By Cassandra Balentine
Service-based organizations benefit from automating tasks and gaining control over processes and procedures. Professional Service Automation (PSA) software delivers the automation and visibility needed to gain valuable insights from business data.
Core competencies of PSA solutions include invoicing, accounting, resource management, ticketing, and project management capabilities. Further, advanced features include CRM, sales, marketing, and procurement functionality.
Service-oriented businesses look to PSA software for operational efficiency. “The market is more competitive and margins are becoming increasingly thin, so technology solution providers need to provide world-class service while minimizing costs,” says Linda Catrett Brotherton, GM, ConnectWise Manage. PSA solutions streamline and simplify operations to help businesses scale.
PSA solutions function as the heart of a marketing service provider’s (MSP) business, enabling control over each aspect of its operations.
Geoff McQueen, founder/CEO, Accelo, believes the professional service sector needs a new, wholesome approach to business operations, with an increased focus on driving utilization, client relationships, and profitability through automation. “The main trends affecting this category today are based around the core industries and users who use and run their businesses with it. Professional users create its perceived value and suggest improvements or alterations because they’re the ones using it day in and day out.”
He suggests the market was traditionally driven by the needs of owners and accountants. “But with one in every six professionals in the U.S. now working in the services sector, and the advancements in the technology behind PSA software, that’s finally starting to change,” says McQueen. He says now, we can and should start to cater to the needs of every member of a professional services business.
Several trends affect the PSA landscape. Terry Melnik, product marketing director, NetSuite, says many of its software service customers redefine services delivery due to new competition and changing target markets. This forces them to explore and adopt new business models. “Where in the past, software companies would sell professional services, today the most progressive are also delivering hosted services, hardware, and subscriptions,” he says.
Steve Chong, COO, Projector PSA, suggests that because the professional services industry is not dependent on large capital investments, heavy fixed asset infrastructures, or lengthy regulatory review, it is able to adapt and innovate faster than many other sectors. Due to this, modern services firms require PSA software that is equally nimble and flexible to accurately model and keep up with their evolving needs.
Catrett Brotherton sees more downstream applications headed to the cloud, increasing the need for integrations that simplify and streamline service monitoring and billing. This extends into the need for a security practice area to support this movement.
According to Mike Puglia, chief product officer, Kaseya, the most important trend impacting PSA solutions today is the growing demand for product innovation to keep pace with an evolving MSP landscape. “First-generation PSA offerings are built on ten to 20 year old technology with inherent operating limitations. As such, MSPs are increasingly dissatisfied with the cumbersome nature and high cost of these antiquated PSA products, which divert resources away from efforts to grow their business. That is why today’s MSPs need an agile PSA solution that is easy to deploy, simple to use, and cost effective.”
In addition to permitting fast implementation, modern PSA software is configurable enough to flexibly accommodate changes in an organization’s underlying business model, points out Chong. He says many services firms supplement their traditional project-centric delivery model with recurring revenue, managed services-type arrangement. “They increasingly use risk-sharing constructs like fixed price contractual terms to enable them to be more competitive as they work to win new business,” says Chong. “They are growing revenue and delivery capabilities by acquiring, partnering with, or starting up operations in other countries—thus requiring more complex inter-company, multi-currency capabilities.”
McQueen says while new users and cloud integration are important trends, the main trend to follow is service operations automation, “which in my opinion does the one thing we all want—simplify our life and workflows.”
PSA tools are essential for many service-based organizations to run smoothly and profitably. Culture change and visibility into an organization are barriers to be overcome.
Chong mentions that as he talks with prospects, he is continually surprised at how many service firms still rely on manual spreadsheets and whiteboards, hard-to-maintain homegrown systems, or commercial systems that are poorly targeted or implemented. “Many of these firms are struggling so hard to maintain, fight with, or settle for their existing systems that they don’t feel like they have the time to do a proper, thoughtful evaluation and implementation of a system that will truly support their needs,” he explains. While these systems may have been sufficient in the past, firms often outgrow them as they expand in size and complexity. “It often feels like the right thing to do to put in yet another manual workaround to overcome the shortcomings of current systems and processes. As these manual workarounds built up over time, however, they end up being a substantial recurring source of inefficiency that can often be alleviated by a one-time investment in new systems and processes.”
