10 Must-Have Professional Services Automation Software Features

What is PSA Software?

PSA software enables all types of services organizations – conventional PSOs, embedded services organizations, and managed service providers – to achieve optimal efficiency across all aspects of the customer engagement by:

• Centralizing key processes and optimizing end-to-end services lifecycle profitability
• Increasing delivery confidence and successfully achieving business outcomes for customers
• Establishing full visibility that drives faster, better decision-making

Business Cases for PSA Software

PSOs maximize financial performance through the effective use of resources. This requires visibility into the performance of current work, as well as the pipeline of potential work.

At the same time, in order to accurately forecast and drive business decisions, executives require real-time visibility with key metrics such as utilization, profitability, and margin.

Despite these essential requirements, many PSOs struggle to achieve optimal efficiencies across all aspects of the customer engagement, this is mainly due to the following challenges:

• Limited and fragmented visibility into services operations caused by disparate systems, disjointed processes, and manual reporting methods.
• Ongoing communication breakdowns across the full end-to-end engagement lifecycle caused by a lack of process automation.
• Poor resource utilization caused by limited visibility into the pipeline, which makes it difficult to effectively and efficiently allocate personnel. 

If these issues remain unresolved, PSOs run the risk of failing to meet performance, productivity, customer success and profitability expectations. Fortunately, there is a proven solution that makes a substantial, measurable, and sustainable difference: PSA software.

Core Features of Professional Services Automation Software

Today’s services organizations are challenged from every angle to meet evolving customer demands and adapt to industry change – especially in the shadow of the pandemic, which is forcing many firms to re-examine and re-invent the links between customers, capabilities, and strategy. 

However, one constant amidst this uncertainty is that PSA software continues to be the foundation for managing engagements from beginning to end. 

The Service Performance Insight 2021 Professional Services Maturity Benchmark found that 85% of the top-performing services firms rely on a great PSA solution.

“PSA systems allow world-class services firms to manage that delicate balance between delivering great work, maintaining profitable projects, and maximizing resource utilization — all of which leads to sustainable growth. This doesn’t happen by accident, but through a conscious focus on investments in the right systems, processes, and people.”

Additional research has found that good PSA software: 

• Increases in billable utilization up to 14%
• Increases average rate realization by 9%
• Reduces average business days to source a customer project by 50%
• Increases the positive impact to earnings before interest, taxes, depreciation, and amortization (EBITDA) up to 24%

What distinguishes good PSA solutions that drive success and growth, from inferior offerings that cause limited visibility, communication breakdowns, and poor resource utilization? Good PSA solutions deliver 10 core features:

Contract Management Optimizing Operational Success

A PSA solution that strongly integrates with your customer relationship management (CRM) system provides visibility into the quoting process and contract details. This enables your teams to manage resource demand and forecast financials more easily. It also enhances pipeline forecasting and profitability analysis. 

Contract types are also key. Being able to define, automate, and track contract details ensures that invoicing runs smoothly, and enables your teams to combine and manage fee schedules, billing rules, time, and expense rules, and more.

This is particularly useful as services contracts become more complex, and the demand for new revenue billing methods increases.  

Contract management is critical to optimizing operational success within your organization, and so is how you gain actual visibility into that data.

A PSA solution with a strong business analytics function improves communication about the financial pulse and health of engagements and is an essential feature for monitoring the overall success of your organization. 

Financial Management: Monitoring and Supporting Healthy Growth

Another critical function is how your PSA software integrates with your enterprise resource planning (ERP) system. When your PSA and ERP applications “talk to each other,” operations are automated for engagement billing, budgeting, and shortening days sales outstanding (DSO) — all of which generate real-time insights about the financial health of your engagements. In this case, simple automation of operations makes a positive revenue impact.  

Find a solution that keeps the most important PSA software features in mind:  

• Real-time visibility such as notifications and alerts that help you course correct
• A financial foundation architecture that lends itself to global organizations
• Configurable dashboards that aggregate the data in real-time that’s most important to your end user

Read next: Guide to Professional Services Automation and PSA Software

Resource Management: Your Business is Your People

With the ongoing financial concerns in the current global economy, services organizations are taking a closer look at the financial stability of the marketplace, and many are taking a stronger view of their operational practices and making the tough decisions necessary around cost control and reduction. 

