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service insights
TPSA Members: Simply click on the Services Insight title to download a copy of the full document in .PDF format.
The Services Innovation Gap:
How Many Technology Companies Are Failing to Respond to Fundamental Challenges to Their Business Model
Bo Di Muccio, Senior Director, Research and Advisory Services, TPSA
J.B. Wood, President and CEO, AFSMI, SSPA, TPSA
Technology companies are under enormous pressure to improve the performance of their service businesses. And this pressure could well increase over time. The simple truth is that as technology firms become more services-centric, they will be less able to meet overall company and shareholder expectations without making serious, systematic investments in services research innovation. Yet, technology companies appear to be doing anything but. Results from an industry survey focusing on services research and innovation, sponsored jointly by the Service Research & Innovation Institute (SRII), the Association for Services Management International (AFSMI), the Service & Support Professionals Association (SSPA), and the Technology Professional Services Association (TPSA), demonstrate that a clear services innovation imperative is being confronted tepidly and tentatively, if at all, by most technology companies.
The Services Dashboard
Thomas E. Lah, Executive Director, TPSA
A common request we receive from AFSMI, SSPA, and TPSA members is for guidance on how to establish a “services dashboard.” A business dashboard is a graphical summary that allows managers to monitor the contribution and health of the departments in their organization. To gauge exactly how well an organization is performing, a dashboard captures and reports critical data points from each department within the organization, thus providing a snapshot of overall performance. By having the right dashboard in place, a management team can better monitor the performance of the services organization and identify areas that need attention.
Recognized Innovator Awards: Spring 2009
Innovation in Collaboration, Infrastructure, Revenue Generation
John Ragsdale, Vice President, Technology Research, TPSA
Faced with an uncertain economy, AFSMI, SSPA and TPSA Research took a back to basics approach for the Spring 2009 Recognized Innovator Awards, identifying categories that enable operational and financial success for service and support operations. The Collaboration category looks for business value amid the Web 2.0 buzz; the Infrastructure category digs below functionality to identify how new and innovative technology platforms are contributing to success; the Revenue Generation category recognizes technology with a proven track record in boosting services revenue. Member companies should stay abreast of innovation in customer service and support products and look for ways to leverage these new approaches to improve efficiencies, lower operational expenses, and increases services revenue.
Service Convergence Begins with KM
John Ragsdale, Vice President, Technology Research, TPSA
As technology complexity has increased, the number of content sources required to effectively meet the needs of customers has steadily risen.Service convergence means that all areas of service and support, including professional services, technical support, field service, and customer education services, are looking for areas in which consolidating people, processes, and/or technology will improve service levels and cut operating costs. This TPSA Service Insight discusses the benefits and challenges of consolidating knowledge management practices across service lines.
Professional Development in a Downturn
Mark Slotnik, Partner, McMann & Ransford
Thomas E. Lah, Executive Director, TPSA
We know technology companies charter their professional services (PS) businesses with the critical objectives of increasing customer intimacy and securing continued product revenues. During a down economy, these strategic goals become even more important. This TPSA Service Insight discusses how building the skills of PS staff can be a key tactic for sustainable competitive advantage when capital spending is under duress and if done well, leveraging these soft skills leads to revenue and margin growth.
What I Heard: Service Technology Trends
Conversations from the 2008 AFSMI, SSPA, and TPSA Fall Conference
John Ragsdale, VP, Technology Research, TPSA
Service and support technology’s proven and easily documented ROI potential means that significant investments are still being made in today’s tough economy. Discover the three high-level service and support technology trends that emerged from member discussions at the 2008 Fall Conference. Understanding these trends and planning for their impact are critical for your organization’s success in 2009.
Trends in Professional Services Automation
John Ragsdale, VP, Technology Research, TPSA
With 63% of TPSA Members currently using a PSA Solution, the push to better understand resource utilization and identify profitable (or unprofitable) projects up front is making adoption of “best of breed” professional services automation (PSA) tools a priority for more PS organizations. Today's requirements for more in-depth business intelligence about services operations is driving many smaller PS organizations to evaluate PSA software for the first time, and forcing some larger PS organizations to replace homegrown solutions that are no longer delivering results. This Service Insight identifies PSA trends for 2009.
