18  Reasons to Trash the Timesheet. Next, read The Case for Timesheets.

Value-Pricing or Hourly-Billing: Which works better and why?
Sound Off: Join the survey, get the answers.

By Ed Mendlowitz

If you've read the "The Case for Timesheets," you might think I couldn't live without timesheets.  But I know many firms use their timesheets differently than I do.

But first:  The business model of not using timesheets recognizes there is a new way accounting services are being delivered to clients and so we need a new way of managing the accounting firm.  This new model is explained and charted excellently in a logically understandable book that I highly recommend which is From Success to Significance: The Radical CPA Guide by Jody Padar.

Based on the partners and firms I know, most use timesheets only for billing and determining staff “bonuses,” which are substantially based on “excess” hours, rather than exceptional performance and client service.

Working long hours on a client does not equate to effective value transference.  Because of this, I believe these partners are short-sighted and actually do not understand how to fully run their business.  I have used timesheet information as a valuable tool to great success.

However, today I want to trash the timesheet and present my reasons for value-pricing.

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The Essential Management Tool. Next, read The Case for Value-Pricing.

Value-Pricing or Hourly-Billing: Which works better and why?
Sound Off: Join the survey, get the answers.

By Ed Mendlowitz

There is a strong growing movement to do away with timesheets in favor of value pricing.  Needless to say, I have been following both methods – long before Ron Baker and his adherents formalized the no timesheet protocol.  Because of my experience and along with discussions I have had and continue to have with hundreds of accountants a year I have heard many arguments on both sides of the issue.  The ones in favor of no timesheets are more passionate but that doesn’t lessen the opinions of those that don’t agree with this.  I will be referring to Ron Baker a lot so I want to mention one of his books that should be read by everyone interested in this debate: Implementing Value Pricing.  Regardless of how you feel, it would be irresponsible for a firm leader to be unfamiliar with what he suggests.

I have opinions on both sides of these issues, and at various times express them depending on the circumstances.  That prompted these two columns: "The Case for Timesheets" and "The Case for Value-Pricing."

Here I will present the case, the way I see it, for timesheets. In "The Case for Value-Pricing," I argue for discarding timesheets and using the value-pricing model, or some form of fixed prices, exclusively.  I hope you enjoy them and this format. We welcome your comments.

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