Episode 16: Connecting Services to the Business

Introductions

00:07
CHRIS: Hello everyone. Welcome to the Services Ops Podcast, presented by Provus, the best podcast solely dedicated to the people, processes, and technology of running a good services organization. My name is Chris Souza. I’m Head of Marketing at Provus here, as always, with our co-host, Co-founder, services luminary genius, one of a kind, Mahesh Baxi. How are you doing Mahesh?

00:31
MAHESH: Doing wonderful, Chris. Thank you so much. This is a wonderful afternoon here, and excited to chat with our guest today. He’s a special guest.

00:40
CHRIS: Yeah, yeah, absolutely. And, let’s introduce our great guest. So we have with us today, Mitchell Palsson, Director of Professional Services Operations with CentralSquare. And he also offers high, high quality, highly recommended quality PS content through PS Amplify. We will definitely link to his LinkedIn and the website in the follow up with this episode. But, Mitchell, thank you so much for joining us.

01:06
MITCHELL: Well, thank you for having me, and you’re too kind. I appreciate it.

01:10
CHRIS: Of course. So let’s just get straight into it, you know, Mitchell, before we kind of get into our topic of the day, which we’ve talked about connecting the business to services, or more importantly, connecting the services mind frame to the business. Before we get into that, let’s talk about you. Right. Talk a little bit about yourself, your role, how you kind of got into your, your love and advocacy for professional services.

01:35
MITCHELL: Yeah. Well, I think my background plays into everything that I talk about. It might surprise people, but my undergraduate degree was to become a high school history teacher. So I had no plans of going into the world of technology. I had just taken a few undergraduate business courses thinking that I might get a minor in business. But really my focus was on, you know, being a history teacher and working with high school students. As I went through the program, I realized that it wasn’t for me, that I wanted something different with my life. And so I moved onto a master’s program in learning sciences and technologies, which essentially is learning theory applied to technological environments, thinking that I’d move into the kind of EdTech space. So after that I found that most EdTech companies are more in need of programmers than educational theorists. And so I started applying just wherever I could and was lucky enough to land us a role with Deloitte Consulting, working on their consulting side with, you know, large ERP implementations for Fortune 500 companies, federal agencies, state governments, things like that. And so I was able to come on as an instructional designer to use my educational background. And then throughout my career, I shifted from instructional designer to functional consultant to PMO manager. I’ve served as chief of staff to a CEO of our company, and currently am, like you said, Director of Professional Services Operations. And so I think initially I thought that I was pretty unique in that most people in a technology company are going to have either a business background or a technology background. But as I’ve met more and more people and have worked with people, I think that more often than not, you’re finding people who have transitioned careers and are not coming in with that really strong background, you know, from a bachelor’s degree or a master’s degree, and they’re kind of learning as they go, just like I did.

03:36
CHRIS: Yeah. And that’s, I mean, that’s a very highly relevant message, I think, for anybody in charge of operational decisions, right? Like, who not, not very often do you say, I’m gonna get really good at operating one specific business. I’m gonna plan my whole way to be like, it just doesn’t happen that way. You kind of like, you’re, you have a skill and a talent, and you just kind of find yourself there. So that’s super, super interesting.

03:59
MAHESH: And to add to that, Mitch, I think, um, while it’s, it’s, you thought it was unique and you found more and more people with that kind of background, but I think you, you know, what it does, as well is really bring a different kind of thought process into technology led, yeah. Innovation or how we apply technology to different businesses. Like, I have what I call the most typical background, right? I mean, I went to computer engineering. I did my bachelor’s there, then I did programming from programming, I went to engagement management, program management, project management. From there, I went into leading organizations. It’s like the most typical background that you can find in the computer industry. But something like what you, you have done, I think it’s, it, it really brings different flavors, different experiences, different thinking process, which is what I think is needed to really drive these projects differently.

04:53
MITCHELL: Agreed. Though, I do wish I had some of that background at times. So I think there’s, like you said, value to all different flavors.

