Making recurring services profitable

Accounting firm

Unplanned one-off requests were absorbing a large share of hours. The partners were considering hiring to absorb the extra workload.

Approach

1. 01

   Frame

   The question was whether it was better to hire or to revise the services included in the packages, with a maximum initial investment of $36,000 CAD. Quality of work remained an absolute requirement.

2. 02

   Investigate

   The time spent on 40 files and the requests from 20 clients revealed that there were no shared limits. Some packages, in practice, included support that the price did not cover.

3. 03

   Explain

   A staff shortage and a poorly defined commercial scope were compared. The variation in hours between similar files pointed the diagnosis toward the content of the packages.

4. 04

   Build

   We compared hiring, a uniform price increase and three service levels with explicit limits. The existing package remained available so that reactions could be compared.

5. 05

   Test

   The new levels were presented to 20 clients. The thresholds set in advance were ten sign-ups and at most one departure, with no drop in quality. Twelve clients signed up; one left the firm.

6. 06

   Decide

   The partners rolled out the packages to a limited group and postponed hiring. Requests outside the scope are now priced and approved before the work is carried out.

7. 07

   Steer

   After four months, the hourly revenue on the files concerned had risen by 11%. Some clients still asked for exceptions; the partners standardized their practices.