The data is in – and it’s not pretty.
After surveying 303 agencies and consultancies through the Business Maturity Quiz, we’ve launched The Maturity Gap Report, revealing just how wide the gap really is between the firms where operations is a strength and everyone else.
In this episode, Harv is joined by operations consultant Manish Kapur and FinOps expert Rich Brett to walk through the headline findings – and what they actually mean for the way your business is run.
Here are a few of the headlines they discuss:
- Role clarity is rarer than you think – only 35% of firms have clearly defined roles, and the knock-on effects reach everything from project delivery to decision-making bottlenecks
- Most operational knowledge lives in people’s heads – just 21% of firms have documented their best practices, leaving businesses one resignation away from losing it all
- Automation remains an untapped opportunity – only one in eight firms have automated any meaningful part of how they work, in 2026
- Time tracking data is being wasted – 41% of firms track time accurately, but only 13% are using that data to make decisions or course-correct mid-project
- Forecasting with confidence is the exception, not the rule – only one in four firms can forecast margins, revenue, and capacity with any real certainty
- Scale readiness is a widespread concern – just 13% of firms believe their operating model is ready for what’s ahead
If you want to know where your business sits against the 303 firms in the report – and what separates the top performers from the rest – this is the episode to start with.
This was originally recorded as a live webinar – if you’d prefer to watch with the presentation slides, head to YouTube here.
Ready to take action to level up?
1) Take the business maturity quiz
2) Read The Maturity Gap Report
3) Subscribe to The Handbook: The Ops Podcast for the upcoming maturity series
Additional Resources:
👉🏽 Follow Manish Kapur on LinkedIn
👉🏽 Follow Rich Brett on LinkedIn
👨🏽 Follow Harv on LinkedIn
Transcript
[00:00:00] Harv Nagra: Hey guys. Welcome back to the Handbook, the Operations podcast. I’m Harv Nagra. Here’s something worth sitting with.
Research interprofessional services firms suggest that moving up just one stage on the operational maturity curve can translate to hundreds of thousands in additional annual profit, one stage. That’s the scale of what’s at stake when we talk about getting your operations right. Well, we’ve Just launched the maturity gap report, a piece of research built from over 300 responses to the business maturity quiz in its first few months, and it puts hard numbers behind something that a lot of us have felt for a while, that there’s a significant gap between where most businesses are operating and where they need to be. This episode kicks off a mini series dedicated exactly to that: business maturity.
We launched the report live in a webinar with ops expert Manish Kapur and finops expert Rich Brett. And if you didn’t catch it at the time, this is a replay. If you prefer to watch this with the slides, head over to YouTube.
The link is in the episode notes. Let’s get into it.
Everyone, thank you so much for joining us for the launch of the Maturity Gap report.
I’m gonna start with, a quick run through of the agenda so you know what to expect. Today. We’re gonna do some quick intros and also a bit about what has happened date, including. Talking about biz maturity, what it is, what the eras are, what, what the quizzes, the headlines from this report, what the maturity gap is, some next steps.
My name’s Harv. I am an ex in-house operations director at a pan-European creative consultancy that was based here in the UK with entities in France and Switzerland. I host the handbook, the operations podcast.
And I’m head of brand comms at a platform called Scoro. which I joined two years ago after having been a customer, a power user for a number of years, and seeing the huge impact it had on our organisation. and alongside me today, I’ve got Manishh Kaur, Manishh. if you wouldn’t mind giving us a quick, intro, to the audience about who you are and what you do.
[00:02:04] Manish Kapur: Yeah, absolutely. Thanks half. Hi everyone. I’m Manish. I’m a ops consultant. I work with agencies and consultancies when they’ve got a very good problem to solve. They’ve got a lot of work and their internal operations have started to crack due to the volume. So I’ll go in there and have a look and see what’s working and what’s not, and help ’em fix it.
[00:02:21] Harv Nagra: Thank you very much. We also have Rich Brett finops expert with us. So Rich, if you wouldn’t mind telling us who you are and what finops means as well.
[00:02:30] Rich Brett: Oh, that’s a good, good question. hi guys. Nice to meet you. I’m Exag agency. I’ve been agency about 13 years. Worked for, we are social for six years through a big period of growth, and now I’m a finops consultant for agencies and professional service firms.
But finops is that sort of gap where finance and ops align. So I tend to try and get finance and operations to try and mould together so that operations tells me what finance is showing and finance guides, operations. So it’s a lot about trying to get those two things to talk together.