A natural area of focus is workforce reduction and efficiencies. Yet, without accurate transparency into the details of the resource utilization and distribution, the risk of decisions impacting the success of the organization increases. 

Furthermore, many organizations still address resource management as a singular process or event within the organization: 

• Project managers require resources to complete the project
• Forecasting needs to “place a hold” on resource futures
• Finance needs to account for the cost of resources
• HR should plan career growth development
• “Keep the lights on” (KTLO) requires a core team of resources to keep the business and other supporting infrastructure running
• Resources need to know, “what to do, and when to do it.”
• C** – requires transparency into all of the above “disparate systems” in real-time

Your business is your people, and their knowledge is your commodity. Business leaders do not want a seasoned veteran assigned to something a junior, less costly resource could handle. Yet new engagements come through the door every week.

Being able to forecast capacity and demand, enables your resource managers to plan and mitigate resource swapping. Effective resource management and forecasting within your PSA solution is a critical factor towards achieving the highest billable margins possible.  

Unfortunately, resource management in professional services is not simple. You are likely working with a decentralized mobile workforce across time zones. A powerful resource management process enabled by a leading PSA solution ensures the right resources are working on the right engagements.  

Look for a PSA solution that provides insight into how allocations align to financial objectives, and PSA modules that make it easy to perform “what-if” analysis to ensure capacity can meet projected demand. That way, you are not overpromising on resources, and you are not leaving anyone on the bench — which is revenue on the table.  

Project Management: Success from Start to Finish

Because today’s projects are not one-size-fits-all, choosing the right execution method and being able to manage that within your PSA solution is critical. Whether you are using waterfall, agile, PMBOK, Prince2, or other methodology, a multimodal approach enables your organization to be more agile.  

Ensure that your PSA solution is equipped to handle your delivery method of choice. Remember: PSA is more than just a work-management tool. It is a single source of truth for all engagement execution data. 

You want the capacity to monitor each project’s financial health every step of the way, to ensure delivery stays on track, within budget, and with a positive impact on margins. 

Time and Expense Management: Empower Today’s Workforce

Your workforce is becoming more mobile and today’s technology is designed to support a more connected digital workforce. Finding a PSA solution with native mobile application functionality is paramount to the success of your organization for a couple of reasons. 

Firstly, your teams can work more conveniently from the device that is already in their hands. Secondly, it enables team members to report time and expense data immediately.

This significantly improves both accuracy and compliance. According to the Ebbinghaus Forgetting Curve, “individuals can recall 75% of newly learned information after a mere six days.” So, why wouldn’t your organization utilize the key advantages of a PSA solution?

Overall, ensure that your PSA solution has out-of-the-box support for a mobile app that enables: 

• Offline mode for anytime and anywhere access. 
• Clear and consolidated time and expense management. 
• Multi-device/platform capability to drive a consistent and familiar experience across mobile devices and tablets. 
• Push notifications so that team members stay informed and connected.  
• Localization to support distributed team members in multiple countries. 
• Built-in app walkthroughs to facilitate ease of learning, and rapidly bring new team members on-board. 

The aggregated impact of these features includes happier teams, increased adoption, accurate time and expense data, and more satisfied customers.  

Revenue Management: Ensuring Healthy Growth

Measuring results at every step of the engagement is critical to reporting on how margins are being impacted. But with all the engagements that are in-flight, that can seem impossible. Fortunately, this is not the case!  

Thanks to PSA solution features such as integrated invoicing capabilities that streamline the order-to-cash cycle, and automated processes that capture and track data at every step of the engagement, it is certainly possible to recognize revenue in real-time. Aggregating data to reflect all in-flight engagements starts to paint the picture on how the organization as-a-whole is performing.

Delivery Management: Ensure Process Adherence for Consistent Financial Success

Your organization is constantly changing and getting locked into outdated workflows can unleash confusion and chaos — which ultimately damages customer satisfaction, reputation, and profitability.  

