Why PSA platforms will overhaul ERP systems

Professional services organisations must be highly efficient, responsive, productive, and adaptable to succeed in today’s extremely competitive market.

There is no room for postponing decisions or making mistakes.

Automating repeatable business processes and manual, tedious tasks frees time to focus on more critical, strategic business matters.

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Professional service companies using an automation platform experience:

• A surge in productivity and efficiency

• Greatly reduce human errors

• Make educated strategic decisions.

Companies are now faced with the question of whether to automate work processes or not and what kind of automation platform to use.

Which is better: ERP or PSA software?

As the global economy becomes increasingly project-oriented, the product-focused approach of ERP systems is no longer sufficient. 

The growing service sector and project-based industries seek solutions that address specific aspects of their business, such as

• Resource management
• Team collaboration
• Remote work
• Time tracking, budgeting and forecasting

For professional services organisations that exchange time and expertise for money, these are crucial elements that ERP systems typically do not cover, but professional services automation solutions do.

That is why PSA software is often considered an ERP system for service companies.

Pitfalls of big ERP systems

ERP systems were designed with the manufacturing industry in mind. They originally provided solutions for product-centric businesses built on a single platform.

As the extensive ERP systems are built to support a wide range of demands from the production industry, they fail to support the unique needs of professional service companies.

Service companies primarily work in the form of projects in an environment exposed to constant changes, and these projects are challenging to manage.

Generic ERP platforms struggle to meet the needs of advisors

Service companies seldom work with all the clients on the same type of contract, and they usually operate within a complex world of billing methods. Sometimes, different billing methods are even combined for parts of a single project.

ERP systems are too generic to handle this complexity and too rigid to be easily adaptable to fit the specific needs of a service company.

The one-size-fits-all method fails to clearly show which projects are profitable, making revenue recognition and maintaining a steady cash flow difficult.

Due to the complexity of ERP systems, custom programming comes at high costs, as do the initial set-up and maintenance.

Traditional ERP systems have a steep learning curve and poor user experience, which hinder their implementation success and delay their results.

As companies buy into these systems, implementation often stalls because employees struggle to make the ERP fit their needs.

Project managers are forced to work in a traditional account-based setup instead of a dedicated project environment. As the ERP remains inflexible, they struggle to adapt and manage their projects.

ERP also doesn't facilitate collaboration between project members and doesn't support the need to place the right resources on the right projects at the right time.

Best-of-breed PSA platform is the best solution

Tracking time and expenses, resource management, budgeting and forecasting, invoicing and analysing profitability are equally important elements for managing project-centric businesses.

Best-of-breed PSA software brings all these aspects together to give plenty of flexibility.

Cloud-based business applications are designed to integrate with other systems easily, so implementing tools from multiple providers under one roof has become simpler, faster, and much less expensive.

Best-of-breed PSA software increases agility for professional services organisations

With the best-of-breed approach, companies have the freedom to customise and switch between tools in a way that is closely aligned with their specific requirements—as often as needed, without disturbing the whole business. They can choose tools designed specifically for their industries or integrate with the applications that their teams are already familiar with.

PSA software is a great way to reduce the inefficiencies of generic systems that lack specific features.

With cloud-based PSA software, project members can access the project’s process from any geographical location. This facilitates team collaboration even when people are out of the office and ensures no information is lost.

Professional services organisations need to be agile and adaptable, always prepared to react quickly and change as they grow. Their automation system should reflect that and be built around their needs, not the other way around. The best-of-breed approach gives the far greatest flexibility, functionality, and user satisfaction at a much lower cost.

How can TimeLog help optimise business processes specific to professional services organisations?

Features of TimeLog support your business processes and help you control your finances.

• TimeLog gives you a complete overview of the project’s progress and invoicing potential.

• The easy-to-use time tracking feature ensures that no billable hours are lost.

• Automated project invoicing saves time for both the project manager and the bookkeeper.

• It is a strong project management tool that gives you command over resource scheduling and lets you handle complex contracts (up to eight different contract types and an unlimited number of subcontracts per project).

• TimeLog also lets you seamlessly connect with other business systems and applications.