Time is money for any business …but particularly for a management consultancy. A consulting firm is a business with mostly fixed costs – you hire a bunch of talented people, and how much profit you make depends on how well you make use of their time on client work. Keep utilization and billability high, and your firm will make excellent profits. Let it slip too low, and your firm starts bleeding cash.
Timesheet software, also known as time tracking or time management software, helps management consulting firms track and bill their time. Since time is, quite literally, money for a consultancy then it is evident that choosing the right timesheet solution is a critical business decision.
With the right timesheet solution, a management consulting firm can dramatically improve its revenue. Effective time management boosts a consultancy’s revenue in several ways, including
Billing more of the time you spend on client work
Scheduling the right resources on the work
Charging the appropriate rate in all instances
Scoping and pricing its projects better
If you look at the profit and loss (P&L) statement of a typical consulting practice, it quickly becomes apparent that employee costs make up the vast majority of their cost structure. Choosing the right timesheet system enables a consultancy to control its costs by
Catching scope creep or project management issues early
Reducing the opportunity cost of time spent on unbillable activities
Understanding how its internal practices (e.g. meetings) impact on staff utilization
Reducing the overhead and administration associated with managing time
There are many choices you face in choosing billing and time tracking software for your consultancy, Should it be installed on your servers or hosted by the vendor Do you need internet or mobile phone access Should expenses be managed through the same system Will you invoice through the timesheet system, or do you need it to integrate with your accounting package And many other such questions…
In deciding on timesheet software you can review all the available solutions yourself, engage a software selection consultancy, or take advantage of new online services that help you compare relevant software for free. Either way, it is important you think carefully about your requirements and invest enough time to make a well-informed decision.
Tags: critical business decision, management consulting firms, project management issues, time management software, time tracking software