Boost Project Margins in the Professional Service Industry

In the highly competitive professional service industry, with over 25 million firms globally, the difference between being at the top and blending in with the rest is often a matter of decimal points. Professional service organizations (PSOs) must find an edge that sets them apart from their competitors to stay ahead of the pack. One key area that can make a significant difference is service execution.

PSOs face various challenges, but hitting revenue and margin targets consistently remains at the top of their list. While many factors contribute to reaching these goals, service execution is perhaps the most crucial. Effective service execution in the professional service industry encompasses resource scheduling, project financial management, time and expense capture, and billing. By excelling in these areas, PSOs can enhance utilization and project delivery, ultimately impacting their competitive position and overall success.

Research indicates that leading PSOs achieve a 16% higher on-time delivery rate than their competitors. This highlights the significance of efficient service execution in meeting client expectations and establishing a strong reputation. However, relying on archaic tools and outdated processes can lead to multiple execution issues, such as increased days sales outstanding (DSO), reduced utilization, increased write-offs, and –  ultimately – reduced profitability.

In this blog, we’ll explore how a modern solution like Sage Intacct delivers measurable improvements to the professional services industry.

The solution lies in adopting modern solutions for service execution. Companies in the professional service industry should leverage these tools to achieve superior business performance and returns. For example:

  • PSOs that implement a modern solution for project financial management experience a remarkable 36% year-over-year increase in revenue compared to those still relying on spreadsheets
  • On average, PSOs using modern solutions have 7% higher billable utilization and 8% higher project margins

Being at the forefront of innovation and customer satisfaction in cloud financial management, Sage Intacct has gained recognition and endorsement from the American Institute of Certified Public Accountants (AICPA) as a best-in-class solution that enhances overall company performance.

 

Increased Margins:

PSOs implementing Sage Intacct for project financial management have witnessed significant benefits. One notable improvement is the increase in project margins. Halloran Consulting Group, for instance, experienced a 12% rise in project margins just through real-time insights. By having access to comprehensive project data, they were able to make better budget decisions and improve overall profitability

Enhanced Time and Efficiency

Efficiency gains are another advantage of using Sage Intacct. Yesler, Inc. reported saving $10,000 per month in staff time. Sage Intacct’s seamless integration with multiple business systems has proven crucial in its ability to scale effectively. 

Similarly, Goodway Group mentioned that if they were still using QuickBooks, they would need to double the current headcount to compensate for the system’s inefficiencies.

Sage Intacct helped them achieve significant cost savings by streamlining processes and eliminating manual tasks.

Predictable Headcount

In addition to saving time and costs, Sage Intacct enables PSOs to manage headcount more predictably. Premier Talent Partners experienced a $60,000 annual overhead cost reduction by streamlining their invoicing process. With Sage Intacct automatically retrieving timesheets from Salesforce and generating accurate client invoices, their weekly invoicing process was reduced from 12 hours of work to just 6 hours.

In conclusion, service execution plays a pivotal role in the success of organizations in the professional service industry. By embracing modern solutions like Sage Intacct, PSOs can overcome the challenges associated with outdated tools and substantially improve project margins, revenue growth, efficiency, and overall business performance. 

If you’re ready to elevate your financial management to new heights, get in touch with us today to arrange a complimentary discovery call. Discover the transformative power of modern solutions and achieve measurable business results.

Questions?