October 1, 2014
Improving Control Visibility and Profitability in the Services Business:
Driving Accuracy in Time Collection, Billing and Revenue Recognition
www.blytheco.com
Agenda
Panel Introductions
Questions for Our Panel
The State of the Industry Today
The Top Requirements and Capabilities
Solutions to Help
Why NetSuite?
Your Questions
Next Steps
Introductions
Alicia Anderson
Strategic Marketing, Blytheco
19 years in ERP sales, service and marketing
Leading ERP provider to thousands of companies nationwide
Rick Cobb
Senior Solutions Architect, Blytheco
Helps companies evaluate and design ERP and CRM solutions.
24 years of industry experience in designing and implementing business management technology
Introductions
John Garzouzi
Senior Solutions Consultant, NetSuite
Designs cloud-based technology systems for businesses nationwide.
Hannah Molette
Principal Consultant and Managing Partner for Matriarch Partners LLC
Independent Consulting/Professional Services firm based in Atlanta.
ERP IT Project Manager for the City of Atlanta’s Department of Information Technology
PMI Atlanta
Introductions
Jeanne Urich
Managing Director, Service Performance Insight
Specializing in improvement and transformation for project- and service-oriented organizations
Co-author of the ground breaking Professional Service Maturity Model™ benchmark used by over 10,000 project and service oriented organizations to diagnose and improve their performance.
www.spiresearch.com
Contact Jeanne at [email protected]
What is the Current “State of the Industry?”
2014 Service Industry Trends
Slowing growth
Lower billable utilization
Higher attrition
More overhead
Lower revenue per person
Loss of profit
Four Major Trends Impacting Profitability
5.30
5.19 5.21 5.19
4.96
4.70
4.80
4.90
5.00
5.10
5.20
5.30
5.40
2009 2010 2011 2012 2013
Bid
-to
-Win
(pe
r 1
0 b
ids)
Year
6.1%
6.8%
7.4% 7.2%
8.3%
5.0%
5.5%
6.0%
6.5%
7.0%
7.5%
8.0%
8.5%
2009 2010 2011 2012 2013
An
nu
al E
mp
loye
e A
ttri
tio
n
Year
67.6% 67.5%
69.6%
70.3%
69.7%
66%
67%
67%
68%
68%
69%
69%
70%
70%
71%
71%
2009 2010 2011 2012 2013
Emp
loye
e U
tiliz
atio
n
Year
3.6%
7.6%
13.7%
11.5%
10.0%
0%
2%
4%
6%
8%
10%
12%
14%
16%
2009 2010 2011 2012 2013
Year
-ove
r-Ye
ar c
han
ge in
P
S R
even
ue
Year
The Balancing Act of Professional Services
Costs Revenues
Winning the Right Clients
Government Funding
Compliance
Training
“On the Ground” Observations
How Do the Challenges Show Up in PSOs?
It is Getting Harder to Make Money!
16.1%
13.5%
16.8%
11.4%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
2010 2011 2012 2013
Earnings Before Interest Taxes and Depreciation
Five Year KPIs for PSOs
Challenges in Process and Planning
Customer requirements
• Inability to meet customer or compliance standards
• Non-aligned/non-existent best practices
• Inconsistent processes
Need for risk mitigation
• Reacting to issues as they arise vs. proactive planning
• Inability to anticipate and plan for project risk
Inconsistent business processes
• Disconnected virtual resources
• Not connected to company best practices
• IP Drain
Fragmented Business Systems
Core
G/L
Management
Reporting
Reconciliation
Statutory
Reporting
Financial
Reporting
Project Accounting
Timesheets
Expenses
Budgets
Sales
Professional Services
HR
Clients
Forecasts
Billings
Upsell
Renewals
Forecasting
Profitability
Resource Utilization Future Billings
Collections
Commissions
MGT Reports
How are Companies Solving these Challenges?
Look Backward, Project Forward
How things can change so rapidly 2010 was about Sales
2011 was about Execution
2012 is about Talent
2013 was about Profit
2014 has been about All of the above!
Executives must prepare Create loyal clients
Develop flexible workforce
Deliver on time and at high levels of quality
Improve visibility and alignment
2014 Planned Steps Taken to Improve Profitability
Steps Taken to Improve Profitability Survey Embedded Independent
Improve sales effectiveness 3.91 3.78 3.99
Improve utilization 3.86 3.88 3.85
Improve methods and tools 3.78 3.95 3.68
Improve marketing effectiveness 3.72 3.36 3.92
Improve solution portfolio 3.65 3.71 3.61
Improve hiring 3.55 3.75 3.43
Reduce non-billable time 3.51 3.75 3.37
Increases rates 3.04 2.61 3.28
What steps are you taking to improve profitability?
1 to 5 scale with 5 equaling greatest focus
The “Best versus the Rest”
KPI Best Rest ▲
Number of Firms 12 226
EBITDA 30.2% 9.8% 209.0%
Average revenue per project (k) $413 $178 132.0%
Annual revenue per employee (k) $236 $150 57.3%
Annual revenue per billable consultant (k) $291 $187 55.6%
Quarterly revenue target in backlog 65.8% 43.7% 50.7%
Project margin for time & expense projects 40.4% 37.4% 7.9%
Larger projects due to positioning, service productizing
Precision execution – high utilization, rates
Robust pipeline, attention to backlog
Lean overhead – virtual facilities and workforce
Proactive vs. Reactive Project Management
Adapt
• Know customer requirements and processes
• Stay on top of trends
Predict
• Manage risks to projects, revenue, and billing
• Up sell throughout client engagement
Collaborate
• Partner with your network
• Get your own teams on the same page
Enterprise-Wide Visibility
Project
Billing Rules
Revenue Rules
Expenses and Purchases
Timesheets
Bills
Employees Project and Resource
Management
Finance
Invoices
Charges
Next Steps
Learn more about best practices in managing PSOs, including:
Download SPI Research’s “Introducing the PS Maturity Model™” paper.
Take the PS Maturity™ benchmark survey and get a FREE ($995 value) copy of the “2015 PS Maturity™ Benchmark” report when it is published in February, 2015
View the NetSuite flash demo
info.blytheco.com/services-resources
Next Steps
December 2- Optimizing Project Resources and Improving Visibility into Performance If you are here, you are already signed up!
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