Becky’s Bytes: Four ways to avoid underestimating and overbooking your time

In the late 1970’s, psychologist Daniel Kahneman proposed that when planning a task, humans budget their time optimistically. It happens with yardwork: You plan an hour to weed the garden, it takes two. It even happens at Office Administration Associates: We budget an hour for a new client’s payroll, it invariably swells to two.

The weeding gets done and the payroll gets posted on time.  Nothing fatal about that optimistic time management flaw, until it becomes your business plan. When you underestimate the time, you’re likely double-booking your time because there are few days when you have only ONE project or client on the calendar.

Here are a few tactics to avoid erring on the short side of the time you budget for a project:

1)      Use past experience as a guide, not as a rule. the phrase “it always took an hour, except when…” really means that we should budget the time for the exceptions.

2)      See the small picture. The big picture is that it takes me 15 minutes to get from appointment A to appointment B because Google Maps said so. Google maps doesn’t account for you grabbing your keys, getting out of the building, finding a parking spot, etc. The 15 min. is the big picture, the other steps are the small picture.

3)      Automatically ‘pad’ your best-guess time estimate based on 1) and 2) by an extra 15 minutes. The 1957 book by Northcote Parkinson gave us Parkinson’s Law: Work expands so as to fill the time available for its completion. It holds true 60 years later despite all our time-saving gadgetry.

4)      Delegate what you can. Small business owners who succeed are the ones that embrace the idea that they don’t personally have to do everything. They hire pros to help with the tasks (marketing, office management, equipment maintenance, etc.) that take time away from client-facing or client-servicing roles. There are enough hours in a day when you aren’t trying to take on everything.

We’re all busy. If they plan properly, no entrepreneur has to be late or miss deadlines – both of which are customer-service suicide.

Photo by Catalin Petolea, used with permission.
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Becky's Bytes: Have your ducks aligned with CFO-level service

The National Federation of Independent Business (NFIB) is among a number of resources that suggest outsourcing as a direct means of boosting your bottom line rather than denting it. The role of Chief Financial Officer is one that comes up often as you can see in this related article from the NFIB.

 

Beef up your success quotient by adding an outsourced CFO's time to your own available time, and you will, by default increase the amount time spent on income generating activities...

success = total time - time managing cash flow - time managing risks

                generating revenue time

The CFO for a business manages cash flow: The accounts payable and the accounts receivable. Cash is king and cash flow is critical to businesses small and large. Lying beneath cash flow are the essential tasks of maintaining budgets, taxes, records, insurance, payroll, and liabilities. Consider how much time is gobbled up just in the first third of the year on these responsibilities before tax filing. A full-time CFO works year round so the 'ducks are in a row' prior to tax season, leveraging the best ways to cut expenses, pay bills on time, and keep production going. When a business owner is the CFO because a full-time one is financially out of reach, then it's the producing revenue part that falls to the second priority… behind the ducks.

If you've been behind ducks, you know it's cleaner walking ahead of them.

 

Imagine now that while acting as CFO, you got yourself into an audit. That's a whole flock of ducks you don't want on your beach. This isn't to say a full-time or an outsourced CFO will avoid an audit 100 percent of the time, but it one came up, they – not you – would be spending the time on it, and you could stay focused on the revenue-generating.

Outsourcing buys you an available assistant – available as you need – without the full-time headcount you might not yet need for the business. A way I look at it is that the assistant assists you with having more time with paying customers… and less time with ducks.

 

Photo by Serge Villa, used with permission.

Becky's Bytes: Celebrate the upcoming National Small Business Week

 

More than half of all Americans either own or work for a small business, according to the U.S. Small Business Administration. The Administration's annual National Small Business Week is April 30 to May 6 to recognize that we create two out of every three new U.S. jobs. It's our chance to talk up each other, and sharpen our own skills. Here are five ideas to improve the value we offer to all consumers.

