October 1, 2014

Improving Control Visibility and Profitability in the Services Business:

Driving Accuracy in Time Collection, Billing and Revenue Recognition

www.blytheco.com

Agenda

Panel Introductions

Questions for Our Panel

The State of the Industry Today

The Top Requirements and Capabilities

Solutions to Help

Why NetSuite?

Your Questions

Next Steps

Introductions

Alicia Anderson

Strategic Marketing, Blytheco

19 years in ERP sales, service and marketing

Leading ERP provider to thousands of companies nationwide

Rick Cobb

Senior Solutions Architect, Blytheco

Helps companies evaluate and design ERP and CRM solutions.

24 years of industry experience in designing and implementing business management technology

Introductions

John Garzouzi

Senior Solutions Consultant, NetSuite

Designs cloud-based technology systems for businesses nationwide.

Hannah Molette

Principal Consultant and Managing Partner for Matriarch Partners LLC

Independent Consulting/Professional Services firm based in Atlanta.

ERP IT Project Manager for the City of Atlanta’s Department of Information Technology

PMI Atlanta

Introductions

Jeanne Urich

Managing Director, Service Performance Insight

Specializing in improvement and transformation for project- and service-oriented organizations

Co-author of the ground breaking Professional Service Maturity Model™ benchmark used by over 10,000 project and service oriented organizations to diagnose and improve their performance.

www.spiresearch.com

Contact Jeanne at jeanne.urich@spiresearch.com

What is the Current “State of the Industry?”

2014 Service Industry Trends

Slowing growth

Lower billable utilization

Higher attrition

More overhead

Lower revenue per person

Loss of profit

Four Major Trends Impacting Profitability

5.30

5.19 5.21 5.19

4.96

4.70

4.80

4.90

5.00

5.10

5.20

5.30

5.40

2009 2010 2011 2012 2013

Bid

-to

-Win

(pe

r 1

0 b

ids)

Year

6.1%

6.8%

7.4% 7.2%

8.3%

5.0%

5.5%

6.0%

6.5%

7.0%

7.5%

8.0%

8.5%

2009 2010 2011 2012 2013

An

nu

al E

mp

loye

e A

ttri

tio

n

Year

67.6% 67.5%

69.6%

70.3%

69.7%

66%

67%

67%

68%

68%

69%

69%

70%

70%

71%

71%

2009 2010 2011 2012 2013

Emp

loye

e U

tiliz

atio

n

Year

3.6%

7.6%

13.7%

11.5%

10.0%

0%

2%

4%

6%

8%

10%

12%

14%

16%

2009 2010 2011 2012 2013

Year

-ove

r-Ye

ar c

han

ge in

P

S R

even

ue

Year

The Balancing Act of Professional Services

Costs Revenues

Winning the Right Clients

Government Funding

Compliance

Training

“On the Ground” Observations

How Do the Challenges Show Up in PSOs?

It is Getting Harder to Make Money!

16.1%

13.5%

16.8%

11.4%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

2010 2011 2012 2013

Earnings Before Interest Taxes and Depreciation

Five Year KPIs for PSOs

Challenges in Process and Planning

Customer requirements

• Inability to meet customer or compliance standards

• Non-aligned/non-existent best practices

• Inconsistent processes

Need for risk mitigation

• Reacting to issues as they arise vs. proactive planning

• Inability to anticipate and plan for project risk

Inconsistent business processes

• Disconnected virtual resources

• Not connected to company best practices

• IP Drain

Fragmented Business Systems

Core

G/L

Management

Reporting

Reconciliation

Statutory

Reporting

Financial

Reporting

Project Accounting

Timesheets

Expenses

Budgets

Sales

Professional Services

HR

Clients

Forecasts

Billings

Upsell

Renewals

Forecasting

Profitability

Resource Utilization Future Billings

Collections

Commissions

MGT Reports

How are Companies Solving these Challenges?

Look Backward, Project Forward

How things can change so rapidly 2010 was about Sales

2011 was about Execution

2012 is about Talent

2013 was about Profit

2014 has been about All of the above!

Executives must prepare Create loyal clients

Develop flexible workforce

Deliver on time and at high levels of quality

Improve visibility and alignment

2014 Planned Steps Taken to Improve Profitability

Steps Taken to Improve Profitability Survey Embedded Independent

Improve sales effectiveness 3.91 3.78 3.99

Improve utilization 3.86 3.88 3.85

Improve methods and tools 3.78 3.95 3.68

Improve marketing effectiveness 3.72 3.36 3.92

Improve solution portfolio 3.65 3.71 3.61

Improve hiring 3.55 3.75 3.43

Reduce non-billable time 3.51 3.75 3.37

Increases rates 3.04 2.61 3.28

What steps are you taking to improve profitability?

1 to 5 scale with 5 equaling greatest focus

The “Best versus the Rest”

KPI Best Rest ▲

Number of Firms 12 226

EBITDA 30.2% 9.8% 209.0%

Average revenue per project (k) $413 $178 132.0%

Annual revenue per employee (k) $236 $150 57.3%

Annual revenue per billable consultant (k) $291 $187 55.6%

Quarterly revenue target in backlog 65.8% 43.7% 50.7%

Project margin for time & expense projects 40.4% 37.4% 7.9%

Larger projects due to positioning, service productizing

Precision execution – high utilization, rates

Robust pipeline, attention to backlog

Lean overhead – virtual facilities and workforce

Proactive vs. Reactive Project Management

Adapt

• Know customer requirements and processes

• Stay on top of trends

Predict

• Manage risks to projects, revenue, and billing

• Up sell throughout client engagement

Collaborate

• Partner with your network

• Get your own teams on the same page

Enterprise-Wide Visibility

Project

Billing Rules

Revenue Rules

Expenses and Purchases

Timesheets

Bills

Employees Project and Resource

Management

Finance

Invoices

Charges

Next Steps

Learn more about best practices in managing PSOs, including:

Download SPI Research’s “Introducing the PS Maturity Model™” paper.

Take the PS Maturity™ benchmark survey and get a FREE ($995 value) copy of the “2015 PS Maturity™ Benchmark” report when it is published in February, 2015

View the NetSuite flash demo

info.blytheco.com/services-resources

Next Steps

December 2- Optimizing Project Resources and Improving Visibility into Performance If you are here, you are already signed up!

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