The right PSA solution features an easy-to-use workflow engine, which provides an intuitive framework for developing simple or complex automated processes based on project type, as well as other key operational attributes. This enables your organization to:  

• Closely configure and re-configure workflows to your unique services delivery processes (e.g., time and expense approvals, invoice approvals, resource requests, etc.)
• Simplify revenue generating activities with the ability to automate the quote-to-cash lifecycle stages.
• Ensure that business processes are followed. 
• Apply auditable best practices to key process needs
• Ensure escalation when delays are incurred. 
• Remove risk with manually trained processes, and efforts. 
• Reduce manual costs of managing efforts. 
• Increase visibility into the success of the process. 
• Remove the guesswork of what needs to be done next. 
• Involve the customer with key decision points in the process. 

Analytics: Using Actionable Business Intelligence to Drive Better Decision-Making

Services business leaders need to know the overall health of engagements — not just when engagements come to an end, but always. When scope changes or resources are suddenly unavailable, rear-view visibility does not help. 

To avoid these costly pitfalls, choose a PSA solution that offers customizable dashboards that give executives and delivery managers immediate, real-time access to the KPIs and other metrics they need when they need it. 

The PSA software should also leverage explorations and AI capabilities to provide actionable insights into revenue leakage, execution risks, unplanned costs, contractual issues, and more.  

Read next: The Secret Tools of Service Leaders

Opportunity Management: Improve Quote-to-Cash Success and Structured Processes

PSA software that integrates demand and capacity gives your organization the up-front line-of-sight needed to assign the right resources, across the right engagement, at the right time. Key opportunity management features should include the capacity to:  

• Drive a standard practice for establishing rigor around your services delivery methodology. 
• Ensuring that opportunities are staffed appropriately based on resource availability, skills, and experience. 
• Eliminate low utilization and cost overruns with a multi-dimensional approach that is critical to establishing a profitable quote-to-cash customer lifecycle. 

Security and Compliance: Protect Your Data, Customers, and Reputation

While not viewed a traditional feature like contract management, project management, and other entries on this list, it is critical to choose a PSA software vendor that has a demonstrated commitment to embedding the highest levels of security into their solution. 

To put this another way: your organization may not “see” security features on a day-to-day basis, but it is as important — if not more important — than anything else on this list. Consider that the average cost of a single data breach has climbed to USD $4.24 million per incident, and the reputation damage can linger for years.  

Any PSA software vendor worthy of your consideration and trust should include the following:  

• A formalized cybersecurity program and strategy. 
• Multiple lines of defense. 
• A comprehensive defense-in-depth security model.
• Robust product security and customer data protection through eencryption, access controls, and preventing data on ports and services. 
• Current SOC 2 attestation that provide controls assurance of operational elements including security, availability confidentiality. 
• An ISO/IEC 27001:2013 certified information security management system (ISMS) to manage sensitive customer information to ensure it remains secure.
• An ISO/IEC 27701:2019 certified Privacy Management Program focused on personally identifiable information (PII) management across the organization’s environment, addressing its different responsibilities both in the role of a data controller and data processor. 
• Assurance that all third-party data center providers and cloud hosting providers are SOC 2 and ISO/IEC 27001 certified at a minimum.
  
• A dedicated team of auditors who regularly assess security and compliance controls for effectiveness and alignment with organizational policy and regulatory requirements. 

The Bottom Line on Professional Services Automation Software

Today’s services organizations must juggle a multitude of engagements and contracts, and effectively manage resources who are multitasking across workstreams — all while protecting margins and driving customer satisfaction. 

The right PSA solution with the right features is out there. As you consider all your options, keep these 10 core features in mind to ensure that your choice drives success and growth now and for years to come.   

Next Steps:

• Adopting a PSA solution is not a one-time transaction. Invariably, your leaders and teams will need a full range of support: everything from strategic advice to hands-on adjustments.
• Watch Planview’s Professional Services Automation Solution On-Demand Demo
• Download the Planview PSA Software Solution Brief

Looking for more insights on services automation and professional service automation solutions? Contact us to discuss how Planview can help make your organization’s engagements more predictable and profitable.