Part 2 of 2: Actionable steps ServiceNow partners can take to maximize billable utilization
By Scott Jacocks www.billfly.com
This article is designed for practice leaders, resource managers, CROs, COOs, CFOs and private equity investors in the ServiceNow Consulting and Implementation Partner Ecosystem
In the ServiceNow Consulting and Implementation Partner ecosystem, billable utilization is more than just a profitability metric. It’s a core driver of financial stability, growth, partner designation/tier attainment, delivery excellence, customer satisfaction and employee retention. It’s also a major delivery distraction if it’s volatile or consistently below target.
As every ServiceNow partner knows, maintaining target utilization while keeping teams certified, scalable, and ready for the next wave of demand is a constant balancing act. And it’s really damn hard.
This 2-part series explores why billable utilization is uniquely challenging in the ServiceNow ecosystem and how to handle billable utilization in a way that supports profitability, delivery quality, and long-term success.
How to Improve Utilization Without Hurting Your Team (or your Customers)
1. Plan Certification and Delta Work as an Essential Priority
Don’t treat certifications as “extra hours.” Instead:
- Schedule training and certification time during slower delivery periods; in my experience, mid-summer and early winter are the slower delivery periods, but this may vary considerably by industry focus, geography, etc.
- Build a learning calendar aligned to ServiceNow’s two yearly releases
- Make certifications part of resource planning, not an afterthought
- Leverage new platform capabilities and releases to build blog articles, posts, service offerings and internal training/communications (ex. “learning lunches”) to boost knowledge and certification training while making productive use of bench time
Partners with structured learning & development and certification programs should see higher utilization and higher CSAT and ESAT.
2. Fortify Scoping to Reduce Non-Billable Rework
A clear, detailed SOW is everything in ServiceNow projects. Focus on:
- Accommodation for current-state interviews and analysis to prepare more effective and efficient requirements gathering
- Customer pre-requisites such as viewing videos of ServiceNow out-of-the-box product functionality and training for internal system administrators and support staff
- More robust requirements workshops
- Better story documentation and refinement early in the project
- Clear delineation of consultant and client roles/responsibilities; as business process transformation projects, ServiceNow projects cannot be executed in a vacuum; beware the client that cannot commit the time required to achieve solid partnership for joint success
- Probe any previous “failed” ServiceNow projects with the client; what were the root causes and how might these root causes impact scope statements?; beware the client that has had multiple failed projects with multiple partners
- Tighter policies and standards regarding changes in scope and timeline
- Controls in place to minimize variance, which is the delta between hours allocated for consulting resources and hours consumed by those resources in the allocated timeslots; how will client-caused delays be handled?
- Accurate estimates aligned to the specific ServiceNow product line, to include any unique integrations
- Thorough vetting of any third parties that might be engaged (example 3rd party vendors that might be providing managed services for the environment or 3rd party vendors responsible for solutions that ServiceNow will be integrated with); any dependencies with your scope must be clearly identified and their hours must be fully estimated and committed accordingly; ownership/governance of third parties belongs with the client, and not you
- Explicit language regarding the definition of “defect” and limits regarding billable and non-billable defect remediation
- Hypercare scope, duration and limitations
- Post go-live/hypercare warranty (if any, and if not, explicitly state this); This should include clear delineation of responsibilities between client, ServiceNow, third parties and you as the service provider
- A thorough review and sign-off of scope, level-of-effort, etc. by Delivery before the SOW is presented to the customer
Less rework, scope-creep and billable variance means more predictable billable hours and a healthy project pro-forma. It’s also important to perform an internal (non-client) project retrospective to identify how the project performed in terms of billable utilization and billable variance within the context of delivered scope, CSAT and financials. Make sure those inevitable lessons-learned make it into your standard scope statements!
