Exclusive Data From Forecast Shows How Agencies Are Failing To Maximise Profitability

forecast, The leading platform for artificial intelligence for project and resource management, has published exclusive data on the obstacles in the process, operation and culture of the company that are hindering the profitability of the project for agencies. Only 9% of all agencies surveyed feel they are ‘nailing’ project profitability; This figure drops to only 5% for agencies with less than 50 employees.

The survey of 163 agency heads was conducted between May and July 2021 in collaboration with Cactus Agency Growth Consulting. The study examined the various barriers that exist when it comes to agencies to maximize profitability and streamline operations. Overall, agencies pointed to inefficient delivery processes (39%) and too much time invested in project management (31%) as the main speed barriers.

Where time is most invested

Reporting and managing how employees utilize time has been found to be a significant challenge for agencies. 67% of agencies surveyed with 100-199 employees cited status meetings and updates, resource management and time sheets as areas of customer management that absorbed most of their time. This figure has dropped to 50% for agencies with less than 100 employees.

Barriers to accurate forecasting

Because forecasting has an impact on so many decisions, including investing in talent and tools, it needs to be as accurate as possible. However, only 40% of the agencies surveyed said they are able to predict very accurately the revenue from client work and projects.

In all agencies, the two most dominant forces that stopped forecasting were invisibility and lack of time (40%). Inaccurate or different data were the third most common cause identified (18%).

Forecast research suggests that agency employees believe customer processes slow them down and waste time. In turn, these processes mean that agencies do not have the time – or the right information – to accurately predict future revenue.

Other key findings:

● 47% of agencies said less than 25% of revenue came from remaining customers

● 60% of all agencies surveyed felt they could make “certain improvements” to maximize project profitability – while 35% felt they could make “significant improvements”

● More than a quarter (28%) of agencies described themselves as not having a defined process methodology

Smaller agencies are less likely to know their billing utilization rates – with 34% of all agencies surveyed not measuring this measure

Rob Massa, chief revenue officer at Forecast said: “The sudden shift to remote work caught everyone unprepared. No one was ready for such a drastic change and agencies had to immediately change their work model to provide a completely remote workforce. There were challenges felt not only by managers and leaders who had to maintain their workloads. , But also for employees who have had to deal with this sudden change.We talk to a lot of agencies on a daily basis and the challenge of accurately forecasting revenue and profitability projects is always number one. What it comes down to is invisibility. Other historical metrics, how can they predict future projects? “

Spencer Gallagher, co-founder and CEO of Cactus said: “Most agencies can’t find the right talent right now and it’s just going to get harder, so they’ll have to work on retaining talent and do more with fewer people – which means not burdening the staff but making sure they’m more efficient in the way they use their time.”

Regarding forecast

Founded in 2016, Forecast is an original project management and resource management platform built to connect people, projects and profits. Forecast’s proprietary artificial intelligence platform represents the most advanced technology ever implemented for project, resource and finance management. Businesses can now automate busy work, predict results, guide projects to success, and most importantly empower each team member to do their job in the best possible way.

Companies including Red Cross, Distributed, O2 Web and PeakActivity use Forecast to consolidate project operations and increase profitability.

Investors include Crane Venture Partners, Heartcore Capital and SEED Capital.

About Cactus Agency Growth Consulting

Cactus is the leading financial and growth advisory firm in the UK. Having supported more than 2,500 agencies worldwide over the past 10 years, many of which are recognized as part of the fastest growing agencies in their field.

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