Are you leaving money on the table?

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Are you leaving money on the table?

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One of the big differences between a service-oriented company and a product company is in billing, and service companies leave a surprising amount of money on the table because of poor billing practices. It’s easy to invoice when you’ve shipped a given number of products—but when you’re billing by the hour, time isn’t always logged.

A few common problems:

If billable hours are the basis of your business, efficient time tracking, project tracking, and invoicing is more than just record-keeping—it’s money.

  • The primary consultant or service provider may bring in another party to consult, but time isn’t logged for the second party.
  • Total minutes of service are not captured.
  • Time is not allocated to project.
  • Small units of time do not get recorded.
  • Switching between projects isn’t allocated, resulting in overbilling one client and underbilling another.

Integration with project management and invoicing

It’s easy enough to install a time clock in your system tray, or even use the old-fashioned notepad by the computer screen method, but there is a limitation to both options. Project managers need regular updates to make sure a project is on schedule and on budget, and regular updates of time spent by each participant on each task is essential. With such information, the project manager is able to make any adjustments needed as the project progresses. The ability to see progress and time spent at any given moment is invaluable to the project management function.

Some of the more basic project management tools are calendar- and timeline-based, and for routine tasks it may be adequate. But, without time tracking integrated into project management, the project manager is limited to verbal and written reports that give only a static picture at the time they are presented. If a project goes off schedule, the manager won’t know it until the next written report is provided.

Software-as-a-service tools such as Skylight provide this level of integration. Each project member can easily record their start and stop time, and the system calculates hours. The time is automatically calculated at a preset rate, so it can flow automatically into the invoicing function.

Collaboration in the virtual world

More often than not, a project is going to be carried out by a diverse group of people that are not in the same office. You may be bringing in staff members from multiple branches, contractors from other companies, or outsourcers from an overseas provider. The nature of how a company operates has changed dramatically because of new collaboration tools and the Internet, and the physical barriers of the enterprise are rapidly breaking down. A company is no longer defined by its physical presence.

Today’s Web 3.0 technology makes all that possible, and tools like Skylight help make it happen. But while there are enormous advantages to being able to work on projects on a virtual basis, there are challenges as well. Simple tools like email can be used to make assignments to your extended team, but the very nature of “virtual” work environments can cause confusion. Team members may each have a different approach for recording their time and progress, and there is a tendency for virtual workers to do their work in isolation.

As a result, some of the gains realized as a result of working virtually can be lost, and it is indeed possible to “leave money on the table.” The project can too easily slip beyond schedule or over budget without constant oversight, and simply tracking hours of your extended team may be problematic if they are not tracked and updated on a continuous basis.

Freeing your project from the confines of a physical office has its advantages, but when you go virtual, you lose something valuable in terms of oversight and ability to track progress. You can add that back within the virtual environment with the right tools. Tools like Skylight impose a “virtual” office over the project, so every participant can be on the same page again. The project manager working in his New York apartment can transparently see the progress of all team members at a glance, regardless of whether they are down the street or in Mumbai, Melbourne, or Minsk.

Why do projects fail?

The three most important factors of any project are project scope, time, and cost. That’s why project management has become such an important field: it brings in new tools that can be used to balance those factors and keep them in check. The Standish Group reports that about 29 percent of IT projects were completed successfully—an appalling statistic, and to be fair, IT projects have a higher failure rate than other types of projects. But project failure all comes back to money—you’re not charging enough, you’re charging too much, or your spending is out of alignment with the project scope.

When a project does fail, good management practice dictates a post-mortem analysis, and discussions in the conference room ensue and team members try to figure out at what point they went wrong. The answer is almost always, “at the very beginning.” Most failed projects were doomed from the beginning when the team failed to include tools for continuous oversight and integration of team members, integrating functions like time tracking into project management and daily reports, and providing every team member with access to a common project portal.

What makes a project successful?

Taking a project team out of the physical constraints of a brick-and-mortar office means that something is being lost beyond the ability of co-workers to meet in the break room and complain. A successful virtual project will add those lost items back in with good project management, a common project portal that can be accessed by every team member, and a tracking system that allows each member to track their progress and for the project manager to view progress as it happens regardless of location of the team members.

The Skylight Advantage

Skylight makes sure you’re not leaving money on the table. Every team member can log in and track their time on each project, the project manager can get regular updates on the status of any project at any time.

With a full set of web-based project management, resource scheduling, CRM, and accounting tools, all in a common interface, it’s easy for a business of any size to enjoy the advantages of the virtual office, and to make sure the project is successful.

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About the Author

Taimur

Taimur is the founder of Skylight. He is a serial entrepreneur with a string of successful companies to his name in UK.

Having identified a gap in the market, in 2009, Taimur set up Skylightit.com to fulfil a simple need for every business; to centralise all key business data in one application.

SKYLIGHTit.com offers a web-based business collaboration solution that includes project management, tasks, time billing and invoicing among layers of features specially designed for businesses and freelancers. It is available in multiple languages including Spanish and German making it a complete business management app.

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