What are the top metrics that companies use to successfully track and manage professional service projects (e.g. utilization, profitability, customer satisfaction)? Are good benchmarks available?
This question was asked by an attendee during the Proformative
A video of the webinar can be viewed here: https://www.proformative.com/resources/webinar-video-revenue-
Utilization certainly.
Profitability by project - split costs into direct, indirect, overhead and track each.
Average bill rate by region/role.
The best book ever on this subject is Managing the Professional Services Firm by David Maister. It maps out how to best construct each project for maximum profitability and expertise. And in that, you will find your best costing structures. Great read.
Revenue per person is often better than utilization - since utilization can hide write-offs and unbillable but customer linked events.
Customer satisfaction is critical to model and measure - since it is a business driver in a number of ways.
Unless you are doing A&E or A&D type projects most folks find profitability by group or team or department is a better measure than profitability by project. Revenue and customer satisfaction are the ultimate drivers here - too much focus on specific project details usually does not meet cost/benefit trade-off requirements.
Tying compensation plans to both revenue and customer satisfaction - along with your measurements - is beneficial.
Bob Scarborough
One of the best
-Financial - Revenue measure, expense, cashflow;
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-Sales - Churn measure; Accounts Receivable;
-Customer - Customer Satisfaction Measure, Market Share;
-Risk - Compliance Measure
Assemble and distribute the dashboard monthly to every Senior Manager in the organization.
Goodluck.
