How to get more value out of consultant firms and contractors
Updated: Aug 7, 2020
It’s the norm in the UK tech industry to ask engineers, designers and product managers to record work completed via a timesheet. I’ve always found this practice odd and have come to the conclusion that there’s a better way.
Why do companies track tech team’s time?
Because it’s an easy method of recording the cost of project-based work. But easy doesn’t necessarily equate to good.
Do the timesheets reflect the reality of the work completed?
Sometimes, but they often don't. I’ve worked with project managers who have asked my teams to allocate arbitrary amounts of time to various cost codes, using up one pot of money before moving onto another. This was a complete waste of time.
Why aren’t timesheets needed for other departments?
Some departments like finance are considered essential. Others like sales contribute to the company's bottom line, so they’re considered valuable. Technology is often seen as an operating cost. This is surely becoming less true as increasing numbers of companies pivot to having digital products at the heart of their offering. I believe it’s time we treated tech as an essential and valuable department.
So timesheets aren’t perfect, but they don’t do any harm, right?
Wrong. The culture of recording effort on timesheet leads to misaligned goals and inefficiency. This is especially true when engaging a consultancy.
The goal of the business is to deliver the project quickly and efficiently and unlock customer value as soon as possible. This should be the same goal as the consultancy, but by measuring effort in time, the longer the project takes, the more the consultancy is rewarded. These diametrically opposing goals can erode trust.
Timesheets encourage waste, with projects often kicking off without clear goals. They also remove any financial incentive for working more efficiently. Can a task be automated? Can you use a tool to save you time? If you get paid by the day why bother?
In this model, all of the financial risks sit with the business, and that isn’t how things should be.
The answer is value
If projects were measured in value instead of time then things would be very different.
By agreeing on an up-front fee for delivering a piece of work, the financial risk shifts to the consultancy. If the consultancy delivers a solution quickly and efficiently then they benefit. The consultancy's goals are completely aligned with those of the business. Trust improves. Results are more likely to be achieved. Projects will only be kicked off when they have clear goals.
Tech departments would start to be viewed less as an operating cost and more as an asset, which will eradicate the need for timesheets in the future.
Isn’t it time your business started to think more about value and less about time?