Melink suggests that the simplicity and ease of use found in personal devices is the functionality expected of commercial applications. “This user experience resets the bar for all commercial experiences. We see it as an opportunity to rethink how people interact with cloud software and how to change the entire user experience,” he adds.
“Once an MSP reaches a tipping point in size—typically around ten customers and 100 managed endpoints—they will look to invest in a PSA solution in order to scale their operations cost effectively and improve service delivery to their customers. Often, an MSP will consider reevaluating their PSA solution when they want to achieve enhanced integration with their RMM solution of choice or if the PSA lacks certain features or functionality—such as advanced automation processes—that impact service delivery,” offers Puglia.
In addition to replacing antiquated solutions, a second trigger that often leads to investment in a new PSA solution is the negative experience of having a project go wrong or alternatively of having the organization unexpectedly miss a goal by a wide margin, shares Chong. “Often management teams who didn’t have sufficient visibility into the state of the state miss the opportunity to take corrective actions in the time to effect meaningful change. Or, they may have the gut feeling that something needed attention, but they didn’t have the data to substantiate that claim, nor the tools to positively affect the outcome.”
Melnik agrees, adding that companies who have trouble getting their teams to adopt the chosen solution face an uphill battle during deployment through the lifecycle of the product.
Due to well marketed, but outdated and expensive tools, McQueen believes few are running professional service businesses that can actually answer the question of what happened today. “In this respect, PSA software does hold tremendous promise. When we talk to professionals who’ve used PSA products in the past, many tell us that the products they found often required more effort to drive than what they had time for, and didn’t truly answer the questions they were seeking responses to,” he offers. “Unfortunately, this has forced them to go back to using a combination of disconnected tools that do not talk to each other and don’t give them the visibility they need to run a successful business.”
Chong adds that regardless of where a firm is along its maturity curve, a successful implementation of a PSA solution is dependent on how well the solution can model the organization’s business. It is not about the technology the PSA is built on, the peripheral systems that the PSA can integrate with, or a checklist of features the PSA can satisfy,” he says.
Considerations for Investment
When evaluating PSA software, professional service providers have many factors to consider. Tools including resource management, time and expense tracking, invoicing, integration ecosystems, cloud offerings, and mobility are popular functions of the software.
Service-based organizations should look for a PSA offering that delivers productivity improvements and works to reduce the overall cost of operations. “The product should enable the fast rollout of new service offerings by streamlining the processes to client projects. Lastly, MSPs should choose an open platform solution that easily integrates with the broadest range of client service delivery tools—including remote monitoring and management, network/system management, security, and cloud management systems—in order to deliver a comprehensive suite of services and solutions to their customers,” says Puglia.
Chong feels the most important consideration a professional service organization should make when evaluating a PSA solution is not what it does, but how well it does it. “All too often I see firms using the checklist approach when selecting a vendor. Evaluators using this approach often give little consideration of how well an application solves a particular problem,” he warns. So how do you evaluate how well a system does something? The answer is simple, according to Chong. “Take a few of your most common use cases and dive deep with them into the solutions you are evaluating.”
“PSA tools vary widely in maturity and how well they can model a firm’s business. Slick looking products that demonstrate well can quickly fall apart when you ask it to do something just out of the norm,” suggests Chong. “Using a targeted, deep-dive strategy will highlight very quickly which solution takes the most natural approach to model a professional service organization’s most critical needs.”
Melnik considers PSA to be a unique software segment. When considering an investment, he suggests first and foremost to ensure you trust the vendor, and insisting that the solution is both flexible and scalable. “You don’t want to outgrow it or learn that making changes or staying on the latest version will cost an excessive—and unbudgeted—amount in fees and effort to refactor code. There’s just too much on the line to not validate that during evaluation.”
For owners and managers, in addition to getting real time reports and insights, it is important to consider how machine learning and artificial intelligence will come to life in the products they choose. “While these technologies are still in their early stages, one thing is clear—they won’t be available to your business if the vendor you choose isn’t a legitimate cloud product,” warns McQueen. He adds that many PSA products are legacy installed products that are hosted by vendors and not true cloud platforms.
