Official NetSuite Blog - Cloud NetSuite

Benchmark Yourself Against Other Professional Services Organizations

At this time of year, many people make and break New Year’s resolutions. Some even keep them. These resolutions, however, are typically considered for our personal lives. How many take time from their busy professional schedules to take stock, learn from experts and set goals for their services organization based on anything besides their own internal performance?  

In running your professional services organization, it’s probably a given that you set and track certain metrics. Common metrics include employee utilization, billing rates and/or revenue per employee, and project profitability that are critical to your organization’s financial success.  Getting a solid understanding of exactly how you’re doing now is the underpinning for knowing where to focus future improvements.

The challenge is that “current performance” changes every day and even within a day, and having an accurate picture of it at any point in time is not as easy as it might seem. With a services resource planning (SRP) system like NetSuite with NetSuite OpenAir, the dream of real-time visibility can be achievable in an average of five months.

With NetSuite’s cloud-based enterprise resource planning (ERP) and project management system, not only can the P&L manager have real-time visibility into accurate data, but so can every project and account manager. Instead of information locked in silos like spreadsheets on individual laptops or in unintegrated applications, NetSuite’s approach ensures that everyone in the organization who is given permission can access the same, current data.  

Thus, they can quickly adjust resources or project scope to ensure profitability. If you conduct business in multiple countries, this system can also provide an updated view as currencies fluctuate or customers come and go. According to the soon-to-be-released SPI 2012 Maturity Benchmark Study on professional services organizations, companies who use NetSuite OpenAir had a tremendous 19.1% EBITDA (earnings)—significantly higher than those with no PSA solution or a homegrown one.¹ If you set the single goal of contacting NetSuite and implementing our cloud SRP system, you can quickly put your organization on the path of being an industry leader.

Knowing your performance relative to similar organizations is a second challenge. Without external information, it’s hard to know whether your revenue per consultant, margin or bid-to-win rates are fabulous or merely average. Even if you’re making continual strides in your own metrics, wouldn’t it be good to know if there were other organizations doing significantly better whose practices you could emulate?

By spending just one hour of your time learning about key industry metrics, you’ll have critical information to decide where to improve or to arm yourself for a discussion with your boss about a nice raise. Join us for a professional services benchmark webinar with tips from a leading professional services practitioner.

2012 Professional Services Maturity Benchmark Results Webinar—Ways to Be the Best!

Webinar:   2012 Professional Services Maturity Benchmark Results

Date:  Wednesday, February 8

Time:  9 am PT / noon ET

At this webinar, Jeanne Urich, Managing Director, SPI Research, will reveal the key trends, challenges and results that shaped the PS industry in 2011. She’ll share enlightening industry benchmarks and some best practices that you can implement.

Sometimes numbers don’t provide sufficient insight on their own, so to ensure you’ll be able to set at least one new positive resolution for your organization, Beat Neuhaus, VP of Global Service Operations for Siemens, will share his experience. Siemens uses NetSuite OpenAir to track real-time customer project status in the cloud and is recognized as one of the top PS organizations in the world with PSA practices in 26 countries. He will give you suggestions for improving your organization that he’s seen work in a complex multinational services organization and discuss how he’s created real-time project dashboards that give him both “transparency and simplicity.”

Experts who have studied resolution-setting say that a key is to break the goal into very small steps. So register here and spend one hour on February 8 and you’ll have a head start on implementing better practices for your professional services organization. Plus, we believe you’ll have an extra bit of motivation and enthusiasm by hearing how well a reasonable amount of effort has paid off for others. 

Best wishes for a happy and profitable 2012!

Ed Marshall, General Manager, Services Vertical

 

¹ David Hofferberth, pre-release information from The 2012 Professional Services Maturity Benchmark, Service Performance Insight.

Solving the Pain of Professional Services Project Management

Professional services is by definition a project-based business. Services firms can have dozens of projects in the pipeline at any given time. Executing those projects on time and on budget is critical to business success. Managing projects effectively is extremely difficult if you rely on cumbersome spreadsheets, manual processes and ad hoc solutions.

A disjointed and siloed approach to project management in professional services wastes time and money. It obscures visibility into project lifecycles and utilization rates. It means running a constant treadmill to track project accounting, time and expenses, personnel, billing, project status and more. It introduces the risk of error and misjudgment that can translate into lost revenue and client dissatisfaction.

