Billable Hours

[Hermitage]

I just took a job with a company that charges billable hours. At my last job I could set my schedule and am finding myself wondering how I can bill enough hours and still attend to health, family, etc. Any advice? How do I make the system work for me? Or am I stuck in a meatgrinder until I can find another job?

[Ego]

Are they using a real time tracking system or do you simply enter the hours you worked on various projects?

[Scott 2]

Figure out the expected utilization percentage (hours billed per day). Are they billing net working hours (something like 75% or 6 hours per day - ie minus overhead like internal meetings, bathroom breaks, etc.) or gross working hours (ie 8 hours per day). Utilization percentage should tell you this. Make your hour patterns match their expectation.

Multi-task. Sitting on a boring meeting? Bill that to one bucket, bang out work for another project on the same meeting. This can get you 2 hours in one.

Round up. If you touch a project, it's a half hour minimum. Keep your increment as coarse as the business will allow. Some places - nothing gets done in less than half a day.

Don't outperform. If your coworkers take an hour to complete a 5 minute task, so do you.


Working in a bill by the hour environment is awful. IMO it's generally a sign of a weak business model, propped up by micromanaging every little bit of waste. The rules manifest all sorts of dysfunction. I'd get out of there ASAP.

[bostonimproper]

I hated consulting, mostly because of the hourly billing model. Results / performance > hours any day, imo.

My suggestions:
- download and use a time tracking app
- feel free to bill downtime spent chatting with someone or ruminating about a project, even when not in active work
- minimize your non-billable work responsibilities (or make sure your target is reduced to account for these responsibilities)
- some places will have “overtime” rate for more than X hours of work per day. I’ve seen some system abuse where people oscillate between daily minimum one day then overtime the next

[Hermitage]

Are they using a real time tracking system or do you simply enter the hours you worked on various projects?

I think you enter what you did. It's not a clock in system.

[Hermitage]

Don't outperform. If your coworkers take an hour to complete a 5 minute task, so do you.

I'm in a funky situation: I'm making career change to do this job. (I took it to get training before moving on.) I'm going to be the slow poke in the office for a long time. Recommendations?

[thrifty++]

My experience of working in those types of environments tells me that how much of your time you bill is the key performance indicator supreme. That is despite lip service being paid to other performance indicators.

What I found was best to do is rigorously focus time and energy on billing out and rigorously avoid other tasks.

That was my experience and suspicion of the environment you are in. But you might want to suss out the lay of the land a little bit and see if it is like I suspect it is.

[Dream of Freedom]

I haven't worked in such an environment, so I won't speak to that directly, but if the priority is training what is the fastest way to get it so that you have better options? Maybe get a mentor or spend extra time in their training program?

[Scott 2]

I'm in a funky situation: I'm making career change to do this job. (I took it to get training before moving on.) I'm going to be the slow poke in the office for a long time. Recommendations?

In that case - you were hired for cultural fit and potential. Understand your employer's expectations for the role. Do enough to meet them. You might even ask - What does the on-boarding timeline look like? How will you evaluate my performance?

While billable hours are a quantitative metric, they exist only as a proxy for qualitative expectations. The organization will have a culture around their metric. Your job is to understand and fit into it.

IMO - maxing billable hours is a losing game. If your contribution is negotiable, the company will always want more.

Put that energy into relationships and learning instead. Much better to be the person who is liked, who can do the essential thing, than the work horse.

[Hermitage]

In that case - you were hired for cultural fit and potential. Understand your employer's expectations for the role. Do enough to meet them. You might even ask - What does the on-boarding timeline look like? How will you evaluate my performance?

While billable hours are a quantitative metric, they exist only as a proxy for qualitative expectations. The organization will have a culture around their metric. Your job is to understand and fit into it.

IMO - maxing billable hours is a losing game. If your contribution is negotiable, the company will always want more.

Put that energy into relationships and learning instead. Much better to be the person who is liked, who can do the essential thing, than the work horse.

Thanks for the recommendations. I think I was hired for potential and don't want to become a piece of machinery. The company will always want more, a feeling I'm already getting from my boss on my second day of the job.
Are there ways to (ethically) game the system? (I want to focus on the training but not at the expense of overloading and burning out.)

