Bringing Certainty to Uncertain Times

Professional Services Organizations Use Vertical SaaS to Increase Efficiency, Maximize Revenue Opportunities and Accelerate Growth

Mike Downes, the Resourcing Director at Logicalis, a global IT solutions and managed services firm, knew that he and his colleagues had the data they needed to accelerate the company’s growth and profitability. Data that reveals whether project teams are understaffed, flags risks of blown deadlines or budgets, and predicts how the business development pipeline will impact future revenue growth. Before they could use that data, they had to locate it. But that was easier said than done because the company managed virtually all of its resources ― from forecasting to billing ― across what Downes refers to as “tons of spreadsheets.”

“It would have taken me a month to complete my demand forecast,” he adds. “So we just didn’t do it, it was based on gut feel.”

The daily frustration Downes felt is common among leaders of professional services organizations (PSOs) who struggle to find and use data that is scattered across spreadsheets, ERP and CRM solutions, project management solutions, time-tracking tools, and other applications. 

According to a recent Censuswide survey of 100 decision makers at IT consultancies, respondents spend an average of 10 hours per week on manual tasks such as data entry — that’s the equivalent of 13 working weeks a year. The majority (39%) say their firms’ resource management processes are most in need of improvement followed by project management and financial management (both at 32%).

Downes brought clarity to his uncertainty by implementing the Kantata Professional Services Cloud platform, a Vertical SaaS solution purpose-built for PSOs’ unique workflows, to support the entire services lifecycle ― from proposals, to staffing, time tracking, billing and invoicing, and reporting. 

His story can serve as a template for how PSOs can leverage Vertical SaaS solutions to create a clear “single source of truth” into the health of their businesses today and identify opportunities to increase efficiency and maximize revenue over the long term, even as the global economic outlook remains cloudy.

While economists are feeling slightly more optimistic, they still predict a recession will begin this year, albeit later than they expected at the end of 2022. The uncertainty over a recession’s timing, severity, duration, and potential impact on a business fosters fear among PSO leaders and their clients. Fear that compels them to fall back on the old ways of preparing for a recession like canceling big projects, freezing hiring, and delaying digital transformation investments. But those measures will only stunt growth even after the economy recovers and make it more difficult to retain the employees they managed to hire during the height of the still ongoing war for talent.   

The Rise of Vertical SaaS

Horizontal SaaS platforms designed for general business uses such as CRM, project management, and accounting, or “homegrown” point solutions built around spreadsheets are not well-suited for effective resource or project management, client servicing, and business development. They don’t address the wants and needs of their workforces that remain stuck on exporting data to spreadsheets and using horizontal ERP or CRM systems and legacy professional services automation (PSA) systems that were not designed for the kinds of projects PSOs run or how the business operates.

Solving these problems compels PSO leaders to search for solutions purpose-built for their workflows including time entry, team member skills databases, task assignments, and the detailed project management data that people across the business need to efficiently deliver outcomes to their clients consistently. For example, the Kantata Professional Services Cloud vertical SaaS platform enables PSOs to migrate away from general purpose horizontal SaaS solutions to improve resource allocation and management, increase productivity, and deliver more accurate revenue forecasting. 

Why PSOs?

PSOs don’t produce, distribute, or sell products. Their primary outputs are their employees’ expertise and creativity in service to their clients. They cannot grow without signing new clients or expanding their current service offerings, but they will not survive if they don’t meet their current clients’ demands. 

Striking a balance between handling the current workload and business development requires exceptional resource management. At a time when a recession looms, and more employees want to work from home and more people are starting their own independent consultancies, resource management has never been more important (or more challenging). 

The Kantata Professional Services Cloud platform enables PSOs to increase efficiency and productivity across their workforces (both employees and independent contractors), improve resource allocation and management, and provide more accurate forecasting. 

With Kantata, Downes can build the resource forecast in significantly less time ― what previously took up to three days now takes a few hours. He sees where there may be resourcing gaps, and when hiring is the best option, he has the data to back up his recommendations to upper management.

