When you run a service-oriented business like a marketing agency, it is not clear how many hours you spend working on certain tasks.
Designing a website doesn’t always take 12 hours and 47 minutes. Sometimes it can take less, and sometimes it can take astronomically more (ask us how we know).
Then it gets weird. It can be difficult to figure out how much time you spend on the different services you offer, leading to a lot of unknowns.
- Which service is your profit driver?
- What service do you think is your winning factor, but it isn’t?
- What service do you need to remove from your offerings because it is taking too much time on your team without enough revenue to make up for it?
This is the phase in the service business (or agency life) when you ask yourself, “Why are things so difficult?” If you’re wondering how to make business easier, figuring out how long each task takes and whether your team’s time is worth it in terms of sales is an essential part of your decision.
We happen to know the woman who can lead your company from quicksand to a smooth process with clear target times for every service and trust in your profitable offers. ELITE Coach and Founder of Jeronamo Solutions Monique Morrison recently made a (virtual) stop at the DigitalMarketer Lab to show us how she turned her business (and others) into a logistics machine.
She calls it the Evergreen Growth Engine, which is where calculations give you the right answers to the questions you asked. With Monique’s target hour strategy, we show you how you can:
- Set target hours for every task your team does
- Check how many active hours you have available to distribute across your team
- Distribute available active hours efficiently (without burning out your team)
Ready to break up?
Set target hours for every task your team does
It’s time to grab your list of offers. Keep it handy as you calculate how many hours it will take to complete this task. Remember, this is just an average. Sometimes this task can take longer or shorter.
For example, if you run a marketing agency where you create websites for clients, create email funnels based on the landing pages created for them, and feed back success metrics that you will find out:
- How long does it take, on average, to create these websites?
- How long does it take, on average, to write the landing page and email funnel copy?
- How long does it take on average to generate a report and present it to the customer?
For example, let’s say it takes your team 20 hours to build the website, 10 hours to write the landing page and email funnel copy, and 3 hours to build the report and present it to the client. These are the target hours for each of these assignments. Depending on how many customers you have, they are multiplied accordingly.
To calculate the target hours for a task, enter how many hours a task completes on average.
After we understand how long it will take for each offering to complete, we need to figure out who on your team has the time to work on those offers and how much they can do.
Spread the hours among your team
We recommend doing this in a spreadsheet so that you can use formulas to calculate these numbers automatically. In your table, create a column titled “Team Member” and write the names of your employees in each row. Next to this column, create a column for the total hours the employee has worked with you.
For example, your full-time employees work 200 hours a week (40 hours x 5 days a week), but you may have part-time workers or contractors who only work 20 hours a week.
Next to the “Total Hours” column, add an “Active Hours” column to calculate how many active hours each employee has available. And then next to that column you create a column for each task on your team. Tasks include client work (like building websites and email funnels) but also marketing, training, administration, etc.
Using your target hours from the last step, you can determine how many active hours each employee has available. For example, suppose you have a co-worker named Jenna who is responsible for creating websites. She builds about one website a week and works full time. Since it takes an average of 20 hours to create a website and she works 40 hours a week, Jenna has about 20 active hours left.
To find the active hours of each employee, multiply the target hours of each completed task and subtract this sum from the total working time.
Do this for each team member to get a total of the available active hours.
Distribute the available active hours
Are you starting to see your business in a whole new light? This is the case when the organization encounters service-oriented companies. We like to call it magic, but Excel would probably just call it formulas.
Add up all the active hours available to you among all of your employees and compare them to your target hours. Your goal is to have fewer target hours than active hours. If you have more active hours than target hours, you will need to hire an employee or contractor to do the tasks your team cannot do.
To find out all of your total active hours, add all of the active hours available from each of your employees.
The key here is knowing what * tasks * to invest those new-found hours in. Here we need to talk about profit drivers. Monique also showed us how to calculate the profit factors of our business, which is a crucial part of that. We don’t want you to use your active hours on tasks and offers that reduce revenue.
We want you to take advantage of those extra active hours and assign them straight to the winners, the money-making offers, and the tasks that make a big difference. Make sure to find out your profit drivers to know exactly what to spend your time on.
Know how many active hours each employee has AND how many active hours you have in total AND how long each task takes –You can find out:
- How many other tasks can each employee take on or not?
- How many more customers can you add to your roster?
- Which tasks do you have time for and which tasks do not
Isn’t it wild how your business feels messier than the tornado a toddler leaves unattended after 3 minutes – and still organizes faster than you can imagine? (Unfortunately we’re only talking about your business here, not your living room).
With Monique’s approach to target hours and her calculations to determine your profit factors, you can see your business in the light you need. This is when you can double the offerings and tasks that are moving the needle (big time) and throw off balance those that just weren’t working.
If you need additional help with this, check out Monique’s Sales and Resources Workshop: Building an Evergreen Growth Engine in the DigitalMarketer Lab. In this workshop she covers how to look into the past to see what works and what doesn’t, look to the future to just focus on what works, and how to optimize opportunities.
These calculations are your ticket to switching from “why is it so hard?” to “Wow, that’s not that bad. I know exactly what to do. “
Time to open this table.