05:01
MAHESH: Yeah. Yeah.

Connecting Services to the Business

05:04
CHRIS: All right. Well, let’s get, let’s get in kind of the topic of the day. You know, Mitchell, last time we spoke, I asked what was on your mind, and you were talking a lot about connecting the services organization to the business as a value add and a strategic add, and also tactically. So I’d love to get, you know, why don’t you kind of explain a little bit what you mean by connecting the services organization to the business?

05:30
MITCHELL: Yeah. Well, just to kind of continue on with my story of, of my own background and experience, I found that as I was moving up into higher and higher profile roles, that different things were being asked of me then when I was an individual contributor. And so I was all of a sudden in calls and meetings with people from FTNA, or from sales or from product. And the conversations were, you know, referencing terms or acronyms, you know, on the finance and business side that I wasn’t familiar with. So I realized that, hey, I need to get up to speed. I need to brush up on my business acumen and make sure that I’m aware of what’s being discussed and that I can contribute intelligently. Which I think is a big miss, in the world of professional services. Because as a consultant, you’re so focused on just delivering your solution. You know, you’re working with your customer, you’re just heads down working on the next task, billing the next hour. And rarely are you stepping back and taking a look at the larger picture and really understanding what’s going on. You know, just for example, as a consultant, I thought time cards were used to control me and to monitor me and make sure that I was doing what I was supposed to be doing. I had no understanding that they were being used to determine, you know, revenue POC on a project or being used to invoice the customer. You know, that’s something, you know, pretty basic. But if you can connect that consultant’s daily work to the broader business and help them understand, hey, you’re not just working an hour. You’re helping us to recognize revenue and you’re helping us invoice the customer, they’ll probably be less likely to have a late time card, because now they understand their impact on the business, even though it may be small in that area, but they have a little bit more, you know, ownership and they’re understanding, Hey, all of this aggregates up to me hitting my, my goals, my bonuses, so I’m gonna pay a little bit more attention to it than I have been to this point.

07:32
CHRIS: Yeah and how do you go about it? I think that’s a great example. The timecard thing’s a great example. You know, what levels of education or how do you go about educating the services organizations say like, Hey, this is important and this is why. And then how do you take them one step even higher to talk about like, profitability matters, like your performance impacts profitability. So it’s not just about billing, it’s not just about this, it’s about the business in general. Like how do you do that? You put it in systematically through training or technology, like what’s your approach?

08:07
MITCHELL: Yeah. So when you talk about like the three people, processing, and technology. I think when it comes to people, you do need to have concerted trainings around these topics. I think a lot of managers, well, first, I think a lot of leaders forget that not everyone knows what they know, that, you know, the things you’ve learned 10, 20 years ago are brand new to someone who’s just starting now, or maybe who ha has never heard it. And so you do have to go back to the basics. I had a LinkedIn post last week where I talked about Vince Lombardi and how every season he would start by saying, you know, this is a football and helping people, you know, remember, you know, these are the fundamentals, these are the basics of the business. You would think, you know, why would an NFL player need to be told what a football is? But it just kind of instills a culture of we’re focused on the fundamentals and we’re gonna make sure that everyone is on the same page. And so I think as leaders, we need to make time and cover some of these topics. You know, what is revenue recognition? You know, what are billing milestones? How do we forecast off of these things? If the data’s bad, how does that impact our AOP? And if our AOP is bad, how does that impact, you know, our, our bonuses and, and our, you know, productivity? And so there’s a lot of ways that you as a manager can kind of address some of these topics either in, weekly team meetings or, you know, when you’re meeting with someone, and let’s say they’re billing milestone target dates are all in the past, you just remind them, Hey, it’s not just important to update them, but the reason why we’re updating these is so that we can forecast cash flow and see when these things are gonna be invoiced. So just, you know, taking the time to remind them, the resources, of not only to do the, the task that you’re asking them to do, but also to tie it into why it’s important. You know, when I think of processes, I think of, you know, how managers are leading their team meetings. Different companies approach it in different ways. I prefer to have a little bit more of a structure. Hey, you know, take your time to do your team meeting, but let’s also make sure that we’re hitting on these topics so that at each level we’re reviewing these things. And, the message is getting out there. Technology again, like if you’re looking at a PSA, you wanna make sure that it’s baked into the system and that it’s relevant and that it’s apparent to everyone what they need to do. And they’re seeing that data. So if you’re, you know, if you’re talking about billing milestones and there’s a workspace for them to be in, make sure that those are there front and center, and that they can see how many are coming up in the next 30 days, how many are overdue, or, or how many may need to be rescheduled based of, you know, the Gantt shifting. Things like that. So really try to operationalize it within the system. And then, you know, tied to dashboards that are relevant. I think, you know, it’s easy to get into the proliferation of dashboards and like, there’s just dozens and dozens and you don’t know which one to refer to, but you should have a core set of dashboards that are kind of the, the single source of the truth where you’re really like, this is what we’re looking at, and everyone needs to be looking at it at their own level so that we’re all on the same page and, working towards the same goal.

