Using PSA for Time and Expense Management

If you’re managing a Professional Services organization, chances are you find yourself juggling competing priorities from customers, finance, sales and executives. Customers are demanding high quality deliverables which often require more time than expected. Finance is requesting up-to- the minute project status and utilization rates. Sales wants to know what you’re delivering and when.  Executives are pushing you to maximize billable hours.

The problem is, if your consultants took the time to answer all of the internal questions, they may never have time to focus on actual customer work. The more you can free yourself and your consultants from project administration the more time can be focused on customer deliverables.

Time and expense management tends to be not only time-consuming but also universally loathed. Consultants often put it off until the end of the time period, then enter information to the best of their recollection. This causes problems on a number of levels.  Without a current snapshot of time spent to date on projects, the management team lacks visibility (until it's too late) into progress toward plan or on-time project delivery.  They also lack the ability to produce quarterly billing and cost forecasts, so quickly lose control of project profitability.

Additionally, errors occur when professional services staff delay time and expense entry until the end of a week, pay period or month. The ability to recall specific hours and deliverables is compromised and results in missing information, errors, and over or under-billing. The costs to validate missing information or correct errors can add up quickly, even requiring a full-time employee for some organizations.  At a higher level, delays in time and expense entry could jeopardize project success. If the finance, sales and executive teams go weeks before knowing that a project may be coming in over budget, it could be impossible to correct the situation.  Clients may not be amenable to scope increases or change requests once the project is already out of control.

A simple solution to the timeliness and accuracy challenges is to use a Professional Services Automation solution to manage time and expenses. While time management, like death and taxes, will never go away, an automated solution like FinancialForce PSA can shift it from an administrative burden to a valuable management tool. A PSA solution simplifies time and expense entry for consultants by enabling the team to enter information through a convenient web browser, through a smart phone or mobile device. When consultants no longer have to navigate through complex systems to get to time and expense reporting, they enter time daily - and the benefits add up quickly. Information gets in the right users hands as quickly as possible.

The payoff is significant. One consultant cited that time required for time and expense entry went from three hours each week to five minutes.  At a billable rate of $200 per hour, that’s nearly $2,400 per consultant per month in lost billable revenue – or $28,800 per year.  With a consulting force of 100 people, that’s $2.8 million in lost revenue per year, or an upside opportunity of nearly $3 million for streamlining this administrative process.

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