And ultimately, it means that management can’t gain the clear, real time view of overall performance and profitability it needs for business agility in a fast-paced and highly competitive environment.

Professional services firms recognize the pains that spreadsheets and ad hoc systems introduce into project management. But until recently, they didn’t have much choice because ERP solutions weren’t geared for project-based businesses. That’s now changed.

NetSuite Services Resource Planning (SRP) gives professional services firms a cloud-based solution that automates and streamlines project management as well as other aspects of the business, including resource management, project accounting and billing and client management. Cloud SRP represents a revolutionary approach to running a professional services firm, much like materials resources planning (MRP) in the 1990s gave manufacturers a single solution to run their business.

On November 1, NetSuite will host a webinar with Forrester Research to size up the emergence of project-based ERP. Forrester Analyst China Martens will explore the challenges and pressures that professional services project managers face and how project-focused ERP can address those issues.

Register now, and you’ll also hear how NetSuite SRP has improved project management and visibility from two NetSuite customers, Calvin Jackman of MyCom Global Solutions and Christopher Nelson of Splunk. I will discuss what makes SRP one of the leading software innovations of the 21^st century.

If your services organization is looking to streamline project management, gain real-time visibility into crucial metrics and increase project margins, don’t miss this event! Sign up now for the webinar, Driving Success in a Project-Based Business.

- Ed Marshall, NetSuite SVP of Product Strategy

The Future of the Cloud Is in the Believing

I believe that our daily interactions with NetSuite customers and prospects are an excellent indicator of where business is going. 

Last week, as NetSuite’s VP of Professional Services APAC, I participated in three presentations to prospects interested in NetSuite cloud ERP. So what? Isn’t that a typical week in the office? Well, yes, but it was also a powerful validation of a growing trend we are seeing—large global enterprises are transitioning from Stone Age on-premise ERP to cloud-based business management.

Two of the three presentations were to Fortune 500 companies that had been using SAP as their primary ERP solution for more than 10 years. Both of these multinational companies knew that they would never again go through another SAP implementation. Both were looking to a cloud software provider to help them solve growing pains in their emerging markets—India, Australia, China, Vietnam and Thailand, to name a few. 

The primary motivation of these companies is simple—they recognise that with cloud computing, they can get to their respective markets fast and cheaper. They know that cloud ERP gives them a more controlled, centralised deployment without the fuss and bother of on-premise databases, servers, virtualisation, and disaster recovery systems that require a financial investment way beyond the cost of the software itself.

When presenting NetSuite cloud solutions to an organisation familiar with SAP, I always take the time to look around the room, gauge body language and try to get a sense of how we are doing. In each case. I find one emotion consistently displayed—disbelief.  

When talking to business and IT leaders familiar with SAP, I find they simply don’t believe that NetSuite can be deployed in six months. They don’t believe we can upgrade all of our customers twice per year without disruption. They certainly don’t believe that NetSuite would allow them to customise their environments and seamlessly retain those customisations through the upgrade process.

Cloud-based ERP software is very hard to build, so understandably some people out there simply don’t believe it can be done. On the other hand, cloud believers recognize that NetSuite has been implemented at more than 10,000 organisations, many of which are using cloud ERP in a two-tiered deployment with legacy applications such as SAP and Oracle.

CFOs, CIOs and other business and IT leaders who chose cloud ERP software are now reaping the benefits, and are eagerly expanding on their initial footprint. The number of disbelievers is steadily diminishing as more and more companies come to believe the cloud is real—and that it enables them to run better and grow faster.

In the meantime, I look forward to my next prospect meeting with yet another “Director, Global SAP” and wonder when the time will come when the company is forced to rethink that job title. 

NetSuite Stakes Claim to SRP

As the pioneer of the SRP vision which seeks to revolutionize operations for services organizations as MRP did for manufacturing businesses, NetSuite SRP has built a strong footprint globally. Services organizations are making the move to the cloud. NetSuite’s key competitor, Deltek is actively losing market share to NetSuite’s cloud-based professional services solutions. Read more at BusinessCloud9.