[00:03:02] Harv Nagra: Excellent. Thank you both for joining us today. Huge fans of you guys, and I’ve learned a lot from both of you, so really excited to get your input on the findings in just a moment. onto today’s topic, business maturity, what is it? So we’re very used to looking at our lives or even civilization in terms of, stages or eras, but when it, when it comes to our businesses, not so much.
That’s not a frame of reference often for most of us. But the thing is, we should, because the same principles apply, our organisation should mature over time. If we want to be successful, if we want to be profitable, if we want the growth, then we do need to operate as increasingly mature businesses should, and that’s where the idea of a business maturity model comes in.
Okay, so this is a business maturity model. they tend to have five stages, depending on the model that you look up. The labels of the stages may differ, okay, but the ideas tend to be fairly consistent. Now, the, the labels that I’ve seen online, they, they tend to be a bit clunky. So I’ve kind of, invented some of my own over the past couple of years.
I’m gonna talk you through them really quickly. on one end of the scale, we have the chaotic era. Okay, so there’s no consistency at all. Success really depends on individual heroics of people in the organisation. And every project or every problem feels like you’re starting from scratch.
Okay? So that might resonate with some of you. Stage two is what I call the glimmers of growth. that’s where you have pockets of best practise in the company, but it’s super inconsistent and usually those pockets of best practise come from individuals that are just a little bit more operationally minded or, or frustrated with the, you know, the way things are running.
we take it up level and we get to the stable era. This is a fantastic milestone, right? Things are starting to look good. You’ve defined roles in your business, you’ve documented your best practise. Everyone’s working the same way. you’ve probably brought in integrated tools by now, but while you’re generating good data, you tend to look backwards at how you did last week, last month, and last year.
Still a great place to be, but there’s a ways to go. And then we take it up a level to the data driven era. This is where you’re making decisions based on live data, right? You catch problems mid project, you can forecast what’s coming in the business with confidence and you operate consistently across teams.
So a really important,stage that we should be aspiring to get to. And finally the innovation era. So at this stage, you’re, you’re firing on all cylinders. You can really focus on developing and innovating your client offer and your customer experience to leave the competition behind really.
And there’s continuous improvement built into everything you do. Okay. So. Last summer I launched the business maturity quiz and really briefly why: it was when I first moved into operations, my then boss, our COO, introduced me to the idea of a maturity model and asked me to look and assess where I thought our organisation.
Until then, I had been in a delivery role and operations was something I was doing off the side of my desk. I was really proud of kind of a lot of the changes I brought into the organisation, whether they were process or systems, ways of working, whatever it may be. I didn’t have the broader operational experience at the time, to understand where our gaps were . I was basically fixing the things that were the biggest problem for me, or that I heard the most complaints about.
so the business maturity model I was asked to look at, it really helped me understand where the gaps were and understand that we had a lot of work left. To do. That’s why I wanted to launch the quiz, to create a really quick way for other people to have that same kind of revelation and understand where the gaps are in their maturity.
it takes three minutes. It’s 25 multiple choice questions, and it gives you a steer on how you rank. Across five operational pillars: people, process, tech, data, and growth strategies. Hopefully a lot of you have already done this, and that’s what this report that we’re presenting today and launching today is based on.
Before we get into the headlines, and, I’m not gonna make you wait much longer, it, it’s, it’s worth looking at why this matters, financially, right? SPI Research, which is a market research firm, they’ve been studying professional services firms for decades. There’s over 50,000, firms in their dataset.
And the probability difference between the top and bottom performing firms is 7.7 x. So it’s not a small difference. But the number that you should hang onto is that for a $10 million firm moving up just one stage on the maturity curve translates to roughly 270,000 in additional annual profit.
That’s the impact fixing your operational foundations can have. So what did the 303 firms tell us? This survey was launched, late last summer, and we had a cutoff date in early January where we took the, the firms that had completed to the,until that point and crunched the numbers. So we’ve.
Pulled out some of the headlines for this presentation. Some of them you’re gonna nod along to, some should genuinely surprise you. And I, I, I do have to say that the full report goes into so much more than just these few headlines that we’re, focusing on today. So you want to read that after this presentation.
but, Let’s get into it, and I’ll be asking Manishh and Rich to comment on some of these as we go.
Alright. First of all, only 35% of firms have clearly defined roles. 59% describe them as somewhat defined and 6% as not defined at all. Okay, you might think, this sounds like a small problem, we’re just talking about kind of role clarity, but it it, you know, maybe it’s just a bit messy. It’s a poorly written job description or there’s no ownership or over certain initiatives.
