I seem to be on a billing kick. This is good, because how we bill affects how we think about our work, the type of work we do, the clients we have and obviously our bottom line.

Generally speaking, we estimate our projects in half-day and day-long increments. We should bill (and work) the same way. This enables designers and programmers to focus on a single project for a while, to get in “the zone.” It also enables us to move beyond being thought of in a “contract” type role, and places the focus on individual projects (a change I’m trying to make immediately here at LD).

Obviously there will still be little things that need to be billed hourly. For a print project, that might be a quick press check. On a web project, that might be making a minor update to something - things that aren’t specifically project-based, but are small maintenance issues. For those, we bill in half-hour increments, with an hour minimum.

Successful firms (I’m talking management consulting firms, etc.) may bill by the hour, but they typically staff projects according to days — i.e., this project will require x number of days at y rate per day (assuming eight hour days). Of course, this is purely based on my unsubstantiated assumptions, and my have no basis in reality. That said, it seems like it would make sense to me. So new rules:

• Anything that requires an SOW will be estimated and billed in half-day increments.
• Anything that doesn’t require an SOW (small updates, etc. - less than half a day), will be billed in half-hour increments with a minimum charge of an hour.
• Singular tasks done by manager-level staff — a quick phone call, for example — may be billed in fifteen minute increments, if part of a larger series of tasks.

This entry was posted on Wednesday, January 10th, 2007 at 6:28 am and is filed under Blog, Business. You can follow any responses to this entry through the RSS 2.0 feed. You can trackback from your own site.