If you ran a factory or a retail chain or a processing plant — your firm’s assets would be obvious, and the information on how to leverage them — endless. As the owner/ceo of a professional services firm — your biggest asset is invisible leveraging it (eg – improving it’s yield) is way more difficult.
Timesheets are your inventory.
For professional firms, a great time tracking software is essential. There aren’t many successful CEO’s that don’t understand that, but you’d be surprised how much prattle there is online about closing your eyes and pretending the clock doesn’t exist.
Don’t believe the hype. While you may have an innate sense of how best to service clients efficiently, your staff needs help figuring it out. All of them; every day.
The only way for you to help them along in that journey is to track what they are working on. Of course, I’m an evangelist for the smartest time tracking software on the planet, so I may be biased…
Start by thinking bigger than just ‘billable hours.’
If the only thing you do with your timesheet data is bill it, you’re missing out. Whether your initial motivation for tracking time was payroll or invoicing, you need to do more with the data if you are going to improve your leverage. Even firms that do fixed-bid work with salaried employees can leverage timesheet data to get better at the “business of running a business.”
We work with thousands of professional firms all over the world. Some of them mint money. Many of them don’t.
What makes the successful ones successful? Leverage. They’re good at leverage.
Successful firms use timesheets (and other data they track) to get better at estimating. They use timesheet data to flag customers and engagements that need attention. They use it to spotlight opportunities for additional training. And, when they do fail, they use that data as an audit-log to help them look back and see where failed project went south.
Track the absolute minimum.
I tell every CEO that asks to track time by staffer/project/labor code and that’s it. Don’t do anything else unless you have a specific and compelling need that ties directly to revenue. And, don’t forget to require notes.
Trust me — a simple timesheet will make you smarter, and it will feel less like a burden. They result in a higher compliance rate, too. Put simply: staff will log time more frequently and accurately if the process is (relatively) painless.
Notes. Notes. Notes.
Dont accept a time entry without any notes, and never accept entry that doesn’t break out a person’s day in to at least 4 or 5 entries. Nobody spends 8-10 hours doing the exact same thing. Nobody. If that’s what you’re getting from your staff — then it’s time to regroup and get the tracking engine back… er… on track.
OK… OK… Now What?
That’s easy: buy-in. Whether you are brand new to time tracking or just trying to pull an existing process out of the ditch, your success depends on getting the entire firm to buy-in on the value of tracking time.
To help them get it — you’ll have to show them.
Let your staff know what you’re up to.
Never ask staff members
“where does ProjectX stand?”
Rephrase the question.
“I took a quick look at the timesheet log, but I didn’t get enough info from your notes. Can you catch me up on ProjectX?”
That simple change will get more detail and more frequent updates.
Of course, you should actually take a look at recent timesheet activity on ProjectX (if your system doesn’t give you real-time access to that data, then switch systems).
Incorporate timesheet data into your status meetings.
Again, let meeting participants know that you’ve looked at timesheet history as a part of your meeting prep. In most firms, both meetings and timesheet/status reporting are seen as efficiency killers. If filling out detailed timesheets reduces the amount of time staffers have to spend updating management, they’ll get an immediate productivity boost.
Get to know your metrics.
You’ll get a huge boost in value if you can monitor three key metrics: availability, utilization and realization (if those metrics are foreign for you, then take some time to research them). I know that there are lots of opinions about what to add to those metrics, but those are the essential 3 for success. You may find others you like (average billing rate, weighted capacity, etc.), but you’ll veer off the road if you aren’t watching those three.
Even if you have to hand-calculate them, work those three metrics into employee reviews and improvement plans. Set targets (for the firm and for individuals), and review those targets with staff and managers.
The temptation — whenever you look at metrics — is to attribute some moral value to them. It’s not your fault — it’s the system you’ve been in since grade-school. No matter how anxious you get when you’re handed a status report from your son’s hockey coach, take a deep breath before you start to stress out about these little metrics.
You want a high-score? Go play xbox. You want to get a handle on what your firm is good at and what you need to work on? You need a dispassionate (eg – non-judgmental) assessment of these metrics. Your goal is knowledge, not high-scores.
That means no cheating. No massaging the data. No “I would have been more utilized, but I think there’s a lot of internal time that didn’t get tracked.”
If your entire team knows that these are the metrics you are looking at every day, and those metrics (good or bad) help drive their opportunities at training, leadership, higher-end client work and more — then they’ll be as interested in making them accurate as you are. And, you’ll take a big step toward using timesheet data to make staffers better at their jobs.