by Darryl Sparey, co-founder
The question I’m most frequently asked when I tell another agency owner that we don’t use timesheets is: “So how do you know what everyone is doing?”
It’s a fair question. If you’re running an agency, you need to know whether your people have too much work, whether your clients are getting what you promised them, and whether you’re making any money. Preferably before your accountant tells you that you haven’t.
But there’s quite a leap from “I need to understand my business” to “I need everyone to reconstruct their working life in 15-minute increments”.
How do I know what everyone is doing in my agency without timesheets?
One of the things that has always struck me about PR agencies is how much useful information they produce, then promptly bury.
Someone downloads a media list, adds a couple of columns to show who they’ve pitched and who’s interested, and saves it in a folder. Inside another folder. Inside a client folder. Somewhere that the next person working on that account may never think to look.
There’s valuable information in there. Which journalists are interested in the client? What have we pitched them before? What worked? What didn’t?
When we started Hard Numbers, we wanted that information to be available across the business. So we built the agency around a customer relationship management system, or CRM. We use HubSpot, and an email widget logs our interactions with journalists, clients and prospects directly into it.
If I want to understand our relationship with a publication, I can see who we’ve spoken to, what we’ve pitched and where we’ve secured coverage. And we can use that history to make better decisions about what to pitch next.
That is useful management information. Asking someone how many minutes they spent on “media relations” six weeks ago tells me considerably less.
Of course, an email record won’t tell you how good the idea was, or how much thinking went into it. I’m not suggesting we replace a competition to log the most hours with a competition to send the most emails. We need to understand whether the activity is getting us anywhere.
How can I track workload and profitability without timesheets?
The next question is usually about capacity. How do you know if someone has too much work?
Well, a useful place to start is how many clients they’re working on.
We track that weekly. We also have staffing bands based on account size, so there are boundaries around how many people should be working on an account.
Neither will tell you everything on its own. Two clients with the same fee can make very different demands on a team. But they give us something to investigate. If someone is working across too many accounts, or a relatively small account has acquired half the agency, we should probably have a conversation.
Every other month, we also ask the team to estimate roughly what percentage of their time they’ve spent on each client. We use that to help assess client profitability.
“Hang on, Darryl. Isn’t that a timesheet?”
I don’t think asking someone for a rough split of their workload is the same as asking them to account for every quarter of an hour. And crucially, we treat it as a rough split. We don’t pretend it’s precise because we’ve put it in a spreadsheet.
People cost money. An agency that doesn’t sell hours still needs to understand the cost of delivering its work. Put those estimates alongside the account fee, the size of the team and what’s being delivered, and you’ve got a much more useful basis for a discussion about profitability.
The point is to spot a problem while you can still do something about it. Chasing a missing timesheet after the end of the month doesn’t help the person who was overloaded three weeks ago.
How do I hold teams accountable without tracking their hours across my agency?
This is the bit that matters most to me.
We write our KPIs into our client contracts. These can be outputs, such as news announcements or media opportunities, or outcomes, such as leads, event attendees or sign-ups, depending on the brief.
And we have a clause that says if we don’t hit our agreed KPIs in a given quarter, we’ll work at our own cost until we do.
It’s quite easy to put “results-driven” in a credentials deck. It’s a more meaningful commitment when you put it in the contract.
We review progress across our client teams, looking at which accounts are ahead, on track or behind their commitments. That helps us decide where we need to put more resource, where an approach needs to change, and where we need to have a conversation about scope.
That’s how I think measurement should work. It should give you information you can use to improve the result while the work is happening.
If you only start thinking about measurement when you’re preparing the end-of-campaign presentation, you’ve missed a lot of opportunities to do a better job.
And the commitment needs to make sense for the client. A news announcement might be an agreed deliverable, but we should still understand why we’re making it. Who are we trying to reach? What do we want them to think or do? How does that help the business?
Those are the questions I want our team spending time on.
How can AI help my agency focus on more high value work?
There’s another reason we built the business this way. We knew AI was coming, even if we didn’t know exactly when or what it would be able to do.
If a task took ten hours last month, and you find a way to do it just as well in five hours this month, that should be good news.
But if you sell hours, you’ve just found a way to halve what you can charge for that task. You’ve made the work more efficient and created a commercial problem for yourself at the same time.
That seems a fairly odd incentive to build into a business.
I think about agency work as “grunt work” and “front work”. There’s the repetitive preparation and administration. And there’s the thinking, the advice, the time spent with clients working out what will actually make a difference.
If AI can help us spend less time on the grunt work, we can spend more time on the front work. That’s a benefit to the client and to us. Our commercial model should encourage us to do it.
What is the best way to buy PR agency services, without using timesheets and hourly rates?
For in-house teams, I’d start with a fairly simple change. Ask an agency what it will commit to delivering for your budget.
Procurement professionals need something they can compare and negotiate on. I understand that. It’s their job. But an hourly rate tells you very little about whether the agency will achieve what you need.
A cheaper hour isn’t much of a saving if you need twice as many of them.
Agree what will be delivered, by when, what good looks like, and what’s included in the fee. Ask how the agency will measure progress and what happens if it misses its commitments.
You still need judgement. Ten pieces of coverage in titles your customers don’t read aren’t equivalent to ten in the publications they turn to for advice. The communications team needs to help procurement understand the difference.
But at least you’re discussing what the budget will buy and how it will help, rather than whether writing a press release should take three hours or four.
I’m not suggesting agency owners should stop looking at the numbers. I co-founded a business called Hard Numbers. That would be an about-face of the kind of proportions of “Hail Hydra” in Captain America:Steve Rogers #1.
I’m suggesting we ask for information that helps us run a better business, give our people manageable workloads and deliver what we promised our clients.
And let everyone get on with doing that, rather than trying to remember what they did on the first Tuesday in May.
