Team Utilization is the measure of available time used for billable or productive work.

To arrive at a sensible utilization figure here’s what you should be thinking about:

  • Which team member delivers which specific skills within their contracted hours.
  • Annual leave, including standard and any enhanced allowance, public holidays, plus any training and volunteering days.
  • Sick leave or unexpected downtime and how to anticipate it. This is a useful one to measure as better capacity planning and better processes can reduce lost time here.
  • Finally and importantly, acknowledging non-productive tasks and admin. Each person will have baseline tasks they need to complete before they’re available to deliver – don’t underestimate these tasks – it’s also another opportunity to measure for future improvements. This is where you can explore software, automations, templates, non-critical tasks and tasks that could be redistributed to others.

Once you know the available time for each team member you can work out if you have enough staffing resources to deliver the task or if the team are under or over utilized. And importantly for agencies, if you have enough billable hours available.

Although it’s easy to arrive at a definitive figure for productive hours with robust calculations, remember we are humans – not machines! The objective isn’t to arrive at delivering 100% for 100% of the time. You need to exercise some judgement and allow for a buffer. An over-worked and burnt-out team is neither effective or productive.

Marija Kata Vlasic from productive.io writes about the Five Stages of Burnout in this post Mental Health in the Office: How to Avoid Employee Burnout

Team Utilization – Where should you start?

Let’s look at a typical agency team member:

  • Imani is the Senior Designer working 40 hours over a 5 day week.
  • Imani works 8 hours per day but must take 1 hour for lunch.
  • There’s now 7 hour available per day which is 35 productive hours per week.

If we give Imani 7 hours of tasks per day not all these tasks are going to get done. Deadlines are getting missed, productivity looks to dropping and the atmosphere is getting a bit tense. But why?

To arrive at an effective utilization rate and work out how many hours are productive we first need to understand the amount of ‘non-productive’ time. And it’s likely to be different for each person on the team.

The easiest way to record non-productive time is to have the team complete a simple diary keeping exercise for a couple of weeks.

The team need to be accurate with the reporting and log all activities throughout the day.

Let’s revisit Imani and see what their productive and non-productive time looks like:

  • As a Senior Designer they also mentor a Junior Designer.
  • It’s a busy, fast-paced, agency, but everyone chips in. Working extra hours is the norm.
  • Every Monday the team has a ‘stand-up’ that takes about 1 hour.
  • Clients love their work and the Account Managers request Imani joins the client update meetings. Sometimes there’s a few of these meetings each week. The meetings last 1 hour and follows a set format. Imani is given the last 10 mins to share any updates.
  • The Marketing Director agreed at Imani’s last personal development plan to focus more on UX/UI. It’s an area they’re really enjoying but not fully up to speed yet. Imani has been reading up on forums, watching how-to videos and working through tutorials. They really want to excel but don’t have the time during work. Any personal development is done during the evenings.
  • They have been on the team for a few years, the Mac Book is a bit old but Imani downloads all the updates to keep it current. Company policy is, new starters get a new Mac. The junior designer started a few months ago and currently has the best spec Mac on the team.
  • Imani is a methodical worker so all work is backed-up on completion and they are active on the project management software making it easy to see what actions have been taken.
  • Social media isn’t really their thing but Imani does help to manage the agency social account. In contrast the junior designer lives for social but hasn’t been given the chance to help out.
  • They get 28 days holiday to take each year. Imani is off next week.

After Imani and the team have recorded all their time over the course of two weeks it’s easier to spot any patterns of behavior or even areas where improvements could be made in the processes.

Reducing non-productive tasks across the team can potentially free up time to convert back in to productive hours – imagine gaining an extra member of the team for free! And the extra time is there to be used. It could be charged back to clients or gifted to the team. Think early finishes on Fridays or put towards time out for self-development – There’s a huge value in found time.

Impact of change

Lets make some changes to Imani’s week and see what impact it has on productive and non-productive time.

  • As a Senior Designer they also mentor a Junior Designer.

Imani is a great mentor and full of ideas. Everybody is working remotely so they usually catch-up for 30 mins twice a day. This reduces productive time by 5 hours per week. The value of this time will be delivered back once the junior is fully on-boarded and committing this time now will make a great impression on a new starter.

  • It’s a busy fast-paced agency, but everyone chips in. Working extra hours is the norm.

It’s not a great amount of time, maybe 45 mins – 1 hour every day. Extra hours worked reduces the value of the billable time! Imani is possibly over-worked and has too many tasks assigned or the work isn’t matched to their skills. Capacity planning might help with the allocation of work along with matching the project delivery schedule to the availability and skills of the team.

  • Every Monday the team has ‘stand-up’ that takes about 1 hour.

