Eliminate the time wasters

Start by identifying the time wasters

According to a variety of workplace surveys, the biggest time wasters include email, meetings and visiting personal sites online.

Office chit-chat round the proverbial water cooler is also seen as a colossal waste of time. This is not exactly a revelation.

Before you can identify what activities are adding value to your business, your personal life and, more importantly, what activities are not, you need to know how you actually spends your time.

Keep a Time Diary for One Week

A time diary is like a food diary. Evidence has shown that people who keep food diaries are better able to lose weight and keep it off if they know what foods they eat and in what quantities.

By keeping a time diary, you can see what tasks you perform daily and the duration of those tasks.

Keep a time diary for a week to ten days. There are mobile applications that allow users to record tasks and the duration of those tasks using either their smartphones or tablet computers. But if you are looking for a low tech option, an analogue time diary using a pen and paper works just as well.

Analyse the Time Diary and Categorise Tasks

By analysing your time diary, you can get some insight into what tasks are eating up your day and if the outcomes of those tasks actually warrant the time allocated to them.

How much time do you give over to answering emails and what types of emails do you receive? How many meetings do you attend, with whom and who initiates these meetings? How much time do you spend on bookwork tasks such as capturing data to your accounting system? Besides work tasks, you also need to account for your personal time.

Prioritise Tasks Using the 80/20 Rule

What tasks are worthy of your time? The Pareto Principle, or 80/20 Rule, was popularised by Timothy Ferriss in his book “The 4-Hour Work Week: Escape the 9-5, Live Anywhere and Join the New Rich.”

Ferriss, a serial entrepreneur, claimed in his book that he was able to reduce his workweek from 80 hours to just four, while increasing his income tenfold by using the Pareto Principle, an economic theorem, which states that 20 per cent of the inputs produce 80 per cent of the outcomes.

The 80/20 Rule helps you identify the tasks that are worthy of your time. These are the tasks you should prioritise because they yield the most benefit to you personally and professionally.

The 80/20 Rule Made Easy

Consider the clothes: what percentage of your wardrobe do you wear regularly? Most people wear 20 per cent of their wardrobe 80 per cent of the time, and 80 per cent of their wardrobe just 20 per cent of the time.

Much of your wardrobe is just taking up space and in no way adding value to your life. Applying the 80/20 Rule to your clothes, you could safely eliminate most of the clothes in your closet without affecting your sartorial success.

For example, answering customer queries is a time-consuming, low-yield task, while creating a FAQ document is a high-yield task that pays dividends in time that you might allocate to other high-yield tasks like planning for the future. Making time for forward- planning, you might then scale up your business as it grows and more likely avoid burnout.

But for many business owners, getting a jump on forward-planning seems a lofty aspiration when they’re so far behind with her bookkeeping that they often have to make decisions about their businesses relying on incomplete data or financial information that is weeks, sometimes months out of date.

Forward-planning aside, the books can be such a mess that they often run into cash flow problems because they have no idea what revenue is coming in and when to expect it. It is this lack of insight into cash flow that often spells trouble for business owners.

Are you drowning in paperwork? Cash flow problems keeping you awake at night? Looking for a Xero Certified Bookkeeper to help you? Learn how Notch Above Bookkeeping can solve all these problems, and more.

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Notch Above Case Study

Meet Nicole

It’s 8:30 pm. Nicole has just arrived home from work.

Nicole owns a services business and she started at the office at 7:00 am this morning. Because it’s a school night, Nicole’s partner has already put the kids down for the night.

Her day consisted of two meetings, writing 15 emails, taking 24 phone calls, and troubleshooting a variety of issues, including recovering two disgruntled customers, once loyal repeat customers, threatening to take their business elsewhere.

Nicole has worked six weekends in a row, and the last family holiday was two years ago.

She hasn’t been to the gym in a week, and Nicole is sure that her friends are about to write her off after she piked on drinks, at the last minute, for the fourth time.

She has to submit her quarterly BAS in a couple of days. She is weeks behind in her bookwork so she is trying to make it up after hours. She now has three hours of capturing invoices to look forward to before she can truly call it a day, go to bed, and start this cycle of madness all over again tomorrow.

Nicole learns the following about how she spends her time in a week:

  • A third of her work day goes to dealing with email queries from customers and her team.
  • A third of her workweek is given over to attending meetings with her team. Nicole initiates 80 per cent of these team meetings.
  • Nicole spends at least three hours a day on the weekends catching up on bookwork tasks. In the week that Nicole kept a time diary, she spent more time dealing with email than she did enjoying personal time with her partner, kids and friends. While she spent heaps of time meeting with her team, she did not enjoy facetime with any of her most loyal repeat customers in the week that she kept a time diary. The diary also reveals that Nicole pulled out of a barbecue on the weekend so she could issue invoices. Why? Well, the week that Nicole kept a time diary was the same week she was preparing her quarterly BAS, and she was way behind on her bookwork.

