“Do nothing” is not an option – that was the key message from the seminar “Growing Services Revenue in a Recession” hosted by Compuware Changepoint in the UK. Our session featured speakers from SunGard, Dell and Changepoint. As the UK economy remains flat, Professional Services & Technology Services organisations are looking at new service offerings to help grow their revenues and differentiate themselves from the ever increasing competition. In the opening presentation Alex Cairns (SunGard) discussed the importance of determining not only the key revenue streams required today but what will be necessary to replace them as they dry-up – something he described as the ‘S’ curve effect.
From listening to the speakers it became clear that there are three critical success factors in bringing new services to market: People, Processes and Products. A services business is a people business and the focus should always be to recruit, develop and motivate the best people. Standard processes, focused on repeatable delivery and tailored to the needs of the individual business units is the second critical success factor. This has helped Dell successfully take to market what John Rosevear (Dell) describes as “Unit-based Services” – a series of repeatable, consistently deliverable elements of service that can be combined as building blocks to deliver an experience tailored to the customer’s needs. The third critical success factor is delivering the ‘right’ services products at the right time. This means understanding your customer – who are the key stakeholders, what are their personal business pains, what’s the impact of these pains on the business and importantly how your organizations services offerings can help them address these pain points.
The third speaker, Kevin Armstrong (Compuware Changepoint) provided an insight into how we, within the Compuware Changepoint business unit, are dealing with the challenges imposed through the tough economic conditions experienced in the UK. Firstly, we have developed a series of new service offerings (called Guardian Services) in response to our customer’s needs. These service offerings are geared towards the implementation and support of Changepoint PSA, our Professional Services Automation (PSA) solution. Secondly, Changepoint PSA is helping to streamline our own internal operations and manage the 360 relationship with our customers. The solution is supporting key business processes including Opportunity (Bid) Management, Project Delivery, Resource Management, Time and Expense Tracking and Invoicing /Revenue Recognition. It’s interesting that a recent comparison of Key Performance Indicators (KPI) from Service Performance Insight (SPI) showed that companies with an integrated PSA solution showed project margins for fixed price projects increased from 33% to 36.3% and billable utilization increased from 63.1% to 70%. If you think about it, even a modest 1% increase in billable utilization for a company with 200 billable consultants (charged at £800 per day) could potentially generate an increase in revenues of £376K pa!