“I can go to my financial director and show them all the upcoming demand in Kantata and start the conversation that we need to begin hiring,” he said. “A year ago, I wouldn’t have even had the conversation. Implementing the Kantata solution has given us a complete and accurate view of all engagements happening over the next six months. Instead of relying on a combination of gut feel and spreadsheets, I can confidently put together the best teams for each engagement and press the button on the recruitment process much sooner.”

A significant majority of Censuswide survey respondents who use vertical SaaS solutions echoed that sentiment. Almost 86% said their vertical SaaS implementations have been “successful” in terms of helping them meet their business goals. 

Additionally, a full 100% of respondents, including those who have not implemented vertical SaaS solutions, believe vertical SaaS has or could benefit their businesses, particularly in the areas of improving talent management, increasing efficiency, enhancing collaboration, improving client relationships and improving profitability. 

Unique Motivations Among PSOs

The primary reason PSOs implement purpose-built software differs from other industries. The priority is resource optimization versus the financials or projects. Yes, projects are important, but at a more executional level, and the financials are an outcome. 

It’s worth restating that PSOs build their businesses around the creative outputs of their employees. Providing an excellent client experience is the difference between happy and unhappy clients. The universal truth among all PS firms is that how they apply their resources is core to their success. 

Optimizing resource management has a direct impact on a firm’s ability to meet its clients’ high expectations for quality work delivered on time, at spec, and at (or under) cost targets. Resource management is the single biggest driver of success by ensuring the right people are assigned to the right projects at the right time. Allocating the wrong people creates delivery and client risk, as does waiting too long to allocate the right people.

Not Just for PSOs

The professional services industry is not alone in its embrace of vertical SaaS. Gartner predicts that by 2027 more than 50% of enterprises across all industries will use cloud platforms developed specifically for their industries to accelerate their business initiatives. 

For example, Procore has developed a cloud-based platform for the construction industry that creates a central hub for owners, general contractors, contractors, and other project collaborators. Internet Pipeline Inc. offers a customer relationship management (CRM) platform exclusively for the insurance industry. Veeva Systems provides cloud solutions that address enterprises’ unique operating challenges and regulatory requirements in the consumer products, food, beverage, and chemical industries. RetailNext is an in-store analytics platform built for retail companies. Farmers Edge has developed solutions to help farmers produce and distribute food more efficiently.

Overcoming Inertia

The challenge to implementing vertical SaaS is often not a technical one — it’s not any different from using a horizontal cloud solution — but a human one. People have toiled in spreadsheets or used platforms built from general-purpose project management, ERP, and CRM solutions for so long, and old habits are hard to break. There’s a comfort level in using the tools and processes they’re familiar with, and they may need help from their vendors and IT departments to switch to purpose-built tools.

The Logicalis case study shows how breaking those old habits by implementing a purpose-built solution like Kantata brings business value to both a PSO’s team members and its clients. Other Kantata success stories include: 

• CloudStratex, a tech company that leverages next-generation technologies that assist businesses in self-sufficiency, improved project delivery (on) time by 50 percent, and increased its fees by 30 percent.

• TeleTracking, a developer of patient flow automation solutions to optimize workflow and improve timely patient care in hospitals, achieved 100 percent compliance with its time-tracking policies and a massive 37 percent increase in billable utilization.

• Hero Digital, a leading independent customer experience company, achieved project forecasting accuracy over 90 days. Kantata’s fast reporting capabilities have made the accounting department’s time to close 40 percent faster, speeding up from as many as 20 days to an average 10-day close.

The Time is Now

PSOs have no time to waste in confronting the unprecedented set of challenges before them.  Market forces including the rapid transformation of the global workforce, the need to engage their staff and their customers in new ways, and the digitization of workflows are escalating both the expectations of employees and customers and the difficulty of recruiting and retaining talent. These challenges transcend the quest to optimize the financial parameters of the business. 

Fortunately, software developers like Kantata are creating the tools that meet the needs of PSO professionals’ industry-specific workflows. They are establishing standards of interoperability that provide PSOs with choice and flexibility within their application portfolios, enabling them to create the most engaged workforces and remarkable client experiences possible.