Challenges toSolve by Aligning Finance and Services

5

NO MATTER WHERE YOU WANT YOUR BUSINESS TO BE IN 2020, HERE ARE FIVE KEY WAYS A PSA CAN HELP YOU GET THERE.

Stop Leaving Money on the Table: Align Finance and Services to Solve These 5 Challenges

Finding profitable new revenue streams is a primary objective of pretty much every executive out there. The challenges are many, and the results are mixed—but one industry that’s thriving with opportunity is Services. And with good reason: Service-based companies often have low overhead and equipment costs and it usually doesn’t take much of an upfront investment to get started.

But to run a profitable practice, you need to accurately track all the financial components of a project: budgets, estimates, bookings, and billing—and everything in between. Things like manual processes and poor visibility may not *seem* like major concerns, but they’re probably keeping you from optimizing your processes... which means you’re leaving money on the table.

There’s an easy answer. Read on to learn 5 everyday challenges you can solve simply by integrating Services with Finance. Find out how you can run a leaner, cleaner org—and learn the tricks to get that cash off the table and onto your bottom line.

Black hole of information

The challenge: Since many services organizations run like a company within a company, they can feel like massive black holes—data goes in, but never comes out. Services teams have their own systems and information, and very little of either is shared with other departments. It’s not surprising that Executives get frustrated when they can’t get current profit/loss numbers—or any data that’s not from a previous quarter. What’s a finance team to do?

Why alignment works: Services and Finance share the same opinion when it comes to data: the more, the merrier. You need to know what revenue you’re forecasting and how backlog feeds into that—and you need both backward- and forward-facing views in order to reach financial goals. Your customers want to know as much as possible about their projects, all the way down to the last hour worked or pound spent. A proper Professional Services Automation (PSA) tool helps free up all that critical project information and fosters collaboration among departments. Go ahead—replace those worn-out spreadsheets that are circulated around the office every Monday morning with last week’s project totals. Instead get accurate forecasts and schedules, monitor budgets in real-time, make adjustments on the move. With PSA, you get Sales, Services, and Finance working together to deliver a profitable project and create satisfied customers.

1

Revenue leakage

The challenge: To stay profitable, services organizations have to centralize financial information from multiple sources and stakeholders: invoices, contracts, approvals, hiring, backlog, and pipeline. If your billing and revenue recognition processes are inefficient or inaccurate that only means wasted admin time, project delays, and ultimately significant cash flow problems and lost revenue.

If you’re not on top of these data points, you’re very likely losing revenue and leaving hard-earned cash right there on the table.

Why alignment works: Aligning Services and Finance helps you streamline information and automate processes. A proper PSA tool lets you forecast resource need, make better decisions about staffing, and stay ahead of the curve. Use it to identify and fix clogs and inconsistencies in your processes. For example, perhaps you could streamline your contracts to simplify things for the back office. Trouble getting the invoices out—correct and on time? Your PSA tool can automate that process so nothing falls through the cracks. Think about capacity; how often have you had to pay expensive contractors for work you couldn’t forecast? Or struggle to staff a project that went over budget? PSA turns on the light, helping you identify whom to hire based on backlog and pipeline and gives you revenue impact on the business. These may seem like small changes, but they’re big wins for improving margins. After all, every increase in resources, efficiency, and utilization translates directly to an increase in revenue.

2

Revenue leakage (continued)

Visibility Capacity

Track bookings vs. backlog Match revenue with resources

View profitability by project Identify areas of under/over capacity

View budgets at a project level Realign to achieve maximum utilization

Automate invoicing and timesheets Understand pricing vs. utilization variations

2

Inaccurate data

The challenge: In today’s world—where everything is tracked and analyzed—accurate data is key. Real-time analytics are no longer a nice-to-have; they’re a have-to-have. Can you see how you’re doing from a profitability standpoint? Do you have visibility into who’s spending too much time on non-billable work? Is your invoicing precise and on time? These questions are nearly impossible to answer without real-time visibility, leaving you with a useless mess of inaccurate or out-of-date data.

Why Alignment Works: The data that a Services team tracks is unique: bookings and backlog, billings and revenue. In fact, most key Services KPIs have a direct impact on revenue and margins: Resource utilization, profitability, realization, and backlog. So these organizations need to ensure they can provide visibility and transparency—and that only happens when everyone is working with same set of numbers. Disparate systems? Not going to work. Moving data, data reentry, and spreadsheets? Expensive, difficult, and tremendously painful. When you integrate Services and Finance with a PSA tool, numbers are shared across the board, leaving no room for inconsistencies. And imagine what you can accomplish with clean data…Accurate forecasts and schedules, useful dashboards and reports, correct invoices and timesheets, and happy teams and customers.

