Our first survey of PSA systems

A review of new software products for your business

For years, popular vendors of accounting and ERP systems neglected the needs of professional services organizations such as accounting, consulting, architectural and engineering firms. Yet these organizations' needs are very different from those of companies that distribute or manufacture products. Fortunately, vendors have now awakened to this fact and have come out with a variety of professional service automation (PSA) systems. That is why we arc taking a tour of the landscape with our first annual survey of PSA products.

Although geared specifically to professional servicebased organizations, PSA can be used by any organization that manages projects and tracks time, such as internal IT or R&D departments. The Aberdeen Group, one of the leading information technology analysts, describes it this way: "PSA supports the core business processes of services-centric organizations to more efficiently utilize people and streamline the project lifecycle to save time, cut costs and increase revenues." PSA systems typically cover most, if not all, of the core business processes for professional service organizations. But there are other systems such as timesheets, time billing and practice management that contain components of PSA and which we have included under the PSA umbrella.

Apart from the vendors that have introduced PSA software products, many accounting system vendors are now offering their own solutions. And then there are those that have targeted a narrow range of professional services such as accounting.

In the accompanying survey on our website, we have tried to sort out all the choices. The products run the gamut from simple to sophisticated. At one end are timesheet systems, which provide timesheets, expense reporting and project management. Next come timebilling systems that include billing and sometimes purchasing, allowing for accumulation of external costs for products and services. When targeted to accountants or lawyers, these time-billing systems are usually called practice management systems.

At the other end of the spectrum are integrated solutions that are meant to meet all the system needs of professional service organizations - timesheet, time billing, customer relationship management, opportunity management, knowledge management and resource management. (For an explanation of the functionality associated with PSA, see "Answering the call," November 2002, at www.CAmagazine.com.) General ledger, accounts receivable and accounts payable are often not included with PSA, but there are links with many of the leading accounting systems.

Some professional service organizations that lack the internal infrastructure to support a PSA system rent their solutions from application service providers. The ASP hosts the application on its Internet site, which is typically equipped with state-of-the-art technology and security, thereby allowing you to avoid the costs of managing the computer and database that goes with it. Some organi/ations worry about security but their own systems usually don't come close to the high level of security demanded of an ASP. That's why an ASP seems like a good choice for many professional service organizations that lack technical resources. Do you think it's just a coincidence that ASP is PSA spelled backward?

The vendors of only 25 products met the deadline for this survey. More have asked to be added to the list, so we will update the chart in a couple of months. In the meantime, we hope the survey makes some sense of the wide world of PSA.

For an expanded version of this article, go to www. CAmagazine.com/PSAsurveyl.

[Author Affiliation]

Michael Burns, MSiA, CA, is president oj 180 Systems (http://www.180systems.com), which provides independent consulting advice in the selection and implementation of business systems. Michael can be reached at 416963-1296 or by email at mburns@180systems.com