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Why you should capture time for fixed fee engagements (and how advanced professional services time tracking software can help)

When an accounting or consulting firm takes on a fixed fee engagement, the professionals assigned to the engagement can often be reluctant to record their work effort. After all, without the right professional services time tracking software, timekeeping can be an arduous, time-consuming process — and since the firm isn’t billing the client on an hourly basis anyway, it can seem pointless to record hours at all.

So rather than record the work hours they actually performed, many professionals choose instead to book their hours to correspond with the agreed-upon timeline and budget of the engagement. At first glance, this seems reasonable: Recording hours this way ensures compliance, and there’s no immediate discernible impact on the engagement or the professional. But when teams fail to accurately capture their time, firms miss out on key data that can help them make better subsequent decisions around pricing future engagements.

Discover the benefits of capturing time for fixed fee engagements, and learn how advanced professional services time tracking software can help your professionals track their hours more quickly and easily than ever before.

Collect and analyze past data

The importance of gathering past data to improve efficiency cannot be overstated. To illustrate this point, consider the following analogy.

When drivers enable location services on their navigation apps, these apps extract data — such as which roads users are traveling on, their average speed, and when and where they come to a full stop. The app then synthesizes this data with additional existing data to identify and predict patterns, allowing it to provide users with valuable information like detailed directions, fastest routes, and near-exact travel time estimates.

Navigation apps couldn’t provide the value and accuracy that they do without the comprehensive data they capture via location services. In the same way, without engagement data, your firm leadership can’t identify key trends and critical areas of improvement to help them make better strategic decisions and successfully navigate the future.

Your firm needs to analyze details from past experiences to determine how much work and how many hours on average go into each engagement type. Based on this information, your firm can appropriately price similar matters in the future and ensure that any fixed fees reflect the actual amount of work being done.

Accurate data will also help you offer greater transparency to your clients — a key differentiator at a time when clients are increasingly demanding more transparency from firms to ensure they’re getting the most value for the best price possible. Detailed records of work hours can help your firm demonstrate to clients just how much work is being done on their behalf. This can help settle any billing disputes and help clients better understand your pricing strategy for fixed fee engagements.

Prepare and adjust for the future

When it comes to using data to identify risk and proactively avoid problems, our navigation app analogy again offers a parallel.

When a car breaks down on the highway you’re traveling on, or when traffic is unusually slow on a particular street you’re headed towards, your navigation app will alert you and suggest an alternative route. In the same way, accurate, comprehensive time data can give your firm the visibility and advance notice it needs to avoid time-consuming and potentially costly problems, and support greater agility during your engagements.

With instant visibility into your professionals’ timesheet details, your firm can monitor engagements in real time to identify high-risk areas and other critical insights that might otherwise get overlooked. For example, you might find that some of your professionals are spending too much time on the wrong kinds of tasks: A consultant might be preparing presentations from scratch instead of using existing templates, or a junior accountant might be spending too many hours reviewing a low-impact account with an immaterial account balance, instead of seeking time-saving guidance from a senior team member.

You might also discover that your staff are spending too little time on certain tasks, which could indicate that they’re skipping critical steps or that they forgot to record their time — missteps that could result in significant errors or erroneous billing and leakage.

By identifying these problems, not only can you take immediate actions to rectify them, but you can promote methods such as better onboarding and training to prevent these problems from occurring again. These adjustments can help your professionals work more efficiently moving forward.

Support your professionals by adopting professional services time tracking software

Despite the benefits of capturing time for fixed fee engagements, many accounting and consulting professionals can find it too difficult or time-consuming to accurately record their hours without access to modern timekeeping tools. By investing in advanced professional services time tracking software, your firm can help your professionals capture their time quickly, easily, and, most importantly, accurately.

Tools like Intapp Time let users choose whether to passively or actively capture their hours and work efforts — both more effective and accurate methods than simply estimating hours from memory, which can lead to underreported time. The software automatically captures narrative information, which your professionals can edit later if necessary, and provides templates with prepopulated information to save them time and ensure that they don’t accidentally leave out narrative details for recurring types of tasks.

Intapp Time also offers a full-featured mobile solution so users can easily capture their time whenever and wherever they find it convenient to do so. This is especially useful for professionals who are always on the go, as they can enter their time immediately on the mobile app rather than trying to remember to enter it once they’re back online.

Investing in advanced professional services time tracking software will make the timekeeping process less stressful for your professionals — and, consequently, your professionals will be more motivated to record all their work efforts for fixed fee engagements.

Schedule a demo to learn more about Intapp Time and how it can help your accounting or consulting firm improve efficiency and profitability.