What is the business case for a full lifecycle PSA platform?

    Written by CloudBlue PSA on 2020-09-09 Last updated 2020-09-09 - 8 minute read

One question comes up again and again, how do you quantify the benefits of implementing an end to end PSA solution like Harmony?

To help provide structure to this question, here are the key points to consider and quantify.

The benefits break down into a number of categories, some of which deliver either hard savings or directly increase revenue and some deliver soft benefits that are difficult to quantify but make a real difference to the way your organisation will operate.

Overall, there are four areas to include when building the business case:

  1. Saving money: the most tangible and direct consequence of implementing the PSA solution
  2. Increasing revenue: by being able to offer new products fast and effectively. This allows you to maximise your opportunities with existing customers and directly increase your share of wallet
  3. Eliminating revenue leakage: a good PSA tool will ensure you bill everything you should and stop doing work for free,
  4. Improving operational efficiency and business visibility: enabling you to optimise the delivery of the business have and ensure you don’t miss any opportunities, slightly harder and less tangible, but very real nevertheless

The combination of these four should both reduce your costs and increase your revenue while allowing you to become more efficient along the way. Think about the consequence of increasing the top line while simultaneously reducing your costs, your profitability will go through the roof and that’s the real reason people implement PSA systems.

Now, on to the detail

#1 – Make direct cost savings, how does a PSA tool save you money? Below is a checklist you can work through and quantify:

  • How much are you spending on software to do the following functions; timesheets, expenses, service desk, purchasing, asset management, CRM, quoting, project management, invoicing and MIS? Not all of these will be needed by all businesses, but many will. Write down all the costs of all that software, including any internal time spent making the data flow between them (manually or automated by you). An end to end PSA will cost less than all these systems so there is an immediate direct benefit out of the box. You could just stop there and the world would be better.
  • Work out the % of your staff that are in Finance, best practice is ~3%, we see examples over 10%. Don’t plan on less than 5%, but redeploying the surplus people into revenue earning roles will see you save real money fast.
  • If data is a problem in your shop, add in the time spent fixing the data or creating manual spreadsheet views of it for management. If you use an internally developed system, check out your time bookings and cost them honestly.
  • Take a look at any “coordination” roles you have in the business and the people who spend time producing management information. They are really supporting a weak enterprise data model and just holding badly integrated software together. They will be surplus to requirements once you have a full end to end solution in place

#2 – Increase revenue, being able to offer a wider range of products and come to market with new products fast without adding more overheads is key to increasing your share of wallet with existing customers and also attracting new business.

  • How long does it take you to gear up to sell new products, to be able to price them correctly and provision them efficiently? As cloud computing continues to take over the business environment, being able to deploy new product fast is key to staying ahead and growing your business
  • You want to upsell the latest tech offering to your existing customers. How long would it take you to build a campaign list of customers that might be interested in such an offering (based on what they own), and once you’ve done this, set up the campaign and start calling round. You also need to monitor the time it takes to run this and understand how much gross margin it brought in from the number of sales closed. Is your data clean enough to do this? Where is the data you need to build that list, where will you manage the campaign and how will you know how much you sold? Do you even have a clean customer list, many businesses don’t.
  • Reviewing your support profitability, you discover customers that cost you money to support. This gives you two choices, cancel that account, or increase the price. Increasing the price to the point where you make a return on the work is the right choice, would you see this opportunity today, accurately without data noise, or major manual analysis? If not, there is a definite opportunity here, add it in.
  • Are you good at tracking change requests on projects and making sure the client pays or changes their mind? Or reviewing bug tickets and converting them into feature requests. Where is all that information, is it on the PM’s email? If you don’t have this problem sorted and visible, add 5% of your development budgets, a reasonable average for untapped scope creep that you can eliminate.

#3 – Bill all you can and should, by eliminating revenue leakage. Frequently organisations work for customers but don’t get paid - look at the examples below and consider what happens in your business:

  • Do you ever provide support without confirming that your customer has a current support agreement for the device or software in question? Before you say no, double check, examples are very common. Would your support people even know that a customer has cancelled?
  • How well is your Project Management software integrated with your order management process? Only PSA tools join these up. Without that join, scope creep means you are working for free on the margins of your projects. The right integrated data stops this dead.
  • Have you ever forgotten to invoice something? Sounds unlikely, no, again this is actually quite common. Have a think and put an annual estimate in the box, it will never happen again
  • If you develop software and customise it for customers, do you add support elements to each and every change? The software is becoming more complex over time, are you getting paid extra or just absorbing the complexity? If the latter, you are missing out on real revenue opportunities, better make sure your control environment can handle that complexity.

#4 – Increase operational efficiency, below are some examples to help you to understand where this matters:

  • Here’s a simple example to try. Your customer makes a repeat order with a different quantity (we’ll use user license but it could be anything). How long (effort time) would it take you to create an order, get it signed, process the order, update the contract database, customer file and raise and post the invoice? And how many people would be involved? In a correctly aligned end to end PSA, this whole process should take a few minutes to complete: catch-up invoice sitting in accounts receivable, no hand-offs apart from the customer signing the order on-line (which he should be able to do paperless). Now think about the people who are involved in incremental orders and what time they would take to achieve the same - add that saving to the business case.
  • The switch from break/fix to managed services has placed more emphasis on understanding true customer profitability. Do you know which your most profitable customer is and which ones you are losing money on? If you don’t have this to hand, how long would it take someone to produce this type of information, regularly? This should be a standard dashboard report from your PSA, available on demand. This is information you need to optimise your business - cost the manual production of MIS so it can be eliminated.
  • You get an order that needs a project to deliver it. How much time does it take your team to record the order (in whatever tracking place you use), set up the project code and budget etc in the PM tool and link this to milestone release, or set up the rates in the billing system and link that to the timesheet system and allocate someone to look after the work? This should be all part of a single unified view that would take a few minutes to manage with nothing needing rekeying. You work out the saving, that’s efficiency.
  • You get a request from a customer for a new piece of equipment. You have to get a signed order, order the kit, arrange installation, book that in the service desk solution with the technician, realign that data when the delivery is delayed etc. You should be able to raise a quote straight from a service ticket, connect that to the implementation ticket, track correspondence against both in one place, on your phone, in minutes.

HarmonyPSA is designed to place your entire operation in a single place, and display it on your phone. It will maximise your revenue opportunities while simultaneously improving your operational efficiency and saving you wasted costs. If you would like more advice on building a business case that is relevant to your business, call us and we will work with you on making the case for change. A significant improvement in profitability is easily within your reach.

Read More

What is a PSA and why do I need one?

What benefits should I expect from my PSA platform?



About the Author: CloudBlue PSA is the most complete cloud professional services automation (PSA) software on the market. Purpose-built with functionality to simplify every need of MSPs and Professional Services Organisations, CloudBlue PSA introduces a state-of-the-art PSA system built for today’s modern service provider. The platform empowers services organizations to scale recurring channel revenue and diminish operational complexity via its advanced product suite, which includes automated billing and reconciliation, an industry-leading customer support center and network operations center (NOC), real-time profitability analysis, and much more. CloudBlue PSA is available globally. Follow CloudBlue PSA on , LinkedIn or Website

Tags: Benefits of PSA, Business, Automation Benefits


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