But what the data shows is that role clarity is actually a huge maturity signal in its own right. 95% of chaotic era firms have a bottleneck with their decision making. Okay? So think about that. The majority of chaotic era firms have a single person signing off all the decisions. By the time you hit the data-driven era, that’s stage four of five.
It’s 37% still have that problem. So it’s shrunk. Quite a lot. There’s still a ways to go though. so the firms that have figured out who’s responsible for what are almost by definition the most mature ones, and the ones that are still fuzzy, are on the bottom of that maturity ladder. I wanna put it to Manishh actually.
How does that line up with what you see on the ground?
[00:09:38] Manish Kapur: Yeah, Harvey doesn’t really surprise me. I think one of the first things I ask for when I go in and do an audio and agency is an organogram. ’cause I wanna get a feel for how it’s structured. and before I’ve even started, I’ve kind of spotted a problem where there isn’t roles that are clearly defined.
And more importantly, there isn’t clear line management either. and the first time someone will see a job description is probably when they join, but that’s probably also the last time they see a job description.
[00:10:01] Frankie: Mm-hmm.
[00:10:02] Manish Kapur: and as they move up the rank. It does become a little bit clear and blurred as far as what their responsibilities are.
And I do have to question is how can you assess if someone is doing their role right and performing it well if they don’t really have clear guidelines about what they’re actually accountable for. And I think, you know, when people start off, it’s all great, but as they start to move up the runs and they’re taking on more responsibility, that’s when you get a lot of crossover.
And it’s not unusual when I go into agencies in particular to see kind of like pseudo titles of where someone might be an account director and then someone is their senior account director, and I’ll ask, okay, well what’s the difference? Can you show me on paper so I can work out how those roles differ?
They go, well, actually they don’t much. It’s just a title that we’ve given that individual because they wanted a promotion and that’s the best we could do to try and keep them within the business. And I thought, okay, I understand why you’ve done that, but you are opening yourself up to a hell of a HR headache.
Because if someone else wants to be promoted to a senior account director, how do you say that they’re not actually capable or right to move up So I think having a structure really important and you don’t need to be of a large scale to get some kind of organisation in place. You know, everybody needs to know what they’re accountable for and who they’re reporting to.
And it doesn’t matter if you are five person or 50. I think it’s important to have some kind of structure in place.
[00:11:17] Harv Nagra: Absolutely. And I’ve seen that, you know, that problem crops up in annual reviews, in hiring and alt types of things if you don’t have that clarity, right? Yeah. So you do need to sort that out at some point.
And if, if you’re kind of listening right now and recognising that you have that problem, I, I’d say that’s an exercise that you should probably prioritise sooner than later.
[00:11:37] Rich Brett: And also, I’ll just say that, that bleeds into projects as well. If the roles aren’t defined about what people’s role in a project is, then how can you be sure that.
The right people are responsible for how a project’s run. Absolutely. Because if that falls in a gap and someone thinks someone else is doing it, then that’s another reason why you lose margin in projects. So it’s not just about the role, it’s about the role within a project. You know, someone doesn’t realise they’re leading the project, then literally no one’s leading the project.
[00:12:04] Harv Nagra: Exactly. Let’s move on to the next. 21% of firms have documented their best practises. Only 21% I should say. I mean, I, I find this shocking. I don’t know about any of you. that means nearly 80% are running on knowledge that’s locked in people’s heads. Things passed down in, like conversation picked up by sitting next to someone, or, or a Slack message.
It’s, it’s one resignation away from disappearing effectively. Right? so. One of the, as an example, one of the first things I did in my first obstacle was build that central handbook for the organisation, documenting our systems, our processes, and company information in a single place. and you know, I, I have to admit, when I was doing that, I had this fear that I was creating this resource for myself, and no one else was gonna look at it thankfully.
That turned out to be very wrong. It ended up being an essential resource that everyone looked to. also because I used it to kind of, signpost to whenever somebody came to me with a question, rather than having to answer the same question a dozen times a day, I could say, oh, go check. The handbook, it, it’s in that section, right?
So what I find is that people feel more supported when there’s that central resource. It gives ’em the confidence that the business has things under control and is organised. and especially when rolling out a new system or a process, it gives them somewhere to look. when they need help as a first point of reference.
and, and documentation plays a huge role in getting to the stable era, stage three of five. you’ve got those repeatable processes and consistency across the business because everyone knows the way you’re meant to be working. so a again, Manishh, you work with a lot of organisations on their kind of, ops of course, but I’m surprised by only 21% of firms saying they’ve documented their best practise.
what do you see out there?