Kicking off the week with the team is a valuable exercise and can set the cadence for the week.

  • Clients love their work and the Account Managers request Imani joins the client update meetings. Sometimes there’s a few of these meetings each week. The meetings last 1 hour and follows a set format. Imani is given the last 10 mins to share any updates.

Imani is in these meetings for about 3 hours per week. Moving their 10 min update to the start and not attending the rest of the meeting requires just a 30 mins commitment per week.

  • The Marketing Director agreed at Imani’s last personal development plan to focus more on UX/UI. It’s an area they’re really enjoying but not fully up to speed yet. Imani has been reading up on forums, watching how-to videos and working through tutorials. They really want to excel but don’t have the time during work. Any personal development is done during the evenings.

Imani spends no time during working hours on personal development. Expanding the UX/UI service holds a huge value to the agency and clients. Even spending a modest 1 hour per week would be a good start.

  • They have been on the team a few years, the Mac Book is a bit old but Imani does download all the updates to keep it current. Company policy is, new starters get a new Mac. The junior designer started a few months ago and currently has the best spec Mac on the team.

Don’t feel too bad about moving tech around the team. Keep on top of technology and kit refreshes. Consider leasing over outright purchase options. I’m a fan of ‘FIF’ Fix-it-Fridays. Each member of the team gets a scheduled time-out on a Friday for ‘tech admin’. Get those updates installed. Catch-up with IT support. Clear off old files and empty email folders. You might be down 2 hours but if you make it a monthly rather than weekly event it’s only 30 mins per week.

  • Imani is a methodical worker so all work is backed-up on completion and they are active on the project management software making it easy to see what actions have been taken.

It’s easy to spend 1 hour each day on admin or 5 hours per week. Find ways to multi-task while catching-up on emails or updating timesheets. Combine tasks like backing up files while completing admin is a sensible approach; It’s going to be tricky to render out a video while backing up a 10gb folder to the cloud – pick your moments.

  • Social media isn’t really their thing but Imani does help to manage the agency social account. In contrast the junior designer lives for social but hasn’t been given the chance to help out.

Review the teams skills. What was a good fit a few years ago or even 6 months ago might not be the best fit now. Knowledge sharing is great, so is empowering others to pick up tasks where they can really add value. Use 121's to get the team to focus on their interests and strengths and utilize that insight when allocating projects.

  • They get 28 days holiday to take each year. Imani is off next week.

When working out non-productive time, annual leave needs to be included. It’s also a good approach to also include an allowance for sick leave too. And if they’re on leave – let them enjoy that time off and come back full of energy.

Insight

How do we use this insight to work out how much productive time is left?

Let’s wrap up a typical week for Imani:

Imani is the Senior Designer working 35 hours (after lunch breaks) over a 5 day week.

They mentor a junior designer for about 5 hours per week.

They attend the Client meetings for 30 mins per week.

There’s a personal development plan allowing 1 hour training per week.

Each month Imani has 2 hours (or 30 mins per week) to sort any tech issues.

We can’t avoid the admin but we can utilize the time. This takes 5 hours per week.

We also need to think about comfort breaks, ad-hoc calls and distractions. A conservative allowance would be 45 mins per day or 3 hours 45 mins per week.

Imani is in good health and enjoys their holidays. Their annual leave allowance is 28 days plus add on a few days for any illness. Convert the days in to hours and divide by the number of weeks in a year equals 217 hours or about 4 hours each week

Imani is the Senior Designer their PRODUCTIVE time is 15.25 hours over a 5 day week. (35–5–0.5–1–0.5–5–3.75–4=15.25)

It might be surprising to see the productive time is now 3.85 hours per day.

If we round up to 4 hours per day, Imani is currently about 55% productive.

(4 hours productive time divided by a 7 hour working day equals 0.55. Multiplied by 100 = 55%)

Once the junior designer is up-to-speed Imani would gain an extra 5 hours per week putting their productivity closer to 60% and according to HubSpot, the average utilization rate for an advertising agency is actually 60%. Perfect!

The power of math’s

We now have our first utilization figure – 55–60% productive – if you have staff in a similar position you can use the same numbers. But for those in different roles you’ll need to run the same exercise to get a true reflection of productivity across the teams.

Combining capacity planning and the knowledge of team utilization gives you a powerful insight into the health of the business and the health of the team.

With this data you can also measure the financial implications – What’s you’re hourly / daily rate? Are you charging enough? Could you scale the business and create more opportunities?

You can also explore if there are any marginal gains, such as, revising processes, introducing automations or defining workflows. Each small improvement across a team over time can make a BIG impact.

Give it a try and let me know how you get on.

Ant Pickard | Creative Operations

Driving efficiencies through data | Capacity planning | Workflow automations | Increasing visibility and reducing silos