Why CFOs Are Ditching Month-End Reporting for Real-Time Finance Insights

Forecasting for Services Businesses: Turning Real-Time Insight into Better Decisions

In this episode we dig into what an effective forecast looks like inside a services business, especially a managed service provider operating on a shared services model. The core message is simple. A forecast only works when it is anchored to clear targets, refreshed frequently, and built from inputs that business owners can influence. That is how you turn budgets into action across Australia’s dynamic market, where cost bases shift, acquisitions happen, and client demand changes quickly.

Key takeaways

• Start with clear targets such as profitability, revenue and capacity. Tie every forecast input to those outcomes so teams know what to move and why.
• Use the right levers in a shared services model. Blend price per user, project outcomes, ad hoc hourly work and product revenue into a single economic view.
• Make finance real time. Review weekly, not monthly. Small, frequent course corrections beat big, disruptive pivots.
• Align top-down and bottom-up. Translate board targets into unit-level inputs that managers own and reconcile regularly.
• Plan for unknowns by staying current. The best hedge against shocks is fresh data, visible opportunities and a cadence that allows quick decisions.
• Hold the line on outcomes. When conditions change, keep the goal and adjust the path. The conversation becomes how to pivot, not whether to retreat.
• Acquisitions raise the bar. Due diligence is a forecasting exercise. Clean, technology-enabled reporting lifts confidence and enterprise value.
• Growth must be defined. Be clear whether you are chasing revenue growth, profit growth, or both. The inputs and trade-offs differ.

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Why services forecasting is different

Product businesses can often apply a clean markup to a known cost and call it a day. Services are not that simple. Managed service providers, digital agencies and professional services firms in Australia usually sell support on a price per user basis, project work on a fee for outcome basis, ad hoc support by the hour, and products at a margin. Those revenue models share a cost base that is only loosely connected to individual sales. Without a single, integrated view, it is easy for economics to drift and for profit to erode silently.

Good forecasting connects those threads. It reconciles the capacity you are funding with the work you expect to land. It maps project pipelines to delivery calendars. It shows how ad hoc demand hits shared resourcing. It assigns product revenue and cost correctly rather than letting it muddy the picture. That way leaders can see the real unit economics and intervene early.

Begin with the goal, then define the inputs

Every useful forecast starts with an explicit outcome. If profit is the priority, put a number on it. If revenue growth matters most this quarter, say by how much. That target becomes the anchor. From there, list the inputs that drive the result and the owners who can influence them.

• Capacity. FTE by team, billable targets, leave, training time, utilisation assumptions, mix of senior and junior resources.
• Pricing and mix. Price per user for managed services, project rate cards and expected margins, ad hoc hourly rates, product margins.
• Demand. Sales pipeline by stage, expected close dates, probability, services mix, project durations and start dates.
• Delivery timing. Backlog, committed projects, milestones, revenue recognition rules, resourcing plans.
• Overheads and on-costs. Salaries, super, payroll tax, rent, software subscriptions, travel, vehicles and other fixed costs.

These inputs are your levers. Empower business unit leaders to own them. Finance curates the model, but delivery, sales and operations must feed it with live assumptions. That is how a top-down target becomes a bottom-up plan that people can execute.

Top-down and bottom-up need each other

Boards and executives in Australia will always set expectations. That top-down number is necessary. The bottom-up forecast is where reality checks happen. The work is to reconcile the two regularly. If the target is sensible, adjust the plan. If the plan is sound and the gap persists, discuss trade-offs early. Either way, that reconciliation builds financial acumen inside each unit, so managers connect commercial outcomes to daily decisions.

Weekly cadence beats month end

Month end is too slow for a fast-moving services business. Waiting for close, consolidation and commentary means you are deciding with stale data. Adopting a weekly rhythm keeps the signal fresh and the changes small.

• Pipeline hygiene. Opportunities updated every week, at a set time, so Wednesday morning the forecast refresh runs cleanly.
• Capacity checks. Rolling four to eight week view of leave, training and project start dates to protect utilisation and delivery quality.
• Project health. Stage gates and earned value reviewed weekly. If a job is sliding, reset the forecast now, not after invoicing.
• Cash visibility. Weekly AR, WIP and billing plans to avoid end-of-month scrambles and surprise cash gaps.

