With the increasing need to become more agile, responsive and competitive in the marketplace, professional services firms are looking to technology to provide business solutions.
Today, there are several solutions out there – such as professional services (PSA) and enterprise resource planning (ERP) – which can help you digitise. But which solution is the right one for your business? PSA, ERP, or both?
In this blog, we’ll cover the similarities and differences between PSA and ERP software, as well as analyse which solution will likely be the best fit for your business.
What is enterprise resource planning (ERP)?
Enterprise resource planning (ERP) is a solution that helps you link several parts of your business and effectively streamline and manage processes such as:
- Production
- Accounting
- Manufacturing
- Resource and project management
- And more
The benefits of an ERP solution include:
- Access to real-time business insights across your organisation – this helps you make decisions based on a single source of the truth, without having to analyse data across multiple data sources
- Improved customer service – access to detailed customer information allows you to meet their needs better and increase response times
- Increased efficiency – automate your core processes through ERP software to reduce the amount of manual and error prone tasks your employees complete
- More control – ERP software helps you boost compliance and business continuity thanks to better visibility of reliable organisational data
- Quicker reporting – reports can be easily generated and shared, which reduces the time needed to source and interpret data
What is professional services automation (PSA)?
Professional services automation – or a PSA solution – is typically used within service-based organisations such as:
- Accounting
- Consultancy
- Legal
- Engineering
A PSA solution helps professional services firms tackle challenges inside their organisation such as:
- Managing complex projects – PSA provides greater visibility and management of your projects through project status, milestone and schedule tracking. Having project data in one place allows you to have greater clarity on the real cost of a project and the resources required to complete it
- Maximise resource utilisation – PSA helps you view how resources are allocated across your projects and/or teams and the costs associated with these resources. This helps you ensure the right resources are being assigned to the right projects at the right times
- Improve time and expense management – PSA provides time and expense management tools that let you track actual effort, forecast remaining effort for each project activity task, record costs, plus automate billing and invoicing
PSA vs ERP: The differences
Traditionally, one of the main differences between PSA and ERP is that ERP was built to manage tangible assets such as products, goods and stock. PSA on the other hand, is more focused on managing intangible assets and the service-based industry, such as consultants and accountants. This means PSA software had a greater emphasis on modules like project management and resource utilisation.
Today’s modern solutions however, have evolved to a point where both solutions can be complementary but also, interchangeable. In fact, there are now all-in-one solutions that allow you to combine your project and resource management (PSA) with financial management (ERP).
This has helped professional services firms unlock new opportunities for growth and improved profitability that previously weren’t possible with traditional ERP or PSA solutions. For example, with a single source of data from a fully integrated system, you’ll have total control over your projects and overall business, allowing you to view areas such as:
- Integrated project accounting with complete visibility and access to cost and sales tracking and budget and forecasting data
- Integrated budget and planning with access to workload and individual calendar planning
- Integrated time and expense tools which help make life easier for your teams
- Integrated invoicing that allows time and expense entries flow seamlessly through an electronical approval process into an invoice
In essence, we believe a truly integrated ERP with PSA functionality will provide the highest level of productivity, efficiency and financial visibility for professional services firms. But the solution you choose should be dependant on your business requirements and the problem you’re trying to solve across your organisation.
Do you have any further questions about ERP or PSA? At Columbus, we have amassed over 30 years of experience helping businesses find and implement the right digital business solutions for their specific needs. And we can help yours too.
Reach out to us today by clicking on the button below.
Choosing the right solution is just one step of your transformational journey…
We’ve spoken a lot about solutions and which one is best etc, but that shouldn’t be your sole focus. New technology will affect every area of your organisation, so you’ll need buy-in from all your stakeholders to achieve success. And that depends on value creation and management.
In our brochure, we explain the importance of adopting a ‘value first’ mentality during a transformation project.
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