Opinion: Workaholism doesn't equal profit in PR

If ever proof was needed that PROs are workaholics, then witness the shudder that passed among delegates at last week's PRCA conference every time anyone mentioned the EU Working Time Directive.

Many consultants think nothing of putting in a 60-hour week, but what became painfully obvious over the day is that burning the midnight oil doesn't necessarily make for a profitable business.

In fact, according to the PRCA Benchmarking Survey, overservicing stands at an average of 22 per cent, while for a consultancy to be profitable, write-off needs to really be kept below ten per cent. One of the speakers, ex-Porter Novelli head Neil Backwith, who now devotes his time sorting out this kind of conundrum, reckons that client-facing consultants need to be spending around 70 per cent of their time on billed work, but in fact are only billing around 50 per cent of the hours they put in.

There has got to be an issue of competence underlying some of this divergence - a greater reliance on more junior staff who are often over-promoted beyond their capabilities or training. If anyone is working more than 48 hours on an ongoing basis, either they can't do their job or the company is understaffed. But the real problem lies with those senior staff who would sell their grandmothers - or at least grossly underestimate the man hours required - to deliver the promised campaign.

What is needed is a more systematic approach to pricing. And ironically this is where the Working Time Directive and that other straitjacket for the PR industry - procurement officers - may actually help the industry.

There is, of course, a significant difference between employment law and the free will of employees dedicated to a career in a competitive industry. But at least the defined parameter of a 48-hour working week would simplify the equation. The problem is that people don't work in percentages; they work in hours. And in a profitable company adhering to the directive, they should be working more than 30 billed (not billable) hours per week.

Yet rarely are staff told what their budget is in terms of time. Most are simply told to complete the job at any cost, and write-off is accrued over the year. Put simply, the issue isn't getting staff to work longer, but to spend more time on billable work. And having the balls to write into a client contract that overservicing above ten per cent will be billed.

Procurement officers may be surprisingly receptive. They think this way.

In fact, this EU straitjacket could turn out to be quite liberating.

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