Out With The Old: 5 Reasons to Transcend The “Billable Hours” Business Model
To ease you into the topic of billable hours, or more importantly, to the reasons your firm should begin to embrace the alternatives, I recently laid out the drawbacks of sticking with this obsolete approach to professional services. The macro stressors perpetuated by the “more-equals-better” mentality, combined with a disconnect between companies and their millennial staffers, plus the overall unsustainability of the 2,000-hour billable year are catching up with a lot of companies.
Various online articles as of late are citing studies that further indicate employee disenfranchisement, and the writing is on the wall: The professional services sector of the future does not resemble yesterday’s or today’s model. Those firms who accept this impending reality are the ones who will pull ahead and likely see the best longevity. Today, I’d like to introduce you to a practical way to begin your company’s transformation by taking a look at a category of familiar and preventable macro stressors.
As the contemporary proverb goes, “Time is money”. But between you and me, this is a backward myth. Time IS money when it comes to deciding whether to drive 30 minutes to the supermarket for milk or to pay $2 more at the corner grocer. “Time is money” is also a fitting approach to compensation for a floor salesperson, or a cashier, or even a babysitter. But in corporate, we are wired incorrectly when we believe that time is money and that hours worked equates to exceptional job performance. We are knowledge workers, paid for our brains. Deliverables are the money. Operating to the contrary becomes the corporate stress-generating elephant in the room. And despite this elephant’s size, it’s hardly apparent to many hard-working, dedicated professionals who could otherwise be performing at an exponentially greater capacity.
Distractions Always Win
It’s been estimated that the brain, which accounts for approximately one-fiftieth of the average person’s body weight, consumes 25% of its oxygen. That being said, when it comes to using the brain in the professional services sector, we need to think of it as the most important muscle in our body. A stronger muscle equates to more efficient output. Then acknowledge that a muscle cannot strengthen when it is perpetually fatigued, which is what happens when workplace distractions have their way with us.
Such distractions devour brain energy like Pac-Man swallowing those bouncing clusters of fruit. Our distractions come in a variety flavors as well, from interruptions by incoming messages (tricky to recover from), to the lure of that open Facebook tab (compulsive and addictive), to the most invasive culprit of all: A noisy office environment. Backing up that last point is a recent ask.com survey of more than 2,000 employed American adults, which saw 89% of respondents declaring that they are most productive when working alone!
Here are three more roadblocks to success that have their roots in the billable-hours model:
-Creativity is a type of thinking which requires the prefrontal cortex to be engaged. This typically occurs organically in places like the shower or the treadmill, not the office environment. But are companies willing to invest more resources finding a way to charge for epiphanies that weren’t made while sitting at a computer?
-If companies don’t take steps to eliminate major stressors from the workplace, employees’ brains will become foggy from the cortisol perpetually dripping through their bodies. We see problems, not solutions in this state. However, if we decided to give our employees the tools to strengthen their brains and become more effective, it would likely be at odds with those billable hours. An avertable dilemma?
-Regardless of the number of billable hours a firm expects from its employees, our brains cannot efficiently manage much more than 45 hours of focused work per week. Any more than that and it’s low-productivity, going-through-the-motions type of work, which taps into the energy reserves needed for the coming week.
Making the move away from the billable hours model is admittedly a sizeable paradigm shift for any company who decides to explore the alternatives. DRIVEN is here to help straighten out the learning curve. When your firm is ready to get serious about creating a sustainable 21st century workplace, operated by a progressive staff of mindful, productive, soft-skilled professionals, consider reaching out to us. Our Private Client Services are customized to fit your specific needs.