How much of the time you record do you actually get paid for?
The share of recorded billable time that turns into fees. A team can be fully utilised and still underpaid, if much of that time is written off, discounted or absorbed into fixed fees that were set too low.
Get a finance reviewFees billed ÷ (Billable hours × Standard charge-out rate) × 100
Often 85% to 95% in well-run professional practices. Below 80% usually points to pricing or scope control issues.
The value of fees billed compared with the value of billable time recorded at standard charge-out rates. On fixed-fee work, it compares the fee with the time the work actually took. It can be measured by person, project, client or service line.
Utilisation shows whether people are busy on client work; realisation shows whether that work is paid for. Low realisation is one of the most common and least visible causes of weak margins in professional services. It points to underpricing, scope creep, inefficient delivery or reluctance to bill, and each of those needs a different fix. Together with utilisation, it explains most of the gap between what a team could earn and what it does.
It only works if time is recorded honestly, including on fixed-fee jobs. Look at it by client and by type of work, as low realisation usually clusters. Separate write-offs agreed before billing from bad debts after it. When realisation is low on fixed-fee work, compare the original estimate with the actual hours before blaming the team.
Most owner-managed businesses don't, or they work it out in a way that flatters the result. We'll calculate it from your own numbers and show you what it's telling you.
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