by Mike McRae, CMA, Vice President of Professional Services, Tenrox

If you’re like most SMB Professional Services Organizations (PSOs), you’ve probably got a good handle on things like utilization rates, average billing rate, profit per project, and revenue per resource. These metrics are widely used across all PSOs and are relatively easy to capture with any Professional Services software tool. The problem with only focusing on these metrics is that they only provide you with insight into how well you’ve done – past tense. They don’t provide you with any insight into how many resources you’ll need next month or next quarter, or more specifically, the number of Project Managers, Database Administrators, and Consultants you’ll need in the US, Europe, and Asia.

More importantly, these metrics will not alert you to upturns and downturns in the sales pipeline. This blind spot limits your ability to ramp up and threatens the new business you’ve just acquired.
Similarly, in a downtrend environment this reduces the amount of time you have to scramble before having to layoff quality personnel. In this regard the SMB organization is greatly disadvantaged over larger competitors. With formalized recruitment and on-boarding processes, larger organizations have an easier time attracting and training new talent and have a much greater ability to withstand lulls in the market, thus making them tougher to compete against.

With so much on the line, why do SMBs spend so little time on Resource Planning?

Read more on PSVillage.com, where Mike McRae is a featured author.