Tag

firm profitability

4 insights

A curve showing the firm profitability that 5.2 percent revenue growth would have produced if the cost of running the firm had held flat, against the flat line of what firms actually reported.

Project Margin Hit a Five-Year High. The Cost of Running the Firm Grew Twice as Fast as Revenue.

Delivery improved by nearly two points and firm profitability moved by one tenth of one point. Subtracting the two published margins shows where it went, and the number is larger than most partners would guess.
Professional Services OpsBusiness Case & ROI
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CXO editorial cover charting alternative fee arrangements as a share of firm revenue, rising from about 20% in 2023 toward a projected 70% or more, illustrating that rate strategy has stopped being a profit lever and margin now depends on the cost of delivery.

Rate Strategy Stopped Being a Lever. Your Advantage Moved to the Cost of Delivery.

2026 rate data shows firms collect the same effective rate whether they discount hard or hold firm. Pricing power is neutral. The margin lever that still moves is the cost of delivery.
Professional Services OpsBusiness Case & ROI
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Line chart of employee billable utilization across professional services organizations falling from 73.2 percent in 2021 to 66.4 percent in 2025, below the 70 percent minimum healthy benchmark.

Billable Utilization Fell to a 19-Year Low. The Top Firms Went the Other Way.

Billable utilization fell to 66.4% in 2025, a 19-year low, in a year revenue and margins recovered. The gap between high performers and the rest is not software ownership. It is system integration.
Professional Services OpsBusiness Case & ROI
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Split bar showing 37 percent of professional services time is billable and 63 percent non-billable, with utilization rising from 66 percent to 75 percent and roughly $1.04M recoverable at a 30-person firm

Your Partners Bill 37% of Their Day. The Other 63% Is Where Your Margin Is Hiding.

Professional services firms bill about 37% of available time while roughly 14 non-billable hours a week per person quietly erode margin. Here is where the money hides and how to reclaim it without hiring.
Professional Services OpsBusiness Case & ROI
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