services-based business kpis that matter · 2017-02-24 · services companies run better on...

SL Associates

Services Companies Run Better on NetSuite.

Services-Based Business KPIs that Matter

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SL Associates

Improved Results from Businesses Like Yours

Financial Management

C SL Associates. All rights reserved. 1

Business Visibility

Collection Time for Accounts Receivables

Improved 30% - 45%

Revenue Performance

Increased 2% - 5%

Time to Close Financial Books

Reduced 45% - 75%

Days Sales Outstanding (DSO)

Reduction 30% - 50%

Accounting Staff Productivity

Increase 25% - 45%

KPI improvements are estimates based on discussions with NetSuite customers

360o Visibility & Actionable Insight

Increased 50% - 80%


SL Associates

Improved Results from Businesses Like Yours


Professional Service Engagement Management

Availability and Utilization of Resources

Report Generation Time

Improved 75% - 85%

Sales and Marketing

Sales Productivity and Capacity

Improved 20% - 40%

IT Management

IT Support Resource Costs

Reduction 45% - 75%

Cost to Purchase and Maintain Servers

Reduction 100%

Business Continuity/Disaster Recovery Costs

Reduction 50% - 75%


Improved 20% - 40%

Cloud-Based Business Solutions Suite Delivers Key Performance Improvements Real-time business visibility and end-to-end business management

SL Associates

Many firms – including those in the services industry sector – have achieved more efficient and agile

business operations by using cloud-based ERP.

Executive Summary

The services industry sector is highly diverse, not just in the variety of services offered but in the nature of the companies themselves.

There are “pure,” services-only firms, such as systems integrators, consultancies and other professional services providers. And then

there are companies that include consulting and/or support services as part of their portfolio offerings, such as software companies,

manufacturers and retailers.

For either services companies or services-based profit centers, companies need to be able to identify and measure key performance

indicators (KPIs). Then, they have a baseline on which to improve and track their critical business processes and achieve a high level of

business efficiency.

There are financial management processes, including billing, cash collections and end-of-month book closings. Then there are project

management processes, including project-based accounting, resource forecasting, allocation and utilization, and a number of other

metrics critical to services – and business – success.



Project-Based Metrics Are Critical for Services Firms Aligning business operations to meet these challenges

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Average Deal Size Reduction in DSOs

External Systems Customers

CEO CFO SRP ERP

PROJECT MANAGEMENT

WAREHOUSE MANAGEMENT

CORE BUSINESS

CUSTOMER MANAEMENT Sales Rep/ Manager

Shipping Manager ORDER MANAGEMENT

INVENTORY GLOBAL FINANCIAL MANAGEMENT RESOURCE MANAGEMENT MANAGEMENT

BILLING MANAGEMENT

REVENUE MANAGEMENT

TIME & EXPENSE

MANUFACTURING

Ecommerce Manager

Support Manager SUPPLY CHAIN

MANAGEMENT PROJECT ACCOUNTING

Vendors Partners

Unlimited Expansion Revenue Growth

Intelligent Order Orchestration


Staffing Resource Challenges

• Resource allocation: Services staff must be assigned to projects based on their skill sets, availability, hourly rates and other factors.

• Forecasting: Companies must ensure that staff with the necessary skill sets will be available for assignment to upcoming projects.

• New employees: Companies in this sector must often hire new talent, and must be able to quickly and easily train people to perform critical business processes efficiently.

Challenges

Accounting Challenges

• Project-based accounting: Everything from project profitability to rates-per-hour to time and expense reporting must be done on a project-by-project basis.

• Unique Project Requirements: Because projects vary, companies may need to support, and track, a variety of billing models.

• Profitability tracking: Companies often track revenues and expenses by client, by service line, by industry and by other variables.

• Accounting consolidation: project revenues and other project-based numbers must be consolidated and integrated with the company’s core financials.


Business Visibility Business value for company management

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Before NetSuite With NetSuite



Increase in 360o visibility and knowledge of operations

50%- 80%

Improved business agility

Improved real-time project and resource management

• Siloed applications and data provided an incomplete view of business

• Analytics solution not integrated

• Not possible to quickly assess and respond to all aspects of a business in response to current and future project opportunities due to siloed applications and data

• Difficult to monitor real-time project status

• Resource availability, utilization and expertise based on gut feel

• Significantly improved real-time visibility into all aspects of the business, allowing faster strategic decision making

• Easy to spot inconsistencies to find out root cause through drill-downs

• Agility from planning to execution

• Support better decisions, improve cost control, and increase the profitability of projects and delivery resources

• Streamline project status for decision making related to deviations and resources

• Ongoing monitoring of project and resource profitability and margin


Financial Management (1 of 2) Business value for revenue analysis and management

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Improved collection time for accounts receivables

