How IT Company Consistently Grows Its Profitability

One of the most important points to focus on when you are running an IT company is profitability. 

 

However, many IT company managers and owners fail to streamline their business processes to maximize their efficiency.

 

At least in the small business consulting segment of the IT industry, the key to profitability is utilization. You cannot be profitable unless you master important ways to boost your utilization rate... the ratio of your weekly billable hours relative to a conventional 40-hour work week.

 

And you can’t truly boost your utilization rate and remain efficient unless you improve your internal systems, so you can run your business as easy as possible. This frees up your time to work on marketing and nurturing client relationships.

 

Consider the following 7 ways to boost your company's overall utilization rate, so you can make your IT company as profitable and rewarding as possible.

1. Create a Boilerplate for Common Tasks. This includes creating a boilerplate for elements such as your e-mail signature and e-mail responses for common customer service and administrative tasks. When you are running an IT company, your time is your inventory. Any way you can help yourself work more efficiently or create some shortcuts through automation can make a huge difference in your utilization rate.

2. Build a FAQ Document. A Frequently Asked Questions or FAQ document that addresses common questions prospects, customers and clients have can help you address concerns and questions during the sales process. Create a document you can e-mail to people, preferably as a deep link on your Web site, so you are not re-inventing the wheel every time anyone asks important questions about your services or procedures.

3. Use a Notebook PC as Your Primary System. You should be using a notebook as your primary computer so you can have everything important with you at all times. If you add mobile broadband Internet access to the mix, you can respond quickly to important e-mails and also look up valuable information for prospects, customers and clients and really boost your utilization rate. Just don't forget backup and data security, in case your portable office gets damaged or stolen.

4. Schedule Long Client Visits Whenever Possible. Longer client visits can really boost the quality of your services and help you build strong relationships with clients. Scheduling three or four hours at a time not only gets you to know your clients better, but it also ensures that less time is spent driving around and more billable time is generated... giving you a big boost to your utilization rate.

5. Book Your Appointment Calendar Well in Advance. You should be booking your appointment calendar with your IT company four to eight weeks in advance. This way you can maximize your scheduling efficiency and utilization rate because you will have fewer holes in your calendar to fill up later … or last minute. Plus you can cluster nearby appointments together on the same day to avoid wasted driving time.

6. Have Backup Subcontractors Pre-Screened and Lined Up. Be prepared with backup subcontractors that will help you satisfy all your clients' virtual IT needs. While most approach subcontractors to fill skills gaps, it's also important for capacity issues. For example, let's say your area is devastated by a tornado, hurricane, or earthquake. Having a deep roster of subcontractors helps ensure that you're able to get to all of your contracted clients with a quick response time.

7. Track Every Minute You Work. You need to track all the time you spend on your IT company. This means keeping tabs on your marketing work, administrative work, and your billable work. Log your time into a billing system and calculate your utilization rates and profitability per quarter, so you are always mindful of how efficient you are. By looking at interim metrics, you can often make adjustments faster that'll make your IT company more profitable..

 

In this article, we discussed 7 ways to boost your utilization rate and profitability as you build your IT company. To learn more about how you can attract great, steady, high-paying clients to your IT company, go sign-up now for the free Sample Tips and Excerpts below from the Computer Consulting Kit Home Study Course.

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