What is Professional Services Automation?
Professional Services Automation (PSA) software helps professional services organizations quickly identify opportunities to win, serve and retain customers by automating pipeline management, resource planning, expense and cost tracking and project financial management.
What is the difference between PSA Software and ERP Software?
Professional Services Automation differs from Enterprise Resource Planning (ERP) in that a full project ERP system manages all aspects of projects, including accounting functions. A PSA solution handles front-office functions of the business and projects; it does not typically include accounting tools (such as a general ledger), but it can integrate with accounting tools.
The definition and functionality of PSA solutions continue to evolve and the lines between ERP and PSA are becoming more blurred. The term PSA therefore will often be used to describe an ERP for Professional Services.
Who Uses PSA Software?
A growing number of project-based professional services companies that derive revenues and profits from projects they manage for their clients need PSA software that supports project delivery via project management, project accounting, resource management, time and expense, invoicing, collaboration and reporting. Professional Services firms are found in industries such as consulting, architecture and engineering, legal, accounting and marketing.
PSA for Architecture and Engineering (A&E)
The project lifecycle at architecture and engineering firms includes business development, project management, resource scheduling, talent management and financial management. Whether your A&E firm is small and looking to grow or a larger sophisticated organization, a PSA system can help you leap to the next level of success.
PSA for Consulting Firms
Consulting firms face challenges such as winning the talent war, compensating and utilizing consultants correctly, delivering successful engagements and improving client satisfaction. PSA solutions encompass the entire engagement lifecycle, including client relationships, proposal automation, project management, resource scheduling, time and expense and financial management.
PSA for Marketing Agencies
Marketing and advertising agencies value PSA (also known as work management in this vertical) because it makes managing projects, people and finances easier. A PSA system handles left-brain activities, leaving right-brained creatives free to do what they do best.
PSA for Accounting Firms
The best accounting firms analyze data to deliver fresh insights and become trusted advisors to clients. PSA software helps them build this value into everything they do by providing the visibility to make accurate plans and the insight to improve resource utilization and profits.
What is the Business Value of PSA Software?
Project-based organizations have distinct requirements, and they need to view their business in three dimensions: accounts, organizations (departments or business units) and projects.
The very thing that makes project work enjoyable—the variety of doing lots of different things for lots of different clients—makes running a project‐based business challenging. You need to manage resources wisely, ensure your people have the right amount of work, monitor project progress and cost, track financials to bill accurately and get paid promptly and collect information that helps you decide which opportunities to seek and how much to charge.
What’s more, customizing generic business and project management tools often results in poor visibility, manual reconciliations and assumed calculations that aren’t tied to the right projects.
PSA software handles these challenges. The key benefit of PSA solutions is that every transaction is tied to three things—an account, an organization (the person or team doing the work) and a project (the product or service delivered to clients that is the source of billings and revenues).
By connecting corporate information and project information on one platform, you gain unparalleled visibility and control, and you can make decisions based on current, real-time data rather than managing through a rearview mirror.
PSA software provides a number of key benefits that support each step of your project lifecycle:
Develop Business through Opportunity Management: Most customer relationship management (CRM) tools are designed for businesses that sell products; they won’t work for project‐based businesses because often a project’s key item is labor. PSA with true project-based CRM helps project‐focused professional services organizations understand their market and identify, manage, track, forecast and capture opportunities.
What Are the Key Features of PSA Software?
Effective Professional Services Automation software includes these key features, many of which maximize productivity and revenue:
- Customer relationship management (CRM) users create campaigns and track prospect and client progress through the sales pipeline. Identifying weak links in the sales cycle and clients who tend to return is invaluable in planning future projects. Proposal automation streamlines pursuing and winning projects, reduces costs and enhances proposal quality.
- Project management centralizes and integrates project initiation, planning, execution, and close. Reports communicate timelines, budgets, activities and their logical order, and resources to perform activities. Time and expense tools integrate with client AR systems and accommodate varying billing requirements to optimize invoicing, billing, proposals and contracts.
- Human resource management (HRM) handles recruiting, onboarding, training, career development, resource planning/management, and payroll. HRM helps project managers delegate workloads and measure seasonal fluctuations, reducing resource issues and increasing productivity.
- Project accounting can be included as part of a PSA solution, or you may want to integrate with your existing accounting tools. Reviewing and managing the entire project portfolio helps you strategically direct the business.
- Invoicing and billing: Capture and tracking functions keep tabs on time and expense data.
- Collaboration tools link people for sharing conversations, tasks, events, and files.
Six Tips for Choosing the Right PSA System
Implementing PSA software should be a no brainer for organizations looking to operate at a higher level than the competition, increase productivity and better understand what makes your business successful.
The decision about which PSA system to implement is more important than ever, because you’re not just buying a tool; you’re choosing a trustworthy partner who will collaborate with you through the digital transformation of your business. Whether you’re seeking a new PSA system or re-evaluating vendors for an upgrade, consider these criteria:
- A comprehensive, purpose-built solution: Your solution should be designed with your industry in mind, not a generic solution requiring customization to your requirements.
- A respected industry reputation: Is your vendor a respected leader in your industry? Look outside of the product and observe the vendor’s influence in the industry.
- Scalability: Look for a solution that can easily accommodate your company’s growth strategy.
- Integration with your existing accounting and/or CRM tools: Confirm that the tool can be integrated with existing tools, if you wish to retain them.
- Transparent total cost of ownership: Recurring costs should be clear from day one. Pricing models should outline all details. Look for companies with flexible price plans that include full suite, PSA and back-office capability with complete core accounting.
- Invested in customer care: Look for a vendor independently recognized as having superior and flexible customer service plans, your main line of communication after implementation.
How Do Deltek PSA Systems Power Project Success?
The Nucleus Research 2021 ERP Technology Value Matrix named Deltek the leader for project based businesses—for the eighth time. In the value matrix, Deltek outranks many ERP competitors because its applications are purpose-built for businesses across a range of project-based industries.
“Deltek is a leader…as its project-centric ERP systems continues to drive value and win contracts for its customers”
Nucleus Research 2021 ERP Technology Value Matrix
At Deltek our mission is to deliver solutions that help our customers connect and automate the project lifecycle that fuels their business. We believe that better software means better projects. Our industry-focused expertise makes your projects successful and helps you achieve performance that maximizes productivity and revenue.