A non-billable plan refers to the strategy for managing time spent on tasks that cannot be directly charged to clients. It’s a crucial part of business operations for service-based companies to balance activities like internal meetings, administrative work, and professional development with client-facing, billable work. The goal is to minimize time-wasting non-billable activities, while strategically using time for essential functions like training and business development to improve overall profitability and efficiency.
Types of non-billable work
- Administrative tasks: General office management, invoicing, and report generation.
- Internal meetings: Team meetings, project planning, and internal strategy sessions.
- Business development: Marketing, networking, and client relationship building.
- Professional development: Training, continuing education, and skill-building.
- Pro bono or discounted work: Services provided for free or at a reduced rate.
- Project-related but non-billable time: Tasks like fixing mistakes or time spent on work beyond the contract scope.
How to manage a non-billable plan
- Track and analyze: Use time-tracking software to monitor non-billable hours and identify trends.
- Automate tasks: Implement tools to automate repetitive administrative work like invoicing and scheduling.
- Set clear boundaries: Differentiate between essential internal work and time-wasting activities.
- Outsource non-core functions: Consider outsourcing administrative or IT support to specialized providers to free up internal resources.
- Cross-train employees: This helps with resource allocation when a project has non-billable tasks or needs an employee to be flexible.
- Plan strategically: Allocate time for essential non-billable work like training and business development to support long-term growth, rather than letting it be an afterthought.