Leadership Flagship

All Accounting Firms Should Track Their Time… Even If They’re Value Billing: Here’s Why

June 29, 2021
by: Margaret Wood June 29, 2021 10:00AM

Managing one’s own time is one thing–but managing one’s own time AND their staff’s, in-office, and remote team’s time is an entirely different ballgame.

Managing one’s own time is one thing–but managing one’s own time AND their staff’s, in-office, and remote team’s time (some of whom are dealing with distractions and less-than-ideal working conditions), is an entirely different ballgame. But tracking employee time should not be synonymous with distrust or micromanagement.

Most firms track dozens of KPIs to manage their practices—most are focused on non-billable vs. billable hours. They follow every employee’s data to monitor what they are doing on a min-to-min basis. The question is: is this data helping managers and partners make better decisions?

Here we discuss the following:

· Best practices dealing with efficient billing practices

· Benefits of time-tracking

· Why accounting firms should track their time even if value-billing

Realization — Is your current system capturing all the revenue?

Accounting and managing a company’s funds is not only one of the most critical tasks; it is also one of the most daunting. Accountants face the dire need for accuracy; even a small oversight or inaccuracy can result in a considerable loss for the company.

The most controllable cost to an accounting firm is time. Team members have been known to manipulate the data (their timesheets) to hit their target numbers.

Consultant Rob Nixon says it best: “Excessive focus on … metrics promotes the wrong behavior. Team members’ hog’ work, ‘pad out’ timesheets and are generally inefficient.” 1

For value-billed projects, tracking actual hours spent on a client’s project is essential to ensuring the firm is fairly compensated for its work.

Handling multiple accounts a day, a.k.a. “Client Hopping,” is quite common for accounting firms with a significant number of clients. However, dealing with disruptors, an unexpected client phone call, an emergency meeting, or an urgent problem that needs to be resolved ASAP may cause you to lose track of time or not track the time spent on those other issues. Consult calls also take up a large portion of the accountant’s workload. Using time tracking software and billing clients for this time is an excellent means to keeping those callers in check.

Again, unless time is tracked, accuracy can easily be lost and can impact what clients are billed. Relying on memory and guesswork can be very costly.

As managers, there are countless responsibilities to deal with on any given day. For instance, preparing for an audit demands a specific focus; when that work gets interrupted, a shift occurs in your mind. This shift is referred to as context switching 4, which can cause significant losses.

A study by the American Psychological Association 3 demonstrated that people lose time for all tasks when switching between multiple tasks.

Automating time tracking with time and billing software for accountants ensures the data recorded is available to outsourced accounting and bookkeeping functions, making data visible and traceable.

Benefits of Tracking Time

If every client is treated as a “project,” project status is transparent and readily available when using tracking software, providing more comprehensive forecasting and planning resources.

Tracking software provides cross-platform availability—accessibility from an office computer, phone, laptop, or tablet.

Today’s time tracking software offers more functionality and analysis tools, aggregates time spent on a project to date, and provides insights on per-client profitability. The software also offers exportable reports for clients, providing transparency of time billed.

Tracking software also has the capability of showing which clients contact you the most often, their inquiries, and the amount of time spent on each call; it can also store all the information for future analysis.

By measuring employee productivity and efficiency based on time spent to complete a given task, analysis can disclose hotspots attributable to lack of skills, practical difficulties, vague instructions, or any number of other reasons, all of which signal opportunities for improvement.

Many of today’s accounting processes are now automated. However, there may be specific situations that require traveling to public offices or notaries, and an employee may spend time waiting in lines, commuting, and even getting stuck in traffic. Tracker software with GPS options is excellent in these cases; they eliminate the need to document locations and names manually.

Effective Project Management

Time tracking software helps create transparency and endorses responsibility by allowing project admins to set timesheets visible to all team members on the project. As a result, all team members can see each other’s tasks and how much time has been spent on them—keeping each other in check. In addition, tracking relieves some pressure of personally monitoring everything.

Effective Project Management boils down to making sure the work is proceeding on schedule. Tracking time presents a clear picture of the progress of any given project, making it easier to manage projects and tasks.

Turn all this time data into actionable insights to improve.

Tracking time throughout the day can be worthwhile in assessing one’s rate of progress and reasons for any delays; it can also help team members make proactive help requests, develop alternative approaches, prioritize crucial tasks, and alert seniors to hotspot issues.

