A Case for Progressive Technology Change
Intellectual capital is a key asset of a professional services firm. It encompasses the knowledge and expertise of the firm’s staff, and is central to selling and delivering services. As a byproduct, many consultancies have a technically focused and collegial culture, as building and sharing intellectual capital contributes to competitive advantage and success.
While well founded and well intentioned, this kind of culture creates challenges for many project-driven consultancies as they look to develop their project management discipline and ensure projects are managed to standards of technical quality and commercial viability. As staff members take on project management roles, they are often operating in an environment that prioritizes technical innovation and excellence over adherence to project scope, schedule, and budget commitments.
And so, a common project management challenge for professional services is managing the tension between scope, schedule, budget, and quality. Compounding this challenge is a tendency to place technical experts in project management roles, without developing their project management skills. This can lead to project managers who view the commercial and transactional aspects of project management as someone else’s job, which in turn impedes a firm’s ability to monitor and control project schedule and financial performance.
Facing this dynamic, project-driven consultancies rely on their project management and accounting functions to jointly facilitate several key processes, including project initiation, revenue recognition, billing, and collections. Some firms also look to address these challenges with business systems.
But those firms that view technology as a solution unto itself often find their improvement efforts futile – they fail to understand that technology is only one component of the overall solution, which really encompasses people, process, and technology.
Implementing business systems can be a unique and valuable change agent for a firm, if done incrementally and iteratively. With the different levels of interactions that occur across the project lifecycle – transactional, transformational, and tacit – this progression also serves as a basis for phasing business system capabilities into an organization, in the following manner:
1. Establish a foundation of project controls.
The core accounting and financial management function (or “back office”) provides a solid foundation for the introduction of business systems into a project-driven consultancy. Deploying a back office system – one that automates core financial processing and reporting, project revenue and billing management, and time and expense entry and posting – establishes a central facilitator and repository of transactional activities that can then be leveraged to drive additional project delivery improvements.
2. Create firm-wide project and operations visibility.
Once core back office functions are automated, firms should focus on information delivery to operations personnel. Begin by defining key performance indicators by which projects, staff members, and operating units will be measured. This sets the stage for role-based dashboards that deliver real-time, online performance measurements and analysis, tailored to the project, resource, and operations managers in the organization. In turn, deploying dashboards provides a valuable opportunity to communicate and reinforce current operating standards and expectations through role-based training and development programs.
3. Evolve project delivery processes and tools.
As Jim Collins indicated in Good to Great, one of the keys to organizational transformation is establishing a culture of discipline that is marked by a consistent framework within which people have responsibility and freedom to operate. Business systems can help evolve and sustain this framework, particularly after enabling the delivery of relevant, timely information to operations personnel that helps them focus on their areas of accountability. At this stage, many firms are in a position to improve and mature other key project delivery processes, such as project planning, resource scheduling, earned value management, collaboration, and work management.
With the continued emergence and evolution of business systems that help automate and facilitate processes, project-driven consultancies face a myriad of decisions and challenges as they look to effectively leverage technology to improve business performance. Spanning the project lifecycle – from business development and marketing to project and resource management to finance and accounting – there are countless business systems that firms can choose to deploy.
But before implementing a business system, take a step back and think holistically about your organizational structure and business processes. Business system implementation often presents a valuable opportunity to realign roles and responsibilities, as well as progress and mature standards and practices. Resist “band-aid” implementation approaches; and instead identify and focus on core issues in an incremental, iterative manner that holistically addresses people, process, and technology.
Where’s the low-hanging fruit in your organization, ready for the picking and ready to be that next step on the path of progressive transformation?