30% - 45%

Increased revenue performance

2% - 5%

Improved billing efficiency

• Excessive time required to identify and post collections data

• Error prone Excel spreadsheet-based operations

• Lost revenues due to missed or inaccurate billings

• Error prone Excel spreadsheet-based operations

• Customer resource management systems not integrated with accounting system

• Inefficient, manually intensive Excel processes

• Significant increase in accuracy for accounts receivables

• Convert active contracts into revenue

• Significant increase in accuracy of revenue recognition

• Identify missed opportunities and timely billing

• Integrated and automated front-end and back-end accounting systems makes the billing process fast and accurate


Financial Management (2 of 2) Business value for accounting department

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Reduced time to close the financial books

45% - 75%

Reduction in days sales outstanding (DSO)

30% - 50%

Increased accounting staff productivity

25% - 45%

• Extensive time spent on reconciliations, especially with multi-division, multi-region and multi-currency

• Difficulty in tracking project status to ascertain timing to recognize revenues

• Difficulties in consolidation of data from multiple entities

• Difficulty in consolidation of accounts in different geographic regions with multiple currencies

• Inefficiencies as a result of manual processes

• Use of spreadsheet based accounting

• Earlier availability of financial results through faster period-end processes and more accurate reconciliations

• Real-time project status to recognize revenue

• Real-time consolidation of data from multiple entities, regions and currencies

• Support for real-time consolidation of financial information in multiple currencies

• Reduced time to close books

• Increased efficiency through integrated and automated reconciliations and reporting

• Reduced need for large accounting staff

• Better management of projects


Professional Service Engagement Management (1 of 2) Business value for project portfolio management

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• Better visibility into availability and utilization of professional services resources

• Real-time insights into project status reports and variances

• Improved margin per project

• Real-time visibility into all categories of expenses

• Real-time project status and resource utilization report generation capabilities

• Required reports can be easily generated by project managers without need for IT

• Poor project monitoring as data is spread across different applications

• Lack of real-time tracking of resource utilization

• Lack of ability to accurately track and assign non-billable expenses

• Time consuming Excel based worksheets for project reporting

• Lack of actionable reporting and visibility into the workload

Improved availability and utilization of resources

20% - 40%

Reduced non-billable hours

Improved report generation time

75%-85%


Professional Service Engagement Management (2 of 2) Business value for project portfolio management

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• Complete visibility and reporting for all processes required for implementing projects

• Integrated business suite supports workflows across all functional operations and departments

• Real-time reporting provides timely insights into project deviations to enable corrective actions

• Increase in customer satisfaction

• Real-time availability of resource skills, availability and costs

• Higher resource utilization and productivity

• Better ability to forecast future projects and resource requirements

• Time consuming project monitoring and management process

• Drill-down analysis into process not easy

• Lack of real-time monitoring of project costs, resource allocations

• Lack of ability to take timely decisions to take corrective actions

• Tracking resources and skill level is cumbersome

• Resource utilization reports not accurate or available in a timely manner

Improved end-to-end process efficiency

Reduced project risks and failures

Improved listing and assessment of resources availability


Sales and Marketing Business value for integrated sales and marketing

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Increased sales productivity and capacity

20% - 40%

Improved customer satisfaction

Improved sales pipeline

• Sales-relevant information dispersed among multiple systems, and not readily available

• Lack of integrated solution and data lead to inefficiencies and disgruntled customers

• Limited sales tracking and pipeline visibility

• Lack of real-time resource visibility to bid on new projects or upsell existing customers

• Ability to generate more revenue with same number of sales people

• Integrated customer and project information improves monitoring, reporting and reduces errors

• Ability to leverage greater number of reference customers

• Better manage and categorize leads by opportunity

• Easily track sales pipeline

• Increase in sales pipeline by tracking leads and opportunities with CRM

• Monitor effectiveness of individual sales reps


IT Management and Resources Business value for company operations

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Reduction in number of IT support people, IT cost savings of

45% - 70%

Eliminated the need and cost to purchase and maintain servers

100%

Reduction in need for business continuity / disaster recovery solution

50% - 75%

• IT resources needed to implement, maintain and update on-premises ERP solutions

• IT resources needed to install and maintain server hardware and software

• Capital expenditure required to acquire and maintain servers for on-premises ERP application

• Ongoing management and maintenance costs

• IT resources and infrastructure needed to support business continuity/disaster recovery

• Implementation is complex and costly

• Cloud-based solutions eliminate need for internal IT staff to support ERP application, on-premises servers

• Faster to implement for productive use of ERP solution

• No need for IT capital expenses as NetSuite is a cloud delivered solution

• Greatly reduced management and operational costs

• Business continuity/disaster recovery are a “built-in” benefit of the NetSuite SaaS solution

• NetSuite has redundant data centers to support business suite and data availability at no additional cost to customers

services-based business kpis that matter · 2017-02-24 · services companies run better on...

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