The holiday season is a scheduling headache for all businesses, but leaders in the services industry face unique challenges. It’s nearly impossible to complete projects efficiently, on-time, and on budget, if you do not have a handle on resource scheduling and capacity. During busy holiday periods, you have to schedule around company holidays and vacations, and overall availability drops. As a result, it's likely that your revenue will decrease, and your ability to deliver client work will be impacted.
Two Major Disruptions During the Holidays: Capacity to Deliver and Revenue
1) Disruptions to Delivery Timelines & Client Service
Stating the obvious — a resource is not available to work on client projects if they are on vacation. They may not even be able to respond to clients in a timely manner. The holidays bring even more chaos with multiple employees out at the same time. While many of your clients may also be out of the office, that is not always the case. There are some clients for whom that may actually be busiest that time of year. In the consumer space, retail and ecommerce companies are usually very busy around the holidays (which is also key shopping season), there may be end year implementations happening, or strategic fiscal year plan development. This is not to mention unplanned activity or crisis situations that may arise.
2) Disruptions to Utilization & Revenue
As a key business metric, utilization reveals your employees’ efficiency and productivity. To measure billable utilization—the kind you make money on—you divide an employee’s billable hours by the number of possible working hours for that same period. For example if an employee bills 32 hours in a 40-hour workweek, the employee’s utilization rate would be 80%. However, during the holidays, the total available hours to work will likely be reduced significantly. If you cannot predict your resources billable utilization accurately, your revenue will suffer. Its critical that you can accurately forecast revenue taking into consideration reduced billable utilization targets due to holiday and vacation schedules during key seasonal periods.
Five Ways To Prepare Your Business for the Holidays
While you can’t predict sick days, you can absolutely prepare for changing schedules during the holidays. Leverage these five tips to get—and stay—ahead during the busy holiday period.
1) Create a Holiday Calendar
We love holiday calendars because the first step to project success is creating a project timeline that you have the resource capacity to meet. A holiday calendar gives you visibility into resource availability, including when they may be away on vacation, so you can select the best resource that is available to deliver a particular task.
Advanced project management software systems have resource planning capabilities along with an integrated global holiday calendar so you have the ability to plan around holiday schedules. Make sure to invest in one that makes it easier for you to deliver predictably during the holidays.
2) Communicate Plans to Clients
It is critical that leading into the holiday period you have a clear understanding of the work that needs to be delivered and the resources available to deliver on that demand, and can clearly communicate that to your team and clients well in advance. The client communication aspect is particularly critical if you plan on having resources working on their projects that are not their usual day-to-day contacts. Don’t surprise your clients by preparing them for any adjustments happening across the holiday season.
3) Close Operations
One idea that is becoming more popular is to close your offices between Christmas and New Years. Obviously, sending everyone home has revenue implications — if your team is not billing, you are not making money. However, if you anticipate slow demand from clients, and most of your team intends to take it off anyway, you may actually save money in the long run. Not to mention that productivity tends to slump during that week when many employees, along with their clients, already take time off. Worse than not generating revenue is losing margins, and having several team members sitting around the office with no billable work. A plus is that your team will consider this a benefit. One note to consider if you do go this route is to make one team member available every day to answer any emergency calls so your clients feel they are still being served.
4) Leverage Contractors
If you anticipate client demand to pick up during the holidays, or that a large portion of your in house team will be on vacation, plan to leverage an on-demand contactor network to supplement the work. Ideally, these are existing relationships you trust and can leverage year round. Consider hiring contractors from different regions and time zones to assure that at least some of your resources will be available to contract out during busy holiday times.
5) Integrate ALL Holidays
Today it's common for services teams to dispersed across the country, or even globe. That means it's important to keep in mind all geographies, religions, and cultural holidays when forecasting for the holidays.