Tech Tools Grow the Business

By Tony Kontzer

It’s beeneight years since Collaborative Consulting turned to the category of softwareknown as professional services automation, and the move appears to be payingoff. The Burlington, Mass-based consultancy first used OpenAir’s suite ofprofessional services automation (PSA) to automate its processing of timesheets and expense reports, and feed that data into the invoicing module.

But as thecompany has expanded its use of OpenAir (since acquired by NetSuite)?mostrecently by using the software’s resource management capabilities?the portionof its consultants? total hours that are billable (its utilization rate) hasgrown from a percentage in the high 70s in 2009 to about 84 percent today, accordingto Richard Curzi, vice president of operations. That represents a hugeimprovement for a company that’s embarked on a five-year plan with a goal ofdoubling the size of the company, while adding as few employees as possible andkeeping administrative costs at a minimum.

"To thedegree that we can eke out an additional amount of utilization from theexisting staff, that revenue comes at no cost and goes straight to the bottomline," says Curzi.

PSAapplications represent one of the most critical IT tools that professionalservices firms rely on to thrive in an increasingly competitive market.According to Jeanne Urich, managing director of consultancy SPI Research, whichgenerates an annual benchmark report that professional services firms use tocompare themselves with their peers, the number of professional services firmshas been growing steadily over the past several years.

Urich saysthey now number 1.5 million in the United States alone, most employing fewerthan 100 people. Meanwhile, her analysis of U.S. government statistics pegs theU.S. professional services market at $1.3 trillion, with the two biggestsectors, IT consulting and legal services, accounting for more than $500billion of that.

In otherwords, more firms are hustling to claim their piece of an ever-growing pie, and,in order to do so, they need to be able to grow. The most effective way toscale a business to accommodate that growth, says Urich, is by investing in PSAsoftware, and growing numbers of firms have been doing just that, trading intheir previous dependency on spreadsheets in the process.

In the pastfive years, according to surveys by SPI, the portion of professional services firmsthat use PSA software has grown from less than 40 percent to nearly 70 percent.This growth has been fueled in part by PSA software becoming so much moreaccessible and affordable to firms of all sizes.

"Tenyears ago, the software didn’t run in the cloud," says Urich. "Ifit’s cheap and it’s great, why would you create spreadsheets?"

In fact,Collaborative Consulting’s Curzi says that because the company’s consultantsare so often scattered all over the five states where it operates, if OpenAirweren’t cloud-based, "it would be a nightmare."

LarryQuinlan, CIO of global business consultancy Deloitte, says that the New YorkCity-based company has a years-long history of working with PSA software toautomate everything from staff scheduling and availability to approvalprocesses. Although Quinlan won’t specify which PSA products Deloitte dependson, other than to say that SAP software is in the mix, he puts the firm’sdependence on PSA bluntly: "I don’t even know how we’d run the businesswithout it."