1) Use Small Business Week as an excuse to learn about the trends, technology and marketing tactics that can help take your small business to the next level. Enroll in an online seminar, or a live and local one. Tech is a game changer, and an ever-changing game. So is marketing. Even if you just refreshed your skills with a seminar or meeting last year, that was 365 days of innovation ago.

2) Look at your recent tax filing. Did you pay too much? Did you plan too little? Taxes – property, personal, and/or payroll – are predictable aggravations for any small business owner. If you found April 18 or the last year-end to be particularly stressful, your accountant has helpful suggestions. So does your office professional.

3) Outsource what you can. The timing of Small Business Week couldn't be better to evaluate where you stand as a business. You're one third of the way through the year. How much of that four months have you spent actually doing what you set out to do? If you spent a quarter of your time chasing invoices or selecting insurance or managing payroll or marketing, any of these can be outsourced so you'll spend 100 percent of your time on your trade, rather than 75 percent.

4) Attend one event or open house, or create your own. The SBA has a list of events at the link above. Local Chambers of Commerce hold 'Business After Five' events. I personally know of one that very week at Yerkes Observatory on Geneva Lake. If there isn't an event in your town, consider hosting your own open house or networking get-together for your local peers. It can be hard to step away from the daily demands of running a small business—use Small Business Week as an excuse to take a little break and connect with fellow small business owners.

5) Join a Chamber or service organization. Never underestimate the powerful networking possibilities that exist in Rotary, Kiwanis, Lions, The U.S. Junior Chamber (Jaycees) or a local Chamber of Commerce. Sorry if I missed one: It wasn't an intentional slight. Each group puts you elbow-to-elbow with possible customers and provides an undeniable measure of community goodwill.

Image by Paulus Rusyanto, used with permission.

Five reasons EVERY small business owner needs an office professional

Every business owner and every business – no exception – can be money ahead thanks to the skillset of an office professional who knows bookkeeping, taxes, insurance, HR, and payroll.

1.   TAXES – This is one area that is so time sensitive that you can’t afford to treat it lightly.  Not understanding the law doesn’t waive penalties or late fees and they accumulate very quickly.  Someone needs to track that all things “tax” because you know Federal and State revenue departments do.

2.   INSURANCE – By definition, insurance is a “transfer of risk.”  Why on earth would you take a chance of not having the right insurance in place for your business risks? Someone that can take the time to review renewals and evaluate risk by asking critical questions is very important.  Do you know if you have already or need E&O, or a BOP, or an Umbrella, or Work Comp?  There are so many types of insurance that are imperative to protecting your business (and you personally) that this shouldn’t be left to “chance.”

3.   REGULATIONS & COMPLIANCE – This might vary greatly depending on your industry. Regardless of the regulations coming from a local municipality, county, state or Federal Agency, the cost of non-compliance can be staggering.  Do you really understand your obligations under OSHA, Unemployment, Work Comp, DFI Filings, EPA Standards, Building or Fire Codes, etc.?  If you don’t have time to master all these areas yourself, you need someone to help, before it’s too late.

4.   EMPLOYEES – From payroll to HR and timesheets to training logs...  Having employees opens a special can of worms.  Training, hiring, firing, unemployment, new tax forms, child support payments, wage garnishments are just a few of the many things that start to suck away your available time once you become an employer. And that’s what it all comes down to…

5.   TIME!  Your time is worth something. Spend it generating REVENUE.  Unfortunately, running an office is OVERHEAD, not revenue generating.  In theory, you went into business because you had a service, trade, skill, idea, or product that other people want or need.  That’s what is generating sales, income and profits.  Running an office isn’t likely what you first goal was.  

 

The person managing the things that keep the business part of the business give you time to sell/create/build. Running to business part may be done more efficiently and cost effectively by someone that makes less than you do, and by someone that already understands these things.  Why re-create the wheel and burn your valuable time?  Hire, train or outsource, regardless of how you get these things done, in the long run you’re money ahead.

 

Photo by Slavoljub Pantelic, used with permission.