Most firms in this business still struggle to get their people to do their timesheets and turn them in – but there could be a simpler way.
Timesheets have always been a big deal for architecture and engineering firms. After all, the only thing we have to sell is our time. That is it! And if our people don’t track that time accurately, we not only don’t know what our costs are to do a given task or project, we also can’t accurately bill our clients on many jobs where the contract calls for hourly billing rates, or time and material. Not to mention the fact that management of firms in our industry are usually preoccupied with “utilization,” i.e., how much of someone’s time is charged to billable projects, because in general, higher utilization means more revenue and less overhead. That’s understandable.
Most firms in this business still struggle to get their people to do their timesheets and turn them in. It usually requires many emails, and sometimes even phone calls or visits to certain people who either lack the discipline to get them done, or those who actively resist doing so for one reason or another. Sometimes companies even threaten their people with withholding their paychecks if they don’t turn in their timesheets. All of this causes great stress for those responsible for accounting and billing, because it puts them in conflict with the offenders who haven’t done their timesheets. These accounting and billing people have to be the “bad guys” on this issue. Nobody enjoys that. The adversarial relationships timesheets cause are not healthy.
One issue that I believe many in this business don’t understand is that of unbillable project or time categories. The typical firm creates more and more of these over time. There are unbillable codes for all manners of leave – vacation, sick, holiday, bereavement, maternity, and more. Depending on one’s leave policies, these may be necessary. But then there are a whole lot more of these task or time categories and codes for everything else under the sun. There could be a dozen codes for different types of training alone, i.e., CADD training, other technical software training, project management training, business development training, and so on. There could be codes for chores such as filing, developing graphic standards, maintaining standard details, and more. There could be codes for recruiting or setting up a physical office. There may be codes for a large variety of marketing activities such as business development phone calls, business development emails, business development meetings, fee proposal writing, qualification document preparation, presentations, maintenance of the CRM database, and others. I have seen some firms that had as many as 50 or even more non-billable project or task codes.
The problem with having all of these different non-billable project or task codes is twofold. One, it creates all kinds of complication and difficulty for those entering their time. They can’t figure all of it out and shift gears so often during the day that it is nearly impossible to say exactly how much time they spent on any of these activities, so they just guess and throw a number in. That makes all of the data that comes out of the system look like it’s accurate when it isn’t. Decisions get made based on that information and the information is wrong so it can lead to bad decision making.
The other problem that is not often considered is that having so many different places an employee can charge their time psychologically legitimizes all of that unbillable time. That, in my estimation, leads to more of it (non-billable time) instead of less of it. And no one who owns a firm in this business wants that.
Therefore, I question the wisdom of having so many non-billable project, time, and activity categories. My advice to management is cut these lists way down to the absolute bare minimum you absolutely need to operate. Stop kidding yourself about the necessity of and accuracy of the accounting for the money you are spending for all of your non-billable activities, and see what effect this change has on the amount of time your people spend doing them!
Mark Zweig is Zweig Group’s chairman and founder. Contact him at mzweig@zweiggroup.com.