[00:13:51] Manish Kapur: To, I’m not that surprised. I think agencies work with a little bit of, chaos. They see that as part of parcel of working in an agency. but it does cause a whole load of problems. And I think the first one is, is particularly when new people join. So if there isn’t anything documented and there isn’t an established ways of working, then the new person will bring in their version of it.
Then before you know it, you’ve got three or four different ways of working to deliver the same kind of work. and that does cause a lot of pressure. You know, our environment is already pressured, let alone having ongoing confusion. I think people are normally quite surprised when I tell them that I’m not actually a massive fan of process and they think that’s a bit weird being an ops person.
But I love best practise and they’re two different things. So you can map out your process from start to finish with all the ideal steps, and to actually get it embedded is tough. It’s one of the biggest challenges that most agencies have. But what’s more important is to identify what are the best practises.
That’s the certain steps that if you do not do something will go wrong. So making sure that you have a properly scoped project and you’ve all agreed what it’s actually gonna cost, an amount of time required on it. Having a brief. Internal reviews, washup sessions. So whatever it might be is to identify what those best practises are.
Because a process and setting a process, even if it’s documented, is not a one and done. It’s an ongoing continuous review. So you’ve got the first version, you put it out there, you try it on an actual project and see how it goes, and then you review it and go, well, did we actually follow the process? Well, there’s some steps missing.
And more importantly, will we able to follow. The best practises. And just picking up on what rich said earlier, is it’s so important to have roles defined because one thing I look at when I do look at processes is a rci. It seems a little bit dated, but I still think it’s really important because of knowing who is actually responsible and accountable in particular for that step is quite key.
’cause if it hasn’t been followed, then you need to go back and talk to the right people to find out why it’s not being followed. So having responsibility right the way through is really important.
[00:15:50] Harv Nagra: And back to your point about onboarding, I think that’s a really important one as well. You know, it, it takes a lot of effort to onboard people if you’re doing, relying on word of mouth, first of all, a as kind of. Requiring people’s time, senior team members’, time to literally take people through all the motions of how the business works.
So having that documentation speeds up that onboarding process so much. So a really important way where, that that just ends up paying dividends when, when you’re, you know, you’re going through a growth period. And people can be self-directed in terms of their kind of, uh, onboarding as well.
Let’s, let’s move on to the next point. only one in eight firms have automated any meaningful part of how they work. Only one in eight.
And more than a third say they’ve automated almost nothing. In 2026. Okay, so it’s not that automation is new or complicated, it’s just that firms have not made it a priority, right? They’re still doing manually what they could have automated years ago.
but Manishh automation is something that we’ve been talking about for years. So why do you think so many businesses are still struggling with it?
[00:16:57] Manish Kapur: Well, I, I would say at the moment it’s probably the, the biggest part of the work that I’m doing at the moment, particularly with agencies. I think there’s a bit of confusion.
First and foremost, I split AI and automation, in my view, they’re two separate things. and automation is what I consider very much a low hanging fruit. And I think ultimately what AI’s gonna do for most agencies is gonna really hammer them down on cost, because let’s not forget, the clients or those agencies are also under pressure.
They’re also being told they’re gonna use AI to make themselves more efficient. and that will only filter down, and I think agencies will suffer because clients will say to ’em, are you using AI in your organisation? And the reason they ask is, well, ’cause you do the work cheaper. And that is gonna be a challenging game going forward.
But I think ultimately when it comes to automation, it’s about just taking away some of the tasks that you don’t necessarily want the team to be doing. ’cause I think agencies in the long run have to be more strategic. If you are at the executional end, then that can be shored or it could be done by ai.
So if you wanna survive, you have to be a more of a strategic agency where you can show the value and actually charge the appropriate fees. And automation is one way of doing that. And the great thing is there are tools like scorer, for instance, that have automation built in. So you can, the teams can actually see how they can leverage automation in the real world by using practical examples.
And I think the first point is just to remove some of the admin tasks, things that your team don’t want to be doing, and get those automated or certain tasks that you don’t want to forget. For instance, like approvals. If you’ve got an approval flow for a quote or a scope of work and that needs to go to multiple people, that should be set up as an automation.
You don’t wanna be sending out one email and get feedback and then send out another email and get feedback. So that’s just one small example. There’s plenty. But I would say right here and right now, automation is a low hanging fruit and you just wanna leverage it. And the great thing is a lot of the tools have this embedded.
