When launching the website for our new Spreadsheets by Email service, I started fiddling around designing a logo, knowing I wanted the website live in a couple of days. After a few attempts that looked far better in my head than they did when I tried to recreate them on the screen, I stopped short and realised that I was seriously undervaluing my time. I took a few minutes to find a service on the web, paid £19 on a credit card for next day delivery by email, and got on with everything else I needed to do.
Those of us who sell our services, often have a good idea of what our time is worth, but we still need to pull ourselves up quite regularly. It can be even harder when we are working within an organisation.
When I was back in practice, our charge-out rate was always three times our hourly pay-rate. Keeping timesheets, which were costed at this rate was a very useful reminder of the opportunity cost of any wasted time. Are you confident that the time you spend at work is worth three times what you are paid? Useful question, isn’t it?
It can be worthwhile, keeping a timesheet for a week, or even a day, and attempting to put a value on each job before comparing it to the cost of the time spent.
Areas where Finance Directors often spend time that can usually be done far more cost-effectively by someone else are:
l need to add value to our businesses., especially in the current economic climate where it is vitally important to add more value to your business than you cost them – so, don’t forget to keep asking yourself, “Is this the best use of my time?”
- Management Accounts preparation – the more you can automate and/or delegate this process, the better. The real value-added is in the review and decision-making based on the numbers;
- Technical tasks, e.g. setting up spreadsheets, fixing IT problems;
- Procurement – sitting in endless meetings comparing suppliers in areas where the possible savings far outweigh the time spent.
- Company vehicles – I have seen Finance Directors spend huge amounts of time sourcing vehicles, effectively acting as a used car trader. This is one of those areas where personal interests can really distort our priorities.
Whenever you find yourself spending more than, say, an hour on something, just stop for a second and think, “Is this the best use of my time?”
If the answer is no, the next question you should ask is, “Who could do it better and cheaper?” Here are a few ideas:
- Another member of your department – we all know the benefits of delegation, so this route should always be considered.
- A member of another department – sometimes we spend ages on jobs to get information we need, when a slight variation of that information is already produced in another part of the business. Adding a few amendments to the way that information is collected, may add no work to the member of staff producing it, while removing the work altogether from your department.
- An outside supplier or freelancer – often these jobs are one-offs which mean there is an unproductive learning curve for whoever does it in the organisation. These are the times when it pays to go outside. It is very easy to find external suppliers via the internet. It can be very surprising the cost-savings available through this route. For example, within my own group of companies, we offer free procurement services and spreadsheets built from around £40/$60.