Small adjustments made weekly avoid big, blunt decisions later. You can pause a hire, pull a start date by a week, or swap a resource between projects. Leave it a month and you risk forced redundancies or heavy discounting just to fill a gap.

Handling unknowns without overcomplicating the model

Scenario modelling has a place, although many teams never use their worst-case tabs after they are built. The practical hedge against uncertainty is a living forecast. Keep the data current. Refresh the view weekly. Hold your targets steady and treat shocks as prompts to pivot the plan rather than to abandon the goal. When inflation jumps or demand softens, bring leaders together quickly. Re-sequence projects, adjust pricing where the market allows, refine the mix of project and recurring work, and protect your best margins.

The service business levers that matter

• Utilisation. True client-facing time after leave, meetings and training. Model by role. Beware averages that hide idle pockets.
• Realised rate. What you actually bill after discounts and scope drift. Track variance to list rates by team and by client.
• Project gross margin. Include delivery time, rework, write-offs and expensive substitutions when a senior consultant covers a gap.
• Managed services margin. Watch ticket volumes, automation gains, and scope creep. Price per user only works if service load trends the right way.
• Product attach and warranty risk. Product margin can be healthy, but post-sale effort often lands on the same shared team. Allocate it correctly.
• Hiring lead times. Capacity is lumpy. Forecasts should reflect hiring pipelines and time to productivity in the Australian market.

Defining growth properly

Growth can be organic or inorganic. Both can be good, but they need different inputs. Be explicit about the type of growth you are targeting and how you will measure success.

• Revenue growth. Focus on sales velocity, win rates, average deal size and attach. Ensure delivery can keep pace without margin compression.
• Profit growth. Tune mix and pricing, drive utilisation, automate low-value work, and prioritise higher-margin segments and services.
• Inorganic growth. Acquisitions demand disciplined forecasting and rapid integration. Technology enablement supports synergy realisation.

Acquisitions raise the standard for forecasting

In M&A, due diligence is essentially a forecasting exercise. You are building a view of future maintainable earnings and the levers that can improve them. Clean, integrated reporting shortens that process and lifts confidence. Many Australian buyers now expect a technology-enabled finance function that can consolidate entities quickly, produce a credible forward view, and tell the story in a way that aligns to how the business actually operates. That maturity directly influences enterprise value.

Make finance the enabler, not the auditor

Finance becomes fun when the numbers are current and the conversations are about action. The role shifts from month-end historian to commercial partner. That means curating a stack that pulls live data, publishing a simple weekly rhythm everyone trusts, and coaching leaders on how their inputs affect outcomes. The win is cultural as much as financial. Teams see the impact of their decisions faster and take ownership of the plan.

A practical weekly workflow you can adopt

• Monday. Delivery leads review project progress, dates and risks. Update timelines and hours remaining. Confirm resource moves.
• Tuesday. Sales cleans the pipeline. Close dates, probabilities and values are refreshed. New opportunities are tagged with service mix.
• Wednesday. Finance runs the forecast refresh before lunch. Publish a one-page pack covering revenue, margin, capacity and cash.
• Thursday. Short cross-functional huddles by unit. Agree minor adjustments. Escalate only what needs executive input.
• Friday. Leadership checks trend lines, not just the week. Confirm any hiring pauses, pricing tweaks or project resequencing.

This cadence creates momentum. It also normalises small course corrections, which protects team morale and client outcomes.

What good looks like in Australia

• A clear profit or revenue target that everyone can state in one sentence.
• Inputs owned by leaders who update them weekly without chasing.
• A single model that blends recurring services, projects, ad hoc work and product.
• Real-time dashboards that make pipeline, capacity and margin visible.
• A culture that holds the outcome steady and flexes the plan when conditions change.

Closing thought

Month end belongs to history. The services businesses that win across Australia run finance as a live system, not a monthly report. They use clear targets, real-time inputs and a weekly rhythm to make better decisions. When unknowns arrive, they do not shift the goalposts. They pivot with purpose and protect the outcome.

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