In my years working in professional services and speaking with peers, I have been astonished by the lack of clarity many enterprise software companies have regarding the role of their professional services (PS) teams.
I frequently see professional services teams acting as “fixers.” They write statements of work to solve a wide variety of problems, requiring diverse skill sets and spanning the entire customer lifecycle. To many, having such a MacGyver team of problem-solvers within the company seems highly convenient.
A loosely defined role for your professional services (PS) team can lead to strategic misalignment and operational inefficiencies. Before elaborating on these issues, it is important to first outline the different roles a PS team can play in an enterprise software company.
What roles can your PS team play?
When somebody founds a software company, their ultimate dream is to create a product that is so easy to use that it sells itself, customers don’t need assistance with getting started, product customisations are not required, and support costs are next to nothing. Unfortunately, that dream doesn’t always come true, and professional services will have to fill some of the gaps.
Over my 30 years of experience working with enterprise software, I have seen professional services teams focussed (and compensated) on the following categories of work, namely:
- Custom acquisition
- Product adoption
- Product improvement
- Methodology and thought leadership
Customer acquisition
When professional services are used for customer acquisition, it means PS is heavily involved pre-license deal. That can mean delivering proof of concepts, creating an MVP or even a nearly production ready implementation (if your GTM strategy includes to “lead with services”), but it can also simply mean that professional services are heavily involved prior to the deal closure to help define a clear roadmap to implementation success by making project managers, architects and SMEs available to talk to the customer. Obviously this does not mean your PS team will not do work post license deal, but it means that:
- their MBO’s will be organised towards new logo or new project acquisition,
- they are heavily paired up with your sales organisation,
- you have allocated time in your utilisation model for scoping and selling
This model is often found in companies that sell a horizontal technology with a wide application area or in other words, a technology that needs a heavily tailored success plan depending on the selected use case.
Product adoption
The most common focus for professional services is product adoption. The ability to accelerate how fast a customer adopts your product is directly related to churn probability. If product adoption drags on, the project sponsors will start doubting the business case, your champion will loose their face and people who had doubts about your product will start to “I told you so”.
If you decide to focus your professional services team on product adoption, that will be visible in the form of enablement and training materials, starter packages or template projects. Your PS team will:
- provide sales with standard packages which they can attach to deals with little involvement from the PS team,
- have a clear recipe for executing these packages to achieve faster TTV (time to value)
- be able to focus on delivery which will translate into higher utilisation rates
- be paired up with your customers success organisation or renewals team.
This model works well for companies that have a vertical solution with a limited amount of use cases for which the implementation scenario can be standardised and packaged.
Product improvement/extension
Some companies don’t align their PS team with sales, nor with customer success, but see PS as an engineering function that builds solutions and product in the field. (Palantir’s forward deployed software engineer model has been discussed a lot online). It will be marked by your PS team delivering product extensions or even entire new modules, which are fed back to the in-house engineering team, or put into an open-source / labs area (like Neo4j Labs).
Your PS team will:
- be heavily engaged, or even running part of the sales cycle,
- used to deliver long running and expensive projects, on-time, within budget,
- consist of software developers rather than consultants, reinforced with scrum managers or project managers,
- have time carved out in the utilisation model to document and clean up code, “bring the knowledge back home” and handover to product management and in-house engineering.
This model works well for companies that are in the early days of building a very complex product and are going to market in a phase where the product still misses a lot of features. As pointed out before however, some very large “software” companies like Palantir have made this part of their day to day business making the solution the product.
Methodology and thought leadership
Lastly, a less frequent model is when professional services is used for driving a methodology and though leadership. This model is often found in companies that are early stage and still trying to build their image, but also in companies that are heavily into building out a partner network for services delivery. In this case your PS team will:
- closely align with marketing and partner management,
- be more consultative in nature, have great speaking and training capabilities, and have some content developers that manage a knowledge base and set of training materials.
Deliberate choice
The above list of options, hopefully already explains the importance of a clear focus for your professional services team. A lot of things depend on your PS strategy like
- the profiles you are planning to hire,
- the type of engagements you’ll deliver,
- the relationship of PS with other departments,
- your utilisation model
- your employee satisfaction
Unless you take the time to make a deliberate choice about the key focus area for professional services, you risk to create major inefficiencies by hiring the wrong people, having your PS team having to interact with all departments and setting unrealistic utilisation expectations towards your team.
What ever the choice you make, here are a couple of final considerations
- Don’t expect your management will let you set a clear cut PS strategy, where you are allowed to focus on just 1 focus area. Unfortunately it is very likely your PS team will be asked to do a bit of all of the above. What is important is that you set a key focus that is appropriate for your company at this point in time and that you explain to eStaff that a different focus means a significant change.
- e-Staff involvement in setting your PS strategy is key. What your PS team does, has little or nothing to do with the financial metrics that are usually shared with you eStaff and board members. Funny enough, your key metrics (bookings, utilisation, margin, backlog … ) will be roughty the same for any of the above. So don’t assume your eStaff knows how PS is being used in your company.
- Revisit your PS strategy on a regular basis. Over time, as your product and company matures, your PS strategy might shift. Adapt timely!
Conclusion
Plenty of companies expect that their professional services team can pick up anything from PoC’s, over implementation work, product extensions and methodology/best practices. Setting a key strategy and focus area for your PS team will make the department more efficient, it will benefit the entire company and make for happier PS team members.
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