One of the scourges of running a services business is “revenue leakage.” Described by business experts as the “silent killer of profitability,” revenue leakage is money that your company earned but did not collect.
One of the main causes of revenue leakage is inaccurate time tracking from the people who work on the projects. This results in billing errors, incorrect statements of work, and misquotes—all of which lead to lost revenue. It’s harmful and could even be fatal to your business.
The percentage of billable work written off by companies is 3.2%. Organizations with between 10 and 30 employees had the highest (4.2%) of billable work written off.
Organizations that use cloud business management platforms report 88% customer retention compared to 84% for those without cloud business management platforms.
96% of top performing professional services organizations use timesheet management tools vs. 71% of other companies
There are ways to simplify the time-tracking process for your consultants so you can more easily create invoices. Employees are happy when they don’t have to spend hours or days on boring and unpaid administrative tasks. You are happy when you can provide your clients accurate, on time, and detailed invoices. Together, this provides a more reliable and transparent billing process.
More often than not, consultants hold off completing their timesheets until the last minute—particularly if they have to do it manually. Who can blame them? It’s time consuming and not fun trawling through multiple documents and sources to try and figure out how much time they spent on a project or task. It’s definitely no fun for you if you have to jump in and search through documents on behalf of the consultant, who quite frankly, should be focused on client deliverables and not on administrative (nonbillable) tasks.
If you’re relying on manual tracking and letting consultants record bulk hours at project level with little or no task level details, it’s impossible for you to know how your consultant’s time was spent across the project. Not only is this knowledge important for tracking profitability and estimating resourcing on future projects, it’s a valuable record if a client disputes an invoice.
SystemX Business Management Platform (BMP), allows project managers and consultants to effectively track time spent on projects by team members and themselves to bill the customers accurately minimizing revenue leakage and increased profitability.