Project Going Over Budget? How To Get Back On Track And Achieve Customer Success

Project Going Over Budget? How To Get Back On Track And Achieve Customer Success

Even the most world-class Professional Services Organizations (PSOs) with the best project managers and service team members will encounter problematic projects every once in a while.

When this happens, projects can run over budget and clients can become frustrated if the service team doesn’t turn the project around and get things back on track.

If you find yourself with a project that seems like it’s derailing quickly, here’s some steps you can take to resolve the issues, get the project back on track, and deliver a successful and complete project that will keep your client satisfied with the service you provided:

1. Identify the problem areas

When a project starts to derail, the first step is to identify what the problem is. Maybe your service team has hit a roadblock where they’re waiting on a piece of information from the client. Or perhaps there is a technical difficulty that needs to be resolved by another department within your organization, such as the IT department. Maybe the project was incorrectly scoped during the sales process and your service team is unable to deliver a complete project with the allotted hours dedicated to project implementation.

Whatever the problem may be, identifying it allows you to step back and look for a resolution to the problem. This is where a project manager should take control and resolve the issues at hand in order to get the project back on track.

A Professional Services Automation (PSA) Software can help a project manager identify and resolve project issues, because it helps provide a clear picture of the entire project lifecycle. Part of monitoring a project for success requires tracking a project’s estimate-at-completion against its budget. Doing so, acts like an early warning indicator, alerting project managers when a specific aspect of a project may have taken more effort than intended. For this to be effective, however, project managers need to maintain accurate resource management projections and visibility into the project in real-time. Using a PSA software can easily enable a project manager to do this.

2. Resolve the issues by making necessary adjustments

When you’ve identified that there’s a problem with the project, the worst thing you can do is hope that it will correct itself along the way and everything will work out in the end. If it seems unlikely that a project will be completed on time and on budget, that will most likely be the case unless you step in early and make adjustments in key result areas.

Some project managers will assume that a tiny setback will not have a large impact on the completion of the project. This may be true in some circumstances, however, tiny setbacks can often add up throughout the lifecycle of the project which means it is the responsibility of the project manager to adjust for these discrepancies and keep the project moving along smoothly.

One tactical action that project managers can take is to identify the project’s key result areas, also known as critical success factors in project management. These are the big-bucket items that must be completed on time and to a high degree of quality in order to achieve project success. Much like an intricate game of chess, project managers can shift around priorities to accommodate for discrepancies in the project’s plan.

For example, if you know that a client is more budget-conscious than time-sensitive, you may be able to play around with resource utilization in project management. You might trim the team to stick to the budget but at the expense of time to market. If scope or quality are factors that can be adjusted, you may be able to make small reductions that don’t jeopardize the ultimate goal of the project while still achieving your key result areas.

3. Include the client in the discussion as adjustments are being made

There’s nothing that will frustrate your client more than being told at the last moment that the team has used up all of the allocated hours for the project and the work hasn’t been completed, especially if the client was under the impression that things were running as planned. If your client has a strict budget for the project or a non-negotiable date for project completion, they will not be happy if they find out at the eleventh hour that there are issues with the project plan.

As soon as the problem has been identified by the project team, and suggestions for making adjustments have been decided on by the project manager, the client should be made aware of the adjustments that are proposed and sign-off with their approval of the changes to the project plan.

This transparency provides the client visibility into the project and ensures that they are less likely to feel blindsided later on if there are unexpected costs associated with their project, or timelines have shifted.

4. Use data and insights from problematic projects to ensure future projects run more smoothly

Sooner or later every project team will face a problematic project. Hopefully by taking the steps above you can turn a project around and successfully deliver a project that meets your client’s satisfaction, however, the best PSOs will learn from their mistakes and use the lessons they learn from problematic projects to make future projects run smoother.

A PSA software with functionality for creating detailed reports of projects, can help PSOs plan for better success in the future by using project data to understand where improvements can be made. In addition, a PSA software with the ability to send surveys for client feedback and create communities for clients to have visibility into a project can help you get a better understanding of what your clients are looking for and how to do better in the future. Project Health Check Statuses will allow you to quickly see your most successful and least successful projects and empower you to make changes where needed.

How To Reduce Revenue Leakage for Professional Services Invoicing

How To Reduce Revenue Leakage for Professional Services Invoicing

On the surface, invoicing for professional services organizations seems like a simple concept.

For services organizations just starting out, oftentimes it’s as easy as downloading an Excel invoicing template for consulting services, punching in your hours and rate, rendering a services invoice, and sending it to the client.

