Bizinta News & Trends
Professional Services Operations Challenges
Author: Matt Lentzner, CEO, Bizinta
At most SMB professional services firms at least one person dreads the first of the month - the operations person who works on invoicing. I tell you with confidence that they are 100% justified. And I’m on their side, I know the feeling firsthand. So, let’s look at what’s behind the misery and how to fix it.
Many companies still use manual processes to create invoices - this entails multiple manual steps per invoice with lots of invoice customization based on client requirements. Operations staff don’t have an alternative to their slow and error prone process - not all errors will be found. Accuracy is a problem and under or over billing happens. And, as the company grows, invoicing deadlines get harder to meet and more errors sneak by. While very small companies can get away with a tedious manual process, once a company approaches $5M or more in revenue it becomes inefficient and excruciating.
The good invoicing soldiers in operations may not complain loudly, but make no mistake if this is going on then they are being burdened unnecessarily - and they know it.
Invoicing should be easy and take no more than a couple of days no matter how big your company gets. If it isn’t easy, the pain gets unbearable as you grow so if invoicing manually takes you a week today then it will take two weeks if you are twice the size and all month or more if you doubled again. And your operations and accounting leads feel it each month. Worse, every day you don’t invoice is another day delay in receiving payment.
In this era of software, taking days or weeks to send out invoices should be unacceptable in any professional services organization.
Leaders can fix the problem easily. It just takes adding some simple software that operations staff can use to automate their manual invoicing processes so they’ll be fast and error-free.
This way they can cut invoicing time by 75%, and some companies even complete it in a half a day or less, including customization by client or by project, and increased accuracy and defensibility. It takes a small budget, a little time, and good software.
Let’s get into it a little deeper - the manual steps to consolidate and automate are the data gathering and correlation steps you do before you generate invoices, then generating invoices, then reviewing them against client requirements, making corrections, sending them to account leaders for review, and then finally sending to clients. So, to automate and streamline that you have to realize that invoices are created using time tracking data, project data, and client customization data so that’s where you start. On the first of the month your operations should be able to kick off automated processes to:
All in one step - that’s the most beneficial way. Bizinta can do this today. But, whatever you use, you should fix the problem asap. Changing processes these days is smooth, fast, and inexpensive. Once you’re set up then:
Making this happen is a leadership decision. Usually the obstacles are leadership’s willingness to address it, not seeing the urgency or potential benefits, not knowing where to start, thinking that changing this is difficult. So leadership is the key to slashing invoicing time by as much as 75% which means receiving payments up to 75% sooner.
It is time SMB Professional Services leaders recognize that manual invoicing is painful, and that fixing it benefits the business and employees. No one on your team should dread the first of the month.
This is just one of the many problems that bleed SMB Professional Services companies. If you’re a leader at an SMB Professional Services company, I would like to know about your invoicing and other operations challenges. Message me or reach out on social media.
Share This: Read @Bizinta CEO latest blog The First of the Month Doesn’t Have to be Soul-Crushing #ConsultingLeadershipExcellence
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