Title: How Utilization Rate Affects Your Profitability (& How to Increase It)
Headings: How Utilization Rate Affects Your Profitability (& How to Increase It)
How Utilization Rate Affects Your Profitability (& How to Increase It)
Understand Utilization Rates
What the Utilization Rate Tells You
We make Workamajig, the all-in-one project management suite built for creative teams
How Utilization Rate Affects Your Agency’s Operations
1. Understand billing rates better
2. Map skill demand
3. Develop talent
How to Increase Utilization Rate
1. Use better time-tracking software
2. Use better reporting
3. Establish utilization rate benchmarks (and share them with resources)
4. Track utilization rates across the entire agency
5. Minimize ‘valueless’ bench time
Over to You
About The Author
Hannah Cohen

Content: Develop talent
Utilization rates also help in spotting talent development issues. You want your senior resources to work on your highest value projects. You also want them to spend more time on business development and coaching/mentoring junior resources. If your utilization rates indicate that your junior resources are underutilized while senior resources are spending too much time on low-value clients, you have a talent development issue at hand. Junior resources aren’t learning enough and seniors don’t have enough time for more high-value development/mentoring work. Thus, it helps to track utilization rates not only by skill, but also resource seniority. This can also help you spot junior resources that need additional training (i.e. they spend too much time on non-billable work due to constant revision requests). How to Increase Utilization Rate
As you can see, utilization rate impacts every facet of your agency’s operations. Tracking it will give you deep insight into how your agency works and where it can improve. Do keep in mind that there is a limit to how much billable work you can extract from creative workers.