Practices and Results
Thomas E. Lah, Executive Director, TPSA
Service management teams are constantly on the hunt to identify best practices they can implement to improve performance. Service organizations also need to benchmark current performance against relevant industry data to determine how well the organization is currently performing. These two activities, practice improvement and benchmarking results, can be powerful tools to improving the overall performance of a services organization. However, if the services management team does not have a common framework for applying both practice and results data to their organization, these activities can quickly become ineffective.
This Service Insight provides services management teams with a framework for effectively
applying both practice and results data from the industry to drive performance improvement.
This content is relevant to any organization determined to improve performance
by clearly understanding current industry performance.
Education Services: TPSA Focus Group Highlights
Bo Di Muccio, Ph.D.
Senior Director, Research & Advisory Services, TPSA
Periodically, TPSA convenes focus groups of 5 to 7 member companies who are willing to share experiences and best practices. This is a vehicle that we typically use to jumpstart framework maturity in areas where we lack extensive benchmarks, but where there is also keen member interest in understanding what others are doing. In September 2008, TPSA facilitated a focus group discussion on the subject of Education Services. This Services Insight offers a summary of the context and highlights from this session.
The Solution Provider
Thomas E. Lah, Executive Director, TPSA
Over the past ten years, the technology marketplace has significantly matured. With this market maturity there is a new set of strategy challenges for historically product-centric companies. One of the urgent discussions occurring among technology executives is the role of professional services in the overall company portfolio. To help technology companies with this service strategy discussion, Thomas Lah, the Executive Director for TPSA, and author Geoffrey Moore collaborated to create a framework that accelerates the service strategy dialogue.
The Product Extender
Thomas E. Lah, Executive Director, TPSA
This article defines in greater detail the role of professional services for product companies where new product sales may have slowed down but there is a large install base crying for more service assistance. For these companies, PS has become or is becoming a larger portion of the overall corporate economic engine. This growth in the PS gear requires a realignment of PS strategy parameters otherwise, company profitability could suffer.
The Product Provider
Thomas E. Lah, Executive Director, TPSA
Over the past ten years, the technology marketplace has significantly matured. With this market maturity there is a new set of strategy challenges for historically product-centric companies. One of the urgent discussions occurring among technology executives is the role of professional services in the overall company portfolio. To help technology companies with this service strategy discussion, Thomas Lah, the Executive Director for TPSA, and author Geoffrey Moore collaborated to create a framework that accelerates the service strategy dialogue. Using this framework of service stratgy profiles, this article defines in greater detail the role of professional services for traditional product providers, where PS is a realtaively small gear in the overall corporate economic engine and the name of the game is partner enablement.
Managing VSOE: Revenue Recognition Part 2
Thomas E. Lah, Executive Director, TPSA
Ever since AICPA SOP 97-2, PS managers within software companies have been forced to arm wrestle with both internal accounting staff and external auditors regarding revenue recognition policies for service engagements that are bundled with software and support offerings. Now, hardware companies that are bolting in value added software products are being forced to navigate 97-2.
In March 2006, TPSA published an article titled Revenue Recognition Part 1 which provided an overview of the revenue recognition issues faced by software companies and specifically defined the pain points in establishing VSOE for professional service offerings. This Professional Services Insight (PSI) takes the discussion to the next level.
Strategies in Professional Development for TPS Organizations
Thomas E. Lah, Executive Director, TPSA
TPSA members know that high-performance PS organizations look for ways to
add value and build strong account relationships. In order to move from simply
serving as a company’s tactical implementation team to becoming a critical
partner to the customer base, PS consultants must develop the necessary soft
skills to engage clients in a professional manner, confidently lead project teams,
and successfully up-sell project work. This is not a one-time training activity, but
an on-going training commitment throughout the PS consultantcareer. This
article provides specific strategies PS organizations can pursue to develop these
required soft skills in front line PS employees.
