If people are the lifeline of a successful firm, then a plan is the rope that pulls in profit or breaks under strong pressure. With client projects directly impacting revenue, adopting a regimented planning approach is a must. Finance leaders should factor in resources, revenue streams, and project work into the firm’s financial plans.
“Planning for people costs at a detailed level should tie to financial plans and budgets for the overall organization. Even more importantly, in businesses where the production and customer service capacity of the business is highly dependent on people, workforce planning is essential to understand capacity constraints and enhance revenue predictability,” advises Paul D. Hamerman, former vice president, principal analyst at Forrester.
The foundation of strong planning lies in the availability of key data and systems across the enterprise. By managing resources, projects, and financial data comprehensively, a firm can get context into its client projects, skills gap, and the health of various service lines with immediate insight into whether it’ll meet its financial targets. With this approach in mind, professional services firms need to have planning processes that enable:
Headcount planning: Track the number of FTEs and contingent workers, as well as data on key worker attributes including industry, product, service line, key skills, and certifications.
Project and opportunity planning: Determine current and future resource needs, as well as revenue potential.
Capacity planning: Get an aggregated view of availability by worker attributes and schedule (so you don’t schedule someone who will be out on leave or vacation, for example).
Financial planning: Obtain a full view of revenue and margin across service lines driven from both financial and project data.