Explore key trends and findings within the 2025 Professional Services Maturity™ Benchmark report—and how professional services organizations can leverage them for current and future success.
Written by Alison Natali, Industry Marketing Director, Professional Services
At face value, the numbers may seem alarming—a drop in year-over-year revenue growth to 4.8% from an 8.7% five-year average—but this isn’t a moment for panic for professional services organizations (PSOs). Rather, it’s a moment for decisive action, a call to reassess and recalibrate operational strategies over the months ahead.
SPI Research’s recently released 2025 Professional Services Maturity™ Benchmark Report provides a deeper understanding of shifting professional services trends with a comprehensive analysis of more than 400 organizations across seven industries, including IT and management consulting and software firms, among others. Importantly, its findings illuminate clear pathways for PSOs to enhance client engagement, refine talent development strategies, and optimize project efficiencies for future growth.
To effectively navigate these changes and capitalize on emerging opportunities, we dig into four critical insights that demand immediate attention from PSOs.
Billable utilization has plummeted to 68.9% in the last year, far below the 75% benchmark, signaling critical inefficiencies for professional services firms, according to the report. This downtick in billable utilization translates to lost revenue, as skilled consultants find themselves increasingly tied up in non-billable tasks such as cumbersome time tracking across multiple projects and client-related expenses.
Further exacerbating this utilization gap is a lack of real-time visibility into resources and skills, as well as staffing issues due to inaccurate project forecasting. Underpinning these utilization challenges, however, are much broader issues like ineffective scheduling, manual time tracking, and fragmented systems.
For example, without integrated HR, finance, and project management tools, consultants are often mismatched or misassigned to clients, delaying projects and inflating timelines. Without the right tools in place, growing pressure for high utilization can also lead to rushed assignments, compromising service quality and client satisfaction.
Addressing these resource management gaps is a key priority for professional service firms. PSOs that can optimize billable utilization via improved forecasting, time tracking, skills matching, and real-time visibility wield an incomparable strategic edge over firms reliant on siloed data and manual processes. In other words, this has evolved well beyond operational efficiency to become a strategic necessity.
An intriguing talent paradox highlighted in the report is the growing reliance on short-term staffing support within professional services. While demand for specialized skills such as accountants, data scientists, finance managers, and nurse practitioners remains sky-high, firms experienced only a marginal 1.9% increase in headcount last year.
This disparity underscores a significant reliance on subcontractors, who now represent 10.9% of revenue. This trend further emphasizes the strategic importance of effectively integrating external talent as part of an agile workforce, ready to provide the precise skills needed on demand.
For PSOs navigating fluctuating project needs and striving for long-term sustainability, the ability to seamlessly manage contingent workers is fast becoming a critical differentiator. By embracing technology that streamlines subcontractor engagement and collaboration, firms can tap into a broader spectrum of expertise and rapidly scale their teams to meet evolving project demands.
This not only empowers them to consistently deliver exceptional service but also cultivates a more dynamic and adaptable workforce, ensuring the right skills are readily available to fuel innovation and drive sustained growth. Ultimately, this proactive approach to workforce management—encompassing both internal talent development and the strategic integration of external resources—will be essential for building a resilient and successful organization in the years to come.
Another critical disconnect for PSOs: While deal pipelines expanded by 8%, on-time project delivery dropped from 80.2% to a concerning 73.4%. Together, these metrics suggest that many PSOs are experiencing significant execution challenges and budget overruns, both of which directly impact client trust and profitability.
A closer look at these challenges exposes several unsurprising culprits: inadequate project planning, poor resource allocation, and outdated project tracking capabilities. Disconnects between sales and delivery teams pour even more gasoline on the fire. While sales teams are securing more leads, their associated project scopes are wildly off—leading to an influx of unrealistic timelines and an outflow of financial losses.
Nearly 80% of high-performing organizations are using a PSA solution, with over half integrating it with their core financials
Combined with inconsistent processes, these misalignments between project and sales teams keep many PSOs from fully capitalizing on their growing pipelines. To course-correct, firms need to implement a more holistic approach for improving sales efficiencies, tightening project scoping processes, and enhancing service delivery.
This is where powerful tools like Workday Professional Service Automation (PSA) help PSOs shine, integrating with financial management to provide the real-time project data visibility that firms need to close these gaps. Notably, the report finds that nearly 80% of high-performing organizations leverage a PSA solution like Workday, with over half integrating it with their core financials.
Finally, it’s worth noting that EBITDA margins across professional services have also taken a hit, dropping to a five-year low of 9.8%. This suggests a real challenge with rising costs and operational inefficiencies—that even with a consistent project flow, profitability is on the decline. This may point to underlying issues such as increased cost of labor and a lack of cost controls, and firms that don’t make a serious effort to streamline operations now risk greater financial strain over the months ahead.
This drop in margin isn’t a minor setback; it requires a strategic shift beyond simple cost-cutting measures. Inefficient project management and a lack of automation are among the biggest contributors to budget overruns and missed project deadlines. Add in intense price competition, and margins get squeezed even tighter. To navigate this, firms need to prioritize decisions based on accurate and updated business data, implement stronger financial controls, and invest in technologies that boost efficiency.
Another key point: How efficiently a firm quotes services directly affects its financial health and success in this initial phase is critical. Nearly half of the organizations surveyed struggle with this process, losing bids due to delays and inaccuracies.
Done right, especially with solutions like Workday Services CPQ, efficient end-to-end quoting cycles can drive higher revenue growth and ensure projects are delivered on time. Streamlining this process helps PSOs win more bids, improve their margins, and build a more resilient financial foundation.
The report’s findings reveal that the professional services landscape is shifting, demanding strategic adaptation from PSOs. To thrive in this environment, firms must prioritize operational efficiency, talent sustainability, and client satisfaction.
By focusing on the four critical areas highlighted—utilization, talent, sales-delivery alignment, and margin management—PSOs can transform challenges into opportunities and build a more resilient and profitable future.
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