Reluctance to change, a major obstacle for companies

change-ahead-sign

Types of change

Any change that occurs in the ecosystem of the business generates reactions. There are among others, two main types of changes:

  • Technological changes: for instance we introduce a new mode of production in the factory, or new management tools.
  • Changes related to duties and obligations of employees.

In some cases the change will not only have an influence on the technological aspects of the business but will also have an impact on human resources. This is the well-known case of the implementation of new software that modifies the management process, but also the habits and duties of employees. The introduction of a time, billing and project cost management software like Abak is a good example.

Possible reactions

The occurred change will have a serious impact on the day to day operation of the company and will also generate very different reactions from the workforce. Those reactions can be of two types:

  • Positives reactions: every change has its supporters. It is seen as a progressive innovation which, at medium and long term, will be productive (time saving, standardization of data entry, improvement of the billing process, optimized management of projects, etc…). Generally, executives and management staff are in favor of these changes.
  • Reluctant reactions: employees will have to complete their timesheets and their expense accounts regularly and in a consistent manner. Furthermore software will generate automated reminders when time sheets are not completed on a specific date. What will be the reactions of the employees?

– The introduction of this tool is a more or less hidden reinforced control tool of employees’ activities.

– This will result in a work “overcharge” because the time sheets will have to be filled regularly.

– The employee will have to detail his/her activities and not only declare these succinctly.

– The implementation of such a system can be seen as a lack of confidence from the management towards the employees.

What to do?

Before the implementation of the time management, expenses, billing and cost management project software, it is recommended to “take the pulse” of the team. We inform the staff of what is coming and we do it in an open dialog.

For example we organise one or more meetings that will focus on several topics:

  • What are the day to day recurring problems? For example: difficulty managing time banks, under billing, loss of valuable time; all factors that affect the efficiency of the business and its competitiveness.
  • The example of companies which have optimised their process by implementing new management tools.
  • The desires of the direction to facilitate the work of everyone in an organized, functional and effective way.

The final goal is to invite employees to think on how to improve the current situation and to present the solution considered as a useful tool for everyone whose use will simplify the daily administration, optimize the billing and project management and employees time bank. Time gain, ease and process optimization are all keywords that will contribute to the general acceptance of that new software.

Who does what, for whom and for when? Eloquent case study

The client has just sent his order and there is a lot of excitement at the company. Indeed, the project is very ambitious and is going to require most of our employees over a long period of time.

We are Epsilon Conseil (*), a SME specialized in professional services. We deliver projects which are mostly far different one from the other. Indeed, some of them last over a short period of time and involve a limited number of employees and others, on the contrary, are larger scale projects.
This kind of large project represents a primordial interest for a SME because it generates revenue that we cannot miss. However, it can be risky.
Let’s take some examples:

  • Delays on delivery resulting in possible penalties.
  • Work overload for employees and progressive demotivation.
  • Risk of exceeding the initial budget that was used to calculate a fixed price. Risk of loss through under-billing.
  • The project requiring much of the workforce, there is a bottleneck risk when obtaining other projects during the delivery of the project in question.
  • If many people are involved in the project, some tasks may be duplicated and, therefore, affect the profitability of the project.

We have, upon reception of the order form, determined the deliverables list and we have quantified them. To do so, we have listed the requested activities defined their quantities and determined the expenses that we shall engage to fulfill those tasks. At last, to take into consideration the risk factor we have applied a buffer percentage to the estimated project duration. Here we are, finally ready to launch our project. However, the human resource aspect must be taken into consideration to ensure the success of the mission. Indeed, we must plan the different steps of production and delivery to ensure that we have all the available resources to do so. Another element requires a special attention: our production capacity.

In our professional field, our production tool is time spent by our workforce on the different projects. Therefore, it is mandatory, for the benefit of the project, to ask us these questions:

  • In the meantime during which the project is active, what other projects are in the pipeline?
  • Which impact would have those ongoing projects in terms of staff mobilisation?
  • What would be our flexibility in case we would win new projects during the considered period?
  • How to deal with the delays and their impact on the following projects?

This list is not exhaustive.

The evidence is there: the solution is a planning tool which is integrated not only to the application that controls the working time but also to budget control reports, and other project monitoring reports (work in progress, expenses management, and billing).

Abak software Inc. proposes a resources assignment tool. There are several ways to assign employees to projects. It is possible, when building the project architecture in Abak, to assign several employees for a given period and for a specific number of hours per day during which the employees will work on the project or to assign employees to a specific activity for example.

This results in a monitoring table, Gantt type, which offers an overview of everyone’s time, and determines the level of availability of employees for a given period. The assignment module includes a detailed report as well. Depending on the selected criteria and the employee’s assignment, this application will be able to track the progress of projects and the remaining availability of resources.

gantt-english

How to find where your highest margins are hiding

In the world of a service-based business, like any business, you have to know where the money is coming from. More than that, you have to know where the profits are coming from. After all, running a charity is not the intention, so why take on contracts for clients that are barely breaking even? Why work with clients that always end up costing more than they bring in revenues?

With project-based accounting, knowing where the money comes from and where the money goes can be done in real time. With a centralized time and billing system like Abak 360, you can charge all costs to the proper project or contract. You can also attribute all revenues to the relevant project. Once the data is there, figuring out where the margins are highest is kid’s play.IDEA-MAN-iStock_000017496132Large

When costs and revenues are associated with a project, a client, an account manager, a project manager, a business line, or even a partner, it becomes easy to analyze your business performance. For example:

  • Do margins differ significantly from one project manager to the next? What about account managers? Partners?
  • Is there a specific client type where margins are higher? What about project types?

With quality business performance data on project margins, our clients were able to identify where they were successful financially, and where they were not. The next questions would then relate to business strategy:

  • Are you willing to tolerate a lower margin on some projects, because they bring in other higher-margin project?
  • Are you willing to keep a low-margin client because of the visibility it brings to the business?

It is crucial to choose a strategy that allows the company to know all about the aspects of its revenues and losses. To do so, having a versatile software that standardizes processes, manages time and expenses and allows optimized invoicing as well as a sane budget and project management would consist of the ideal tool.

The name of this software? Abak 360.

Do you like offering your services for free?

In the professional services world, working for free is like giving away our product. Just like retailers try to avoid giving away products, consulting professionals want to avoid under-billing clients.

Under-billing happens when we forget to record billable time for a client. If it’s not recorded, it cannot get billed. And if time is not billed, then we’re working for free. The trouble is: we still have to pay the salary for team members who are doing non-billed work for clients.

How does that happen? The monthly time sheet is one source of the problem. Since most consulting projects are billed – or at least accounted for – on a monthly basis, employees are asked to provide their time sheets once a month. In too many organizations, time sheets are Excel spreadsheets filled out at the end of the month. Who remembers what they worked on three weeks ago?

While it may be perceived as more time-consuming, filling out our time sheets daily or weekly is profitable in the long term: the records are more accurate, less billable time is forgotten and invoicing increases.
With Abak as the time sheet and billing system, the connection between billable time and billed time is made automatically: there is no need to re-enter information and no risk of data entry error at invoicing time.