A Guide to Service Business Benchmarks
The 2022 Professional Services Maturity report is the gold standard for the consulting industry. The business benchmarks give leaders a clearer picture of how their company stacks up against its competitors, highly effective professional service organizations (PSOs), and other larger professional services market. This information clarifies best practices to significantly increase the company’s productivity and profitability.
PS executives can use the business benchmark guide to assess the present degree of maturity and identify potential improvement areas where they can have the most impact in the shortest amount of time. The benchmark will act as a road map and the initial stage in achieving long-term sustainable success.
Over 35,000 service- and project-oriented firms utilize this report it. It is the industry’s top performance improvement tool to plot its path to providing exceptional customer service.
In this study, we’ll evaluate the features and appropriate behaviours of Professional services based on their lifecycle stage as well as an array of data that measure business performance.
Fifteen years ago, SPI Research established a methodology that splits and evaluates a PSO into five distinct areas of performance that are logical and functional. The five underlying components referred to as the “Service Performance Pillars” serve as the basis for all professional services businesses.
The PS Maturity Model’s central concept is that PSOs succeed by optimizing five Service Performance Pillars:
- Leadership: build leaders for the future. A new young millennial workforce requires strong front-line management and guidance. Effective, ethical, and collaborative leadership is required with changing work dynamics
- Client Relationships: selling professional services has become increasingly complex, as client organizations look for demonstratable value and demand “pay as you go” subscription or consumption-based pricing. Marketing and sales campaigns must address clients’ key challenges and provide the means to buy the way they want to. New usage-based business models make it easier for buyers to buy but more complex for service providers to provide. Measurable business value and adoption are driving references and growth.
- Talent: your talent pool is your most critical asset, and continued understanding of how the workforce changes, and how they wish to be treated, from training to compensation to social programs, is critical to understand and cultivating a high-quality workforce.
- Service Execution: delivering services on time and on budget with sufficient margin fosters growth and profitability. It’s always important to keep an eye on project budgets to actuals to eliminate overruns before they spiral out of control. You can’t have your best people on every project. There must be a mix between higher-level skills and lower-level and lower-cost talent. Implementing standardized business processes and systems helps you better understand and track the effort for the services delivered.
- Finance and Operations: keep an eye on the bottom line! Cash flow is critical, and it is imperative for your organization to track costs and expenses to determine improvements. Predictable financial performance provides the breathing room to invest in new growth areas. Consider a permanent shift away from expensive facilities and lavish meetings. The last two years have proven these discretionary expenditures make very little difference in either employee well-being or business success.
These pillars, along with business benchmarks, are used to develop improvement plans to advance lagging areas. According to SPI Research, the PS Maturity model has widespread approval because of its all-encompassing approach to performance evaluation.
The SPI Research conducted a study with 540 billable professional services organizations. To assist professional service firms in evaluating their results, the report provides related business performance and an overview of major markets that make up the global professional services industry.
Today, there are over 25 million businesses in the professional services sector worldwide, and their annual revenues total more than $8 trillion combined. The report provides good implications for the growth potential of professional services firms.
Are you ready to propel your business forward? Talk to one of our experts today.