February 2024 - Action Coach Geelong

Navigating Non-Billable Hours in Trades Businesses

In the world of trades businesses, where every minute counts, the concept of non-billable hours looms as a challenge that can significantly impact productivity and profitability. These non-billable hours encompass tasks that don’t directly contribute to generating revenue—activities that can often slip under the radar but play a crucial role in the overall functioning of the business. Today, we’re delving into this aspect and presenting a unique approach that can transform the way trades businesses address non-billable hours.

Before we dive into the strategy, it’s important to acknowledge that non-billable hours are more than just a minor inconvenience. They can encompass various activities, from administrative tasks and travel time to training sessions and project planning. While these tasks might not result in immediate revenue, they are undeniably essential for the smooth operation and growth of a trades business.

Reverse Thinking Strategy

Now, let’s talk about the reverse thinking strategy, a powerful concept that flips the traditional approach to non-billable hours on its head. Rather than solely focusing on the billable hours that your team is clocking, the reverse thinking approach shifts the spotlight onto the hours that aren’t billable. It’s a shift from “How much can we bill for?” to “How can we minimise non-billable hours?”

Consider the scenario of a plumbing business. Imagine there are four team members: Tim (the owner), Rob, Blake, and Luke. Instead of dissecting the billable hours of each team member, the business adopts the reverse thinking strategy to address the non-billable hours.

Tim, for instance, spends 1.5 hours on non-billable tasks. Rob’s non-billable hours amount to 1 hour, while Blake and Luke each have 0.5 hours. These hours could involve tasks like quoting, administrative duties, cleaning, or even training, which might not directly translate into revenue-generating work.

The pivotal step here is to recognize the importance of allocating a portion of non-billable hours to job-related activities. In this example, the plumbing business mandates that all team members, apart from half an hour, must dedicate their non-billable hours to job-specific tasks.

To implement this strategy effectively, the business utilises a job management system. This system not only helps differentiate billable and non-billable hours but also aids in tracking how non-billable hours are allocated.

Moreover, communication plays a significant role. The team members are educated about the reverse thinking strategy and the necessity of minimising non-billable hours. It’s a collective effort aimed at boosting productivity, enhancing the business’s performance, and ultimately contributing to its success.

Tracking The Progress

Tracking progress is another crucial component. The business employs a whiteboard to visualize and update the non-billable hours allocation on a weekly basis. This transparency not only keeps everyone accountable but also fosters a culture of productivity and responsibility.

The reverse thinking strategy offers a fresh perspective on tackling non-billable hours in trades businesses. By actively managing and allocating these hours to job-related tasks, businesses can strike a balance between essential non-revenue-generating activities and revenue-generating work. It’s a proactive approach that not only optimises productivity but also drives growth and efficiency. If you’re intrigued by this strategy or have implemented a similar approach, we’d love to hear your feedback. Let’s work together to empower trades businesses for a more productive future.

Find out more by grabbing a copy of my two Wealthy Tradie Books

Creating and Sustaining a Positive Culture in Your Trades Business

In the dynamic world of trades businesses, the significance of cultivating a thriving workplace culture cannot be overstated. A healthy culture not only enhances productivity but also reduces employee turnover rates and fosters an environment where everyone can thrive. So, how can you build and maintain an exceptional culture that resonates with your trades business? Let’s explore some actionable steps and insights that can make a substantial difference.

Documenting Your Culture

The first step towards establishing a great workplace culture is to document it. This involves putting your culture’s values, norms, and expectations in writing. While this might sound like a formal process, it’s crucial for ensuring that every member of your team understands and embraces the culture you aim to foster.

In the context of trades businesses, where practicality is often favoured over elaborate corporate jargon, adopting a point-by-point, rule-based approach tends to be more effective. Addressing specific areas of concern such as start and finish times, phone usage policies, vehicle protocols, and sick leave procedures can set clear expectations and minimize misunderstandings.

Tackling the Sore Points

We’ve all encountered scenarios where employees start off strong but gradually slip into behaviours that compromise their performance and dedication. Punctuality begins to waver, and standards begin to dip. To counteract this phenomenon, having your culture documented and accessible becomes invaluable.

By clarifying expectations about crucial aspects such as work hours and behaviour protocols, you can prevent the erosion of standards that often creeps into a business. Imagine having a clear policy on start times that’s not only communicated but also visibly available for everyone to see. This not only reinforces discipline but also acts as a reminder of the standards that the business upholds.

Integration into Training and Communication

While the documentation of your culture serves as a foundation, integration is key. Every new team member should be introduced to your culture as part of their training process. It’s an opportunity to emphasize the values that underpin your business and lay the groundwork for consistent behaviour.

Moreover, effective communication is a linchpin of sustaining a positive culture. If there are any changes or updates to your culture’s guidelines, everyone in the business should be promptly informed. Whether it’s through regular meetings, digital channels, or internal announcements, keeping everyone in the loop ensures that the culture remains alive and relevant.

A Culture Template for You

To facilitate this process, we’ve prepared a culture template that you can readily download from our website. This template is designed to cater specifically to trades businesses, offering a structure that’s easy to understand and implement. By entering your details below, you’ll receive immediate access to this valuable resource that can act as a catalyst for transforming your workplace culture.

In conclusion, building and maintaining a strong culture in your trades business requires dedication, clarity, and consistency. By documenting your values, addressing potential challenges, and integrating your culture into every facet of your business, you create an environment that not only drives productivity but also nurtures a sense of purpose and unity. Remember, a thriving culture is an investment that yields dividends in the form of engaged employees and sustainable growth.

Don’t miss the opportunity to enhance your trades business’s culture. Unlock the culture template by clicking here to download then you can embark on a journey of positive transformation today.

Dealing With Non-Billable Hours