11:27
MAHESH: Yeah. That is extremely well said. Mitch, you know, and, and you know, if you think of the services, right, whether it’s a product company, consulting company, professional services company, no matter what kind of services you provide. Services are more complex than delivering a product of any kind. Because when you are delivering services, you are dealing with technology. Yes. But you are dealing with people and processes most importantly. And it makes you know, and because your services engagements can be fixed bid for fixed scope, different, you know, maybe even if it’s DNM, there is a scope associated with it. There is milestone billing, and you have to be aware of all of those things. It’s a fine intersection of people like us who are super passionate about solving a complex problem for the customers. But you, you don’t have a finite time. You don’t have, you know, you cannot take as much time as you need because there’s a SOW associated with it. There’s a cost associated with it. There’s a PNL associated with it. So how do you finally balance what you wanna do for the customer, which is make the customer successful and solve a complex business problem, and yet make your employer, or, or this engagement profitable. Because that’s how the companies, that’s what the companies work for. That’s how they survive. That’s how they thrive. And, you know, I found, I mean, one of the best practices that we learned and started doing in one of the companies that I worked previously is before even kickoff. Do you know, once you have identified the team, do a joint reading of the SOW together, because there are so many finer details in the SOW, like, what kind of billing is this? How, why are timesheets important? Because hey, you know, at the end of every Friday we need to do an invoice. Why is this understanding of the scope so important, right? Who are the key players and what is important to them? Because you can’t get kind of dragged away by, you know, maybe someone who is loudmouth or someone who is a, who has a higher influence, but that doesn’t mean that the other groups are not important for the project delivery. So there’s just so many components, so many different elements that play, to the success of what you are supposed to deliver. And like you said, it’s, you know, maybe half of the room has been doing it for 10 years or 20 years, but what about the other half? They don’t know what it, what, how complex undertaking this one is. And, and so very well put in terms of really, you know, bringing everybody together and starting from ground zero, if you will.

14:00
MITCHELL: Yeah. I think that was a great addition. And, and like you said, even just with contracts, you would assume if you hire a project manager that they’re comfortable and confident in reading a contract, you might be surprised that that’s not always what happens. Okay. And so, again, that’s just, you know, one of the fundamentals that you have to drill is when we book an opportunity, the first thing you need to do is go in and review the contract, make sure that you know the template. Because you know, PSAs probably have a template that’s maybe derived from their scoping. But are you applying a template that is in alignment with the SOW in the contract? If not, you can get off on the wrong foot right out of the gate and, you know, it just, it sets you back and all of a sudden you’re apologizing to the customer instead of having a great start.

