Recent studies have revealed the industry average for lost revenue among professional service firms, including marketing agencies, stands at a full 5%—mostly due to billing errors, time wasted on product or project delivery issues, incorrect statements of work, or misquotes within firms.
Many factors contribute to lost revenue, and all employees—from executives to account executives—have a hand in it.
Top-level executives at agencies and services firms excel in business development and client service. Staying close to other areas, such as operations, finances, and human resources, is important for the overall health of the business, but doing so can often feel like a chore to a busy executive—and sometimes outside his or her comfort zone.
To offset potential revenue loss because of inefficient or inaccurate operations, agencies should implement clear operational and financial guidelines, with support for adhering to them coming from the top down.
Educating all agency professionals about why time entry, data, and project tracking are critical to the success of the agency is the first step in making internal change.
Regarding financial issues, it's been proven that providing employees with an individualized picture of their financial impact makes for engaged, productive team members. Employees want to feel they are contributing to the greater good and are an integral part of the success of the agency. Making it clear that tasks such as accurate and timely reporting, invoicing, and data entry a vital and mandatory part of everyone's job will pay off.
With that in mind, services firms and marketing agencies can take these three steps to prevent revenue loss while preserving a service-driven culture:
- Make it a daily habit. Employees must understand why correct, timely, and detailed data entry is important and how it can work to overcome even the simplest problems within firms. Research reveals that firms entering work hours at the end of the month suffer more revenue loss than those that do daily or weekly. The reason is simple enough: The more time that goes by, the more likely employees are to report work activities inaccurately.
Make this menial task rewarding, and consider recognizing team members who do their time thoroughly and accurately by the end of each week; give a small gift or make it a longer-term competition for the top time reporters with a bigger prize at the end of each quarter.
- Consider the Cloud. An important step before determining which type of solution best meets business needs and goals is educating professionals on how important activity tracking is. If professionals are not aware of why it's important, they are less inclined to commit to the action.
Once a solution is determined in conjunction with proper education, businesses should consider managing time and data entry via a Cloud-based solution. With the ability to log data on the go, employees will do so more accurately, potentially saving hours worth of time. On top of that, business owners will be happy to say goodbye to late or illegible activity log sheets.
- Streamline processes. Once an agency has determined the best solution for its business needs, it needs to streamline all processes, including sending out daily, weekly, or monthly reminders to employees to ensure time sheets are complete, along with any project management and reporting tasks and expenses.
By doing so, extra hours won't be spent double-checking previous work, and business owners can integrate time registration and approval with invoicing processes, automatically generating invoices to reduce the chance of hard-earned money slipping away.
Don't lose sight of your agency's goals this year. Each professional plays an integral role in the overall success of the agency and can contribute positively to the bottom line.