PSA – An Overview

As I learn about PSA, I plan to create a series of posts covering all aspects of Microsoft’s Project Service Automation application (PSA) for Microsoft Dynamics 365. PSA is a powerful addition to Dynamics 365 that enables project management capabilities in Dynamics 365.

I guess the first pertinent question might be, why do I need PSA? After all, we already have Microsoft Project which is an advanced project management tool. Microsoft Project is a great tool for project managers and in some circumstances, might be the only tool you need, PSA won’t be for everyone! But you will find that PSA has a slightly different focus, it is not “just” about project management. PSA is more focused on the engagement with the customer. By this I mean it covers the full life cycle of the project right from initial estimate to completion.

PSA can be used in many business types but you may find that is of particular relevance for professional services companies. For example, IT Consulting companies that might be selling a mixture of professional services and product licenses or hardware.

In the professional services scenario, you’ll often find that services will be charged either as a fixed price or on a time and materials basis. (Or even a mixture.) These types of engagements are commonly long running and will require a mixture of resources. Resources will typically have differing sales and cost prices depending on parameters like skills, experience, geographical location and employment basis. (For example, companies often make use of freelance development staff who may command a higher cost. Or maybe some tasks are completed by offshore resources which could be  cheaper.) As I expand on the capabilities of PSA, I hope you’ll appreciate that these types of challenges are ones specifically addressed by PSA.

Some key features include;

PSA Features / Capabilities
Sales / Opportunity Management PSA offers extensions to opportunities and quotes to support the management of project based engagements.

Including definition of project contracts, track labour rate and generation of a Statement of Work. (SOW)

Project Planning From very early in the engagement project managers and sales account management can work together to define and refine estimates.

Gaining visibility of costs, effort and sales values for your opportunities.

Resource Management Assign / manage optimal resources based on skills and availability.

Resources have the ability to search for and apply directly for open project roles.

Team Collaboration Office Groups can be used to allow customers and project teams to communicate.
Time and Expenses Estimated, actual and billed time for resources is tracked,

Ability to enter time and expense details via web, office and mobile apps.

Customer Billing Project managers can review, override and track overruns. And they can approve all costs impacting the project.

Supports generation, approval and distribution of accurate invoices to customers.

Analysis and Integration Interactive dashboards provide insights into resource utilization etc.

The powerful reporting capabilities of Dynamics 365 can be leveraged to report on profitability, revenues, expenditure etc.

PSA Roles

Practice managers, Account Managers, Project Managers, Resource Managers and team members all collaborate on projects. Let’s consider the main functions of their roles;

Practice Manager
Has overall responsibilities for the practice and would use analysis tools to review profitability to the organisation as a whole or by resourcing unit.

Account Manager
Monitors their pipeline of sales, creates opportunities and works with the project manager to estimate a project.

Project Manager
The project manager will work with the account manager on the original estimate, then will create a detail plan once the work is won. They will then work with the resource managers to resource the project. Project managers will also be responsible for approving time and expenses as the project progresses.

Resource Manager
Resource managers review resource requests submitted by project managers. They then “staff” projects by looking at resource role type, availability and skills.

Team Member
Team members can apply for roles on projects, they can also enter timesheets and record any expenses.

PSA Price Lists

Price lists can be used to define bespoke pricing structures for each customer based upon the roles and organizational division of resources. For example, a developer based in the UK may have a different day rate to one off shore in India. A similar pricing structure can be applied to cost prices, meaning that together this information can be used to show the profit on projects.

Also standard product pricing can be applied to include additional items in quotations. Such as software license fees or any materials required during the project.

Sales Cycle

A project manager will probably be the person that creates an initial quotation and ensures the correct price lists have been selected. Then a quotation is produced that initially contains details of the customer’s high level budget expectation for the project plus any products they require. At this point the account manager and project manager will work together to add a high-level estimate into the quotation. Including an estimate on how many hours or days are required of particular resource roles. This information can then be used to present a profit estimate on the project and report if the proposed approach will meet customer expectations.

Following on from the high-level estimate the Project Manager can then create a project and start to build a detailed estimate.

Project Contract

Once a quotation is marked as won a project contract is created. This is effectively the order for the engagement. In-fact PSA uses the Dynamics 365 order entity for Project Contracts, with some significant extensions.

Those extensions include the ability to define billing mile stones and an associated invoicing schedule.

Project contracts start off in a draft state but once you have entered details of the billing schedule the contract can be confirmed. Once confirmed prices on the contract become fixed and cannot be changed.

Invoices / Billing

Invoices are linked to the project contract. PSA contains functionality to generate as few invoices as possible, by this I mean that if you billed expenses and time monthly it will automatically recognise this and put both lines onto one invoice.

A project manager can monitor the invoices for time and expenses to track and manage overruns.

Resource Management

After creating the project and its initial estimate a project team will be created to deliver the tasks defined on the project. This can be done manually or automatically using the generate team option.

Project managers can directly hard book resources. Or submit requests for resources to a Resource Manager who would control a pool of resources.

Additionally resources can request to join projects by searching for projects with vacancies.

Time and Expenses

As the projects progress PSA users / resources can enter their timesheet details and expenses to automatically update the actual effort on projects.

I hope you agree that Project Service is a powerful tool for managing projects, I am going to enjoy exploring its features in depth. J

5 thoughts on “PSA – An Overview

  1. Pingback: PSA – Complete Guide | Microsoft Dynamics CRM and Unified Service Desk

  2. Hi Neil, you did a wonderful job.
    One question, when I open e Quote line, the grid with Quote line details is not filtered.
    Is there something wrong with a script?
    Thanks for your answer. Marco


    • Hi Marco

      One tip I have is to ensure all of your workflows are activated. (Included actions). Recently I had a problem that “something” caused some of my processes to swap into draft mode. That caused some strange results. I simply reactive Ted all the workflows and everything worked again as expected.



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