In this article, Abtrac’s Edward O’Leary discusses the most important features of project management solutions for the professional services sector.
All businesses will require a project management system of some sort.
Sometimes those systems are largely Excel-based for timesheets and they’ll do their invoices in Word and rekey them into their accounting system. Even if they have a specific project management system, many existing packages don’t have a financial management focus.
Many solutions are Kanban-type platforms with ‘to do’ lists that are basically post-it notes in columns: “Not started”, “In Progress”, “Completed”. You’re probably familiar with ‘sprint’ boards and the like that have become synonymous with modern, agile project management.
Other systems go a bit further, being calendar-based with deadlines for deliverables and due dates, and again lists of things to do to achieve each deadline.
But a truly powerful system is one which fills the gap between the money management side of projects and the work allocation and job tracking side. In managing the money on all projects in the office, a comprehensive project management package can become the ultimate revenue management solution for your business.
At the end of the day, people realise that the whole reason for coming to work and executing on projects is to make money, but if the tools they use to run their business can’t accurately allow them to track and manage their revenue then they can’t be sure how effective they are.
To make sure you’re choosing the right product for your needs, there are a few features you need beyond the cool graphics and seductive gizmos you wouldn’t use anyway (that some vendors emphasise when pushing their product). So. here are the seven things to expect in your project management software.
Invoicing can be the bane of your life if you have to fiddle, twiddle and process ‘adjustments’ just to obtain the figures you want on your invoice. Even then, too many offices produce their invoices from a third-party tool, usually Excel, because their time and cost system cannot do it. Invoicing doesn’t have to be that hard.
There’s a whole raft of project management systems like that – designed and written by people who are used to invoicing everything on the tab to the cent. But many businesses do fixed-fee work and there’s always going to be variances between what was quoted and the value of the time engaged to complete the job.
For example, someone quotes a job to their client at a fee of $12,000. But, after staff have done their timesheets on that job, the value of their time might come to $11, 876.54 based on their hours entered.
Or it might be $13,500 or indeed any amount more or less than the exact $12k they’ve quoted the client. In some systems the users then have to add or subtract amounts to achieve a balance of exactly $12K. They do this by entering dummy timesheet entries or by deleting or adjusting entries.
So, the real value of how long it took to do the work is lost in order for them to bill their clients the quoted amount. As a result, they’re unable to take any learnings from one job to the next that may improve efficiencies in their business. They lose information on staff productivity and how long a particular piece of work really takes because they have to keep destroying the real values in order to create the invoice with the exact quoted amount to the client.
The truth is, you shouldn’t have to destroy your true time and disbursements data by adjusting WIP to balance your invoices.
Instead, you want a system that retains two independent ledgers, one for time and disbursements and one for invoices. That way the write-on or off is always visible.
In a project-based office you also need accurate invoices out on time, and with the professional format you want, be they charge up, retainer, progress claims, percentage claims, lump sum, hourly rate or whatever.
A decent system will save you hours. And you’ll go to bed knowing that you have the information to respond to any invoicing query from anyone.
Increasingly, you’re having to cut deals with specific clients to retain them or to get them as a client in the first place.
Your time and cost system should have a range of rates you can maintain, by employee, by client, by job, by activity, down to one employee on one job stage and more, so data is captured correctly and thus correctly portrayed in reports and on invoicing.
Reports themselves need to cover a range of options from the office management perspective, the project perspective and of course by employee, showing productivity, profitability and more.
You need a system that ticks all the proverbial boxes based on what you currently need and at the same time it needs to spark additional areas you can dig into to, taking your business to the next level.
And, of course, while disbursements are incidental to the revenue from fees, they’re still important.
They need to show in reports and you need the ability to query or invoice them however you want to.
You also need your system to capture disbursements as easily as possible and, where possible, import them en-masse from an external source.
Take it to the next level with a system that supports a business culture planning and managing jobs and people.
No job nor person should run over budget without raising awareness among others who need to know.
You want a package that will let you plan time and schedules as far ahead as you need, so jobs and stages, employee schedules and everything else that’s happening next week and next month is as easily managed as what happened last week and last month.
When you get stuck you want support.
You need someone who knows what they’re talking about whether on telephone or email. You don’t want someone who will fudge their way through a response to your query or worse, put you crook.
Check that support is managed by people who know their product and who provide answers ASAP.
For a simple query, you shouldn’t have to wait three days or more. And you shouldn’t have to rely on ‘locals’ who often know less about your system than you do.
The revenue in your business comes from the applied time and expertise of the productive and administrative team in the office.
Your time and cost system can help immensely support the combined effort in so many ways.
Here’s a fact: by the time the information hits the accounting system, it’s history. But your time and cost system should integrate with your accounting system on as many touchpoints as possible. This will add further savings of time, reducing re-keying and the inevitable error checking required if the two systems aren’t talking to each other.
NB: This article is an adaptation of a post that originally appeared on the Abtrac blog. Details have been changed to include additional information and to meet MYOB’s editorial guidelines.