The Impact of Services Resource Planning

Back in the 1980s, a new concept was introduced to manufacturing companies—one that defined a method for centrally coordinating all the resources and moving parts that make up a manufacturing company. No longer would individual functions need to be managed in disjointed systems, files, spreadsheets and so forth. Instead, data, material inventories, budgets, orders, human resources and more would all be centralized.

The result? Not just a revolution in the way manufacturing business are run, but a whole new way of looking at the entire business cycle. MRP—manufacturing resource planning—was born, and thus began the installation of countless on-premise MRP solutions over the coming decades.

Fast forward to today. As many of our world economies transition to services economies, we find that we’re at a similar crossroads. To drive the business of this new services-based economy, how can services companies move away from disjointed legacy systems, countless spreadsheets and manual processes to start gaining visibility into the entire services lifecycle? With services resource planning (SRP).

Services organizations are revolutionizing their businesses by abandoning traditional, installed applications and moving to cloud-based SRP solutions. SRP allows services organizations to focus on the core aspects of their business, including resource management, project management, project accounting and billing and client management. 

On Wednesday, September 7, NetSuite will host a webinar with guest speaker Mike Fauscette, Group Vice President at IDC, to discuss the impact of SRP, how SRP has evolved, and the impact it is having and will have in the future on the services industry. We’ll be joined by Rob Hull, Founder and CFO of NetSuite SRP customer Adaptive Planning, who will outline how his company has realized breakthrough gains in profitability and performance with SRP. And Ed Marshall, NetSuite’s SVP of Product Strategy for the services vertical, will discuss what makes cloud SRP one of the biggest software innovations of the 21^st century. 

If you are a services organization looking to streamline project and resource management, drive talent acquisition and retention, increase real-time visibility into key metrics, and manage the complexities of project accounting, then you won’t want to miss this event! Sign up now for the webinar, The Impact of Services Resource Planning.

Can't make the webinar? Sign up for the recording.

Professional Services Benchmarks and Metrics: How Do You Stack Up?

We like to spend as much time as we can with professional services executives to help us understand how we can better serve their needs.  Whether visiting our customers, speaking with prospective customers or networking at various events and roundtables, there is one thing we keep hearing loud and clear: “We need more PS metrics to better measure our organizations.” 

It seems that the industry is responding. Just launched this week is the PSVillage Professional Services Industry Benchmark, a new survey targeted at professional services leaders with P&L responsibility in software companies or services firms. As PSVillage explains it, by participating in the benchmark survey, you’ll be contributing to a community-developed and supported resource designed to help PS organizations optimize their operations and performance. 

The survey results will be available in Q4 of this year.  The goal is to enable PS execs to:

• Filter data on demand based on geography, industry, company size and service
  area, providing you with industry metrics at both the macro and micro level
• Identify critical financial and operational metrics, including a variety of compensation
  measurements by role, and compare them to similar organizations
• Identify key areas of improvement and more effectively manage your services P&L.

NetSuite has long been a sponsor and supporter of similar benchmarks, including one produced annually by SPI Research. We’re proud to be an inaugural sponsor of the PSVillage benchmark. We view it as one way that we can help give our customers and the industry as a whole exactly what they’ve been asking for—more metrics and benchmarks to better measure their organizations.

If you are a PS leader with P&L responsibility, we highly encourage you and your team to participate in this—and all—benchmarks. It only takes about 20 minutes to complete, and surveys like these are the only true way to gather the metrics, benchmarks and other data that can help us all to grow and better our organizations. Better yet, survey participants receive full access to the results for one year at no charge.  Visit the PSVillage website for more information and to participate. 

SuiteWorld 2011 PSA and SRP Recap

A big thank you to all of our customers, partners, staff, press, analysts and other guests who attended the SuiteWorld conference in San Francisco. It was a fantastic event, with nearly 2,000 attendees from all over the world!

NetSuite’s Services Vertical team spent the months leading up to the event preparing professional services automation (PSA) and services resource planning (SRP) sessions to cover hot topics such as project management, resource management and skills tracking, project accounting and more.

We realized that all the hard work paid off in spades when we kicked off the PSA track…and it was standing room only! Thanks to all attendees who stuck around to learn more about NetSuite products for professional services…especially those who had to stand. We promise we’ll reserve a larger room next year.