Nicole’s experience is not uncommon.

In the beginning, her business was tiny and Nicole could very easily do it all. But in the last two years, her business has quadrupled in size, yet Nicole still tries to run her business like she did when she started. Because she tries to do it all, the day-to-day tasks blind her to the big picture, which she, as the business owner, should be focused on.

Nicole has made the same fundamental mistake that many overworked, time-poor small business owners make: confusing productivity with effectiveness.

The number of phone calls you make, the number of emails you send, and the length of the meetings you attend are not indicators of how effective you are as an entrepreneur.

A hamster running on a hamster wheel is certainly being productive, but effective? No. The hamster is running, but going nowhere.

Nicole is certainly keeping very busy, but by trying to do it all she is spreading herself too thin and sacrificing her personal life on the altar of her business.

But all is not lost for Nicole.

To get her life back she needs to know how and where she spends her time, prioritise high-yield activities, eliminate or automate low-yield tasks, delegate the tasks she doesn’t have the time or expertise to complete, and very importantly, teach her team and her customers how to do without her.

How we help

Notch Above Bookkeeping is a team of certified Xero bookkeepers and BAS Agents. Based in Brisbane we help small business clients right across Australia prepare their BAS returns and streamline their bookkeeping processes, payroll and accounting records. Read more here or call us today on 1300 015 130.

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Fundraising isn’t the end-goal

Should a business bootstrap or raise external financing?

There is a time and place for either strategy, but what we’ve noticed is that startups tend to fixate on the latter. 

Some believe that once they’ve raised enough money, everything’s going to be okay. But while raising capital definitely helps, it shouldn’t be the end goal of a business.

Working with someone else’s cash gives business owners a sense of confidence and accountability. But there are many things bootstrapping can teach founders.

In fact, it’s quite common in Australia for business owners to bootstrap.

They have credit card limits of $30,000 to $50,000 – enough to run their businesses on personal credit. That’s very risky. But in the process, founders become more disciplined and thoughtful about where they spend their cash.

At the end of the day, it isn’t just about raising the funds, because a business isn’t about going from fundraising to fundraising. It’s about being able to achieve a goal, such as acquiring new markets or launching proprietary products, with that cash.

Start with insightful financial reporting

Learning to use and understand the powerful reports inside Xero are critical to the overall success of your small business. The management team at Notch Above are able to work with you to customise advanced Xero financial reports, while identify strategies to increase your cash flow or setup your annual budget. Read more or call us today on 1300 015 130.

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The importance of financial transparency

Financial transparency is important to investors

When pitching a business to investors, getting the right number – whether it’s net profit, sales, margins – is key. 

But the kind of data you present depends a lot on the stage of your startup and the kind of investor you’re looking at. 

As an investor himself, Sam had this advice to give: “If we’re talking about seed [funding], they’ll be investing more in the team, personality, vision, and market-depending on the stage.” 

He goes on to advise small and medium enterprise that “annual finances are useless in the beginning because business is changing so frequently. Investors will want to see on a month-on-month basis what’s happening.”

Mature startups appealing to investors who have part-ownership of the business is a different story. 

Investors typically want financial transparency to understand the health of the business. Like Sam, they usually ask for a monthly update using consistent growth metrics. But it’s a bonus if the investors are aware of what’s happening in the business’ bank accounts as well. 

A business could have sold to a client and earned $200,000, for example, but they might not be receiving the payment another 90 days. This kind of information helps everyone involved make better decisions. 

Tools like Xero are extremely useful in this case because it provides real-time insight into a business’ cash flow. Especially since cash flow management is one of the top issues for small and medium businesses, this sort of transparency is essential to grow and scale.

By making bookkeeping easy, we empower business owners to focus on scaling and doing meaningful business. Call Notch Above Bookkeeping in Brisbane on 1300 015 130 today.

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STP transition year for large employers has ended

Single Touch Payroll (STP) reporting started for large employers (20 or more employees) from 1 July 2018.

The 12 month transition period for large employers to start STP reporting ended on 30 June 2019.

The ATO will soon contact large employers who have yet to start reporting through STP and who are not covered by a deferral.

If your business has a lodgment deferral, you need to start STP reporting before the deferral end date. Failure to lodge on time penalties may apply if you fail to start reporting within a reasonable period.

Notch Above can take care of all the bookkeeping tasks you would rather not do, like bank reconciliations, supplier payments, payroll processing, invoicing and debtor management and BAS returns. We set up systems and checklists to ensure nothing is missed and things are processed when it suits you. We can be involved as little or as much as you like, we give you the flexibility to decide what’s best for your business. Call us today on 1300 015 130.

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