(Not heard this song? Check it out on YouTube here.)

It’s a key CMAP feature that’s designed to help eradicate the drain [...]]]> It’s not just the title of a classic 70′s song by Billy Ocean. It’s an inspiration for one of the features of our CMAP software.

(Not heard this song? Check it out on YouTube here.)

It’s a key CMAP feature that’s designed to help eradicate the drain of money from your business as a result of over-delivering.

For, try as you might, you can’t ignore a red light.

Red flags up problems. And when these problems are flagged up early enough, you’ve time to take evasive action. Before costly consequences.

That’s just what CMAP can help you do about spending too much time on projects.

CMAP’s Live Project Status dashboard box uses traffic lights to give you an immediate insight into the health of your projects. Key amongst these traffic lights is the live Budget vs. Actuals warning.

As soon as your project looks like it’s going over budget, the traffic light will glow red, alerting you that there’s a problem.

But we don’t stop there. Click the red traffic light and you immediately see a live Budget vs. Actual report for the offending project so you can see exactly what’s going on.

Simple, but extremely effective.

CMAP gives you a live Budget vs Actuals report for your project with a single click

CMAP can’t prevent projects from going over budget. But it will alert you to it faster, and tell you exactly which part of the project is responsible.

Now, if I could just get that damn Billy Ocean song out of my head…

WARNING: this makes for uncomfortable reading!

One of our clients showed me the CMAP performance report for one of his designers. Suffice to say, [...]]]> As you probably know, I’m always talking about the scourge of over-delivery and the terrible impact it has on your profits. Well, here’s a real-life example that illustrates my point perfectly.

WARNING: this makes for uncomfortable reading!

One of our clients showed me the CMAP performance report for one of his designers. Suffice to say, it wasn’t good news!

Here’s a screenshot of the offending report (with the name blanked out):

Now, if you’ve ever spent any time talking to me you’ll know that one of the key principles I always rant on about is making sure your people know exactly how long they’ve got to complete their projects.

For example, if you’ve quoted 56 hours for a designer on your project, you pick a designer and give them those 56 hours. Their responsibility is simple: to deliver the project successfully within the time you’ve given them.

Unfortunately, most agencies aren’t run this way. When they win a project they just dive in and work on it until it’s done – regardless of what they quoted.

Sound familiar?

Anyway, back to our story…

We had just implemented CMAP for this particular client and he had a bunch of historical timesheet data (that he never looked at!) and project quotes in a spreadsheet, so we were able to import it all into CMAP for him.

This meant he could run some reports for the previous year to get his starting position, including the report that showed him how well (or badly) his people where performing.

Pretty much every report told a sorry tale. However, it was when he ran the report for this particular designer that his blood started to boil!

Whilst everyone was over-delivering to some degree, this guy’s numbers where horrendous. Almost every project was ridiculously over-budget, and the bigger the project the worse it got.

Take this project for example:

On this project alone the designer spent an extra 130 hours that they couldn’t bill the client for. At £80 per hour that’s £10,400 down the drain.

What’s worse, when this happens project after project it really starts to mount up, which is exactly what happened. Here we send the end result for his year:

The total value of the work this designer did was £143,840 which would be fantastic if it could all be billed for.

However, only £72,640 of it was actually billable, meaning this designer alone was responsible for flushing £71,200 right down the drain.

That £71,200 would have bought this rather nice Aston Martin (with change):

Now, you might be thinking that none of your staff would run over on a project as much as the designer in this agency. But the reality is that this kind of lost revenue is happening right now in the vast majority of creative firms.

A few days lost here, a couple of weeks lost there…over time it really mounts up and if you work out the numbers the results will probably shock you.

For example, I spoke to a Partner in a small practice the other day who told me that even though he’d recently quoted just half [...]]]> One of the biggest problems I’m hearing right now from the architects I work with is that they’re being forced to massively under-quote to have any chance of winning business.

For example, I spoke to a Partner in a small practice the other day who told me that even though he’d recently quoted just half of what he normally would, he’d still lost out because someone else had quoted even less!

Now, if you’re familiar with our work with CMAP, you’ll know that we continually talk about growing your profits by banishing the Evil Twins, namely under-quoting and over-delivering.

So, the big question is…

What do you do when you’re forced to under-quote?

The answer is to focus on the area you can control. You need to focus your energy on eradicating over-delivery.

The good news is, there’s usually massive potential for improvement in this area alone for most practices.

Why? Because, quite frankly, most architects are guilty of horrendous over-delivering!

Let me give you an example of what I mean…

You ask one of your architects (let’s call him Mike) to work up some sketches for a new scheme. Mike spends 5 days working up some great sketches. Problem is, you only quoted 2 days. Congratulations, you’ve just lost money.

The real problem is that this kind of over-delivery can (and often does) happen on almost every task in a project.

Pretty soon, your £25,000 project has actually cost you £45,000-worth of time and you’ve made zero profit.

Even worse, because no-one is monitoring this it passes by un-noticed and exactly the same thing happens on the next project, and the next one, and the next one…

The reality is, if you can eradicate the rampant over-delivery in your practice, your profits will improve dramatically – even if you are being forced to under-quote.

One of the key elements of the work we do with our clients is to focus and minimising over-delivery as much as possible. In most – if not all – of the companies we work with, this is the #1 area for rapid profit growth, so I strongly suggest you give is serious consideration.

Have a great day!