Tuesday, November 10, 2015

Billable hours

A comment on this recent post reminded me that I haven't directly addressed one of the most intimidating parts of the consulting biz: being billable.

Because consultants are mostly paid by the hour (and even for lump-sum projects, I've always billed hourly to the project so that internal management can see if the project's on track), we need to track what we're working on. And if we're not billing to a project, we bill to some sort of administrative project.

The tracking of hours really isn't that complicated - it just becomes a habit. I keep a running tally of what I'm doing throughout the day, and then at the end of the day, I figure out how many hours I've billed to each project. Fieldwork is easy because it's usually one project all day. I used to use a flurry of post-it notes and scrap paper, but now I have a notebook-based system so I can go back and check. Other non-luddites may use tracking software, but I like the ability to jot things down on paper while I'm going from one task to another.

Of course, the big fear for newbies is not having billable work. Here's the thing: having billable hours merely quantifies what would be happening anyway. If I never have a project to work on and I'm just twiddling my thumbs all day, a firm would have a problem with that regardless. Having it in numbers just makes it more obvious. A reasonable firm will have an understanding that nobody will spend their time entirely on billable work - people go on vacation, have mandatory training, work on proposals, etc. And sometimes work is slow and after you go through the round-robin of all the people who may have work for you, and you can't find anything billable, you end up reorganizing the equipment room or watching some webinars. That's life.

Entry-level staff have the least agency, and are less likely to have long-term projects that they can pull out and work on when work slows down. However, those people often have extremely high billability overall, because they tend to do the bulk of the fieldwork. Also, they're cheap. It's really not a hardship for them to be temporarily non-billable. Higher level staff (like me) aren't expected to be quite as billable, because we're more likely to work on proposals, train other staff, and have explicitly non project-related management work. In my experience, higher level staff are also expected to "eat" more hours and not charge as many hours to administrative tasks as they actually work, but this varies so much that I can't really generalize.

Switching from a non-billable environment (academia, oil and gas, etc.) can be an adjustment, but I don't think it's intrinsically more stressful than other work. But maybe I've just gotten used to it...

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