What can firms do to change?

By misusing data, firms may be impacting their firm’s culture.

According to the CPA Journal, “…data should be the starting point to understanding the functionality of the firm. It is not about micromanaging time. It is about understanding how much time it takes to do something.

Use data as a question—not an answer.
- Why are some accountants billing more hours than others?
- Why are some team members more profitable than others?
- Why is the audit department more profitable than the tax department? “2
Often, data is used as a measuring stick—to determine whether a team member is performing well. For example, a project’s success is often measured by the number of hours it took to complete and whether it hit a budget target.

Tracking firm-holistic numbers rather than measuring based on time alone may yield better data. This requires identifying what data is essential. All data initiatives measure time to some degree:
- The time it takes to process tax returns,
- How quickly the team responds to emails,
- The amount of client contact required.
Individual numbers should only be examined when looking for outliers.

Accurate time tracking has become a necessity, especially with the dispersal of teams. Moreover, even if everyone is back in the office, there is a high probability that there will be a need for remote working capabilities over the long haul. Thus, solid, comprehensive-time tracking software is even more critical in remote settings to ensure the continuum.

Whether the firm bills clients hourly or value-bills or the firm has employees who work from home and seem to be spending too much time on specific projects, time tracking software creates an attestable record of the time spent on accounts.

Conclusion

Time tracking is not meant to be another task. But tracking time can help business operations make more cost-effective decisions. Automating time-tracking can be a valuable business investment—especially with the proper integrations to your general accounting system.

Replacing conventional data points with data that aligns with the firm’s primary goals can lend themselves to managing a firm more cost-effectively, leading to an increase in the most critical metric of all: the bottom line.

Sources
Business Skills That Play an Important Role at Home and at Work

March 30, 2021

by Stephanie Haywood

Business Skills That Play an Important Role at Home and at Work

When you think of business skills, things like effective communication, number-crunching, and management likely come to mind. However, these are not the only areas where a bit of expertise comes in handy. If you want to get the most done at home and at work, you have to have exceptional task management skills. These might not be exactly what you think. Here are some examples:

Sleeping

Let’s get the most unusual off the list to start. Sleeping may not seem like an important business or task management skill, but it truly is. Leadership Flagship has discussed the importance of sleep for your brain and body before. Essentially, when you get enough rest, your mind can function at its peak and your body has the energy to get through your day. Stop looking at bedtime as the end of your day and consider it an opportunity to recharge and refuel so that you can wake up ready to tackle your most pressing challenges.

Delegation

If you think about any major profession (e.g., doctor, attorney, or teacher), you may see these as one-person-only positions. But the reality is that each has a backup: The doctor has people to prep surgical equipment, the attorney has his paralegals, and the teacher has access to aids and administrative support.

Like these professionals, you should learn to delegate some projects or individual tasks so that you can take care of areas where you are most effective. One example is forming your LLC if you’re a small business owner. Instead of using the time to research state laws, you can outsource this to a formation service to save time and to ensure that your business is structured correctly.

Organization

Being organized means more than just knowing where your pens and papers are on your desk. Understanding how to keep your proverbial ducks in a row means that you are never scrambling at the last minute to find a piece of crucial information to finish a task. However, being a disorganized mess, you may lose up to six hours per week, according to Pingboard. That’s almost an entire day’s worth of work lost when your time is much better spent turning a profit.

Record-keeping

Like being organized, keeping accurate records will help you be more efficient and effective. There is some level of organization involved here, as well, but record-keeping also requires attention to detail. Maintaining accurate and detailed records will ensure you’re never at a loss of information. This will serve you well when it’s time to make decisions about individual projects or business as a whole.

Stress management

Poor leadership, unreasonable workloads, and lack of control over your working environment are all top causes of workplace stress, and these are issues that Dr. Steven Aldana of WellSteps cites in favor of work-based stress management programs. Learning how to manage stress and strain will go a long way toward ensuring your mind is free and clear so that you can take care of problems as they arise. Further, acknowledging stressors and meeting them head-on will keep you from letting your negative emotions at work follow you home.

Ultimately, all of your behaviors and learned skills at work and at home play a factor in your effectiveness and enjoyment of each. Things you may not even consider, such as sleeping and maintaining accurate records, are crucial in your professional success and personal wellness. If you’ve yet to master any of the above, there’s never been a better time than now to try. Learning one skill at a time is perhaps one of the best ways to grow your profession and be a more effective leader when it’s your time to shine.
13 Signs of High Emotional Intelligence

March 10, 2021
Wonder what emotional intelligence looks like in everyday life? Here are 13 examples.

