'Tyranny of Billable Hours' in Professional Service Firms

New research from the Faculty of Management at Cass Business School found a culture shaped by the 'tyranny of billable hours' in professional service firms.
Aug. 16, 2012 - PRLog -- This has led to over-charging clients, overworking junior employees and avoiding strategic issues. Recently, there has been an increased focus on finance as a form of control in corporations. This paper explored financialisation as an employee control strategy in a Big Four accountancy firm, and more specifically how it affects the everyday lives of the professionals within the firm.  It was found financialisation involved attempts to transform employees working lives into an investment activity where work was experienced as ‘billable hours’ that are ‘invested’ in the hope of a high future pay-off. Employees sought to increase the value of their investment by skilful manipulation. If wisely managed, this investment could yield significant benefits in the future.

The researchers also found that professional service firms tend to group clients into 'bill sensitive' and 'unsensitive', and charged accurately and overcharged respectively.

In addition, junior employees are often forced into working into their personal time to complete non-billable tasks. This culture, the researchers point out, hinders competency development at junior level. Progression is measured through the number of billable hours submitted as opposed to improving skills.

Finally, senior members of the firm avoided strategic and leadership issues to focus on bringing in more billable hours.

Cass’s Professor Andre Spicer said: "If you look at the history of how professional services firms were run, there used to be a strong professional ethos, it was all about collegiality and partnership. But as the big firms have become more like corporations ... billable hours have become more and more important.

"They talk about client service (being their primary focus), but in fact if you just scratch the surface what you find is billable hours still dominates."

The study was carried out by Professor Andre Spicer, Cass Business School (http://www.cass.city.ac.uk/), City University London and Dr Johan Alvehus Department of Service Management, Lund University, Sweden.

Cass Research (http://www.cass.city.ac.uk/research-and-faculty/research) faculty comprises over 100 research-active experts.  Prior to joining Cass, Andre Spicer was a Professor of Organization Studies at the University of Warwick. He has also been a visiting Professor at the University of Innsbruck, University of Paris Dauphine, Lund University, the Central European University, University of St Gallen, Hanken School of Economics and the University of Sydney.  Professor Spicer was educated at the University of Otago and holds a PhD (http://www.cass.city.ac.uk/courses/phd) from the University of Melbourne.   His main expertise is in the area of organizational behaviour.
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