Opportunities in Service Innovation
Thomas E. Lah, Executive Director, TPSA
Service innovation is the theme for the 2008 TPSA spring summit. For the summit, we are defining service innovation as “the embodiment, combination, and synthesis of knowledge that accelerates the creation and delivery of original, relevant, and valued services.” This article provides a practical assessment of the sources for this service innovation in the next three to five years.
Focus Group Highlights: Leveraging Solution Centers
Bo Di Muccio, Ph.D., Senior Director, Research and Advisory Services, TPSA
Periodically, TPSA convenes focus groups of 5 to 7 member companies who are willing to share experiences and best practices. This is a vehicle that we typically use to jumpstart framework maturity in areas where we lack extensive benchmarks, but where there is also keen member interest in understanding what others are doing. In January 2008, TPSA facilitated a focus group discussion on the subject of Solutions Centers. This PSI offers a summary of the context and highlights from this session.
Professional Services in a Downturn: Surviving Management Expectations
Thomas E. Lah, Executive Director, TPSA
As we enter 2008, there are strong indications the U.S. economy may experience an economic slowdown. The economic slowdown could be mild or severe—TPSA will leave it to the economic experts to predict and track this. In a severe economic downturn, professional service organizations are called upon to help their companies weather the rough seas. Specifically, priorities are shifted from product adoption to customer retention and cost control. This shift places new expectations on PS performance; expectations that are often challenging to meet. Hopefully, 2008 will present nothing but a mild slowdown in continued economic growth. But to be on the safe side, this article outlines the priorities for a professional services organization that will help it weather both the economic and management storms created in a downturn.
Negotiating with the GEOS
Thomas E. Lah, Executive Director, TPSA
In their efforts to optimize the business on a global basis, technology professional services (TPS) organizations confront head on geographic centers of power, so predominant in the technology industry for the past 30 years. Read this PS Insight to explore the dynamics of negotiation between the exigencies of sound global TPS management and the traditional geographic power structure.
The TPSA Playbook: Leveraging Analyst Relations
for
Technology Professional Services
Bo Di Muccio, Ph.D., Senior Director, Research and Advisory Services, TPSA
Many PS organizations under-utilize or eschew industry analyst relations (IAR) altogether, driven in part by misconceptions IAR and also what is required to achieve valuable results. TPSA believes that a targeted IAR program should be beneficial for most TPSOs. This TPSA PS Insight outlines the IAR “play” using the TPSA Playbook structure previously used in other PS Insight research documents.
Sourcing Solution Architects 
Thomas E. Lah, Executive Director, TPSA
Solution architects have become the critical path to a PS organization’s ability to successfully scale the business. This TPSA PS Insight thoroughly defines the role of the solution architect, discusses the factors to consider when sourcing and developing solution architects, and presents several industry benchmarks related to this increasingly important role.
Calculating Utilization
Thomas E. Lah, Executive Director, TPSA
TPSA will never completely put to rest the debate surrounding utilization calculation. However, this PS Insight provides the TPSA recommendation for the most effective way to calculate utilization across multiple geographies. This PS Insight also introduces a recommended practice for calculating utilization. Additionally, TPSA does see variances in utilization metrics based on the service strategy profile of the professional service organization. Finally, this paper reviews existing TPSA benchmark data regarding utilization targets and services mix.
Driving Global Alignment in a PS Organization
Thomas E. Lah, Executive Director, TPSA
The third summit TPSA hosted was on the topic of the annual PS planning
process. At the summit, attendees indicated that one of the most difficult aspects
of driving a global PS business plan is negotiating that plan with each of the
individual geographies within the PS organization. In a following PSE Roundtable,
members discussed tactics to better align the corporate and geographic aspects
of a PS organization. This PS Insight itemizes seven key metaplays management
teams can use to better align the PS organization on a global basis.