[Scott 2]

I'd focus on learning the rules and culture, before trying to game it. You need the tools to manage your priorities and tactfully say no. Establishing work / life balance is a skill, like any other.

[Hristo Botev]

Multi-task. Sitting on a boring meeting? Bill that to one bucket, bang out work for another project on the same meeting. This can get you 2 hours in one.

Round up. If you touch a project, it's a half hour minimum. Keep your increment as coarse as the business will allow. Some places - nothing gets done in less than half a day.

FWIW, I'm a "timekeeper" (an attorney), and if I took any of this advice I'd be sued and disbarred. "Double-billing" is particularly frowned upon. It also wouldn't take much time before I wouldn't have any clients left to double bill.

If I'm right that your employer's revenue is directly tied in to how many hours you bill, well, that's your value. In my profession it's pretty easy: You bill X hours multiplied by Y rate; your employer decides to (or not to) mark down your hours or your rate for a particular client or for a particular client; the client then further insists upon additional write downs; you take the amount the client actually ends up paying and the firm receives, and then you subtract your salary, benefits, and any other "overhead" your client attributes to you; and viola, that is your profitability and how valuable you are to your employer. Hopefully at the end of the year that is a positive number.

As a practical matter, as inefficient as the system seems like it would be, in my own experience (a little less than 15 years as a timekeeper), the more efficient you get, the more work you get, the higher your billabale rate gets, and the less time you have to screw around. Speaking personally, I don't think I'd be any more efficient with my time if I didn't have a billable model. In fact, I charge flat rates for certain things (like trademark prosecution/clearance matters) for which I have a pretty good idea how long it should/will take, and from experience I don't think I'm any more efficient with my time on flat fee work than I am on hourly billable work.

All that's to say, I'm much less "negative" about the billable model now than I was a few years ago. I've not met too many people who are gaming the system, and that's not because they are afraid of getting caught, it's more because they are just too damn busy to game the system. If they were the kind of person who would game the system, they wouldn't be busy because they wouldn't be getting any work.

It's fine. It's work. It's just another way to apply value to labor time.

But if you think there's some sort of "4-hour workweek" hack for this that isn't illegal or immoral or unethical, I suspect that's not the case.

I'll add that I had a brief break from being a timekeeper when I went on "secondment" as an in-house attorney with one of my firm's bigger clients; NO TIMEKEEPING. I thought I'd enjoy it; I didn't. For one, with a timekeeping model, there are like NO "team meetings," etc. Because you know a client isn't going to pay when they see an invoice where 5 attorneys all have an hour billed with a narrative "prepare strategy for X"--the clients know what at means. But when I was in-house, it seemed like all I did was sit in meeting after meeting; which I hated. Also, as a timekeeper that means you are on the revene side of the ledger and not the expense side; that's a big deal. It means, for one, that you never have to "prove" to your employer what your worth is; you can just look to your profitability. There's something honest and clean about that. I've come to like it. It also means I don't suffer fools at work. I've always got an excuse not to hang out at the water cooler or whatever if I don't want to; or not to talk to some "potential client" who really just wants an hour of free legal advice. Nope.

[Scott 2]

But if you think there's some sort of "4-hour workweek" hack for this that isn't illegal or immoral or unethical, I suspect that's not the case.

FWIW - I don't disagree. I spent the first 7 years of my career in an hourly billing environment. My experience was the clients and consulting firms are also engaged in games. The hourly billing relationship is structured with an inherent conflict of interest. Dysfunction spawns on all sides, generating constant stress and wasting enormous amounts of time.

As the associate, you either play the game or wreck your home life. The reality is - at a sustainable pace, you have about 4 hours of quality knowledge work per day. In my experience, none of the hourly billing structures recognize this. Maybe the legal environment is different than software development.

It's part of why I spent the last 10 years of my career as an employee. Much easier to align compensation with creation of value. I don't know that I'd ever consider a consulting firm again. Maybe if the work was on an FTE basis, managed with a flow based framework like Kanban. But that's essentially an attempt at becoming part of the client company.