Top tips for growth in the professional services sector
Professional services alone contribute over £190bn to the UK economy. Meaning industries under this umbrella are fundamental to the future economy. But with companies facing unprecedented changes in the last 16-months, achieving sustainable growth can be daunting especially without the right tools at your finance team’s disposal.
Typically professional service businesses are in a strong position to target growth, with workforces in this sector already savvy with digital technologies compared to other sectors. They understand the commercial and long-term benefits that technology can unlock - from efficient billing processes and access to reliable analytics, to frictionless experiences for both staff and clients.
While there are still a number of businesses using legacy on-premise platforms, many have already adopted a forward-thinking approach and, as such, are operating on their second or third generation system, running operations and services in some cases via the cloud with the ability to access applications anytime from anywhere. Finance teams in this sector appreciate the benefits that integrated systems bring to their day-to-day role, and most are looking for a central system that connects their financials to timesheets, billings, CRM and more.
1) Having the tools in place
According to research into clients of professional services in the UK, 65% of respondents agreed that digital service delivery is one of the most important factors when they select a partner – re-affirming just how critical technology is not only to internal operations, but external too.
Many businesses that actually thrived in the pandemic, did so because they had the right technology already in place, but those that relied on older, legacy systems and manual processes inevitably faced hurdles. Particularly because of the lack of flexibility that their systems offered to a remote workforce. For teams such as finance that had previously been used to predominately office-based work, this represented a significant move.
2) Reviewing internal processes and harnessing digital transformation
Without a doubt, the pandemic provided the catalyst for many businesses to review their internal processes and that much is true for finance teams working in professional services. According to our financial pain points survey from 2020, many finance pros felt the pandemic forced them to digitise their processes, with 24% predicting that 2021 would be the year they would invest in cloud accounting software, 23% stating payments software and 16% forecasting investment in automation software. Processes that, even before the pandemic, they believed to be inefficient.
With an integrated, cloud-based accounting system in place, finance teams were able to support professional services firms with the overall strategy of the business – even from home. With access to real-time financial data, finance teams are able to accurately track income and expenditure, and increase the frequency of their reporting, which enables senior managers to navigate the crisis more confidently. Added to that, with growth now at the forefront of future strategy as the economy continues to recover, the detailed insights they have at their disposal could also help to identify new areas of investment and unexplored opportunities, leading to potential business expansion.
3) Identifying areas to save
Our financial pain points survey identified a number of operational processes that continue to hamper finance teams. Those without integrated technology found that processes like payments held them back, and overall 12% of respondents said that dealing with ‘inefficient and time-consuming processes’ could be the main reason why some saw their workload increase.
In reality, these inefficient processes, and a lack of reliable, real-time data, can create a number of problems – in particular, making it extremely difficult for some finance teams and their senior managers to identify potential savings. In a fast moving world, having access to up-to-date data from your finance system is hugely valuable. When aligned with data across the entire business it creates even more value.
Without accurate up-to-date information from fee earners’ timesheets and expenses forms, and transparency of how much clients have been charged, you may not be aware that the company is losing revenue. Knowing exactly how much your fee-earners are billing means they can be allocated to the right clients and projects, based on their skills, capacity and experience, which in turn helps to drive up revenue.
Not only this, but up-to-date data allows finance pros to see exactly how much billable time is tied up in work in progress (WIP), so you can establish whether the project or case is still profitable. With this overview, project managers and resourcing teams will be able to identify hidden costs and allocate resources more efficiently. While reviewing this process will ensure the business isn’t overspending or under budgeting, it might also encourage senior managers to review pricing, checking supplier agreements against current market rates, to ensure the business is getting the best value for money.
4) One single version of the truth
As things start to return to normal, ambitious professional services companies are priming themselves for growth. By bringing all your data together, on one single company-wide platform, finance pros will have the ability to confidently provide business-critical advice to business leaders.
Growth can be difficult to achieve if a business lacks a robust financial plan and a lack of visibility can leave a business in the lurch. Integrated technology can deliver the level of transparency finance teams need to accurately monitor and control costs, demonstrating clear benefits for finance pros at growing professional services businesses.
