbearing, the right technology can give you the control you need. Collaboration, real-time information sharing and automation are key factors to bring finance and operations together and make execution easier.
By using an automated finance platform to get and keep the financial house in-order while tying in operational and project data, you drive down executional costs and keep the business focused on customers — not transactions, broken processes and data headaches.
How Wipfli can help
At Wipfli, we have supported the accounting needs of project-based professional services firms for nearly a century, and we’ve provided accounting and ERP solutions for decades.
As one of the largest accounting firms and VARs in the nation, we understand your needs and work with you to implement the solutions you need to drive your business forward. If you feel you have outlived your current accounting or ERP solution, we invite you to learn more about Sage Intacct.
Designed to provide innovative, integrated and intelligent ERP for mid-sized businesses, this true cloud application gives you the power to take control of your projects, deliver more profit to your firm and ultimately improve client relationships.
Ready to learn more? Stay tuned to our blog in the coming months as we explore this solution for professional services firms, and if you are ready to move forward, contact us for more information.