Managing Electronic Documents
By Tony Kontzer
It's been eight years since Collaborative Consulting turned to the category of software known as professional services automation, and the move appears to be paying off. The Burlington, Mass-based consultancy first used OpenAir's suite of professional services automation (PSA) to automate its processing of time sheets and expense reports, and feed that data into the invoicing module.
But as the company has expanded its use of OpenAir (since acquired by NetSuite)—most recently by using the software's resource management capabilities—the portion of its consultants’ total hours that are billable (its utilization rate) has grown from a percentage in the high 70s in 2009 to about 84 percent today, according to Richard Curzi, vice president of operations. That represents a huge improvement for a company that's embarked on a five-year plan with a goal of doubling the size of the company, while adding as few employees as possible and keeping administrative costs at a minimum.
"To the degree that we can eke out an additional amount of utilization from the existing staff, that revenue comes at no cost and goes straight to the bottom line," says Curzi.
PSA applications represent one of the most critical IT tools that professional services firms rely on to thrive in an increasingly competitive market. According to Jeanne Urich, managing director of consultancy SPI Research, which generates an annual benchmark report that professional services firms use to compare themselves with their peers, the number of professional services firms has been growing steadily over the past several years.
Urich says they now number 1.5 million in the United States alone, most employing fewer than 100 people. Meanwhile, her analysis of U.S. government statistics pegs the U.S. professional services market at $1.3 trillion, with the two biggest sectors, IT consulting and legal services, accounting for more than $500 billion of that.
In other words, 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 to scale a business to accommodate that growth, says Urich, is by investing in PSA software, and growing numbers of firms have been doing just that, trading in their previous dependency on spreadsheets in the process.
In the past five years, according to surveys by SPI, the portion of professional services firms that 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 more accessible and affordable to firms of all sizes.
"Ten years ago, the software didn't run in the cloud," says Urich. "If it's cheap and it's great, why would you create spreadsheets?"
In fact, Collaborative Consulting's Curzi says that because the company's consultants are so often scattered all over the five states where it operates, if OpenAir weren't cloud-based, "it would be a nightmare."
Larry Quinlan, CIO of global business consultancy Deloitte, says that the New York City-based company has a years-long history of working with PSA software to automate everything from staff scheduling and availability to approval processes. Although Quinlan won't specify which PSA products Deloitte depends on, other than to say that SAP software is in the mix, he puts the firm's dependence on PSA bluntly: "I don't even know how we'd run the business without it."
Supporting Mobile Workers
The increasing use of PSA applications has dovetailed with another area of focus among professional services IT departments: mobile access to data and processes.
Gartner estimates that mobile application development will outpace development for PCs by 2015, spurred in large part by industries that increasingly support a large population of mobile workers, with professional services being among them.
"Supporting the mobile user is a big part of the IT manager's job in professional services," says Richard Fouts, a Gartner vice president.
Under Quinlan's guidance, Deloitte has invested heavily in mobile solutions in recent years, establishing a program in which it supports a variety of smart phones and tablets and governs how they are used. More recently, the firm adopted mobile application development platforms that he hopes will generate apps that the firm’s consultants will find indispensable.
Ultimately, Quinlan says his goal is to use mobile technology not only to support back-office functions, such as submitting time sheets and expense reports, but also to provide services to clients. (He declined to speculate as to what services these might be or how they might be delivered.)
Like the growth of PSA software, cloud computing is a big driver of the move toward mobility. Gartner’s Fouts says that by 2016, half of the Fortune 500 (including many of the largest professional services firms) will be storing customer data in the cloud, and that data will increasingly be accessed from mobile devices.
Managing Electronic Documents
This combination of factor—more automation and mobility spurred by cloud computing—is shining a spotlight on another area essential to professional services firms: electronic management of documents. Nowhere does this loom larger than in the legal services sector.
For Mark Karnick, CIO of Glaser Weil, a 100-attorney Los Angeles firm, the march toward a paperless environment is in full swing. And while Karnick admits that the notion of the paperless office is so turn-of-the-century, the economic downturn came before the needed tools had reached maturity, and a clampdown on IT spending prevented Glaser Weil from investing in a solution.
However, subsequent advances in the ability to more thoroughly track, search and collaborate on a wide variety of documents have combined with an improving economy to put electronic document management back on the firm's front burner. The need for such capabilities has also been fueled by what Karnick calls exponential growth over the last several years in the amount of electronic data law firms must manage.
"That data has to be stored, indexed and searchable, and it has to be accessible to geographically dispersed users," he says.
Despite the growing capabilities in those areas, Karnick says no one product is able to meet the firm's needs, so his team is working on an integrated system built largely around Hewlett-Packard’s Autonomy, which analyzes unstructured data, and the document collaboration capabilities of Microsoft SharePoint. The resulting solution, which represents a six-figure investment for Glaser Weil, will consist of three components: a robust back-end database, an easy-to-use interface, and effective tools for getting data in and out.
Additionally, with a mandate to steadily replace laptops with tablets and incorporate them into all of the firm's business processes, Karnick has to ensure the electronic document management system is easily accessible from iPads and a handful of other tablets.
Once the new system is rolled out to users later this year, he expects it to save clients money by improving productivity and reducing the number of billable hours spent performing mundane, low-value tasks, as well as to slash the cost of storing paper documents. (The firm will have to retain paper documents with signatures.)
All of these technologies—PSA, mobile platforms and electronic document management—address what Gartner's Fouts says should be the top priority for any professional services firm's IT department: "using today's trends and advances to help the people on the ground doing the work, because those are the people who make you money."