Are we delivering what we sold?
№ 090 · Booked vs delivered revenue
Definition
MetricRevenue leakage (booked or contracted revenue minus delivered and invoiced revenue)
Unit% of contracted revenue not delivered or invoiced
Two lines (booked is signed contracts, delivered is recognized). Gap reveals backlog. Build from CRM bookings and finance recognized revenue per month. Bookings stalling while delivery climbs means pipeline drying up. Example: bookings $2.4M Q1, delivered $1.8M = $600K rolling backlog.
- CRM
- Customer relationship management system. The system of record for accounts, contacts and pipeline.
Benchmarks
| Bottom 30% | Median | Top 30% |
|---|---|---|
| 8%+ leakage, usually paired with overrun above 15% and on-time delivery below 65% | ~4.5% leakage (2025 industry average, a five-year low) | 2.5% or less leakage, typically paired with project overrun under 10% and 80%+ on-time delivery |
Global billable professional services firms, mostly $5M-500M revenue, IT and management consulting weighted, 2024-2025 fiscal data, SPI definition of revenue leakage (contracted value never billed or delivered) · SPI publishes averages, not percentiles; top30 and bottom30 are estimated from the spread between SPI maturity levels and the sub-5% healthy threshold SPI states. Leakage definitions differ across firms (write-offs, unbilled scope given away, post-signature discounts). PMI figures below are 2018 data and cover all project types, not services firms specifically.
Category split omitted: No two independent Tier 1-2 sources publish revenue leakage split by service line or engagement type; SPI is the only recurring dataset.
When it looks bad
The delivered line flattens while the booked line keeps climbing, and the gap between the two widens for three or more consecutive months instead of closing at period end.
Booked $1.24M of work in Q2, delivered and invoiced $0.99M by quarter close, a 20% gap against a healthy 3-5%; half the gap traced to unstaffed kickoffs, half to scope delivered free.
What to do about it
- Run a weekly booked-vs-delivered reconciliation at project level, with a mandatory change order for any scope addition above 5% of contract value; SPI ties overrun below 10% to protected margins and repeat bookings.
- Integrate PSA with financials so delivery and margin are visible before period close; SPI 2026 finds firms on project-based ERP grow revenue 20% faster and run 10.2% EBITDA vs 8.6% without.
- Publish a written out-of-scope list per engagement and bill approved extras; PMI found 52% of projects hit scope creep (2018 data), and unbilled creep is booked revenue that never becomes delivered revenue.
- Pace kickoffs to staffed capacity rather than sales urgency; SPI 2026 shows pipeline coverage at 175% of quarterly bookings while utilization sits at a record-low 66.4%, meaning conversion into delivered work, not demand, is the constraint.
Sources
- Rocketlane (SPI Research data) Revenue leakage improved to a five-year low of 4.5% in 2025; SPI healthy thresholds are leakage below 5% and overrun below 10%; 90.1% of firms hit revenue targets, up from 87.9% rocketlane.com ↗
- Deltek (SPI Research data) Project overrun improved to 10.7% in 2025 from 11.3%, still above the 10% threshold where overruns damage margins and client trust; on-time delivery 73.8% deltek.com ↗
- SPI Research (co-published with Kantata) 2024 data: on-time project delivery slipped to 73.4%; scope creep and poor forecasting named as direct margin drains; 87.9% of firms hit revenue targets get.kantata.com ↗
- TimeLog (SPI Research data) 2026 edition (n=509) finds execution discipline, not demand, separates high performers; firms with real-time visibility convert bookings to revenue faster timelog.com ↗
- Project Management Institute 52% of projects experienced scope creep (up from 43% five years earlier); 48% finished late, 43% over budget; 9.9% of every project dollar wasted through poor performance (2018 data, dated) pmi.org ↗
- knowledgelib.io Aggregated FY2024 view tracks leakage and overrun as core delivery-quality metrics; warns that denominators and margin definitions vary across firm types knowledgelib.io ↗