Profitability Habits CFOs Use to Steer Project Success

By Paul Johnson
CPA, CGMA, MBA

No two service companies are identical, but they do find common ground when it comes to guiding a project’s profitability. So, what do successful CFOs do to help steer project profitability, that you can start using today? Glad you asked!

1. They prioritize time for analysis.

According to a survey done by PWC, top-performing organizations spend 20 percent more time on analysis versus data gathering. You can have all the best data to use toward a solid project strategy, but if you don’t set aside enough time to analyze that data, it will do you no good.

2. They focus on the right metrics.

The most influential CFOs use their time wisely by sharpening their focus on the data that delivers the most value. Here’s a list from Services Performance Insight of the top 5 KPIs for services organizations:

Billable utilization
Project overruns
Project margins
Annual revenue per billable consultant
Annual revenue per employee

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3. They support their project managers’ success with dashboards.

Dashboards are the modern CFO’s go-to when it comes to task management and information analysis.

From Ernst & Young’s research, 67 percent of surveyed CFOs believe a top priority for finance is to improve cross-functional collaboration.

The most effective CFOs support their project managers by guiding them to the data and information most critical to making effective project decisions in the shortest amount of time by using dashboards. They conveniently showcase the most pertinent data, all on one screen, for fast access and analysis.

4. They apply analytics to drive company decisions.

According to Forrester Research, 74 percent of businesses want to use data to drive their decisions, but only 29 percent say they can successfully apply those analytics.

When data is easily accessible, consistent and accurate, CFO’s can more effectively encourage company decisions to be driven by data.

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5. They know the value of fixed-fee project costs.

Fixed-fee project cost trends are still going strong. 50 percent of professional services projects that TSIA analyzed are sold on a fixed-price basis, industry-wide, according to their research.

That said, whether you currently bill based on time and materials, or on fixed-fee basis, to understand your true project profitability, you need to know your cost details –And not just by way of spreading costs evenly over the project.

When your teams can see detailed labor costs, decisions become more insightful. Cost margins become clearer.

Sage Intacct, a best-in-class cloud-based financial management solution, offers data consistency, accuracy and data access for everyone involved in your projects.

Dashboards, highly customizable reporting features, and detailed chart of accounts tagging options streamline your analytics, and simplify the complex. A strong financial management solution like Sage Intacct can leverage your data to work harder and smarter for you.

Want to know more? Drop us a line! We can help you find the right tools to support you in your leadership role to drive your company’s project success.

Beat CFO Insomnia and Go from Chaos to Control

By Paul Johnson
CPA, CGMA, MBA

It’s a tough job. From drum-tight audits to flawless compliance, as a CFO, everything that drives the company’s financials rests on your shoulders. Seemingly small weaknesses can cause a rift in accuracy, leaving even the toughest of CFO’s to lose sleep night after night. We’ve listed 6 common financial system weaknesses, and how to strengthen them.

business organization

1. Spreadsheets

Love them or hate them, they have their place. Unfortunately, their place is not everywhere in your office. Spreadsheets are great in a pinch or for limited tasks, but their error-prone design can easily lead to cascading data errors.

Solution: For tasks like revenue management or consolidations, seek automation with the cloud.

2. Outdated Reporting and Slow Answers

Today’s companies make quick, informed financial decisions on the fly. If your teams are working with in-house systems to manually compile, filter, sort and re-sort your data, by the time those reports circulate, the data’s already gone stale.

Solution: Get real-time, system-compiled data available to decision-makers through cloud-based reporting and dashboards with the right financial system – like Sage Intacct. No time machine required.

3. Time Consuming and Error-Prone Consolidations

With multiple entities, if your company’s consolidations are being done manually, so much can go wrong. Currency conversions, complicated formulas and endless spreadsheets leave room for one manual mistake to throw everything into chaos.

Solution: With a financial management system that focuses on growth, your company can perform one-click consolidations reduce errors, save time, and ensure accuracy and compliance.

4. Under-billing Time and Expenses

When teams in the field and have to wait until they’re at their desks to track time and expenses, your billing may not be as accurate as you think. Chances are good that things are going undocumented, and unbilled.

Solution: Everywhere-accessible automation. With Sage Intacct’s cloud-based time-tracking and expense features, your team can log project-based items from anywhere, at any time.

5. Ill-Fitting On-Premises Software

With on-premises software, companies often have to upgrade for customizations, bend and flex to get system updates and maintenance, and endure long implementation timelines. Many times, these companies end up with wasted features that sound great at initial buy-in, but in the end, don’t meet a need.

Solution: With the cloud, growing businesses see tighter information security and software reliability, customizable options, and automatic updates and configurations for reasonable monthly subscriptions.

business organization

6. Software Solutions that Don’t Play Well Together

When software solutions don’t integrate, people can’t access information they need. Further, data needs to be manually entered sometimes two and three times in multiple systems, leaving it vulnerable to error. The company is left with disconnected teams and a fuzzy financial picture.

Solution: Sage Intacct – a best-in-class cloud financial management solution – offers seamless integrations so data moves easily between many of today’s best-in-class cloud systems. Companies can reduce their manual entry time, and customize their integrations to fit their needs while also getting a real-time company picture to keep every department running smoothly.

Still have questions? Pick up the phone or drop us a line. We’re here to help you get peace of mind, and some shut-eye!