14:49
MAHESH: Yeah and Mitch, you know, I’ve spent 30 years in this industry and most of that solving complex business problems for the customers. You know, as passionate as I am for solving complex business problems for the customers, most often than not, people don’t pay attention to how you are drafting your SOW, how you are estimating, or how you are doing the quoting. What are the things that you are just giving away without really documenting? Because the last thing customers and you want is in the kickoff, you know, at the end of the kickoff, you talk to the customer and say, by the way, here is a change order. Right? Nobody wants to hear that. Nobody wants to really get that at the end of your kickoff. And like, you know, why didn’t you tell me before? Why wasn’t the scope clear? I told everything to, you know, that I knew of. Why didn’t you document it? Or why didn’t you, you know, explain it to your team and all that kind of stuff. So, and, and this is where, you know, Provus, I mean, we don’t wanna get into the history of Provus here, why we started, but this is one of the key aspect of why we started Provus, which, where we automate that entire services quoting or services CPQ process so that, you know, while you wanna deliver and you are delivering to the best of your abilities, but how you are scoping, how you are estimating, how you are quoting, how you are, you know, Ts and Cs, your scope elements, all of that gets into the document, is something that we focus on as part of our software.

16:18
MITCHELL: That was one of my first forays into the world of operations when I was a functional consultant. My manager asked me to help productize the service for our new product that we had, I think around 15 live customers. And so I went through and did a lot of the documentation standardization, how do we productize this so that we can turn around and scope it accurately? And then, repeatedly without having to tap on services resources, go, Hey, you know, should we do this or do that? So I think that’s one area that is massively underserved, where services teams aren’t reviewing their implementation methodology frequently enough and looking at the data associated with it to then have that positive feedback loop of are we updating our scoping so that we’re constantly having the best available data, coming into us. Right.

17:13
CHRIS: And who do you think, you know, where does, where does the buck stop there, right? With the, with the focus on data and looking more, more into the future or, or on the past, right? With those services teams that you’re talking about? Like, is it managers, is it CROs, CFOs? Like, where, where does it, where is it, where should it start? And, and, and who’s kind of dropping the ball when you’re not having those types of reviews?

17:35
MITCHELL: Well, I’m all for services owning its own destiny and, you know, keeping services within services. So I would hate for the CFO or CRO or someone else to come and tell us that our data is bad. So that was one of the first things when I came into this role. So I had been involved from a transformation director perspective in helping to implement our PSA. And then I went for nine months and was working as the chief of staff to the CEO. And then I came back as the Director of Professional Services Operations and was looking at the data in the system, and it felt like I had handed the keys to a Ferrari to my 15-year-old son. And like, it was just wrecked because there were thousands of hours of timecards that had not been submitted or approved. There were millions of dollars billing milestones with target dates in the past, so you couldn’t forecast them. And so for me, that was one of my first real efforts was to clean up the data and then instill some kind of discipline around dashboards and reminders. Because I mean, humans aren’t computers. We’re not meant to be processing, you know, thousands of lines of data and understanding what’s going in the system. So you’d have to kind of create those processes so that people know where to turn. But as a Director of Professional Services Operations, I don’t have time to be cleaning up everyone’s data every week. So we really need to drive that down into the business and help the managers and ultimately the, individual contributors understand why it’s important, and again, instill those habits so that they are the ones who are maintaining it, and we’re just kind of the backstop that’s making sure it doesn’t get too out of control. And, you know, back in a bad spot.

How to approach buy-in from C-Suite

19:22
CHRIS: And this is a question for Mahesh and for you Mitchell. The data being so important, you got lots of people that you need to have doing the right things so that the data is clean. How do you work with, let’s go back to that C-level, right? So how do you, what is your pitch from your operational seat to the CEO? What is your pitch to the CFO to invest in your data quality within your services organization? Whether, once again, it’s either technology or its process, but what do you go to those folks that can, it all starts at the top, right? Like, you can, we can map it out the best we want, but unless the buy-in is where it is both financially and prioritization as prioritization, it’s probably gonna get stalled. So what’s your pitch to, to kind of those, those two departments, right? Your, your C-level, your finance folks, and then your, and your strategic folks