I think the reason why agencies aren’t using it, I get a bit muddled about how much of AI do we need to be doing. My view is separate it out. AI is one thing, automation is something else. Start automating the tasks that you do day in, day out that are mundane that your team don’t necessarily want to do and don’t add any value to clients.
[00:19:03] Rich Brett: If you haven’t got, clearly defined roles or best practise, how are you gonna automate anything?
[00:19:08] Harv Nagra: That’s a good point. That is a good point. and, and I, I, I think just really quickly before we move on to the next is, is that, that it’s such an important thing that, like, you know, the AI becoming a bigger, technology that we’re more excited about does not replace automation.
You know, AI is not meant to. Do all those automation things because it’s still executing all those tasks one by one, where as automation just creates that flow for that activity. So it’s important to keep that separate and, and look at it, as kind of complimentary, technologies.
[00:19:39] Manish Kapur: Absolutely. I’m just having a little quick of a chat.
Sean, you’re right. I think ultimately if your overall process is broken, you can’t automate it. Mm-hmm. And one thing I always recommend is that you actually map out your process from start to finish. Review how you go about delivering work from start to finish. Have your responsibilities aligned, get your racy in there, and then look at where you can actually automate.
Tasks, what is you’re doing to get from point A to B? And could that be automated? And it’s all part and parcel of it. You know, you don’t wanna automate a bad process because that’s just gonna make things worse.
[00:20:07] Harv Nagra: Exactly. Exactly. And you know, one, one other thing that comes to mind is it doesn’t unfortunately fill me with confidence about, these businesses.
Addressing and embracing AI in the best way if we haven’t even looked at automating some of the, some of the things that we could be working on and taking some of these other maturity steps, along the way that we’re highlighting today. Let’s move into the, the next point.
When we start looking at the data side of things, there’s also some kind of disappointing news. You know, 0% of the lowest performing firms track time accurately. 0% of the lowest performing firms track time accurately. And before I get rich to comment, there’s kind of a a, a similar point that I want to highlight on the next slide, which is.
40. When we look at the full picture, 41% of firms track time and expenses accurately, but only 13% are using that data to make decisions. Okay? So the lowest performing firms aren’t bothering to track at all. And here we have firms that are going through the effort of capturing that information. You know.
Bugging their teams to do their timesheets, logging, their expenses and all that kinda stuff. And then not acting there, acting on it. It just sits there. It’s not connected to anything. It’s not changing how projects are run or resources are allocated, which probably explains why there ends up being frustration with logging time in the first place.
Like it doesn’t seem like you guys are using this for anything, so why should I do it? But Rich, I would love you to jump in and, and tell us what you think of this.
[00:21:33] Rich Brett: You probably don’t. Um, I mean I spent years, I mean we are social. I think the average age was 23 out of 120 people. So getting 22 year olds do their timesheets wasn’t easy, but you’ve gotta find ways to make it work.
I think we tried to build in and understand if commerciality and that we’re using this data to help understand what you are doing rather than just making sure you’re working. I think that’s one thing I would say is that I think sometimes leaders can be a little bit weak on this, in that. You allow your team to not do timesheets well, you know, its part of their contract is to do timesheets.
They kind of have to do them, but I think the big part is making sure that people understand what they’re actually used for. And I think what you said is important. I think you’ve gotta be transparent about what this data is telling us. It does not surprise me one bit on E or this. I think I would probably suggest that that 41% of firms that track time and expenses accurately.
That’s probably not right either. They probably think they do. I see very few who are using this data in a good way, and that’s not just at the small sizes. It’s talking it up to very high levels because if the data’s not right, what’s the point in looking at it in the first point?
the second part is, are the right people even looking at this? Project managers are really stretched trying to deliver projects. Are they gonna spend time looking at this? You’ve gotta make it accessible. You’ve gotta make sure it’s really clearly defined what this means, and then you’ve gotta report it back.
If you’re not doing those things, you’re not really learning anything from the stuff that you got to do. I was chatting to an agency only yesterday who’s doing, who’s trying to productize and do value-based pricing, and we both agree that he needs to do timesheets. Now, most people would say, you don’t need to do that if you’re doing value-based pricing because you’re selling value.
But you still need to understand how much time was spent delivering that value. So even if you’re not selling on a time basis, or selling on a roles and rate card basis, time is still the most effective way of understanding are you making profit? And how long did it actually take to deliver this work?
