Timesheets are Training Wheels

I received an E-mail this morning from Hugh Williams in Great Britain, author of the new book, Life Without Timesheets. I love Hugh's analogy:

Dear Ron

Does this make sense? I found myself thinking of it yesterday.

Billing based on time sheets is like riding a bicycle with stabilisers. Before you remove the stabilisers you think: Help I could never manage without these. They make me feel so safe.

Little do you realise that, once the stabilisers have been removed you a) will go much faster and b) be a far better rider of bicycles.

So I now think that time sheets are for people with no confidence in their own ability. Strong stuff but (as I firmly believe) true.

How many more enemies will I have just made, I wonder?

Yours ever

Hugh

I used to believe a firm could implement Value Pricing and still maintain timesheets, as long as they were used for cost accounting purposes only, not pricing.

I no longer think this, and for what I believe is an empirical reason. After working with those firms that I would consider to be the best pricers in the Professional Knowledge Firm industries—comprised of accounting, law, advertising and IT firms—I discovered one commonality: the best pricers didn't have timesheets. I believe this a causal relationship, not just correlative.

Those PKFs without timesheets have removed the training wheels. The firms that continue to maintain them always go back to them for value and pricing decisions. They don't use them for cost accounting, since they already know their costs (they are, after all, mostly fixed). Anyway, we are not going to become better pricers by becoming more accurate cost accountants.

Take off the training wheels and watch your pricing competency accelerate. I firmly believe it is the only way to become a better pricer.