Tony Korn explains what service organisations or units should do to gain maximum business benefit from investing in Professional Services Automation (PSA). He explains that it is not the system that matters so much as how the implementation is best planned and executed to match strategic business needs.
You doubtless have a sense of how information and communications technology (ICT) can assist a service organisation or unit to improve its performance – particularly its productivity. The most obvious areas where ICT is consistently used to add value are:
è Contact management: this includes both:
o Relationship management (that is developing and maintaining information on current and potential customers), and
è Cost management:
o Most critically this relates to time and expense management – that is managing the costs associated with ‘projects’, including monitoring utilisation and cost control,
o It also covers business intelligence – providing reporting tools that improve the assessment of business operations; and
è People and resource management: including
o Resource management,
o Project management,
o Practice management,
o Partner relationship management,
o Collaboration management, and
o Information and knowledge management.
More often than not, however, the IT solutions involved are pieced together from a variety of different applications – poorly interfaced – and not as part of a coherent strategy.
Surprisingly, many service organisations seem to be unaware of recent new developments in applications. There are now a number of package suites that have been designed specifically to assist service organisations address the specific areas listed above in a comprehensive and integrated manner. These are known as Professional Services Automation (PSA) packages.
PSA packages have their origins in ERP software, Enterprise Resource Planning suites of integrated modules designed to improve the productivity of an organisation (originally manufacturers, then retailers, then virtually every other large enterprise, regardless of business sector). PSA packages are designed to do for service organisations or units what ERP packages did for large organisations that implemented them in the 1990s.
It should be said immediately that there is absolutely no necessity to go for ‘big bang’ and implement all the available PSA functionality simultaneously. The great majority of organisations implementing PSA begin with Time & Expense Recording and Management, looking to improve utilisation and cost control. The point of PSA, however, is that all of the modules integrate – data in once and only once – and so it is easy to progress from one module to the next, building a complete and comprehensive information and knowledge base that truly provides operational support.
PSA application suites offer service organisations or units the opportunity to:
è Increase utilisation and improve financial management;
è Facilitate more effective collaboration with partners through improved communications;
è Integrate information and knowledge management;
è Increase business operations;
è Increase client/user satisfaction; and, overall,
è Increased productivity.
è Customers gain too: they get real-time data on project status and costs and a tool to improve the management of projects. That should mean no, or at least fewer, surprises as the work unfolds and inevitable issues are uncovered;
è And employees gain: their gains include consistent scheduling, insight into overall business-wide activities and future projects, and reduced administrative burden, particularly if access to the system is fast and well structured.
Moving to a PSA-supported environment can also be justified on the basis of the extra importance of flexibility in a constantly changing economic climate. Service organisations or units need to be able to respond rapidly to changes in needed skill profiles, organisational change and technological advancements.
Implementing PSA most cost-effectively with the most successful end-result requires proper planning and proven experience. It cannot be undertaken successfully by individuals with little practical know-how, regardless of the methodology they may follow. The right strategic framework for the business processes, PSA system, organisation, information and technology – relative to the organisation’s own business strategy and operational model – is absolutely essential for maximum value.
The first phase of such an implementation project needs to focus on the future strategic business requirements, identifying priority areas on which the business vision depends. The impacts of technology, particularly e business, and the opportunities to leverage information need to be linked back into the business strategy, identifying overall strategic information needs and opportunities. Prioritisation is critical at this point. Classically, one or both of two techniques are used here: critical success factors and value chain analysis.
At the end of this first and most critical phase, a future business model is created which shows how the enterprise will operate to meet the underlying demands of markets, customers and suppliers, both internal and external. The business model shows how future key processes and information flows will best blend together.
The second phase maps the strategic business requirements into potential systems applications and determines possible technology options and strategies. At this stage the existing systems inventory is assessed for its future applicability, particularly in a PSA environment. It is always too easy for current systems to be abandoned; however if they are business critical then the impact of a complete change needs to be taken into account.
This leads to the final, pre-strategic-approval phase when the organisational and business impact is finally appraised in terms of need, cost and benefit to determine the most appropriate strategy. At the end of the study, a formal business case that sets out the plan, its costs and its benefits, is developed and agreed in order to ensure the organisation takes final ownership of the strategy and its practical implementation.
Within this overall framework, there are two key checkpoints where the strategy development needs to be crosschecked at special workshop sessions. Additional workshops are often used as a means to involve as many client staff as possible in the work, particularly in relation to prioritising particular business requirements.
Turning this into a clear programme of activity, the following step-by-step approach must be followed in sequence if a PSA solution is to be successfully implemented:
1. The organisation’s (or unit’s) business strategy must be assessed.
2. Awareness must be gained of potentially relevant PSA package suites.
3. Executive sponsorship must be gained.
4. An organisation structure for the project must be developed and agreed.
5. Business processes must be re-evaluated. Future business processes must be clear and agreed before selection commences. Place the emphasis on the “process”; understand, dissect, define and agree requirements; automate; and optimise. Then it’s time to measure the benefits and report them.
6. Measurable evaluation criteria must be developed and agreed.
7. A business case must be created.
8. Implementation time must be minimised. If you’re going to make major change, do it quickly. Where the ROI (Return on Investment) goes down, this typically correlates with increased deployment time.
9. Gain approval for the strategy and plan.
10. The PSA package suite must be selected and implemented, taking account of the need for change management. Train, train, train. Measure, measure, measure.
11. Review results from operations (including multiple analysis) to determine what further needs to be done.
12. Even if not fully deployed, look for immediate benefits.
13. Report to executive body.
14. Go back to Step 1 to evaluate and improve on what has been achieved.
Failure to undertake an adequate re-evaluation of business processes and inadequate subsequent change management are the key causes of poor implementations of PSA. Getting these two activities right is definitely a Critical Success Factor.
But how should you make this new initiative happen effectively within your organisation? If you try to do it with just internal resources, then:
è There will be a long learning curve as the team decide how to sequence their work;
è It will therefore take a lot of resource; and
è There will be a lot of risk as your business slowly changes to adapt to the new systems.
There are alternatives for a service organisation or unit other than implementing PSA. It looks highly likely, however, that all but the smallest will soon move to having a PSA-supported environment. PSA is clearly a potentially highly-powerful tool for service organisations and units.
כותב המאמר: Tony Korn