The services business just isn't what it used to be.
What was once a clearly defined industry that centered around traditional professional services such as law and accounting is now a part of pretty much every company. Whether you're in software, healthcare, media or even manufacturing, chances are there's an emerging services component to your business.
It's a trend that's forcing companies to tweak their systems to accommodate service-based revenue models and effectively manage resources(opens in new tab), and NetSuite finds itself in prime position to help companies do just that. Such was the theme of the first-ever services industry keynote at SuiteWorld Wednesday. It was just one of several simultaneous industry keynotes that reflected NetSuite's growing focus on the particular needs of the vertical markets it serves.
Huge Piece of the Economy
Jason Maynard, Executive VP of Strategy and Corporate Development, illustrated just how prominent services have become by sharing an eye-popping statistic: Services now generate 59 percent of the U.S. gross domestic product, compared with just 27 percent for industry and 14 percent for agriculture. The figures represent a sharp reversal from several decades ago.
What the growth of services means for most companies is the adoption of new business models. And as they become hybrid businesses, companies need systems that allow them to account for varied revenue streams.
"This is not something that is going away," said Maynard. "We think there's more complexity coming."
In an effort to address that complexity, NetSuite has zeroed in on several areas of strategic focus as it strives to help service businesses get their houses in order: global expansion, project- and product-based businesses, excellence in execution, future proofing and diversified growth.
Several customers were on hand to illustrate how NetSuite is helping on this front, and here are a few of their stories in brief:
Private equity and real estate fund administrator Augentius has experienced rapid global growth that caused the company to outgrow its dependence on spreadsheets.
"As the business got more complex, we needed a spine that would run our business," said James Watts, group information officer.
Deploying NetSuite, Watts said, has led to greater process control, improved access to timely data, and improved use of resources.
Having started out nearly 30 years ago as a value-added reseller for Autodesk, Advanced Solutions has since morphed into a professional services(opens in new tab) organization that helps Autodesk customers figure out how to use the technology to manage their business workflows. That transition to multiple revenue streams brought numerous challenges, including changing the corporate mindset.
"We had to innovate and evolve our business beyond just a box of software," said Justin Palmer, VP of engineering solutions.
Prior to deploying NetSuite, the company relied on numerous systems that provided each part of the business with its own version of the truth, making it hard to deliver a consistent level of service to customers.
"NetSuite has allowed us to reach the goal of a single source of truth," said Palmer. "The visibility into customer interactions from the sales side really allows us to engage our customers."
A value-added reseller of security products, GuidePoint has found itself in a sweet spot. Security is a hot area, and GuidePoint, which pairs a variety of professional consulting services with the security products it sells, has carved out a niche that's helped it grow from a four-employee startup in 2012 to a 112-employee company that generated $110 million in revenue during 2015.
But being in such a hotly competitive sector has its challenges, and like most security providers, GuidePoint can't add talent fast enough, said Lisa Morehouse, VP of operations.
Along those lines, NetSuite is helping the company hold onto the talent it has. The software enables GuidePoint to more efficiently match resources to projects, meaning that consultants are used in ways that keep them happy. For instance, if a certain consultant has indicated that they can't travel more than 50 percent of the time, NetSuite helps GuidePoint ensure that the consultant isn't on the road any more than that.
Financial media company Bankrate found itself in a nightmare scenario last year: It had to restate its earnings, forcing the company to let go of the majority of its financial staff and bring in a team including Eric Luehmann, senior director of financial systems, to help clean up the mess.
After evaluating the company's financial systems, Luehmann determined that the biggest problem was a lack of proper controls, and that NetSuite was the solution to that problem.
"We needed somebody that was mature enough to wrap our controls into the system, but somebody that was agile enough that we could quickly react to any business," Luehmann said. "NetSuite has a very fresh look at GRC right now, which is awesome for us."
After a whirlwind two-and-a-half-month deployment, Bankrate was up and running on NetSuite in February, and it now has a set of automated controls ensuring that the restatement was a one-time occurrence.
"We don't want people to think about controls, we want them to just happen in the background," Luehmann said. "If you have all the controls in place, you don't have to ramp up that side of the business."
If you’re facing any of these challenges, or simply want to learn more about how other Services companies are dealing with the issues of revenue recognition, process control or melding project- and product-based business models together, check out this white paper on the Benefits of Services Resource Planning(opens in new tab). If you would prefer direct contact fill out a Free Product Tour form(opens in new tab).