I run a very active slack channel for firms that are in my Boardroom coaching program. They can ask me a question or their other peers from around the world. Every member is committed to growing their profits to beyond $1M (or equiv in their currency) per partner.
This week Shaun posted a question regarding hours budgets on jobs.
Here is Shaun’s question:
“Following on from our catch-up last week I’m working on re-implementing time sheets (but not charge rates) and tracking the hours on each job. You mentioned number of hours per job would be a tracking category, how do you determine how many hours per job is required without having a charge-out rate per accountant? In a traditional accounting firm one would work backwards from the fee/budget – to charge out rate to determine hours budgeted. Do you go on gut feel or do you have a methodology to determine job hours budget?”
Let me rant for a bit re hours. People fill the available time with what work they have to do. The old saying ‘if you want something done give it to a busy person” is so true.
Think about the week leading up to a 4 week holiday. You are super effective. Meetings are short. Emails are NO rather than a diatribe of rubbish in the message – NO is OK. Speed is the key.
Certainly get the tools for effectiveness. I am working at a stand-up desk for the past 3 weeks and I can feel myself going faster. I have 3 screens + Ipad for effectiveness.
Self imposed deadlines are also key – imposed to a client “we’ll meet on Friday at 3pm to present our work” and habits around being self imposed. I will complete these 3 things by 0945 this morning. Habits like making the bed every morning and cleaning/putting the dishes away after a meal is all about “finishing what you begin”.
Which leads me onto hours budgets.
You can set the hours budget a number of ways:
1) The price is fixed at $5k, you’ve got a maximum of 10 hours to do it in. Because you’re Average hourly rate target is $500. It’s amazing how time can be met when you push the time down.
2) The price is fixed at $5K, last year it took 25 hours. How do we do it this year in 5? And then brainstorm doing it in 5 – then just do that. It’s amazing how time can be trimmed when brainstorming ways to do it
3) What do you think you could do this job could be done in if a) you had all the raw materials, b) you had uninterrupted time, and c) the clients systems were great? Just go and do that.
I like a combo of all 3.
When challenging time down remember this little phrase “I know its not possible, but if it was possible, hypothetically possible. What would need to do, change, fix, different system, different process, different whatever to make it remotely possible?” Then Brainstorm. Then do that.
There is no right or wrong answer to the right hours budget because I have seen people do amazing things when they have the resources and are under the pump for deadline. The key is create that environment
Enjoy getting the hours down!