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There are two words that best describe the professional services sector from a manager‘s perspective; exciting and frustrating. On the one hand, the sector is growing exponentially. By the end of 2024, revenue in the Professional Services market is projected to reach US$72.61bn in 2024. Such consistent growth for the better part of the decade shows that professional service firms have an excellent opportunity to scale in the coming years. Sounds exciting, right? However, the industry also comes with a unique set of challenges.
Some of the primary challenges include a shortage of labor, maximizing billable hours, planning for outgoing demand, and waiting for client payments. Despite such challenges, you are still expected to deliver exceptional services. Otherwise, you stand to lose your clients to increased competition.
Compared to companies that deal with products, there is a greater need for service firms to enhance the customer experience continually. So, how can a company achieve a competitive advantage? The answer is – with the use of professional services automation software. In this article, you will find five key ways to use PSA software to gain competitive advantages in the service industry in 2025.
1. System to detect common project bottleneck
Bottlenecks are congestions or factors within your service delivery process that result in delays. Addressing such bottlenecks is essential as they have a significant impact on your bottom line. First, they reduce the number of clients you can serve while affecting customer satisfaction, which can be detrimental.
Due to the unique nature of the service sector, bottlenecks are quite common. They include approval bottlenecks for deliverables, change requests, hours, and resources. There are also financial bottlenecks that cause project delays due to the late release of funds.
Bottlenecks are not just mere delays. They have a significant impact on projects and overall company success. Some of the negative effects include:
- Loss of man-hours
- Reduced quality and performance due to disruption
- Increased probability of projects exceeding the budget
- Decreased client satisfaction
This is why gaining and maintaining a competitive advantage, like having a system that helps identify bottlenecks, is crucial. Some of the steps to take to help you achieve this include:
- Creating a process for identifying potential bottlenecks
- Setting up measures to identify potential bottlenecks
- Defining the change management process
- Updating your resource planning approach
This is where PSA tools come in handy. PSA software isn‘t just about fixing problems; it‘s about working smarter and staying ahead.
PSA software, such as Birdview PSA, solves these and many other issues with tools like automated time tracking and smart resource scheduling. Using PSA software in the service industry ensures your team stays productive without burnout. It also automates workflows, keeps everyone connected, and helps you quickly address issues to maintain performance.
Meanwhile, if you are worried about budgets spiraling out of control, PSA tools like budget tracking and forecasting let you catch overspending early, adjust plans, and keep finances on track.
At the bare minimum, clients expect excellent and timely delivery of services. Though delays aren‘t completely avoidable, you can mitigate their effects with a bottleneck detection system. When such delays arise, communicate with your client and let them know the measures you will take. These are some of the minor things that make or break relationships with clients.
2. A clear understanding of the project’s status
Depending on the scope of the project, different tools and the collaboration of multiple teams may be necessary for developing a sustainable competitive advantage in the service industry. As the number of tools and people involved in a project increases, so does the risk of poor visibility. When you do not have a clear and accurate picture of the progress of a project, the following risks are inevitable:
- Bad decision making
- Wasted resources
- Miscommunication with clients
All these can lead to project failure or, at the very least, ruin your relationship with customers. Considering that service companies greatly rely on repeat business and referrals, you must ensure that you can track project progress at any given time.
With Birdview PSA‘s centralized BI dashboards and reports, you can achieve real-time project visibility across all teams and projects. Whether it‘s tracking milestones or understanding how resource allocation affects timelines, Birdview ensures everyone is on the same page, empowering better decisions and client communication. Besides, its automated project status dashboard delivers clear, up-to-date summaries of progress directly to stakeholders, eliminating guesswork and keeping everyone aligned.
In this regard, a project scorecard is an invaluable competitive advantage in the service industry. It makes it easier to track progress, allowing you to identify and rectify any issues swiftly.
To set up an effective scorecard, you should:
- Determine the measures to track
- Set targets for each measure
- Fill in the scorecard
- Monitor the results to identify data trends
- Share the results with other stakeholders
3. The ability to update clients with the right data quickly
One of the tenets of running a project successfully is keeping your client in the loop at all times. Some of the information you need to share with your client includes upcoming payments and project plan baselines, among others.
Such data is shared via email, which is not an ideal method for referring back to previous communications. A more suitable alternative is having a central information hub or a platform that makes it easy to retrieve communications later if need be.
Birdview PSA offers a free client portal that allows you to securely share project updates, financial forecasts, and deliverable statuses in real time. Clients appreciate having easy access to accurate information without needing endless email threads. This boosts transparency and strengthens trust.
Such a competitive advantage will improve transparency, accountability, and customer satisfaction. As a result, clients will be more likely to offer you future work and refer you to other companies.
4. Improved cash flow
If there‘s one thing certain in business, regardless of industry, it‘s the risk of failure. Surprisingly enough, the biggest threat to your professional service firm is not a lack of market demand or failure to generate sales. Data from a US bank study suggests that 82% of businesses fail due to cash flow challenges. This means that even after landing clients and generating sales, your business can still fail.
This is because, without proper cash flow management, your business will not have funds when needed to settle expenses and capitalize on opportunities. The effects of poor cash flow include:
- Strained relationships with vendors
- Missed opportunities due to insufficient funds
- Difficulty covering overhead costs
When it comes to projects, preventing cash flow issues is about synchronizing the delivery team and finance team‘s efforts. This will ensure that the project is billed on time, preventing any financial bottlenecks.
Birdview PSA makes cash flow management seamless with its robust budgeting and cost-tracking tools, ensuring you always have a clear view of project finances. By logging both billable and non-billable hours, Birdview helps maximize profitability and ensure accurate invoicing.
Birdview PSA also supports flexible billing models, including Fixed Cost and Time & Material, so you can adapt to client preferences. Whether it‘s rate cards by role, project, customer, or activity and resource-specific rates, Birdview allows you to set billing structures that align with your business needs.
On the other hand, Birdview PSA improves cash flow by shortening the delivery-to-cash timeline. Integration with popular accounting and ERP platforms like QuickBooks, NetSuite, Deltek, and Microsoft Dynamics streamlines the invoicing process. This eliminates manual errors, accelerates approval workflows, and ensures smoother operations.
5. Technology
Arguably, the biggest disruptor in the modern-day business ecosystem is technology. Organizations that are quick to adopt new technologies gain a significant competitive advantage in the service industry as efficiency and productivity increase. Some of the tools that can help your organization include financial, resource, and project management software.
More importantly, it‘s not just about having many tools at your disposal. The tools you have should have the capacity to connect to each other and the systems you have in place. This will make processes more efficient and ultimately affect your bottom line.
Birdview PSA connects with over 5,000 business tools, including MS Outlook, Jira, Salesforce, HubSpot, and Adobe Creative Cloud, streamlining your workflows and centralizing your operations. Using Birdview‘s integration capabilities, you can create a cohesive ecosystem where all your tools communicate effectively, leading to more efficient processes and a stronger bottom line.
Set the pace in your industry
The professional services sector is very lucrative but highly competitive and comes with unique challenges. This is why it‘s essential to capitalize on all key competitive advantages available. Investing in the right tools is arguably the best way to streamline processes and improve efficiency, allowing you to stay one step ahead of your competition.
Birdview PSA offers professional services automation tools that allow you to gain full control of your projects. All from one platform, you‘ll be able to detect bottlenecks, track project progress, give clients quick access to data, and improve cash flow. Request a free demo today to find out how Birdview PSA can help you scale your professional services firm.
