Tracking Utilization, Profitability and Realization Metrics to Improve Performance

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Introduction

Professional services organizations have seen a dramatic shift in the challenges facing the industry over the past
decade. Ever-decreasing margins due to increased competition and (in some sectors) de-regulation have
created cost pressures on businesses seeking to grow or simply maintain past profit levels. Yet new opportunities have emerged as well. Cloud business management technologies have helped service providers expand into new markets, better track and manage key metrics, and drive client satisfaction.

As demand for professional services grows, leaders will differentiate themselves through end-to-end visibility that enables them to capitalize on opportunities.

While the professional services industry landscape has changed, the underlying metrics to manage services businesses have remained consistent. This white paper examines three core metrics critical to professional services performance and offers practical examples of how you can apply them to measure and optimize your own business:

• Utilization: Maximize the billable hours of your consultants to increase revenue.
• Profitability: Sharpen analytic visibility into the factors behind profitability
  by client and project.
• Realization: Measure your actual revenue vs. optimal revenue to assess
  your performance.

Gathering and effectively using these metrics is not easy if you are still using Microsoft Excel or disparate systems to manage critical tasks like timesheets, expenses, resource management, project management and invoicing.