On the Market
Many PSA software vendors offer solutions for professional service businesses. Here we highlight select tools from vendors that participated in this article.
Accelo is a cross-industry platform used by agencies, consultants, developers, accountants, architects, engineers, and a number of other professional service providers. By combining CRM, project management, service tracking, retainer management, time sheets, collaboration, and billing into tone integrated system, the product aims to save time and boost utilization and revenue of its users.
Accelo integrates its solution with hundreds of business software products and is primarily used by businesses with between five and 500 employees.
ConnectWise offers a suite of solutions that can be tailored to a company’s needs. It offers a healthy ecosystem of integrated, third-party solutions. ConnectWise Manage encompasses all the core competencies of a PSA plus sales and marketing functionality. “For reseller businesses, we also offer a full procurement and inventory system. Incorporating best practices and staying in touch with current trends in the industry, our solution continually adds needed features like user-based billing, cloud services integration, and mobile functionality to support personnel on the go,” says Catrett Brotherton.
Kaseya BMS is a next-generation business management solution built specifically to help MSPs spend more time selling and delivering services, and less time on non-revenue-generating tasks like billing and project management. “As the industry’s only second generation PSA solution, Kaseya BMS challenges the notion that PSA solutions have to be bulky and expensive,” comments Puglia. “The platform’s cloud-based approach makes deployment fast and easy. It provides authorized access from any web-enabled device at any time, thereby reducing both the cost and effort associated with complex legacy PSA implementations. The BMS web interface reduces training costs and improves user productivity. Total cost of ownership is reduced by eliminating add-on feature prices, hardware, systems software, and systems administration costs associated with the support and maintenance of antiquated PSA solutions. As a result, users of Kaseya BMS save between 50 to 75 percent versus the costs of competing PSA solutions,” says Puglia.
NetSuite OpenAir is built in the cloud. According to Melnik, it’s easy to integrate. Aside from its native connection to NetSuite, customers have real-time, bidirectional connections to their favorite salesforce automation solutions, their preferred ERP, and reporting engines and other platforms.
OpenAir offers powerful accounting and revenue recognition features, as well as a recently launched intelligent reporting suite. “Our powerful resource management tools not only help find the best resource, but optimize matching people’s skills and abilities with the engagement as much as their career objectives, ultimately increasing utilization but also raising employee satisfaction, moral, and minimizing attrition,” says Melnik.
Projector is a PSA solution focused on the professional services industry. Management consultancies, digital marketing agencies, IT consulting firms, and other project-driven organizations utilize the solution as their core operational system. Its clients vary in size from a few dozen to tens of thousands of employees ranging from independent boutique consultancies to embedded services businesses within the Fortune 500. Its core functional capabilities include four fully integrated yet distinct modules, including Project Accounting, Resource Management, Project Management, and Advanced Analytics.
Projector integrates openly with other core business systems found in professional services firms, giving functional teams access to tools designed specifically for their needs. Although integrating with nearly any solution is possible, it provides pre-built, click-to-configure connectors to some of the most common solutions on the market. These solutions include CRM tools like Salesforce.com, accounting packages like QuickBooks and Intacct, project management systems like Microsoft Project, and workflow management systems like JIRA and Zendesk.
Projector’s key differentiator is its singular focus on serving professional services organizations. “Few other PSAs on the market carry this distinction,” says Chong. “The majority of PSA solutions are built on a generic platform that limits their capabilities or are part of a larger product suite that serves multiple industries. As such, the Projector team is led by seasoned professional services executives seeking to solve known business needs rather than technologists looking for a market. The result of this distinction is a more thoroughly vetted solution that balances the how against the how well for each unique feature.”
Automation and Integration
Professional organizations benefit from automating the management of many of its critical daily tasks and processes. The evolution of PSA software tools should make these organizations stop to consider whether or not their current processes are working as effectively as they could be. Further, trends such as cloud integration and emerging technologies like machine learning and artificial intelligence provide considerations for future needs.
May2017, Software Magazine