20:16
MITCHELL: I would say, I mean, if you want to have realistic and attainable targets that the company is working towards, it all starts with accurate data. I mean, you cannot operate on faulty data, otherwise, you’re just kind of throwing spaghetti against the wall and hoping to see what sticks. And so, really I would hope that, you know, your C-suite and your strategy arm will understand that, you know, your inputs or your outputs only equal to your inputs, right? And so if you have bad inputs, you’re gonna have bad outputs, and you’re gonna set yourself back from the start. So let’s invest in, you know, the systems and the processes and the people to make sure that they have the data. Because, you know, having been in, you know, these, these calls with the executives, again, this was an eye-opening thing for me. It’s just, it’s all about the data. You know, it’s all about the numbers, it’s all about the forecasts. It’s all about drilling in to see what we can pull forward. And if it’s not accurately forecasted, you don’t know what you can pull forward because you don’t even know where it stands. And so you really need to have that foundation if the business is going to thrive.

21:22
MAHESH: Yeah and I think, I completely agree, Mitch. My experience has been that it’s, you know, this particular piece is easy to sell to the executives because there’s a concept, you know, everyone understands the concept of DSO, which is, days sales outstanding. In other words, if your invoices are inaccurate or delayed, the amount of time that it’s going to take for you to receive the payment is going to be delayed. And every day of that delay is going to cause not just disruptions, but it’s going to cost someone to run the operations. Right? And so, I think, you know, it, I believe that’s an easy one to sell because ultimately the entire business runs on the kinds of projects, the time sheets, milestone based billing, and doing those accurately on time, right? Both are important, on time is important, and accuracy is important because if you do it on time, and then after three days somebody comes and says, oh, sorry, I forgot my timesheet, you know, here is, here is the one, and then you have to redo the invoice. The clock is just resetting every time. Or if a customer comes back and says, oh, you didn’t charge for this correctly, the counter resets every time you are doing inaccurate invoicing, right? So I think it’s an easy sell. Everyone understands the importance of data. Where it’s important is really for people on the ground to really understand why you are creating a bigger impact for the company that you are working for and for the customers, but to run the operations of the company successfully. These other things that may be boring to you to do on a Friday evening call time sheet, you know, here is why it’s so critical to do it, and take that 15 minutes, half an hour, whatever time you need on a Friday evening. Right? I think that’s the key. And, and I love what Mitch said earlier. I think just treat every project beginning as if everyone is hearing or doing it for the first time. Just talk about the basics, talk about, you know, the type of project, why timesheets, what is timesheets, all of that stuff. I think that’s great advice.

23:28
MITCHELL: Yeah and I think one of the worst habits that a leader can get into is trying to own it themselves and saying, I’m just gonna make sure that my org’s data is clean. Because again, they don’t have the time to do that. They should be monitoring it, and they should, should be ensuring that it’s, you know, up to date and accurate. But you’re gonna be spending your time in the wrong area if you’re trying to be the hero who’s just doing it all instead of, you know, training and trusting and then verifying along the way.

23:59
MAHESH: Mm-Hmm. Absolutely. Absolutely.

24:01
CHRIS: Then of course, as you know, let’s put all our technologists operational hats on really configuring and making sure that your PSA, your CRM, they’re doing what they do with guardrails as much as possible, right? You wanna make sure that’s a nice wide river so people can execute well. But there, there’s definitely a stopping point. And when it comes to collecting data personally, that’s where I like to narrow the river banks a little bit. Like there’s, yeah, there’s how you execute, and then there’s the data that you contribute to the overall business and your processes. And so when I think about guardrails and actually collecting data, I like to narrow it a little bit more, still let execution happen the way it happens, right? But, you know.

24:42
MITCHELL: Well, yeah. I mean, a great, just going back to when I first stepped into this role
and was reviewing the data, within our PSA, I found that there were, over $2 million in billing milestones that had been approved, but not put into a, a billing event. So within the system, the PM had to approve it and then go back to the project and then generate a billing event. And they were forgetting to do that second part. And nothing in the system was telling you that you needed to do it. So, you know, don’t just trust your system that it’s set up correctly. Like, again, trust but verify. And then if it’s not, you need to make a change, which is what we did. We said, okay, once the PM approves every night, we’re gonna have an automation that sweeps everything into a billing event so that we don’t get into this situation again.