We highlight our customers’ successes whenever we can, and SuiteWorld was a great opportunity. Special thanks go out to FatWire, TECO Natural Resource Group, MetricStream, RIIS and Emergo Group and their representatives who stepped onto the stage and shared their successes and expertise with everyone. Along with additional presentations, customers shared some really amazing and impactful business results directly derived from NetSuite SRP and NetSuite OpenAir, including:

• FatWire escaped “Excel hell” for resource management, expense management and financial forecasting with NetSuite OpenAir, and drives a global, multi-currency financial organization with NetSuite Financials.
• MetricStream was able to grow rapidly over four years and has an ROI of hundreds of thousands of dollars with NetSuite OpenAir.
• Emergo Group leverages NetSuite OpenAir to help stop revenue leaks, streamline the management of subcontractor invoices and manage revenue recognition.
• POSitive Technology decreased project administration by 90%, accounts receivable lead time by 50%, and increased expense and billing by 35% with NetSuite SRP.
• TECO Natural Resource Group realized 100% ROI on NetSuite OpenAir in just three months
• RIIS seamlessly manages a distributed workforce thanks to NetSuite OpenAir, empowering the company to hire the right resources for the job, despite geographical locations.

Thanks again to all who attended. We couldn’t have done it without our fantastic customers. We are already planning for and looking forward to the SuiteWorld 2012 conference, taking place May 13-17, 2012 in San Francisco. We hope to see you there!

Strategies for Productizing Your Professional Services Offerings

Our friends at PSVillage put on another fantastic event in Boston this past week. The breakfast series brought together 25 executive leaders of some of the most respected professional services organizations (PSOs) in the area, with strong representation from service organizations embedded in hardware/software companies. It was great to see so many new faces and everyone benefiting from a lively discussion and insightful perspectives. 

The topic of the day was “strategies for productizing your services offerings.” The attendees were at different stages of bringing packaged services to market, but the topic was on everyone’s minds. We covered a lot of ground, but if I were going to organize the discussion around two themes they would be: 1) Why are we doing this? and 2) What do we need to do to make it successful?

Why Are We Doing This?

PSOs are focused on productizing services offerings. For most, it is not a huge percentage of their business today, but it is core to their strategy going forward. This seems true of PSOs from five to 12,000 consultants. Why? Reasons most commonly cited were:

• Enabling the PSO to hit a price point not accessible with a custom engagement
• Reducing the administrative burden of scoping/SOW development
• Shortening the sales cycle, in some cases dramatically
• Cultivating the ecosystem by creating repeatable offerings that third parties can deliver

What Do We Need to Do to Make It Successful?

It’s one thing to want to productize a service offering, but what does it take to be successful?  Some consistent criteria emerged throughout the session:

• The market matters. At its center, a productized service offering needs to have a standardized, repeatable services engagement. For some PSOs, this simply is not part of the reality or the strategy. Also, the maturity of the market matters. Educated buyers and experienced delivery groups are important in developing, evaluating and delivering a productized service.
• Setting expectations with the customer is critical. Items need to be clearly defined as in or out of scope, and a policy should be set and communicated around substitutions and change requests. Once a customer’s need is understood and pegged to a packaged service, a clear “this is what it is” as opposed to a “tell me everything you want” discussion needs to occur. 
• Getting this right requires cross-departmental dialogue. Selling a packaged service may represent a shift for the sales team. They must be educated on the offering itself as well as (potentially) how to sell it. Before the offering is brought to market, potential conflicts or disincentives should be scrutinized (for example, any incompatibility with the sales team’s commission plan). On the engineering side, there might well be minor tweaks to the product that really enable productizing the service, for example disabling, excluding, or preconfiguring aspects of a product that could consume considerable time during implementation.
• A feedback loop with clearly defined measures of success is critical. PSOs need a PSA system that can deliver timely metrics to the level of detail required to optimize the offering: Is it staged appropriately? Are certain tasks/activities consistently hurting us? Can we safely pull hours and cost out of certain tasks?

There are clearly places where the packaged service may never go—complex enterprise deployments came up a lot—but the benefits of getting this right in the addressable market seem big. In addition to some of the other objectives mentioned earlier, PSOs well down this path reported that packaged offerings are some of the most profitable offerings in their portfolio. 

Ultimately, the core competencies here are strengths already exhibited by successful PSOs— managing risk, setting expectations and consistent delivery.    