3. Use Resource Management Tools with Real Bench Visibility
Many ServiceNow partners still use spreadsheets for resource planning. That works for a period of time, but ultimately becomes inefficient and ineffective. Modern Resource Management tools (to include ServiceNow itself!) improve:
- Forecasting
- Demand planning
- Skills matching (per ServiceNow product line)
- Bench management
- Variance management
- Budget management
ServiceNow practice resource managers know just how difficult a job it is to constantly keep up with the dynamic nature of live projects and the sales pipeline. A single delayed workshop can have a cascade effect on that project and others that must be managed/mitigated so as to avoid consultant burn-out and quality issues.
This is extremely difficult to do in a spreadsheet! Better resource management → less chaotic staffing → more stable billability.
4. Build Reusable Accelerators
Reusable assets can dramatically increase repeatable delivery:
- Governance frameworks and process lifecycle templates/process guides
- Script Includes
- Flow Designer templates
- App Engine components
- CMDB normalization patterns
- Training and testing tools and templates
These assets can reduce delivery time without forcing consultants to work excessive and potentially non-billable hours. That said, I suggest avoiding “accelerators” that materially change the baseline or “OOTB” functionality of ServiceNow apps. While we used to build these things in the early days of ServiceNow when the platform was less domain-specific and domain best-practice, we’ve also spent years unraveling the technical debt caused by too much customization!
Finally, while not necessarily relevant to “reusable artifacts”, Artificial Intelligence (AI) tools cannot be ignored as part of the “acceleration” conversation. This rapidly evolving field is focused on expediting configuration/development of ServiceNow with multiple parties focused in this area. While these tools are still somewhat experimental, they are sure to achieve increasing utility and value. It’s critical to stay on top of this new and evolving area so as to not be left behind!
5. Balance Workloads to Maintain Long-Term Talent Health
ServiceNow talent is high in demand and hard to replace. Chronic overutilization leads to:
- Burnout
- Expired certifications
- Failed projects
All of the above inevitably leads to attrition.
Monitor and adjust resource availability and utilization weekly (not quarterly). Where you see that resources are being over-utilized in the forecast and there is no other feasible option to reduce this, communicate this to impacted resources in advance and make sure this is doable for the consultant. Your consultants will appreciate the heads-up and a firm “no” from a consultant tells you that you must find other options, else risk losing that resource.
Most consultants are willing to put in the extra hours provided a) this is a conversation and not an “order” and b) there is a deliberate plan to ensure this is short-term and not the new norm. Further, it’s always appreciated when extra work is recognized and rewarded through mechanisms like quarterly or spot bonuses.
6. Have a Deliberate Resource Acquisition Plan and Posture
Without a deliberate resource acquisition and allocation plan, the organization will typically suffer from chronic under-utilization and over-utilization challenges. It’s an organization that is operating accidentally and not deliberately. These are the “feast or famine” practices where billable utilization charts can show wild variances across a calendar year. It should be noted that while feast or famine models can result in net-profits over the course of the year, they should not be normalized as “feast” typically means overutilization (e.g. stressed, overworked teams resulting in retention problems) and “famine” often means under-utilization, with all the negative consequences already described in this article series.
Resource acquisition methods and options are pretty straightforward, but without adequate guardrails in place, billable utilization can quickly spin out of control.
Options and suggested decision-making criteria include:
a) Hiring a full-time employees (FTEs) is always the preferred path provided that the current workload and forecast/pipeline support billable utilization targets for the FTE team. Your FTE team is always going to be your core team and the full-time nature of that team drives loyalty, culture and quality. However, one must be extremely cautious with FTE adds and removals as this is also your least elastic workforce. If your mantra is FTE-only, you have an inelastic workforce operating in an inherently elastic industry and billable utilization will likely suffer. Criteria:
i. Forward-investing into providing expanded services into an area that is not part of the current portfolio. For example, a HR boutique that wants to expand into CRM or emerging areas of the platform (ex. AI) that you must have staged on the team to even be able to scope and sell it.
ii. Long-term project or managed service requiring FTE hours.