Essentials of Global Resource Management in Technology Professional Services
Randy T. Mysliviec, President, RTM Consulting
Bo Di Muccio, Ph.D., Senior Director, Research and Advisory Services, TPSA
During the past decade, the growth of services as part of the revenue and profit mix of technology companies has changed how these companies must think about managing human capital. To help technology companies better understand how to deal with the rapidly changing dynamics of Global Resource Management (GRM), RTM Consulting and TPSA have collaborated to create a framework to focus this dialogue. This white paper introduces the many facets of GRM and how to effectively perform GRM in a rapidly transforming marketplace.
Post Summit Report: May 2007
Thomas E. Lah, Executive Director, TPSA
This PS Insight summarizes key findings from the summit. Also, this document identifies recommended action items for both TPSA members and TPSA staff based on summit findings and discussions.
Profiles in PS Leadership
Thomas E. Lah, Executive Director, TPSA
In January of 2007, TPSA held its first Professional Services Executive (PSE) Roundtable where twenty-five service executives met to discuss the topic of “profiles in service leadership.” This PS Insight discusses the changing requirements for PSE’s within product companies and the fundamental differences between professional service executives that serve as general managers and those who simply steward the business.
Service Strategy Profiles
Thomas E. Lah, Executive Director, TPSA
Geoffrey A. Moore, Managing Director, TCG Advisors
Over the past ten years, the technology marketplace has significantly matured, causing profit pools, in general, to migrate from products to services. This in turn is driving urgent discussions among technology executives as to the current and future role of services in the overall company portfolio. To help technology companies with this service strategy discussion, Thomas Lah, the Executive Director for TPSA, and author Geoffrey Moore have been collaborating to create a framework to focus the dialogue. This article introduces a key component of that framework: service strategy profiles.
Revenue Recognition and VSOE: Part 1
Thomas E. Lah, Executive Director, TPSA
This article provides an overview of the revenue recognition issues faced by software companies and specifically defines the pain points in establishing VSOE for professional service offerings.
Intellectual Asset Management: Glossary of Terms and Definitions
Greg Burnett, Program Manager, TPSA
Thomas E. Lah, Executive Director, TPSA
This article presents a list of common terms and definitions used to enable the working dialogue between the task force representatives from each of our member companies. These common terms and definitions are used as we move forward to develop a framework and best practices for IAM.
The Professional Services Hourglass
Thomas E. Lah, Executive Director, TPSA
This article reviews the deficiencies in the pyramid model and introduces a new model to consider when building and scaling a TPS organization.
Demand Generation: A Case Study
Thomas E. Lah, Executive Director, TPSA
Kathy Macchi, Principal, Allegro Associates
This article provides a best in class example of a company that developed and deployed a systematic, continuous, and effective demand generation command for service offerings.
Services Engineering
Thomas E. Lah, Executive Director, TPSA
This article introduces the Services Engineering function by defining its objectives, outlining key roles of the department, and listing metrics that can be used to evaluate the effectiveness of the function. The article also discusses why the function is critical to the long term success of a technology professional services organization.
Why PS: Part 1 The Case for Professional Services
Thomas E. Lah, Executive Director, TPSA
This is the first of a two-part series on why technology companies are continuing to invest in professional services capabilities. In this first part, we start by discussing how professional service executives currently defend their businesses. We then discuss the brutal impact that professional services revenues have on technology companies. Despite the negative effects of PS revenues, technology companies continue to add PS capabilities and revenues. We discuss why this shift continues. The article ends with a summary of the forces currently pulling the PS discussion in three distinct directions, and how TPSA intends to help align these currently conflicting forces.
Leasing Professional Services
by Thomas E. Lah, Executive Director, TPSA
This article explores this new option by reviewing EMC's partnership with Accenture to incubate a consulting business unit. As the reader will learn, there remain many unknowns regarding the success of this innovative alternative.
The Services Marketing Mix
Kathy Macchi, Principal, Allegro Associates
Thomas E. Lah, Executive Director, TPSA
This article defines four marketing activities: Core content creation, Market analysis, Awareness and Demand generation. It also provides an example services marketing budget that achieves a balance between tactical content creation and strategic demand generation.