Record Number of NetSuite Partners Expected at SuiteWorld 2011

With less than two months to go before the big event, NetSuite has already surpassed 1,000 registrants for SuiteWorld 2011 and the number of customers, partners and developers just keeps growing. While SuiteWorld 2011 is NetSuite’s first user conference, it follows on the heels of last year’s successful SuiteCloud partner-only conference. And SuiteWorld this year includes dedicated content for the NetSuite partner ecosystem.

With an agenda featuring content for every type of partner, NetSuite is preparing to host its largest annual gathering of channel partners, system integrators, software developers, and strategic business partners as part of SuiteWorld 2011.  NetSuite partners are signing up in droves as event sponsors and conference attendees to experience the numerous benefits SuiteWorld offers, including:

• Learning about the latest product features and benefits from NetSuite and our SuiteApps partners
• Gaining access to NetSuite experts in product management, channel enablement, and customer support
• Networking with other business partner professionals and NetSuite executives
• Tapping the collective knowledge and best practices of NetSuite experts in sales and marketing to accelerate your success in the market

This year NetSuite is lining up an exciting agenda for our business partners. On Monday afternoon, May 9^th all partners are invited to attend a Special Partner Update session that takes place just prior to the SuiteWorld Welcome Reception. Then, from Tuesday through Thursday, NetSuite delivers a wide range of breakout sessions to assist partners in selling and marketing NetSuite, including:

• The Art of Solution Selling with NetSuite
• 5 Keys to Success in Marketing Lead Generation
• NetSuite Solutions & Competitive Selling – Part 1
• NetSuite Solutions & Competitive Selling – Part 2
• Vertical Solutions: Running a Wholesale/Distribution Business Faster and Smarter
• Vertical Solutions: Powering the Next-Generation of Software Companies
• Vertical Solutions: Transforming and Elevating Professional Services
• Vertical Solutions: Managing a Manufacturing Business with NetSuite
• Vertical Solutions: Leveraging NetSuite.org to Reach New Markets and Sell into Nonprofits
• Dueling Demos – NetSuite in Action

We look forward to greeting our NetSuite business partner community at SuiteWorld 2011 and delivering yet another valuable and rewarding experience. Come join us May 8-12 in San Francisco!

Amede Hungerford - Sr. Director, Partner Marketing

Benchmarking the Evolution of Services Businesses: The Future Looks Bright

It has been an interesting couple of years for professional services firms of all shapes, sizes and specialties.  The economy has presented challenges that haven’t been seen in decades and some that have never been seen before.  At some level, we’ve all adjusted the way we do business, and the just- released results of SPI Research’s 2011 Professional Services Maturity Benchmark speak loud and clear on the results:  professional services businesses are now beginning to reap the benefits of change, including:

• Increased annual revenue growth for 2010
• Improved bill rates
• Rising salaries and headcounts
• Establishing Software as a Service (SaaS) PSOs as profit centers.

Some of the above changes are a factor of regulatory changes such as EITF-0801 and some are a reflection on the economy, but many are a direct reflection of the way that we’ve chosen to evolve our businesses to meet the new challenges of the 21^st century.

Annual benchmarks, studies and surveys like this one from SPI Research allow us to see the trends and changes—both good and bad—so that we can adjust to change and evolve our business in the down times and celebrate the wins and improvements in the good times. We can also measure the impact of technology on professional services businesses, which for a technology vendor is priceless. It allows us to evolve our own business along with the industry.

Once again this year, we are excited to report that NetSuite and NetSuite OpenAir professional services automation (PSA) and services resource planning (SRP) customers dominated in survey participation with more than 20% of respondents driving their services business with NetSuite products, representing the largest pool of respondents leveraging PSA and SRP technology.  I am also excited to report that four of the top performing PSOs from SPI’s “Best of the Best” list—Workday, TOP Step Consulting, Advent and Informatica—are NetSuite customers, illustrating the direct impact that the right technology can have on your business.

We’re proud to once again sponsor SPI’s Benchmark Survey and we thank all of those services organizations who contributed to the invaluable information it contains. As part of that sponsorship, we’re able to offer you a complimentary copy of the benchmark. Download your copy here. 

We hope that this year’s findings help and inspire you to evolve and drive your services organization throughout 2011 and into the future.