BY JUSTIN BARISO@JUSTINJBARISO

Getty Images

In 1995, psychologist and science journalist Daniel Goleman published a book introducing most of the world to the nascent concept of emotional intelligence. The idea–that an ability to understand and manage emotions greatly increases our chances of success–quickly took off, and it went on to greatly influence the way people think about emotions and human behavior.

But what does emotional intelligence look like, as manifested in everyday life?

For the past two years, I’ve explored that question in researching my forthcoming book, EQ, Applied. In doing so, I’ve identified a number of actions that illustrate how emotional intelligence appears in the real world.

Here are 13 of them:

1. You think about feelings.

Emotional intelligence begins with what is called self- and social awareness, the ability to recognize emotions (and their impact) in both yourself and others.

That awareness begins with reflection. You ask questions like:
- What are my emotional strengths? What are my weaknesses?
- How does my current mood affect my thoughts and decision making?
- What’s going on under the surface that influences what others say or do?
Pondering questions like these yield valuable insights that can be used to your advantage.

2. You pause.

The pause is as simple as taking a moment to stop and think before you speak or act. (Easy in theory, difficult in practice.) This can help save you from embarrassing moments or from making commitments too quickly.

In other words, pausing helps you refrain from making a permanent decision based on a temporary emotion.

3. You strive to control your thoughts.

You don’t have much control over the emotion you experience in a given moment. But you can control your reaction to those emotions–by focusing on your thoughts. (As it’s been said: You can’t prevent a bird from landing on your head, but you can keep it from building a nest.)

By striving to control your thoughts, you resist becoming a slave to your emotions, allowing yourself to live in a way that’s in harmony with your goals and values.

4. You benefit from criticism.

Nobody enjoys negative feedback. But you know that criticism is a chance to learn, even if it’s not delivered in the best way. And even when it’s unfounded, it gives you a window into how others think.

When you receive negative feedback, you keep your emotions in check and ask yourself: How can this make me better?

5. You show authenticity.

Authenticity doesn’t mean sharing everything about yourself, to everyone, all of the time. It does mean saying what you mean, meaning what you say, and sticking to your values and principles above all else.

You know not everyone will appreciate your sharing your thoughts and feelings. But the ones who matter will.

6. You demonstrate empathy.

The ability to show empathy, which includes understanding others’ thoughts and feelings, helps you connect with others. Instead of judging or labeling others, you work hard to see things through their eyes.

Empathy doesn’t necessarily mean agreeing with another person’s point of view. Rather, it’s about striving to understand–which allows you to build deeper, more connected relationships.

7. You praise others.

All humans crave acknowledgement and appreciation. When you commend others, you satisfy that craving and build trust in the process.

This all begins when you focus on the good in others. Then, by sharing specifically what you appreciate, you inspire them to be the best version of themselves.

8. You give helpful feedback.

Negative feedback has great potential to hurt the feelings of others. Realizing this, you reframe criticism as constructive feedback, so the recipient sees it as helpful instead of harmful.

9. You apologize.

It takes strength and courage to be able to say you’re sorry. But doing so demonstrates humility, a quality that will naturally draw others to you.

Emotional intelligence helps you realize that apologizing doesn’t always mean you’re wrong. It does mean valuing your relationship more than your ego.

10. You forgive and forget.

Hanging on to resentment is like leaving a knife inside a wound. While the offending party moves on with their life, you never give yourself the chance to heal.

When you forgive and forget, you prevent others from holding your emotions hostage–allowing you to move forward.

11. You keep your commitments.

It’s common nowadays for people to break an agreement or commitment when they feel like it. Of course, bailing on an evening of Netflix with a friend will cause less harm than breaking a promise to your child or missing a major business deadline.

But when you make a habit of keeping your word–in things big and small–you develop a strong reputation for reliability and trustworthiness.

12. You help others.

One of the greatest ways to positively impact the emotions of others is to help them.

Most people don’t really care where you graduated from, or even about your previous accomplishments. But what about the hours you’re willing to take out of your schedule to listen or help out? Your readiness to get down in the trenches and work alongside them?