It’s not that difficult to set up. I’ve had a lot of complaints to me. I used to have the keys to the beer fridge. So on a Friday, if timesheets weren’t done, then the beer fridge didn’t get opened. That was a powerful tool, but ultimately it didn’t work. Like what actually worked was just really talking to the teams and getting heads of department to understand Yeah.
What their team’s doing. Mm-hmm. And we would every month take through that data and say, look, this is what your team’s doing. Does this make sense?
[00:23:59] Harv Nagra: Yeah.
[00:23:59] Rich Brett: And that’s where we really start to see value. ’cause then heads of department, before they could hire anyone could have to look at the data and say, I, I can see that my team aren’t that busy, so therefore it’s gonna be really hard for me to justify or hire.
Suddenly it becomes, well, you show me that data and we can sign that off. So I think a lot of it is not down to. People doing timesheets is actually the people who are more senior. Really embedding that culture of this is really useful data. It really helps us understand what’s going on. Yeah. And we can then start using that for future facing capacity and resourcing as well.
[00:24:29] Harv Nagra: Absolutely. And helping people, like you said, understand it’s not about tracking them, it’s tracking like. What’s happening in the business with regards to projects, you know, and, you know, if they’re saying they need additional resource, well we need to see evidence of that in, in the amount of time that’s being logged and what it’s being logged on.
And, and you’re also right that if there’s inconsistency and inaccuracy and people are doing it, there’s almost, it becomes almost pointless. ’cause if there’s giant holes in your data, ’cause three people just never log their time, it’s not helpful, right? So you need to get everybody on board. There’s a related point on the next slide.
Again, it’s, it, it’s actually somewhat an extension of this, that only 13% of firms use live data to adjust mid-project. So again, I, I think this is really disappointing. You know, 41% are saying that they’re tracking time accurately, right? But of that, only 13% are using that data to steer what’s happening on the project.
So again, it’s like, well, what is the point of even doing that? Right? So was it just for fun? so the rest of the, the firms are basically waiting for the project to finish, to send that final invoice and figure out what happened afterwards, if they even can, get that picture together. But by then, there’s nothing you can do.
Other than just kind of take the hit, right? So, and this is the one I, I think has the most direct impact on profitability. and, and there’s always evidence when you’re tracking things, on, on what could be going wrong. You, you see the budget drifting, you see your team burning more hours than expected.
There’s scope creep, all that kind of stuff. But if you’re only looking at numbers at the end, you’ve lost the opportunity to course correct. rich, anything to add here?
[00:26:05] Rich Brett: I mean. It’s crazy. to be honest I often say let’s start with a source of truth, which is how many hours have we sold? How much have we sold?
What have we sold? Like we can normal ev Most agencies and pro professional service firms have that. But if you then just go blind into doing this work and just use timesheets to tell you how you’re doing, firstly, that’s a problem anyway, because timesheets are historic and looking at something that’s just happened isn’t gonna help you decide what needs to happen next week.
So the basis has to be timesheets to say, well, how far through it are we? But really it’s the whole piece of you’ve got to look at how you’re doing, not just on time, but how are we doing time against task and actually against delivery? ’cause then you can then go, well actually we’ve got 25 hours left that we need to deliver with.
How are we gonna use those best? And some, this isn’t gonna solve profitability by doing this. But at least it allows you to have a chance to solve it, because if you’ve missed scope, something changing halfway through isn’t gonna stop the fact that you’ve missed scope. But at least it try, makes you, gives you an opportunity to know that that’s coming and to try and do something about it.
it, it doesn’t, unfortunately, it doesn’t surprise me at all. because if the data’s not right, if roles aren’t defined, if best practise isn’t defined. Then why is anyone gonna do this stuff and who does it sit with? Yeah. You know, a lot of people think that profitability sits with finance, but finance aren’t delivering the projects.
Finance aren’t booking in the resource. It has to sit with ops. This is where it becomes a finops exercise, is that you’ve gotta make sure those two things are aligned, that you’re aware of. Revenue, profit, and time. Yeah. But I really like to fact, I, I think time is a really important factor because if you sell 20 blocks of time, everyone knows you’ve got 20 blocks of time.
If you start talking about profit margin or gross profit. That’s a much more confused thing to talk about, but time and hours, most people should understand how time works.
[00:27:58] Harv Nagra: Exactly. Exactly. I. Manish, anything to add to that before
[00:28:02] Manish Kapur: we move on? Yeah, I think, um, to honest, I’m surprised that it is as much as 13%.
I don’t know many that are tracking in real time. look, you know, in the creative business in particular, you know, things don’t always take. The amount of time that you anticipated and sometimes they take longer. You know, obviously we’re about the quality, we wanna make sure we’re delivering to the client’s brief.
