Juggling client expectations and internal ROI

Resource Planning Software
Retain International
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All businesses strive to manage their resources as efficiently as possible. But for a professional services firm where skilled staff such as accountants, consultants and lawyers represent both their biggest cost and biggest source of revenue, effective resource management is critical to creating client value, enhancing profitability and maintaining a competitive edge.

Clients want to know that their investment will improve their business, whether by lowering costs, enabling efficiencies or expansion into new markets. They also need assurance that a project will complete on time, on budget and within the agreed parameters. If a deliverable does look likely to slip, then they expect to be informed as early as possible.

As such, professional services firms need complete visibility across their business. Projects must be planned, resourced and executed in a way that allows a firm to find the right combination of team members and skill-sets to maximise billable hours at lowest cost and achieve the best possible margin.

They also need to be able to bid for contracts safe in the knowledge that they have the headroom to deliver on what they have set-out within the tender. This is particularly challenging in the current economic climate, where headcounts have been reduced and recruitment programmes frozen. The more prospective projects there are in the pipeline, the greater the risk that resources will be overstretched.

Spreadsheet silos

Providing professional services is very different from operating a product-based business. Each project is unique and demands a bespoke solution combining specific skillsets, levels of experience and timescales for delivery. Although many professional services firms continue to use conventional spreadsheets to plan projects and allocate resources, they are finding it increasingly difficult to maintain visibility across their organisation and manage resources effectively. Some firms are running many spreadsheets serving different service lines, offices and regions, which means potentially business critical data is being stored in silos.

Without a consolidated database at a group level or the means to report on the information stored within these silos, senior management has no way to identify where resources are being under-utilised or where spare capacity may exist. This leaves the business vulnerable to spikes in demand if more projects are won and it is unable to identify and analyse trends that would otherwise help to improve the business and plan for future work. And while spreadsheets provide the means to calculate actual billing revenue on a monthly basis, there is no way to accurately forecast future billing revenue or apply ‘what if’ scenarios.

Moreover, as clients become increasingly discerning and demand greater visibility into engagement pricing and project structure, it is difficult for professional services firms to provide this level of visibility if they don’t have it readily to hand themselves. For example, both the supplier and the client will want to be able to track project progress against budget spend, yet many firms still rely on simply setting a budget threshold within the spreadsheet. The result is that clients are only made aware of a potential overrun once it is imminent or the threshold has already been reached.

Increasing visibility and planning capabilities

A growing number of services-based businesses, such as accountancy, consultancy and law firms now use resource management and staff planning software to efficiently manage the distribution of client matters amongst their professional staff. These systems can also be used to monitor the amount and type of staff training provisioned in support of a project, as well as for facilities management, whereby resources, such as conference rooms, can be allocated according to the specific equipment and feature requirements of each individual project – as well as the requirements of the staff tasked with its delivery.

By matching the right resource to the right job, firms are able to optimise resource utilisation and adjust allocations as and when required. This is achieved primarily via a ‘booking’ system – i.e. where a ‘resource’ is allocated to a ‘job’ for a specific period – based on a configurable graphical interface that allows views to be customised to display data in different ways to support the planning and forecasting process. Information such as office location, departments/specialty and industry can be stored against resources, jobs and bookings, with users also able to group data by these fields and apply filters. The latter enables users to quickly find resources, jobs or bookings based on availability or that match other specific criteria. Bookings can be made or amended; resources allocated or reallocated; and block bookings used for the allocation of a team to a job. In addition, by making ‘ghost’ or scenario bookings, users are able to plan tentative work, while using reporting functionality to assess the impact of tentative bookings if the work is confirmed and issue conflict warnings if resources are over-booked.

Combining resource allocation and utilisation data with dynamic report writing functionality allows firms to report on every aspect of the data held within the resource management and staff planning platform – from job revenue and booked time by group, to over allocation. Users can also create reports to compare resource utilisation and availability over periods, highlight important data such as jobs over budget and export data to other applications for further analysis and reporting. Importantly, reports can also be customised and produced for presentation to clients.

Building bespoke solutions

Much of the success of a professional services firm hinges on its ability to provide a potential client with a competitive and bespoke solution. Planning the delivery team is the first and most basic requirement during the bidding stage and calls for assessment of the level of experience and skill-sets required, the staff necessary to deliver the project and confirmation of their availability. Here, the key challenge is to find the optimum combination of experience, skills and pay grade to ensure the most cost-efficient resources are allocated to the project. Thus the ability to visually mix and match resources based on these factors and book them in advance provides firms with the confidence they have the headroom to deliver. It also allows firms to identify and address any potential skills shortages in advance.

When looking to secure staff for a project, a major frustration is that senior management often request the same staff each time, because they know that certain employees have the experience and skills necessary to do the job. Aside from the obvious problem that these staff might not be available or become overworked, there is the wider issue of talent management at play. Whereas consultants have traditionally remained focused on specific areas, today they are keen to expand their knowledge base and experience. This means firms must provide opportunities for personal development and growth, especially since many are now operating with reduced workforces. Being able to use new projects to expand the capabilities of employees and enable them to grow as individuals not only means they can be charged out for more in the future, but that staff remain motivated because they have the opportunity to diversify.

Similarly, improving overall visibility of the skills and available experience provides firms with the flexibility to plan for potential project wins by arranging staff transfers from other offices well in advance. This is particularly important for those with multiple offices serving specific regions. Often, larger firms find that a regional office will be maxed-out in certain service lines. But if they can identify early on that there are staff sitting on the bench at other offices in nearby locations, they can arrange for a transfer in a timely and less costly fashion while improving resource utilisation at a regional level.

Empowering staff with greater visibility of the new business pipeline is another area where business benefit can be realised. Given that most firms set utilisation targets for their consultants, with a performance bonus triggered once the target is met (typically around 80%), pipeline visibility ensures consultants are more proactive in putting themselves forward for new undertakings, notifying senior management when they expect to be rolling on and off of projects and booking time for holidays or training courses during quieter periods. It also allows staff to better prepare for future projects by seeing who else has put themselves forward and ‘buddying up’ with those that have already undertaken similar roles.

Delivering on client expectations

By operating a much leaner operation with optimum staff utilisation, professional services firms are able to maximise ROI in terms of allocating resources against a client’s budget and ensure that a project is not being over-serviced and staff not over-worked. In other words, client expectations can be managed efficiently and delivered upon to agreed service levels, without being exceeded and thus impacting on profitability. At the same time, budget shortfalls can be identified early on when allocating resources, meaning terms are easier to subsequently renegotiate. This ensures that a high standard of client service is maintained.

Using resource management and staff planning software to forecast future requirements assures firms that they have the headroom to deliver on the projects they are bidding for and flag potential bottlenecks and skills shortages well in advance of a go-live date. By being able to mix and match skill-sets and experience, professional services firms not only benefit from allocating the most cost-efficient resources and the opportunity to further the development of staff, but ensure the long-term sustainability of their business in what is an increasingly competitive market.

About Retain International

Retain International is a provider of resource planning software for businesses of all sizes. Founded in 1992, it provides cost-effective and flexible solutions to allow firms to effectively manage their staff and resources. With a complete overview of current clients, projects and staff, organisations can ensure they are operating at optimum efficiency and profitability.  

Retain International works with customers in over 65 countries, and has experience in providing solutions to the consultancy, accounting, banking and legal sectors, including PricewaterhouseCoopers, BDO, Shell, Zurich Insurance and Cap Gemini. For more information about Retain International’s suite of resource planning solutions, and for a free trial, please visithttp://www.retaininternational.com/ . 


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