Actions like these build trust and inspire others to follow your lead when it counts.

13. You protect yourself from emotional sabotage.

You realize that emotional intelligence also has a dark side–such as when individuals attempt to manipulate others’ emotions to promote a personal agenda or for some other selfish cause.

And that’s why you continue to sharpen your own emotional intelligence–to protect yourself when they do.
Yes, Pronouncing Other People’s Names Correctly Does Matter

March 9, 2021

Especially if you value dignity, respect, and inclusion.

BY JEFF HADEN @JEFF_HADEN

(Reposted with permission)

Names are not just words

Before Coming to America, before The Arsenio Hall Show, long before Coming 2 America, Arsenio Hall was a sometime panelist on The Match Game-Hollywood Squares Hour, a game show whose one-year run was about a year too long.

As Dave Holmes points out, the only notable thing about the show was that everyone — including the show’s announcer — mispronounced Hall’s name: saying Arseenio (like the long e in Armenia) instead of Arsenio (like the short e in men.)

Hold that thought.

In the 1980s and ’90s, I worked in a manufacturing plant with Ken Quach. Ken literally came to America when his family fled Vietnam after the Vietnam War. To my knowledge, “Ken” wasn’t his original first name. It was just easier for his American sponsors to pronounce.

But “Quach” evidently wasn’t any easier to pronounce. Instead of “qwa,” everyone said “quack,” like a duck.

Maybe Ken didn’t care. Maybe he figured the joke was on us, like people in other countries who secretly laugh at stereotypical American tourists who think everywhere should be like here.

Then I remembered the day Ken came into the break room to get a machine operator. “Joe,” he said, “Line is down. They say to tell you to come.”

“My name isn’t ‘Yo,’ ” Joe said. “It’s Joe.”

“Sorry,” Ken said. “Will you come?”

“Not until you say my name right,” Joe said.

Ken tried. Several times, but not to Joe’s liking. Finally, Joe shook his head and said, “Look, Quack, tell them I’ll be there in a minute.”

The irony was lost on Joe. And I’m ashamed to admit that at the time it was also lost on me.

It wouldn’t have taken us long to learn to say “Qua.” But we didn’t, because it was easier to say “Quack.”

And, sadly, it was also a way to implicitly point out Ken’s “otherness.” We were from around here. He wasn’t. We didn’t need to learn his ways.

He needed to learn ours.

Which was a (crappy) way for us to act.

As Myles Durkee, a University of Michigan professor who specializes in race and identity, says:

Other people can see it as, “Oh, it’s not that big of a deal.” (But) what makes it detrimental is the chronic pattern of consistent mispronunciation. And the ripple effects from that are much more adverse, signaling to the individual that they’re less important, that they’re less valued.
Strategically mispronouncing someone’s name is a way of “othering” someone.

We all — myself definitely included — could have actually walked the diversity and inclusion talk. We could have put in the tiny amount of effort required to pronounce his name properly. We could have treated Ken like one of us — because he definitely was — rather than as someone who would always be slightly different.

When you meet someone new, work hard to pronounce their name correctly. Ask to be corrected. Ask if you’re getting it right. And don’t do anything that implies their name is the problem, since the only problem is your initial inability to pronounce it correctly.

Because your willingness to try, and to care about getting it right, is a first step toward genuine inclusion.

And because treating every person you meet with dignity and respect isn’t just good business.

It’s the right thing to do.
The Cost of a Bad Hire Can Be Astronomical

February 8, 2021
What does it cost a company that hires a person who’s not right for the organization?

By Lisa FryeMay 9, 2017

By some estimates, it costs more than a quarter of a million dollars to find and hire a new employee. If that person turns out to be wrong for the role, add to that amount the toll that the bad hire takes on a manager’s patience and on colleagues’ morale, plus a myriad of other costs if the person needs to be replaced.

“The cost of a bad hire is always extensive,” said Arte Nathan, founder of The Arte of Motivation, a human resources advisory service based in Las Vegas.”Most companies don’t know the full cost of the turnover, so they don’t apply the resources upfront to avoid it. If you make a bad hire, there is a ripple effect among all who work for you, your product and your product quality.”

It’s likely every company has had experience with hiring a person who wasn’t a good fit. So how can an HR professional ensure that she doesn’t waste her time recruiting, interviewing and making job offers to the wrong people?

