A recent article by Roger Russell (November 5, 2007) in Accounting Today and also appearing on the webcpa site proves that just a focus on project management, rather than time, is sufficient to increase effectiveness, no matter how you price.
A quote from Mark Robinson of KAF Financial Group really summarizes it quite nicely, “We also became a project-based firm,” he said. “We stopped thinking about billable hours and started thinking in terms of getting the work done. We became more focused on working as a team to deliver projects, not on getting 75 billable hours per week.” (Emphasis mine.)
However, my favorite quote is from the articles author who, when describing Robinson results writes, “Productivity actually increased.” (Again, emphasis mine.) He seems incredulous.
Yes, you can actually increase productivity by focusing on the results not the efforts! We wonder if KAF Financial Group still bills by the hour and keeps timesheets even though they have already demonstrated the absurdity of hourly billing and tracking.