9 Things To Consider from an Operations Perspective when Implementing a New PSA

Looking to implement a Professional Services Automation (PSA) system can be highly beneficial for any organization that delivers professional services, such as consulting firms, IT service providers, marketing agencies, law firms, and engineering firms.

It’s easy to assess a new system from a tech perspective and the solutions it provides at face value, however, it’s essential to take stock of your internal operational needs 

like how you bill your clients (fixed fee, deliverables, and/or time & materials), how you need to track time and manage client projects, and the type of reporting needs for revenue, margin, and utilization to support your internal operational processes. 

Here are nine crucial things to consider when implementing a new PSA system from an internal operations perspective:

1. Time-Tracking:

If you’re a Time and Materials (T&M) billing company, how granular do you need to be with your project management time tracking? Do you need to track time down to 15-minute increments, be able to see which tasks that time is going to, and capture notes for time integrity? If so, you’ll want to ensure the PSA makes it easy for your PMs, managers, and Ops team to see, review, and approve that time. If it’s not visibly easy to see that information, those team members will spend more time on timecard reviews and this also leads to greater room for error. Mistakes with time entries happen! If you often find yourself having to correct already approved time you’ll want to make sure this process is easy and doesn’t bog down your ops admin team. 

2. Time Integrity

: How important is time integrity to your business? How much visibility is needed for what exactly is being done in the hours that are reported? If this is important to you or your clients, make sure your PSA has a feature for your resources to capture notes for all time entries AND make it easy for your PMs and managers to review the notes associated with the time entries to ensure those entries are accurate. Most PSAs have this feature, but some do a really good job of making this visibly easy to review because their system is designed well for this functionality. So, determine how critical this feature is for your business and thoroughly vet your potential PSAs to ensure their solution meets your needs. 

3. Billable vs. Non-Billable Time:

Are you an organization that needs to be able to easily differentiate between billable and nonbillable time? If so, it’s critical to look at how different PSAs are designed with this feature in mind. Some are designed to make it visibly easy to see the difference utilizing colors, and headers that provide the information you need at a glance. Others don’t have their system designed this way and require further drilling down, or customization to find the information you need. Being able to track billable vs. non-billable time is crucial for time entry integrity and capturing the time entries that need to be billed. 

4. Time-Tracking for Payroll:

Do you need your people to track their time in the PSA or will you use your HRIS or payroll provider? Do you need these systems integrated or will you manually enter the time into your HRIS to process payroll? Depending on your answers, it’s important to look for a PSA system that allows you to track internal operational time, paid time off, holiday time, etc., and be able to pull reports that can be exported or seamlessly integrated with your HRIS or payroll provider. 

5. Approvals Processes:

If you are a large organization you may need a multi-layered approvals process when it comes to time tracking, billing, resourcing, and many other functions. If you’re smaller, a one or two-layer approvals process should suffice. Look for a PSA that fits this need, as some provide customization to have as many layers as you need to ensure the right people are approving what they need to approve from timecards to resource requests, to budgets, and more. 

6. Client Billing:

What billing frequency do you need to support your business: monthly or bi-monthly? Or maybe something else? PSA systems have the capability to process billing in the cycle that you need, but it’s super important to understand if this feature is out-of-the-box or if it requires further customization to ensure the data you need lines up with your billing cycle (net 10, 15, 30 or +) and mechanism (fixed fee, deliverables, or time & materials).

  1. For example: if the PSA system is designed at a foundational level to pull time on a weekly basis (T&M), if you’re a business that bills bi-monthly, often those dates end mid-week and may require further customization to ensure billing cycles line up and that data is accurate.

7. Reporting:

What types of reports do you use daily, weekly, monthly, quarterly, and annually and what type of data do you need to see? Internal operations/HR may need to see breakdowns on team utilization including cost, margins, and hours spent on various projects. HR will need hours associated by person to process payroll (if systems aren’t integrated). PMs and Directors may also want to see utilization for their teams and projects. Executive management will need high-level visibility into financials including project health, revenue, margin, revenue forecasting, resource management, etc. Take time to figure out what types of reports you need to run your business and determine if those come as out-of-the-box standard reports, or if you will require further customization to get the reports you need. Almost all PSA systems have reporting features that can be customized either by an internal business analyst or system administrator, but further customization may come at a cost. 

8. Workforce Planning:

As a service firm it is important to have insight into the talent you have on your bench from a skills and utilization perspective. This helps you staff client projects appropriately and hire in advance to cover any potential gaps. It’s critical to have a 4 -8 week rolling plan of who is on what and bench availability for future work (client backlog or in the sales pipeline). Having a resource management module that allows you to track skills, utilization and current forecast easily and visually is critical. This also helps you see any revenue gaps you may have as well as supporting client billable and committed projects. 

9. Business Need:

It’s easy to get dazzled by behemoth systems that offer a lot of features and customizability. Do you really need it? Even for future growth and scalability do you need it? Most PSAs are going to market their product for all business sizes and will say their system works for small businesses when in reality it is really designed for mid-to-large enterprises and you may not need all that functionality. If you are a small business that needs to be more agile and doesn’t require a bunch of red tape and superfluous processes to run your operations, then you need to take that into consideration when looking at PSAs.

As mentioned a handful of times, many PSAs offer the ability to customize what you need, but some of this customization comes out of the box as part of the standard pricing and may only require an internal resource like a system admin to take care of those needs. Other customizations beyond what comes standard may require more specialized skill sets to complete and in the end, will cost you more. It’s critical to assess your current needs and pain points and determine if the PSA solution you need checks all the boxes as it comes, or if some of those needs will require additional customization which means a change to your budget. 

Also, be mindful of what is not customizable. Every system is built differently and there may be core functionality that cannot be changed at all. Do your due diligence to ensure this core functionality aligns with the solutions you need, otherwise, you may be stuck spending more time on workarounds to get the functionality you need. 

At the end of the day, any decision to implement a SaaS-based solution requires forethought and thorough planning and assessment. Can you do it yourselves or will you need to bring in an outside consultant with experience to take the heavy lifting off your team? There are so many considerations and you’ll want to be sure you’re investing in a product that meets as many of your needs as possible, especially from an internal operational point of view. 

Here at 5P, we have experience using and implementing Monday, Kantata (formerly Mavenlink), and the Certinia (formerly FinancialForce) PSA systems. These systems are three out of many PSAs that could be a good fit for your business. Let us help you figure out which is the best fit through a business systems analysis and we’ll create a value roadmap to guide you through the decision-making process. Reach out today for a free consultation or if you need advice, we are experts and here to help! 

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