Jessica Veiga
If you could pull a lever to create more capacity at your accounting firm, would you? Of course you would! We know from speaking to many growth-focused firms that capacity is a major issue, and firms will do whatever they can to increase it.
That’s what this blog post is all about!
In reality, it’s not as simple as pulling a single lever to magically increase capacity at your firm, but that doesn’t mean it’s impossible to do. It just takes planning.
Capacity planning can prevent burnout, save you from passing on projects worth a lot in revenue, create added value for your clients, and it will make your firm more successful overall.
Elaine is burnt out and needs more capacity!
But capacity planning is like most other skills: it takes practice and time. It’s actually quite the balancing act of distributing the right amount of work into the right places. It involves in-depth tracking, identifying and analyzing flaws in your workflow processes, and determining value in your projects and resources.
At first glance, it might seem like capacity planning is heavily focused on having the right number of employees for the work at hand. But looking deeper, the planning takes place at a higher level. This is especially true when you add tools to increase capacity—either by reducing redundant tasks or speeding things up in some other way.
Keep reading to learn how to excel at capacity planning the modern way: through the use of technology!
Capacity planning and why it matters
To quickly sum it up, capacity planning means determining how many resources/staff members are needed to get your firm’s work done.
The trick to capacity planning is finding the balance between your available staff and client needs so you can maximize your work volume. In some cases, you may find you have an abundance of work, and it may be beneficial to hire additional staff to get the work done, or you could outsource your redundant tasks to save you time and money.
On the other hand, it’s possible you have too many employees. And in that case, you’ll either need to downsize or actively find more work. Each of those can be a tough task considering how much the busy season affects your workload.
It takes some analyzing and planning to find the sweet spot, but once you do you’ll experience:
An increase in project efficiency
Your employees will no longer be working on multiple tasks at once, which has proven to be inefficient. Capacity planning also provides a general overview of projects and lets managers know which team members are working on which projects. Overall, capacity planning helps project management and completion run more smoothly.
An improvement to your long-term strategic plan
Capacity is not just beneficial for the present. It can also help determine if you have enough workforce to complete potential future projects or if completing your current tasks on-time is even possible. Additionally, when you know your capacity, you can provide clients with more realistic timelines.
So how do you create an effective strategy for capacity planning?
How to plan for capacity
Capacity planning isn’t something you can just guess at and get immediate results. It requires following a few key steps to start off on the right foot.
Track everything...we mean everything
Start by listing out all of the services you provide and who on your team does what. This doesn’t exclusively include the services you provide your clients; it’s also internal tasks like marketing and team management. You want to make sure everything that takes up an employee’s time is accounted for.
Be specific. If an employee spends a lot of time on bookkeeping or onboarding clients, note it. (We’ll refer back to this later in the article.)
It’s also important to note that capacity planning is a continuous process. Once you’ve put a new plan in place, you want to be able to reevaluate to see if your plan is working. If you’re tracking all your services accurately, you’ll be able to see where there are issues and make adjustments as needed.
Determine your critical path and find bottlenecks
Once you’ve figured out who does what, you can begin to look at your processes. Essentially, you’re determining the steps it takes for a project to be completed from start to finish. This is your critical path.
Your critical path can show you a lot, but its importance now is for determining where work starts to slow down within your process — AKA: bottlenecks. Inevitably you have bottlenecks...most operations do! But once you pinpoint them, you can rework your critical path to make things flow more efficiently.
Get to know your projects, resources, and value
You probably have a pretty good idea of how much time, manpower, and resources each client project requires. This is important to understand for later on when creating your plan.
You should also look at how much value each of your projects and resources brings to your business. If you’re working on tasks that slow down your employees and don’t bring in much revenue, you might consider adjusting your services so you can improve your capacity.
Support your team
The largest factor to capacity planning is your team. Unless you’re a one-man show, your team is an essential part of your business. They’re doing the work that brings you revenue, and it’s important you support them in the best ways possible.
When you think of capacity planning, your mind probably jumps to making hires to get your overflowing work done or conversely, getting rid of employees because you don’t have enough clients. While these are partially true, it’s about more than people.
Capacity planning is all about making the most of your work with the resources you have available. A simple way to do this is to support your team, your most valuable resources.
Not sure how to support them? Ask them! Having regular, candid conversations about how things are going is a powerful way to support your team.
Leverage Automation Technology to Create Capacity
Remember when we discussed tracking everyone’s responsibilities? Odds are there are plenty of tasks each of your employees are doing that can be automated, which will have an immediate impact on capacity at your firm.
For example, tasks like bookkeeping and client onboarding are often tedious and take time away from your employees that could be used to work on other projects instead. To increase capacity, implement technology that provides simple solutions to areas of your business that may be bottlenecks or are soaking up your productivity. Automation is a perfect solution for removing bottlenecks, and it frees up your human staff for more productive tasks.
If you’ve been thinking about how to overcome the capacity bottlenecks that are holding your firm back, now’s the time to dig into the benefits of automation technology. You can learn more by chatting with a specialist — click below to get started!
