Where PS Should Invest

Tomorrow, I host a webcast with my colleague John Ragsdale and one of our TSIA partners, Compuware. John will be highlighting several areas where he believes PS organizations can best benefit from investing in technology infrastructure. To join us, please register by visiting:

http://webcasts.tsia.com/event/g5u6c1pnc2/tsia

For sure, I can tell you two facts regarding infrastructure investment within PS organizations:

1. Skinny Investment

On average, PS organizations  reinvest 5% of their revenues back into non-billable, General and Administrative (G&A) activities. That 5% is typically used to cover not only non-billable headcount but the IT infrastructure required to support the PS business. One of the most common problems we see when benchmarking PS organizations is that they spend only 1% – 3% on G&A. This means they are barely investing in any infrastructure to support the business.

2. Positive Correlation

We also know that PS organizations that invest PSA infrastructure, on average,generate higher operating incomes. This is a fact we have been sharing with TSIA members for several years when they benchmark with us. The data point helps make the case for investment.

So, PS organizations have a tendency to under invest in technology, yet we see improved financial performance when infrastructure is in place. Quite the paradox!

Tomorrow, John will be discussing the areas he believes PS organizations can benefit the most from infrastructure. I’m curious what you think. In the poll below, pick the top two activities where you feel your PS organization would benefit the most from technology infrastructure.

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One Response to “Where PS Should Invest”

  1. Knowledge Management: Failure Points « Service Visions Says:

    […] Management: Failure Points By Thomas Lah A few weeks ago, I asked readers to vote on where PS organizations should be investing to improve performance. The early voting is showing readers believe knowledge management is where […]

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