But if you are able to track the data, then you know where you might be able to recoup it. And as Rich said is that, you know, you may not save it completely, but you can try and do something to try and prevent the time over running even further. And agencies on the whole rely until the project’s finished to go well how do, how, how do we do?
But by then it’s too little too late. You know, you’ve already. You over delivered and probably worse, you’ve kind of set an expectation to the client that you will deliver this type of quality on a lot lower, less budget. So if you are able to track it in real time and the client asked for more work or whatever it might be, at least you’re in a position to go, well actually, if we do this additional work, it’s gonna go X amount.
You might be in a position where you can go back to the client and ask for more, but just tracking it. So, you know, if you’ve gone over on one particular phase, you might be able to recoup on the next, but if you haven’t got the data to tell you how you’re actually spending the budget, then you can’t do anything until the job’s actually finished.
And then you kind of just have to accept that project’s gone way over and you just have to accept it as a loss.
[00:29:15] Rich Brett: And if you’ve got data that backs up that feeling, that’s what I want to have. I data tells you something, but what I’m always looking for is the narrative and like, can you, does this fit with what we’re seeing? Does this fit with how we’re feeling about this project? Mm-hmm. And if it doesn’t, there’s something wrong with the data, but you really wanna try and get people to tell you what they think about it, not just use the data.
[00:29:33] Harv Nagra: We need to move into the next point, but I, I just wanna highlight something that Rich said, at the beginning of this topic was also responsibilities and like, having, understanding whose responsibility it is, right? If there’s no project ownership with the project managers, then they don’t understand that it’s their responsibility to deliver this project on, on, on budget.
Then, you know, no one’s gonna bother looking at it, and it’s just an exercise to collect timesheets. So, again, really important point. Let’s move on. one in four firms, only one in four firms can forecast margins, revenue, and capacity with confidence. Keyword forecast looking forward. Being data-driven, after everything we’ve just talked about.
Poor time tracking data that isn’t used, no mid-project control, all that kind of stuff. This one absolutely does not surprise me. it’s a result of all those gaps. You can’t forecast confidently without kind of accurate inputs and good systems and good processes and, roles and responsibilities defined and a lot of firms don’t have that kind of stuff in place. So Rich, there’s a lot of talk about being data driven. But this really points to the fact that the majority of us are not,
[00:30:38] Rich Brett: You should probably put a think they can as well here, because I’ve spoken to professional service firms who think they’re forecasting, but actually they’re not.
They’re just changing their budget and updating things and updating their pipeline. You know, for me, a forecast shows me. On the 15th of April where I think I’m gonna finish revenue, staff cost, overhead and profit. And it shows where the, the top, the maximum of that is and where the bottom of that is. And I’ve spoken to agencies of various sizes up to 10 million and plus.
And even those bigger firms aren’t doing this because sometimes they don’t have the systems in place to do it. ’cause it takes that real collaboration between finance and operations. And sometimes I think a forecast is a finance problem. For me, a forecast is an agency problem. It’s, it’s got to be solved by everybody.
It’s based on do the marketing team, how much money the marketing team’s spending, you know what’s resourcing. And if you’re not doing timesheets properly, you’re absolutely not booking resources and capacity correctly. And I think this is the one big thing that I try to get into all my firms is to forecast.
And we start with current month and then as we get better, we try to move to next month and then we try to get to three months. Obviously the market is incredibly tough at the moment. That doesn’t mean that it doesn’t make, make forecasting easier, but it makes it way more important because you need to make decisions much quicker based on the volatility of the market.
And I try to keep things quite simple but the thing to do is just, you know, set up so your timesheets are done correctly, everyone’s doing them. Then start to go right, we now know how to do that. Now let’s look forward. Then speak to your finance team about how you can get a forecast outright.
But again, this comes down to the fact that if you don’t have good business practises and the right people in place, you’re asking an owner to create a finance forecast, a P&L forecast. That’s not an easy thing to do if you haven’t got the support in cast around you to do it, or the systems.
[00:32:31] Harv Nagra: Exactly. Let’s, move on to the next point. Somewhat related, only one in five firms run their operations in a single joined up system so that it means 80% are bridging their projects and their time and their finance and disconnected tools and spreadsheets and kind of calling it a system. Right? this goes back to the automation point.