Final Key Takeaways

25:31
CHRIS: Love that. Love that. Ah, so good. All right. So we’re just about at the end of our time, Mitchell. The way we like to end our episodes here is everybody just takes one crack at probably one solid foundational takeaway for our audience to either challenge ’em to do this week or do it a little bit later. So what I’m gonna do is I’m gonna jump in with one that you guys both kind of inspire me on, and then, then we’ll kind of go around the horn and, and go to you. So one thing I think is a really important takeaway based off of this conversation is educating your entire services business in line about the business. And an outcome from that, that you’re gonna get more likely than not, is you get boots on the ground, right? The people who live the inefficiencies in the process every single day. Now, thinking about making those better, right? Like Mitchell said, you’re, you’re in this tunnel and you’re just trying to finish a project. If you’re thinking about the profitability of your project, if you’re thinking about your billing hours or whatever it’s gonna be, even though it’s not your job, you’re more likely than not opening lots of the actual boots on the ground’s eyes who are gonna come to you with suggestions and come to you with ideas on how to improve those. And that’s the best way you’re gonna do it, right? Like, we can always sit up on top of the tower for a while and come up with ideas, but it’s best heard from the ground up, right? So that’s, I’m just echoing probably what Mitchell’s advice, but I just thought that was really good. All right. Mahesh, you’re up.

27:01
MAHESH: Yeah. You know, I’m going to go one step up in, in the process, or process food chain and take this opportunity to obviously talk about Provus, but you know, more often than not the services, and I’m talking about B2B services, because B2C, if you’re, you know, something like Apple, you don’t need a whole lot of services, right? But if you’re B2B, you know, no matter what kind of technology you have, there’s gonna be people in the process that’s involved. And more often than not, you end up in a stressful situation, change order situations, customer being unhappy, team being stressed out. All of those situations arise because of the upfront process of estimation quoting, SOW thinking through all of the clauses, thinking through the scope elements, what should be in the scope, what should be out of the scope, what is it that the customer should be doing, right? All of those things, you leave somewhat ambiguous, for someone to interpret. And when it’s ambiguous for someone to interpret, the customer always wins, right? You don’t win. So I would say, you know, if you have, if you have not automated your services CPQ or services quoting process, which allows you to do your estimating and quoting accurately, timely, allows you to learn from your previous, you know, quoting how you have sold, how you have executed, I think this is the time to really, you know, take your take, take this opportunity and really implement that upfront process, which is obviously going to feed into your, backend fulfillment systems as well. But it’s going to make everyone’s life so much simpler, so much smoother, and, and most importantly, your customers are going to be super happy, in terms of how you’re doing the proposal making in the first place.

28:57
CHRIS: Excellent. Alright, Mitchell, take us away with your, your great takeaway.

29:02
MITCHELL: Well, I’m just gonna piggyback on what Mahesh was saying earlier and say that if you’re a leader in professional services and you want to improve your team’s business acumen, but you don’t know where to start, just pull up a recent contract and start working through that with your team and dissecting it and then asking them questions. You know, what do these terms mean? What do these conditions mean? You know, what do these milestone payments mean? And, and trying to explain it to them, and then tying it to the work that they do so that they understand their involvement in the broader business. I think that’s a fantastic way to start.

29:34
CHRIS: Awesome and of course, visit Mitchell’s, LinkedIn, and PS Amplify, and refer all your teams to kind of learn from what’s going on there as well, obviously. Great takeaway.

29:45
MITCHELL: Yeah, please do.

29:48
CHRIS: Awesome. Mitchell, thank you so much. This has been a lot of fun. Really, really enlightening conversation. Great way to start a week. And thank you to our audience for listening. Please like, subscribe, share. We, like we said, we’ve got great tips at the end of this episode. Forward ’em to your colleagues and go out and be an excellent services leader.