There are many ways to calculate compensation in an organization, but what is always consistent is...people's time costs money. As a CFO, we want to see that time accurately reported, but in reality, financial reporting & models do not properly reflect time.
What I mean by that is, there can be hints within a budget or a financial report about where your people are spending their time (or not spending their time), but the actual cost of it isn’t captured very well. Sure, we see it when we account for salaries and wages, but that doesn’t necessarily give us clear insights on efficiencies or effectiveness.
When you create a budget or review financial reporting there’s value in thinking outside of the pure numbers. For example, let’s say you have five locations and they all spend $5k a month on an activity; could there be an opportunity to centralize in order to save both time and money? Could you work with the vendor or counter-party to ensure you are leveraging your negotiation powers? Could you find automation to assist with this activity?
I challenge you to put on a new lens when you look at your numbers--
And one of those lens should be from the perspective of time.
It doesn’t matter what industry you are in, your people’s time is certain to be a significant resource and any opportunity you have to use it wisely, will provide huge benefits for your organization. It will also benefit your people individually, as it will increase their engagement, give them back a precious resource (time), and help them prevent burnout.
"Time is precious --
Make sure you spend it with the right people."
When I first came across this article in the Harvard Business Review, I thought it would be more about time accounting and the fact that financial reporting and models do not properly reflect time. It turns out this article is about something else entirely, but it is still very interesting and intuitive.
For a person who is driven by time, it will ring true with a lot of good points and ideas. For those driven by money, it might be a little out there so take the time to expand your view on time with this read: https://hbr.org/2019/01/accounting-for-time