LETTER: Is your hourly rate what you intended?

Robert Gray's valuable article 'So much admin, so little time' (Features, 18 April) highlights a series of management challenges that have been endemic in the industry since the invention of time sheets.

Since all consultancies surely use hourly or daily rates to cost programmes, it is instructive to keep track of what happens once the work begins.

Over-servicing rates shown as percentages are useful, but an even more graphic way of expressing the problem is to measure 'effective rate per hour'. Divide 'fees billed' by 'hours worked' each month - and cumulatively - to find the actual rate per hour you are earning from each client.

I've found that management information specified in units of currency tends to concentrate the mind a good deal more than percentages.

This approach also prompts the useful question: 'What criteria did we use to set our hourly rates in the first place?'

David Watson, principal, Campaignteam

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