Saturday, October 22, 2016

If You Make All the Money You Want, You Don't Need to Work In Real Time

One of the most important decisions you have to make in your business is how closely you want to monitor the two most important elements in a service business: Time and Money.

When you're a sole proprietor all you have is time, which you trade for money. When you hire employees you begin to trade money for time and then resell that time for money. No matter what the mix is between time you buy, time you sell, money you receive, and money you spend, the relationship between time and money will dominate the the equation of profitability in your company.

And you know the old rule: You get better at whatever you put your attention on. If you want to get better at money, you need to put your attention on money. If you want to get better at managing time, you need to put your attention on time.

One key component of managing time within your business is to track how your employees use their time. Is any given half-hour focused on administration, training, service delivery, billable work, rework, or something else?

Here's a quick video:

Many people assume that getting a "good idea" of how time is spent is good enough. Well, that depends on what "enough" means to you. If you are generally profitable and generally okay having a general idea of profitability, then that's fine.

If you want precise measurements of how profitable your team is (or a specific technician, a project, a client, a project, etc.), then you need to track time very well. A key component of precise tracking is to have everyone work in Real Time. That simply means that techs put their time entries into the service desk or PSA as soon as each task is completed.

The best part is: You don't have to buy anything extra to make this work. You just have to start using your current tools (whatever they are) to keep your time entries up to date.


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