Data – seems that everything revolves around it nowadays. More and more companies see added value in making decisions that are ‘data-driven’. At TimeChimp, we often work at making data-driven choices too. In this blog, we delve into billability at consultancy firms and advice bureaus according to our own user data.
You could divide TimeChimp’s data streams along the broadest lines into two different groups. On the one hand, everything related to bringing in a new customer, and on the other, data that reflects customer behaviour within our tool. In this study, we focus on data from the latter category and specifically on an important KPI (Key Performance Indicator) for consultancy firms and advice bureaus, namely ‘billability’. We will explain what this entails, why it is important and its differences compared to other frequently-mentioned KPIs in this industry.
Analysis of the billability in the Consultancy and Advice Sector
We conducted research into companies in this sector, 20 to 50 employees in size, over the whole of 2019. We analysed several data points and the most interesting of our conclusions concerned billability. For example, we found that this group of companies had an average billable rate of 82.36% across the entire year. This figure is very high compared to the market and is indicative of efficient business operations. But what exactly does this mean? And what is the difference between productivity and billability? We will go into this in more detail below.
Many of our customers come from this sector and represent this size of company. We regularly hear from them about how time tracking is a cumbersome, irritating and downright chaotic task. That doesn’t surprise us. Your company is growing fast and is flourishing, but after a while it gets tied in knots with time tracking. This time tracking is often still done in Excel. This may just about work when you are smaller, but what happens if you have 20+ employees working on different projects? It is important to monitor different issues simultaneously. The project’s duration, the budget involved, the different rates. At the same time, you have to take different employees into account too.
You get it – a clear Excel sheet quickly turns into a nightmare. That is why many entrepreneurs in the consultancy and advice industry decide to switch to time tracking in the cloud. With great success too.