Research Reveals $35 Billion in Billings is Lost Every Year
A recent study by BigTime Software, a cloud SaaS provider of time management software for professional services firms, found that $35 billion in billings is lost every year because of poor or nonexistent notes supporting employee time entry.
Previous studies, including one published in the Harvard Business Review last year, surveyed timekeepers own opinions on how valuable their time entries were. The BigTime study is unique in that the time management software company used economic value, rather than opinions, as a more neutral yardstick.
Unique In Scope
The study is unique in ways beyond its economic valuation of data. The scale of the project, analysis of 12 million timesheets, has not been undertaken before.
Quoting Saunders, “The study is so groundbreaking because of the large amounts of metadata collected by BigTime data analyst Matt Kwiecien – including what location the time was entered from and even what device was used to enter the data. Other studies fell short because they simply asked users opinions on the value of the data and didn’t review the data collected.”
Insightful Findings With a Practical Payoff
The findings reveal that more value was placed on an employee’s activity notes rather than on “real time” data entry. In other words, the data indicate that it is more valuable for businesses to know what theIr employees are working on rather than exactly when they enter their time, as long as it’s every day or so.
Interestingly, the activity notes don’t have to be more than a few keystrokes. Big Time’s study showed 140 characters, essentially a Tweet, is enough to support a more billable note. Time tracked the next morning was found to be equally billable in the study.
Of special interest to small- and mid-sized firms is that they can increase realization by $5,000 to $10,000 per employee annually by adding notes to the time entry, regardless of when the notes are entered.
Potential of Big Data Realized to Help Firms Succeed
Five years ago, BigTime CEO Brian Saunders probably wouldn’t have guessed that his company would be part of the Big Data movement. “You don’t start out saying ‘I’m going to develop a set of data that I can use to help professional firms run more effectively,’” he said. “You head out in one direction, and keep an eye out for potential value.”
Saunders continues, “The thing that makes Big Data so compelling is that cloud companies, like BigTime, have created multi-tenant data warehouses. It’s really a gold mine of information that has the potential to help our customer base elevate their business in a way that they couldn’t if they were on their own.” For more, read the article on AccountingWeb.com.
BigTime’s Study Isn’t About Big Data. It’s About Discoveries Made Using Big Data
When asked why BigTime invested the resources to undertake the study, Chairman John Howell explained, “Our purpose has always been to help our professional service firm customers be more profitable. This research is consistent with that philosophy. It’s another way that we can leverage the data our software captures to help our customers, and the industry at large, achieve greater economic success.”
Howell emphasized, “BigTime’s study isn’t about big data. It’s about the discoveries we made using big data. The fact that note length and timely entry increase billing realization is of immediate value and useful even if you don’t use our product.”
The Study Is Mathy And Here’s Why
Admittedly, the BigTime study is long on math and deliberately so. The research was meticulous and thorough in the coverage of what was analyzed. BigTime wanted consumers of this information to know that it is credible, worthy of being shared, and sufficiently important to establish industry best practices. While we realize most readers will not dive into the details, they are there for those who are interested. Read the abbreviated version of the study.
BigTime Software delivers real-time, metrics-driven time tracking, billing and project management for more than 2,000 professional firms, tracking over $2 billion (USD) worth of billable time each year. Their flagship product is a SaaS-based system that is custom-built for the professional services industry – specifically, Accounting, Architecture and Engineering, Consulting, Creative, Government Contracting, IT Services and Legal firms. BigTime is a venture-funded company based in Chicago committed to helping clients run professional teams more efficiently, unlocking potential revenue and improving profitability within the knowledge economy.