Calculating the Cost of a Bad Hire

The cost of recruiting, hiring and onboarding a new employee can be as much as $240,000, according to Jörgen Sundberg, CEO of Link Humans, an employer branding agency in London. There are extra costs incurred when that person turns out to be a poor fit, not the least of which may involve finding a replacement. Brandon Hall Group, a human capital research and analyst firm based in Delray Beach, Fla., identified several variables that go into calculating the cost to replace a bad hire. They include:
- Recruitment advertising fees and staff time.
- Relocation and training fees for replacement hires.
- The negative impact on team performance.
- The disruption to incomplete projects.
- Lost customers.
- Outplacement services.
- Weakened employer brand.
- Litigation fees.
Lack of Patience, Talent and Resources

So if it’s so expensive and time-consuming to make a bad hire, why does it continue to happen?

Chicago-based CareerBuilder, which specializes in job advertising and HR software, suggests that one of the reasons is that companies are too often in a rush to fill a position. In a 2012 survey about why companies make bad hires, CareerBuilder found that 43 percent of respondents said they made a bad hire because they felt they needed to hire someone quickly.

This sense of urgency happens for several reasons, CareerBuilder noted: the current staff may be overextended, a project may require new talent or a key employee may depart suddenly, leaving a critical hole in the organization. Too often, hiring managers are so anxious to put a body in the vacant chair that they overlook candidates’ flaws and end up hiring someone who really doesn’t meet the needs of the job, CareerBuilder noted.

More than 1 in 5 respondents (22 percent) to the CareerBuilder survey said they lacked the skills to interview and hire people effectively.

“Instead of blaming the person who was hired, we need to blame those who are doing the hiring,” Nathan said. “There is an assumption that because someone is a manager, they know how to interview and hire the right person for the job. Hiring managers need to know what they are looking for [and] how to ask the right questions, discern candidate responses and get the right person for the job.”

The Art of the Interview

Organizations that lack a standardized interviewing process are five times more likely to make a bad hire than those that do have such a process, according to a 2015 talent acquisition study from Brandon Hall Group and Mill Valley, Calif.-based Glassdoor, an online provider of company ratings and salaries.

A standardized interview process provides hiring managers and recruiters with tools to formulate good questions and evaluate candidates. Behavioral interviews and peer-to-peer interviews can determine if the candidate would fit well into the company culture. The process is consistent for all candidates who’ve applied for the same job and relies on the same interviewers, who should be trained to look for red flags during the interview and to discuss any concerns with recruiters.

Many interviewers’ questions are so benign and accommodating that they fail to uncover a lack of motivation or passion that might prevent someone from succeeding at a job, says Carol Quinn, CEO of Conyers, Ga.-based Hire Authority. Quinn spoke during last month’s Society for Human Resource Management’s Talent Management Conference & Exposition. She said managers need to get the candidate to relax and open up, then frame their questions carefully so they can ascertain whether an applicant is a good fit for the role and for the organization.

[SHRM members-only platform: SHRM Connect]

Branding

Nearly 1 in 10 respondents to the CareerBuilder survey said the person they hired didn’t work out because the company did not properly convey its brand or culture to the new hire.

An employer branding strategy should be a priority for any company looking to avoid making a bad hire, Nathan said. In its recruiting materials and on its website, a company should consider using videos and social media to convey messages about the company culture. When a company accurately reflects its culture, it will have an easier time attracting the right talent, he said.

Brandon Hall Research Group suggests that companies look well beyond hard skills when assessing job candidates. When companies focus too much on the skills and experience in a job description, they can overlook whether an applicant has the potential to lead, for instance, or demonstrates behaviors that are inconsistent with the company’s values.

First Impressions Last

Strong onboarding processes improve new-hire retention by 82 percent and productivity by over 70 percent, according to Brandon Hall Group research. And companies with weak onboarding programsare more likely to lose these people in the first year, the research shows.

Onboarding shouldn’t be just a one-week orientation, but rather a yearlong program that helps new hires feel acclimated and motivated to perform, Nathan said. New employees should feel welcomed in their first days, get a tour of the facilities, be introduced to key staff and have their workspace set up with a computer, a phone and business cards. It’s also wise, he suggested, to schedule regular meetings with the new hire—perhaps after 30 days, then 60 days, then 90 days—to discuss how he or she is adjusting.

Lisa Frye is a freelance writer based in Alexandria, Va.