However, as services teams grow past 25 consultants, firms begin to focus their attention on streamlining the invoicing process. But quite often, even some of the largest professional services organizations are still approaching the vital task of invoicing incorrectly. Given that invoicing directly affects cash flow for a business, it seems like something that organizations should dedicate time to getting right, yet to this day perfecting the invoicing process continues to be put on the back-burner by many services teams.

Excel Invoicing Templates Are Not Enough

There’s a time and a place for Excel – but invoicing is not it. A key trait of any growing services business is the ability for top management to solve problems quickly and efficiently. Talk to anyone who has spent time managing a professional services organization and they will tell you that they spend most of their time “putting out fires.” As a result, Excel becomes a manager’s go-to fire extinguisher–it’s easy to understand, it can get the job done quickly, and it’s flexibility allows you to make things look the way you want. When it comes to invoicing for services work, however, that is where the benefits of using Excel end.

The invoicing process can be a tedious one. Even one small mistake could cost a business tens of thousands of dollars, often without anyone even noticing. And, the process can occupy a lot of time and resources if not done efficiently. With Excel, every step of the process – creating, proofing, approving, adjusting, and sending invoices – introduces inefficiency.

Not only is using Excel for invoicing labor intensive and error prone, but the manual processes can also reduce visibility and transparency for senior management who need insight into the performance of the business.

If Not Excel, Then What? 

When it comes to replacing Excel templates, invoicing software seems like the obvious answer. But for professional services businesses, invoicing software isn’t usually offered as a standalone solution. Most commonly, it is part of a financial management solution, a time and expense tracking tool, or a professional services automation (PSA) suite. A typical and costly mistake that many services teams make, is selecting a type of invoicing solution that is unable to accurately support the needs of their business.

Financial Accounting Software

When thinking about generating invoices, financial accounting solutions seem like a natural starting place. That said, for professional services organizations invoices are more about people and projects than they are about simple debit and credit transactions.

If a services team plans to grow past just a few consultants, or is already well past that size, it’s probable that the organization will outgrow their accounting system quickly and won’t be able to rely on it for generating invoices and tracking project progress.

This doesn’t mean, however, that invoices for professional services work will not need to find their way into an accounting application to track receivables, cash flow, and outstanding balances. To accomplish this, it’s best practice to leverage a solution outside of an accounting application to generate invoices that can be integrated back to a business’s financial accounting solution. Robust solutions will have pre-built integrations to some of the most popular accounting packages, allowing data to flow seamlessly from one application to the other.

Time And Expense Software

Software designed for time and expense tracking is a much more natural fit when it comes to the invoicing process for services teams. These tools are better developed to manage people and projects and make it easier to translate activities into the financial components of an invoice.

However, time and expense software is not without its limitations. Missed or forgotten transactions, for example, can be problematic with a time and expense tracking tool. If the software a business is using is not able to recognize when a billing milestone has been achieved, it can go un-invoiced for quite some time, creating revenue leakage and reducing cash flow as a result.

Professional Services Automation (PSA)

For services organizations achieving growth, the only real answer when it comes to the right tool for invoicing is a professional services automation software.

A PSA software is a project management and resource management software rolled into one easy-to-use platform. The value that PSA software brings to the invoicing process can be seen in both reduced revenue leakage, and increased efficiency.

Reducing Revenue Leakage:

Consolidating invoicing and time tracking into the same system helps to eliminate revenue leakage. PSA software takes the process a step further by focusing on collecting all of the time that can be billed, and ensuring it reaches the invoicing process. Robust PSA solutions will have a detailed understanding of how much time is anticipated in a given period. Based on project schedules, a PSA solution will alert project leaders when things aren’t going according to plan. More importantly, a PSA solution will understand the difference between earning revenue and sending an invoice. This helps to recognize revenue properly on fixed price work.

Driving Efficiency:

A PSA solution will also allow project managers and finance teams to model exactly how they would like to bill their clients up front. With so many different contract terms available, this allows the organization to seamlessly complete the invoicing process in whatever manner suits them. Finance teams can complete the invoicing workflow quickly without the headache of manual processes. More importantly, this structure drives accountability throughout the entire invoicing process. Finance Managers and CFOs are provided a detailed view of exactly what has been billed, how it has been adjusted, and what is still being waited on. This helps streamline the business’s month-end processes and frees up valuable time and resources to focus on other important projects.

Perfecting the Invoicing Process With PSA

Through leveraging a PSA solution, organizations can reduce errors and increase efficiency, while also ensuring that cash flow follows closely behind work being performed. And, as the business grows, they offer a scalable invoicing process which means fewer fires to put out.