How To Reduce Non-Profitable Working Time
There might be no such thing as 100% productivity, but there’s every chance you’re spending time on non-profitable tasks you’re better off not doing! Here’s how you can track and reduce those non-profitable hours.
STEP 1: Define What A Profitable Hour Looks Like For You
Answering this question isn’t as easy as it first seems. Depending on the type of business you have, and how much help you currently have from employees or virtual assistants, you might be doing any of the following in an hour you’d deem as profitable:
- Directly delivering your products or services to your customers, such as coaching calls, workshops, teleseminars, consultations.
- Processing sales orders either by phone or fax or internet.
- Writing a sales page or sales letter or sales copy to promote your products or services.
- Calling prospects or leads to offer your products or services.
- Writing proposals or quotes for prospects or leads.
- Delivering sales presentations to potential clients.
- Building relationships with existing customers or clients, calling them or taking them to lunch or coffee.
Now, not all these tasks are directly earning revenue but they do contribute in some way. Until you get good enough in your tracking to measure the unique contribution of each of your tasks to the bottom line, you’ll have to rely on your best judgement about which tasks your profitable hours are spent on.
But, notice there are quite a few types of tasks that are *not* listed above as the focus for profitable hours. Going to the post office, managing your emails, and other administrative tasks aren’t there. Any time you spend on tasks that can be automated, done by someone else, or don’t need to be done at all are *definitely not* profitable hours.
STEP 2: Calculate How Many Of Your Hours Spent Are Profitable
So long as you’re able to recognise which of your hours spent are profitable and which aren’t, there are several ways you can measure and track the profitability of your time. Here are a few to get your measurement juices flowing:
ROTI (Return On Time Invested): total net profit divided by the number of hours you worked in your business, each month
Billable Time: the total hours you billed as a percentage of the total hours you worked in your business, each month or each week
Income Producing Time: the total hours you worked on tasks that contributed to earning revenue as a percentage of the total hours you worked in your business
You’ll need a way to capture how you are spending your time, so you can record which tasks are profitable and which aren’t. This might mean using a time sheet, or your diary, or even your Outlook Calendar, to record each task you do in your business. At the end of each week, you’re going to tally up the hours that were profitable versus the total hours you worked.
Yes this will take some discipline! But be prepared for a surprise: the very act of tracking how you spend each hour in your business can on it’s own start improving the profitability of your time. You’ll become more aware, and with greater awareness comes conscious choice.
TAKE ACTION:
Start recording how you spend your time – hour by hour – so you can identify which hours were profitable and which were not. Then set up a measure to track how profitable your time is. Look more closely at the time you spent that wasn’t profitable, and decide whether to automate, delegate or delete!
Stacey Barr is a specialist in performance measurement, helping micro and small business owners to move their business results from where they are, to where they want them to be, using powerful, transformational measures. To grab your free copy of Stacey’s Special Report “7 Clues to Measure What Matters In Micro & Small Business”, visit www.staceybarr.com/smallbusiness. Article Source:http://www.articlesbase.com/management-articles/how-to-reduce-nonprofitable-working-time-852957.html
Share this:
Read also:
- Keep the Christmas Spirit in Retail
- Avoid Inconveniences By Choosing The Right Freight Shipping Company
- Managing Your Local SEO Work: Tools and Ways to Get Efficient
- Stop employee attendance problems from becoming a big issue
- Understanding the ITIL Qualification
- Managing Retail Displays this Black Friday