iii. Late-stage/high probability sales pipeline. Caution: even for the highest probability deals and even those with a verbal “Yes” might fall apart or get delayed. Staff up to a specific percentage that is appropriate to your organization size and risk tolerance – example 50% of high probability pipeline. Having a deliberate policy like this and being able to demonstrate success (or course-correcting accordingly) will go a long way towards the CFO office trusting your future actions regarding hiring ahead of the work.
b) Engaging a contractor from a staffing firm or a freelancer. There are several firms that can handle ServiceNow staffing, to include some that are fully or partially dedicated to ServiceNow and have deep networks and with the ability to effectively pre-screen candidates. Freelancers can often be found via platforms like LinkedIn, Upwork and Fiverr. Key considerations to address in advance include making sure that the customer contract does not preclude use of non-employees/third party resources and that contracting agreements are prepared and approved in advance (ex. by Legal) so they are ready to go when the right candidate is identified. Criteria:
i. Unique skillset need that does not map to the bench/bench forecast for when the skillset is needed.
ii. Full-time or close to full-time (ex. >30 hrs/week) for a fixed period of time greater than, for example, 90 days.
c) Engaging another ServiceNow partner. Partnering between partners has become more and more common for many of the reasons already discussed in this article. In fact, ServiceNow has made accommodation for this by, for example, allowing 3C credit for work done where the partner is not the prime, where certain criteria are met (if you are a ServiceNow C&I Partner, see the latest ServiceNow Partner Program Guide for specifics).
In my experience, this is most commonly achieved by contacting your ServiceNow partner manager, but a ServiceNow partner manager is not available to all partners/tiers.
Further, ServiceNow partner managers typically have a limited scope (ex. geography) and an assigned portfolio of partners, so their knowledge of competency-by-partner can be very limited and their knowledge in terms of individual partner resource capacity will typically not exist. This can result in a lot of legwork, fact-finding, e-mails and phone calls to narrow down the partner and then determine if a) they are interested in subcontracting with you and b) if they happen to have the right resource, right capacity, right time. This is daunting!
There is a solution for this however, and precisely the reason that Billfly exists. Billfly was created to allow partners and freelancers in the ServiceNow ecosystem to connect and share resources for the purposes of subcontracting, without friction.
Joining Billlfy is as simple as subscribing at www.billfly.com (no cost), posting “jobs” where short-term needs are required on a project so that all subscribers (freelancers, partners and agencies) can see the job and submit resources (typically bench) to these jobs. It’s a fantastic way to quickly close skills gaps on projects and get yourself (as a freelancer) or your bench resources (if you are a partner) billable.
The fee structure is simple – Billfly is paid a small fee by the subscriber operating as Prime, which is a percentage of the subcontracting subscriber’s billables. Those operating as sub (e.g. providing the freelancer or bench resource to the job) pay nothing.
I invite you to learn more at www.billfly.com.
Checklist for Success
Is your ServiceNow practice deliberately designed to sustainably achieve your utilization targets?
1. ServiceNow Training & Certification Plan
2. Project Scoping Methodology and Policy with Standardized SOW Scoping Template(s)
3. Resource Management Tools, Process and Policy
4. Billable Utilization Targets by Role
5. Accelerator Portfolio, Repository, Processes and Policies
6. Resource Acquisition Policy and Plan
Conclusion
For ServiceNow partners, billable utilization is a strategic lever that touches every part of the business: profitability, partner tiering, delivery quality, and team health and happiness.
The goal isn’t to push utilization as high as possible. It’s to make it:
- Predictable
- Sustainable
- Balanced
- Supportive of high-quality delivery, resulting in CSAT/ESAT optimization
Partners who master this balance see better margins, happier consultants, healthier relationships with ServiceNow and stronger client outcomes. These are the ServiceNow partners that grow and prosper.
I’m always open to feedback and a conversation. Please feel to reach out to me at scott.jacocks@billfly.com.