3

Inaccurate data (continued)

Business Challenge PSA offers…

Executives only have “rear view” information Project forecast revenue, margin on executive dashboard

Resource management Optimized staffing drives higher revenue potential and reduced costs tied to using contractors

How do I know what resource I need to hire, and how do I invest in the team I have?

Resource forecast by role, comparison to capacity, shorter time to recruit

Managing partner engagement Secured portal to collect Time & Expense for partners; vendor invoicing

Onerous manual rev rec process Automated feed from services engagements to revenue recognition process

3

Manual processes for revenue recognition

The challenge: Since services have to prove hours and work, it’s critical to be able to collect accurate data. This is often very manual and spreadsheet driven, unwieldly, onerous. And using a spreadsheet for analytics is like using a fork for soup: You can do it, but why? Manual data entry is a waste of time. And a pile of spreadsheets ≠ a report, especially now that there are slick cloud services that can automate so many of your tasks. Using spreadsheets means you’re not taking advantage of a set of business processes; you’re making up rules as you go, which isn’t a sustainable business practice. Plus, there’s no single version of the truth when you’re working with spreadsheets—your data’s (literally!) all over the place.

Poor automation results in: Revenue leakage | Challenged DSO | Revenue recognition challenges | Lack of responsiveness

Why alignment works: Make life easier for yourself and unify these processes and tasks with the proven efficiencies of PSA software. System integration means accurate information shared with the right people. You can set up a PSA to pull numbers automatically and route them as needed. Automated invoicing? Easy. Automated approvals? Definitely. Automated timesheets? Piece of cake. There’s no time wasted on the back-and-forth that takes place with irregular cycles or missing information. PSA software can track project costs at a granular level. That means every hour on every project is easily tracked, along with any ancillary costs on a project (like travel or subcontractor expenses). Set up your bill cycles, and voilà! The revenue comes in.

4

Poor business efficiency

The challenge: You’ve got one system for accounting, another for data, and a third for project management. You’ve got to train your team on the different systems, you have to enter information multiple times to maintain consistency, and you’ve got higher costs. The small annoyance here is that you have to log out of one system and log into the next… but the real pain comes when you realize how little visibility you have in the end—and that you have to do all that manual stuff anyway. Your numbers, tracking, and analytics are off, and everything takes longer.

Why alignment works: Stop the pain by tearing down the walls between departments. Sales has to engage Services and hand off smoothly, and Services has to deliver well and on time. Accounting and Finance need to wrap it all up with timely, accurate invoices. These teams need open lines of communication and the same view of the business. Professional Services Automation helps you plan, track, and execute your work, taking project management to an entirely new dimension. It keeps you organized and effective, and with one point of entry, your information is consistent and accurate. PSA also boosts visibility, eases collaboration, improves resource management, and streamlines billing—all of which make your organization sleek, organized, and enviably efficient.

5

STAY AHEAD OF THE CURVE. YOUR CUSTOMERS, PARTNERS, AND CFO WILL THANK YOU FOR IT. LEARN MORE AT:

http://www.financialforce.com/products/professional-services-automation/overview

Stop Hemorrhaging Revenue—Starting Now

If Services is going to play a strategic role in your business, you’ve got to turn on the lights and bring them into the fold. A proper PSA lets you do just that by automating processes, forecasting recourses, and keeping up with staffing. Your team—and your customers—can rest well, dreaming dreams of timelines met, budgets kept, and projects properly staffed.

FinancialForce.com

Built on the Salesforce1 Platform, FinancialForce equips customer-centric businesses with a unified cloud platform and all the applications necessary to grow both the top and bottom line. Our Financial Management, Human Capital Management (HCM), Professional Services Automation (PSA) and Supply Chain Management (SCM) apps allow businesses to increase the speed in which they operate and be more responsive along every touch point of a customer’s journey. Founded in 2009 and headquartered in San Francisco, FinancialForce.com is backed by UNIT4 and salesforce.com.

FinancialForce Professional Services Automation (PSA) is a cloud-based services solution that uses the power of Salesforce CRM and the Salesforce cloud platform to manage your people, customers, projects, and financials in one integrated services management application. Our software combines advanced project management, resource planning, collaboration, and financial tools, giving you keen visibility into capacity, backlog, and skills availability. See across projects, schedule resources, and drill down to resource schedule details online.

FinancialForce PSA

For more information about FinancialForce: www.financialforce.com / info@financialforce.comAmericas: 1-866-743-2220 / UK: 0808 2389791 / Int’l: +44 1423 532832 / APAC: +61 2 9006 135