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Time Logging Expectations
For 2020-21, we’re We’re improving billing efficiency by comparing ourselves to peers, starting with understanding how billability and utilization are defined in the agency industry.
Billability is how many hours your employees are working doing billable tasks, which can be billed directly to a client you already have. Utilization is "hours" you actually assign to an invoice to a client. You do not have to bill by the hour, but it still starts with figuring out how many hours a task will take and adjusting the flat fee you charge your clients accordingly. Billability should always be more than your utilization. Your goal should be 65% of all available hours are utilized, meaning your billability average should be 75%. By Drew McLellan of the Agency Management Institute
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We expect that at least 70% of each delivery team member’s hours worked are utilized as in genuinely saleable to projects AKA a 70% utilization. That means out of a typical 40-hour workweek, no fewer than 28 - hours must be time well-spent. Time well-spent means that clients are satisfied with our activities by our delivery per estimates.
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