With the rapid pace of change and ongoing labor shortages in many industries, companies are increasingly adopting a skills-based approach that widens the talent pool and finds workers with skills that can move the business forward in dynamic environments.
Simply put, professional services leaders can now leverage an open and connected skills ecosystem to deliver business value and enhance employee experiences through machine learning in both Workday and other applications.
“Fundamental to delivering on this shift to a skills-based approach are technologies, such as AI and ML [artificial intelligence and machine learning], which can understand key attributes to help drive automation and provide insights and predictions that help to identify and align skills with jobs, quickly turning employee data into a strategic advantage, while helping businesses adapt to change,” says Workday Co-Founder, Co-CEO, and Chair Aneel Bhusri.
By bringing skills data together, services firms can have a holistic view of workforce skills and tailor career experiences that help drive employee success and satisfaction.
“Organizations, including our own, are increasingly shifting to skills-based talent strategies to help improve engagement and provide career growth opportunities for their employees,” says Amy Richmond, managing director at PwC, in a recent Workday article.
3. Global Resource Management and Staffing
The challenge. If you hold a leadership position at a professional services firm, you’ve probably put names on a whiteboard, or in a spreadsheet, to assign workers to projects. You may have found you don’t have complete insight into the right people for some jobs and their skills, availability, or even what projects should have priority.
The solution. Get your resourcing process online and integrated into your human resources, financial, professional services automation (PSA), and planning systems. This gives you a holistic view of talent beyond your local office or past projects and availability (including project assignments, paid time off, leave, and global holidays), project requirements, and the specific skills of your workers. This will create tremendous potential for resource forecasting, digital matching solutions, and talent optimization.
Leveraging AI technologies such as machine learning can also help. Intelligent resource management unlocks real-time visibility into your workforce and makes project resourcing dramatically more efficient, more effective, and more intelligent.
“You’ll never take out the human element entirely,” says Patrice Cappello, global head of professional services industry strategy at Workday. “But machine learning can work through so many more dimensions around who would make an ideal team for a particular project—helping the person tasked with resourcing make data-driven decisions faster, and with greater accuracy and confidence.”
4. Client and Project Profitability Tracking
The challenge. Business success depends on having a clear understanding of profitability across service lines, customers, and regions. A key missing component of profitability analysis for professional services businesses is project-level profitability.
Historically, project profitability has been disconnected from financial planning and reporting processes. When project managers use spreadsheets or local project execution solutions for project financial tracking, others lack the operational insights they need to understand the drivers of business performance. This hinders assessment of profitable engagements and customers.
The solution. Make tracking project profitability standard practice, and an important key performance indicator (KPI). Incorporate it as a key component of your PSA process. Once established in a connected PSA system, you can track costs and revenue in real time, as transactions happen (think time, expenses, payroll, and contractor invoices that drive both revenue and cost calculations). Such a system allows you to bubble up project-level financial data into planning and increase real-time metrics visibility for each service line.
5. Billing and Revenue Management
The challenge. Many firms lack visibility into their end-to-end, opportunity-to-cash processes. Symptoms of manual and disconnected monetization processes include one-off contracts, spreadsheet-based pricing, invoice confusion, revenue leakage, and lengthy close processes. Firms may also lack the agility required to develop innovative new service offerings.
Services industries, which are talent-driven, have been challenged to provide timely and accurate quotes as most firms don’t use configure, price, quote (CPQ) solutions. There is no cross-company visibility into opportunities, scopes of work (SOWs), or resource requirements.
Many services quotes today are generated manually in disparate and disconnected spreadsheets and documents, causing delays and errors that can impact the customer experience and prove costly for the business.
Managing services quotes outside of the core system also means that most organizations start a project with an internal proposal/outcome that’s never going to be up to date. As the project starts, changes occur: resources, weekly task work, project forecasts. All of these updates impact billing, revenue (revenue leakage), and cash flow.
The solution. Digital monetization offers immense opportunity, but it needs to be holistic and agile, which are fundamental attributes of cloud-based solutions. A single platform that integrates customer-facing (customer relationship management or CPQ solutions), operational (PSA), and financial processes will minimize the number of touchpoints and process owners.
Leveraging a services CPQ solution builds accurate quotes that lead to accurate project staffing. The data from projects can then feed the quoting engine for future engagements, growing firm profitability.
Once you have a streamlined opportunity-to-cash process, the ability to focus on profitable projects, forecast, innovate, and support new revenue streams becomes easier. This also represents a significant opportunity to drive new business models.
Successful professional services firms can do many things right, from delivering projects on time to maintaining high client-satisfaction rates. One reason firms get high marks on such KPIs is that they have the technology in place to support automation, data-driven insights, and better decision-making.
Digitizing key processes across an organization makes it more agile and streamlined, freeing up your talent to focus less on manual tasks and more on meaningful work that propels the business forward.
To learn more about how Workday helps professional services firms drive digital transformation, visit our website.
This updated article was first published in January 2020.