Team Performance Reporting with Xero Practice Manager: Productivity

This article is an extract from the book 'Everything you need to know about Xero Practice Manager'
Get a copy for your desk at www.linkedpractice.com

Productivity

Productivity is the best place to start when reviewing staff performance. Productivity looks at the amount of time a staff member spends on billable work, as compared to non-billable work. It is expressed as a percentage, and is calculated by taking the billable hours worked and dividing it by the total hours worked (excluding leave). We exclude leave because we don’t want someone's productivity to fall when they take time off, although their output (or billable value) would.

Billable work is any work we do for our clients. Put simply, it is time that accumulates WIP for us. Even if your client is on a fixed fee, we still consider the work they are doing for this client ‘billable’ in terms of their productivity. Non-billable work is your internal time. It is any time sheet entry that is not creating WIP.

We pay our staff for the accounting work they do for our clients, so we want to ensure they are doing this as much as possible. If they are doing accounting work for clients, their productivity increases; if they are not, their productivity decreases. This is why productivity is such an important metric to track. We want to ensure our staff are working on revenue-generating activities as much as possible.

Productivity is also a great KPI. It is a target we set with our staff to ensure they are on track to hit their goals. Depending on the role of the staff member, their productivity KPI would change. For example, a senior accountant might have a productivity target of 80%, whereas a director might have 50%. This is because we expect the director to be working on more administrative activities such as business management and planning.

Low productivity in a practice generally indicates there are a lot of inefficiencies in the workflow and knowledge gaps in our team. These inefficiencies and knowledge gaps cause a lot of internal meetings, which slow our production down. Keeping an eye on productivity allows us to investigate non-billable time to see why it is occurring so we can put measures in place to rectify it.

Let’s look at an example:

Say James has a target productivity of 80%. For the past two months he has been hovering around the 60% mark. James is one of our senior managers, so has a billable rate of $250 per hour. In the past James has been one of our star performers, but this 20% drop in productivity is costing us around $8,000 of billable time each month.

When we speak to James, he tells us that he is very stressed and is not happy with the new seating arrangement. We moved him right next to the admin team, so Nicole interrupts him every 30 minutes. He tells us he didn’t want to say anything because he didn’t want to offend her but she talks non-stop and this is getting him behind in his workload, so he has been trying to catch up on the weekends but it’s hard because of his young family.

After this conversation we know we need to move James away from Nicole, and have a chat to Nicole about interrupting people. The next month, James is back to his ‘happy old self’, and his productivity is back up to 80%. We would not have known this if we were not tracking our team’s productivity, and James would have been looking for a new job.

Tracking productivity is not about playing Big Brother. It’s about getting insight into what your team is working on, and where they need help. Think of your team as the high-performance athletes, and you are the support crew. We need to give them the tools and support they need so they can perform at their best.

Practices with high productivity get their work completed faster, have happier staff, and are much more profitable. High productivity is the reward for great processes, and having a good support network in place for your team. By monitoring productivity frequently, we can investigate issues as they arise and rectify them so our team can focus on the work they have assigned to them.

To track time productivity in XPM, create a job report using the report builder.

Here is how it is built:

Report type: Time Productivity

Fields to display on report (in order):

• [Staff] Name
• [Job] Client
• [Task] Name + Label
• [Time Productivity] Date
• [Time Productivity] Billable Time
• [Time Productivity] Non-billable Time
• [Time Productivity] Total Time
• [Time Productivity] % Billable

Criteria for the report:

• [Time Productivity] Date – is on or after {the start date you want to report on}
• [Time Productivity] Date – is on or before {the end date you want to report on}

Rows are: Grouped and subtotalled by the first field

The Team Performance report in Link Reporting makes improving your practice productivity easy. It allows us to group our staff into roles, teams, offices, or whatever grouping you want to use to analyse your staff. This allows us to analyse our productivity at a grouping level as well as an individual level, and also gives us the ability to drill down to the time sheets for further analysis.

Let’s look at an example:

Say we set up two grouping categories in Link Reporting called ‘Role’ and ‘Team’. We assign Mark ‘Senior Accountant’ as his role, and ‘Christine’s Team’ as his team, indicating that Christine is his team leader. When we run the Team Performance report by role, Mark will appear under the heading Senior Accountant. When we run the team performance report by team, Mark will appear under the heading Christine’s Team.

The grouping allows us to compare our teams, as well as the staff within the team. For example, we might want to see how Christine’s team compared to David’s team. We also might want to see how everyone in Christine’s team is performing, so we can help those that look like they might be struggling. We want to be comparing apples with apples. This is one of the many benefits of using the Team Performance report for our reporting.

To run the Team Performance report, select the period you wish to review from the quick select menu, how you’d like to group your staff, then run the report.

The report will contain the following fields:

• Billable
• Non-Billable
• Total Time
• Leave
• Productivity %

You will see these figures at a grouping level, and this can be expanded to review the staff within that grouping. To further investigate a number, you can click on it to open up a new tab with all the time sheet entries that make up that figure. This is particularly useful when reviewing non-billable time. If someone has lower productivity than usual, click on ‘Non-billable Time’. This will open up a new tab in your browser that has all the time sheets with time sheet notes, grouped and subtotalled by the task name. Here you can quickly see why productivity was down and if you need to make some changes.

The Team Performance report shows all staff in the one period you select. This could be a week, a month, a quarter, year to date, or even a custom period. Once you run the report, you have the option of clicking on the staff member’s name which will take you to a Individual Performance report. The Individual Performance report will show you the period you are viewing for that staff member, plus the previous 11 periods. You can help your team succeed by providing them the information they need at www.linkreporting.com

Enjoy this article? Buy the book.

Need help setting up, fixing up, or getting up to speed on Xero Practice Manager?

We can help at www.linkedpractice.com