Professional services firms that are embracing digital innovation can use analytics to gain insights to drive efficiency and better client outcomes.
As seen in the recent post, Achieving Agility for Professional Services in the Digital Age, professional services firms see the importance of meeting the growing expectations of clients for deeper insights, faster results, and more services. One way to achieve those results is by focusing on metrics that determine impact and efficacy.
Analytics draws on the massive amounts of data available, providing a deeper dive into trends, patterns, and measures that can be used to assess the business. Learn how you can unleash the power of analytics for your professional services firm by focusing on metrics related to resources, client engagement, and operations.
Firms that maximize their human resources aim to have a resource utilization rate of at least 80 percent. Talent is the most expensive part of a professional services firm, and underutilization of that talent results in lost revenue.
Here are a few key metrics that analytics tools can provide you related to employees:
- Annual revenue per billable consultant
- Annual revenue per employee
- Billable utilization, which takes utilization and ties it to overall revenue and profits per employee
With aggregated data available from sales, project management, and personnel, you can use analytics tools to identify opportunities to hone particular skills, geographical or industrial sector opportunities, and talent shortages or surpluses. These insights allow for adjustments in hiring, marketing, and contracting.
Business analytics also allow the firm to forecast what the impact will be if trends persist and to create predictive models of the impact of shifts in staffing, priorities, or markets to the firm’s bottom line.
Analytics allow professional services firms to dive deeper into the efficiency of their operations. Automation tools can reduce or eliminate the need for manual entry, variance analyses, and data processing in the creation of reports that measure profitability.
Business analytics also give firms more insights about days outstanding for delivered work and work in progress that can improve collections strategies and procedures, resulting in improved proficiency for cash flow and profit.
Project performance is another critical measure for any professional services company. With richer analytics tools, companies can better track profitability at the project level, identify and mitigate project overruns sooner, and flag underperformance earlier.
Analytics offer firms the opportunity to provide better client experiences by identifying points of value at each step of an engagement. By tracking information on client satisfaction, services purchased, and buying behavior, firms can fine-tune their sales pitches, service bundles, and delivery methods for information and insights.
An enterprise resource planning (ERP) platform can help bring together the many parts of the professional services firm. Data from operations, finance, human resources, sales, and customer engagement can be collected, analyzed, and used via an ERP solution that provides the deep insights necessary today.
Acumatica is one such product that offers professional services firms the integrated ERP solution that drives improved profits and customer satisfaction. Acumatica’s ERP comes with integrated customer management, financials, project cost tracking, service automation, and time and expense management modules. The solution allows firms to deliver excellent services efficiently while maintaining insights and controls to drive profits.
NexTec helps firms identify and implement the right ERP solution to meet your firm’s greatest needs. Contact us to learn more about how NexTec can help you select the right ERP for your professional services firm.