Time gentlemen please
In the last edition of Connection, we examined the time that could be saved within an IFA practice by the optimised use of technology. It was possible to make this assessment for the firm concerned as they were fee-based and therefore recorded all time spent. However, recording time does not have to be the preserve of the fee-based firm and even when not directly related to fees, without meaningful and accurate data about how you are spending your time, how can you determine where it can be spent more efficiently?
Unlike many business sectors, financial advisers effectively have two assets they can deploy to get a return on their investment – time and knowledge and whilst it is possible to increase the latter (by the skilled investment of the former, using tools such as Techlink), time is the only constant in our lives and cannot be increased, only used more efficiently.
Most advisers are familiar with the concept of undertaking an asset allocation for clients, so why not undertake the same exercise for yourself and your business, identifying how your asset of time is allocated at present and creating a more efficient and profitable allocation? [See Figures 1. & 2.]
Figure 1
Figure 2
In order to undertake this exercise, it is necessary to record time accurately within your business life. Although most accountancy and legal firms have embedded time recording at the heart of their businesses for many years, it is fair to say that the discipline – for it IS a discipline – has not achieved significant penetration within the advisory sector. However, the pressure for change represented by TCF and the Retail Distribution Review means that an increasing number of advisers are examining both time recording and the relationship with fee charging far more closely than ever before. Charge rates and fees will be considered more closely in a subsequent article and for now, let’s focus purely on recording time.
Before time recording can be implemented, a few decisions must be made and rules put in place, in order to ensure that the resultant data is meaningful and of value. These should include:
- The task groups and task names to be used
- The basis for time recording – specific or units of chargeable time (UCTs)
- Whether to record time against just clients or against specific holdings/projects
Unless top-level task groups and pre-defined task descriptions within those groups are defined, time will be recorded under a myriad of different titles and terms, making any meaningful analysis impossible. Task groups may include;
- Prospecting and marketing
- Client meetings and contact
- Preparation, research and report writing
- Travel
- Client servicing
- New business administration
- Compliance and T&C
- Business management and development
- Personal
Naturally, within each of these there may be a varying number of task descriptions but, initially at least, it is advisable to avoid creating too many definitions, purely in order to ensure manageability.
In order to record time, two approaches can be taken: Recording the start and finish time of any task, creating an accurate record of time taken or, alternatively, utilising the approach of ‘units of chargeable time’ or UCTs, which is the approach typically taken by other professional firms, such as accountants and solicitors. The use of UCTs and their relevance to fee-charging will be discussed in a future article. However, for the purposes of this article, their benefit in simplifying the process of time recording will suffice.
UCTs simply allow for an hour to be broken down into equal units, for example 10 units of six minutes each. In this case, any part of a unit is rounded up to the nearest whole. Hence, a five minute telephone conversation is rounded up to six minutes; a seven minute conversation rounded up to twelve. On this basis, time can be recorded using a simple ‘tick-sheet’, either on paper or on-screen, which streamlines the process. [See Figure 5.]
Staff member – T. Smith |
Date 24/10/2008 |
||
| Client name | Task group | Task description | Number of units |
| M Mouse | Preparation research and report writing | Product research and quotations | 4 |
| D Duck | Client meetings and contact | Factfinding | 5 |
| D Duck | Travel | Travel to client | 3 |
| P Luto | Client servicing | Obtaining valuations | 3 |
| [Figure 5. above] Simple tick sheet | Total | 15 | |
Ideally, a firm’s CRM system will allow time to be recorded against a client, holding or project as an integrated part of the business process, allowing both the recording of the task, any further action or diary note together with the associated time and categorisation, which in turn will produce the necessary management information needed to make valid business decisions. [See Figures 6. and 7.]
Figure 6
Figure 7
However, for many firms who have yet to implement a full CRM solution, the move to time recording and analysis has often been too great, as paper-based systems do not offer the powerful reporting, whilst the use of spreadsheets requires an investment of time in their creation, whilst not always being as intuitive as would be desirable. [See Figure 3.]
For this reason, Capita Financial Software is creating a simple utility which will allow a user to record time against a range of pre-defined tasks, with detailed reporting providing an immediate analysis of how time is being spent and, importantly, where it can be saved. The tool is not meant to replace a client management system or be used in the long term, but can be provided free of charge to those firms who wish to begin the process of time management and how it can be embedded in their business. [See Figures 3. & 4.]
Figure 3
Figure 4
An old adage has it that “the journey of a thousand miles begins with a single step”. However, in this age of technological advancement, perhaps a more relevant adage would be that now, the journey of a thousand miles begins with programming the satnav and the first thing this tells you is where you are now.