{"id":2473148,"date":"2017-05-01T00:00:00","date_gmt":"2017-05-01T00:00:00","guid":{"rendered":"https:\/\/prgn.cullencommunications.ie\/how-over-servicing-impacts-pr-agencies\/"},"modified":"2021-10-06T05:31:49","modified_gmt":"2021-10-06T05:31:49","slug":"how-over-servicing-impacts-pr-agencies","status":"publish","type":"post","link":"https:\/\/prgn.cullencommunications.ie\/es_es\/pr-tips-trends\/how-over-servicing-impacts-pr-agencies\/","title":{"rendered":"How Over-Servicing Impacts PR Agencies"},"content":{"rendered":"

This post is sponsored by ClickTime and Gould+Partners.<\/span><\/em><\/p>\n

\"\"<\/p>\n

Over-servicing among PR firms doesn\u2019t simply mean working for nothing. It\u2019s a lot more costly. That\u2019s because when your firm starts to expand client services\u2014without being adequately compensated\u2014it has a negative effect on the rest of the operation. Indeed, the repercussions for over-servicing can make a bad situation considerably worse. Perhaps more so than any other challenge they face, PR firm owners must take actions against over-servicing lest they fall behind. To get some tips for how PR firm owners can tackle the problem, Gould+Partners spoke with David Klein, director of marketing at ClickTime<\/a>, which provides time management software programs to PR firms and other creative services shops.<\/p>\n

Gould+Partners:<\/strong> What\u2019s the relationship between billable vs. non-billable time and the problems associated with over-servicing among PR firms?<\/p>\n

ClickTime:<\/strong> Billable and non-billable time are measurements for how effective agencies are at utilizing the most important resource they have\u2014their employees. Over-servicing is when account executives or other team members perform out-of- scope, non-billable work on behalf of paying clients. By doing so, they are not only offering clients free services, they are limiting their capacity to take on other clients or jobs that may be billable or revenue generating. That\u2019s why over-servicing poses such a challenge for agency management. It\u2019s not simply the non-billable hours; it\u2019s the opportunity cost of not being available to contribute to other projects.<\/p>\n

Gould+Partners:<\/strong> Take us through a common scenario at PR firms regarding billable vs. non-billable hours and how that hurts the financial structure of the firm?<\/p>\n

ClickTime:<\/strong> This is something that, unfortunately, most agency owners know all too well. Let\u2019s take a look at how over-servicing can impact the bottom line: Say you\u2019re an agency with 50 employees and, on average, each employee over-services just one hour per week. Assuming a $200\/hour billing rate, through the course of a year, we\u2019re talking about half a million dollars in over-servicing. The formula is relatively simple:<\/p>\n

# of employees x billing rate x over-serviced hours (assuming a 50-week year)<\/p>\n

In terms of the firm\u2019s financial structure, again what might be most concerning is not the free work (although that\u2019s a major issue) but the opportunity costs associated with it. For example, when staffing a team for a new client, agencies try to map the right talent, staff roles and costs to a project to deliver on the client\u2019s needs, while simultaneously maximizing profitability, catalyzing long-term client retention and up-selling and setting the stage for referrals or work that helps brand the agency (also not easy). One of the few data points that operations executives and others have to work with is employee capacity: How many hours do employees have in order to take on new work? Over-servicing pollutes this data and makes it appear that some employees might have less time to work on new projects than they actually do.<\/p>\n

Gould+Partners:<\/strong> Can some of this be solved when firms start budgeting with their clients?<\/p>\n

ClickTime:<\/strong> Yes, but this conversation has to start before the client budgeting conversation. Of course it\u2019s important to discuss deliverables and terms\u2014and set expectations with clients from the get-go\u2014but it\u2019s the pre-client, internal benchmarking that helps teams create accurate budgets and forecasts. The crux of that conversation revolves around two key questions:<\/p>\n

1. How long should a particular project take to complete?<\/p>\n

2. How much should a particular project cost the firm?<\/p>\n

This is not to say objectively that a blog post takes \u201cx\u201d amount of time to write or a product launch takes \u201cy\u201d amount of time to complete. Rather, it\u2019s about gaining an understanding of how much time\u2014and at what direct cost to the business\u2014certain activities tend to require<\/p>\n

Gould+Partners:<\/strong> What are some of the initial and practical steps PR firm owners can take to reduce\/remedy non-billable time?<\/p>\n

ClickTime:<\/strong> Reducing non-billable time is by no means simple, but even small, incremental gains yield tremendous results\u2014especially when employees are billing roughly $200\/hour for your agency. Here are two practical steps PR firm owners can take:<\/p>\n

– Focus on Communications. The most cost-effective way to reduce non-billable time is to clearly communicate your agency\u2019s vision, goals and expectations. There\u2019s no software or magic bullet that can replace solid leadership and agency direction. Does your team know why non-billable time is such an issue for your firm? Are there shared goals the entire agency is working toward? If so, how do non-billable hours (in excess) negatively impact that goal? Simply telling an account manager that he or she will be at 90 percent billable hours\u2014without context and education and buy in\u2014isn\u2019t an effective strategy.<\/p>\n

– Embrace Technology. Whether it\u2019s modern accounting, expenses, project management or time tracking software, implementing the right technology can offer new insights for how to best manage your business. Leveraging best-in- class operational tools is one of the ways that top-performing agencies continually improve employee performance, automate processes, and reduce administrative costs.<\/p>","protected":false},"excerpt":{"rendered":"

This post is sponsored by ClickTime and Gould+Partners. Over-servicing among PR firms doesn\u2019t simply mean working for nothing. It\u2019s a lot more costly. That\u2019s because when your firm starts to expand client services\u2014without being adequately compensated\u2014it has a negative effect on the rest of the operation. Indeed, the repercussions for over-servicing can make a bad […]<\/p>\n","protected":false},"author":76,"featured_media":2473149,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","episode_type":"","audio_file":"","podmotor_file_id":"","podmotor_episode_id":"","cover_image":"","cover_image_id":"","duration":"","filesize":"","filesize_raw":"","date_recorded":"","explicit":"","block":"","itunes_episode_number":"","itunes_title":"","itunes_season_number":"","itunes_episode_type":"","footnotes":""},"categories":[1272],"tags":[1316,1321,1322,1323,1324,1325,1326,1327,1328],"coauthors":[],"class_list":["post-2473148","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-pr-tips-trends","tag-app","tag-billable","tag-billable-vs-nonbillable","tag-clicktime","tag-gouldpartners","tag-nonbillable","tag-over-servicing","tag-overservicing","tag-tracking-time"],"acf":[],"yoast_head":"\nHow Over-Servicing Impacts PR Agencies - PRGN<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/prgn.cullencommunications.ie\/es_es\/pr-tips-trends\/how-over-servicing-impacts-pr-agencies\/\" \/>\n<meta property=\"og:locale\" content=\"es_ES\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How Over-Servicing Impacts PR Agencies - PRGN\" \/>\n<meta property=\"og:description\" content=\"This post is sponsored by ClickTime and Gould+Partners. Over-servicing among PR firms doesn\u2019t simply mean working for nothing. It\u2019s a lot more costly. That\u2019s because when your firm starts to expand client services\u2014without being adequately compensated\u2014it has a negative effect on the rest of the operation. 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