When your systems don’t connect seamlessly, you can’t have automation. And I, I, I think the thing, important thing here is that nobody decides. To build a disconnected tech stack. It’s just how you kind of grow up in the organisation. Somebody chooses off the shelf tools during those less mature times and it just doesn’t evolve.
And then you continue to bring in more and more things and they don’t speak to each other. And no one takes the onus to kind of get those connected or, or decide that it’s time to level up to something that’s more consolidated. So it, it’s, the problem here is that once you get in that scenario and you’ve gotten to this, a certain headcount size, it becomes more and more inefficient for your team members to be doing that.
And you’re probably paying higher salaries for people to be doing all this admin work to copy and paste information, crosscheck things important. And you end up getting very lagging data as well as you don’t get a picture of what’s happening today. You might, by the time you reconcile all those reports, even if they’re, if they end up being accurate, which is unlikely, it might be a week or a month later.
So in my view and in my experience. this is an important milestone that most firms, agencies, and consultancies have to go through at a certain, point in their growth journey to get to that higher stage, of maturity. The spreadsheet and the two dozen systems, thing only goes so far, and, and it becomes a liability.
so we’re running short on time, guys. I’m gonna click through to the next one so we can, stick on time. and this one, is the one I wanted to, end the headlines on before we get into some of the other stuff we’re gonna be talking about. And I find it a bit sad actually. only 13% of firms, believe their operating model is ready to scale.
So what I find interesting is even among like the top performers, the data-driven and the innovation era firms. Only 38% say they feel ready. So I, I think that probably points to that, just being so much change and, so much change needed to keep up with what’s happening in the market that everyone feels unsettled and not quite ready.
But, the, the point is we, there’s a lot of work to do to make sure that we’re genuinely future-proofing our organisations. And it’s important to take the maturity journey and, and address some of the challenges we’ve been talking about across those pillars of people, process, tech, data and growth strategies so that we’re ready to address.
The, the bigger, challenges on the horizon. guys, any thoughts on this before we move on? But let’s try to keep it a little brief ’cause we’ve got to get to the q and a and all that kind of stuff.
[00:35:21] Manish Kapur: Well, I think a hundred percent right there, Harv. I think ultimately the challenge is, is that you can only go so far.
and obviously there’s a lot of, emphasis on sales. and that’s how they see growth. I read one line which I thought was quite actually quite telling, which was that efficiencies and new growth lever. and I think ultimately we’re gonna have to do more with less. And I think looking at how you’re actually operating and the tools that you are using and how you’re using your people and aligning responsibilities, all the things that we’ve already talked about are really, really important because, you know, we can’t help it.
We are gonna have a situation where, you know, the AI in particular is gonna drive down prices and it’s gonna be difficult for agencies to retain their margins. and the normal instinct is, is when you stop to grow is to add more people, which obviously adds more overhead. And my belief is we’ll just.
Take a step back and just see what you currently got and ensure that you’re using the right tech to leverage the people that you’ve got and ensuring that they’re actually doing their jobs correctly and in the way that actually adds value to clients. And I think it’s a constant review. You know, it’s not something that you put in place once and then you leave it, and then you get to a point where you’re in the shit and you go, okay, we now need to have a look at it.
As you grow, as you add people, as you add clients, as you add revenue, you’ve gotta be looking at your internal operations at all times.
[00:36:30] Harv Nagra: Thanks very much for that. Let’s, keep moving, as we’ve got a bit more content to cover. So those were the headlines, right? but I wanna really briefly show you what the distance actually looks like between the top and bottom performing firms, and that’s really what the maturity gap report was looking at.
the way we’ve defined, top performers are the ones that are in those top two stages of maturity and bottom performers are in those bottom two stages of maturity.
A few things stood out to me. People has, one of the closest gaps around 40 points, which makes sense. That’s something people tend to prioritise in terms of hiring and making sure, they, they’ve got the right people in their teams. the real points of difference here are the data and technology pillars where the gaps are over 50.
Points each, right? So that of course points to the fact that there’s a lot of work we need to do on both of those to level up. and it’s worth noting that even top performers are not scoring a hundred percent anywhere, right? So there’s room for improvement at every level. The the gap is wide, but it is closable and we need to be working on, moving up that maturity ladder.
So what’s next? We’re gonna get to the q and a in just a moment where you can ask questions and all that kind of stuff. But first I wanted to quickly highlight three things you can do after this to start your business on the journey of levelling up.
step one, if you haven’t already, take the quiz. It’s the same 25 questions, you’ll get your score across those five pillars, your overall maturity stage, and a steer on what to focus on next. And you can benchmark yourself against.
Everything that’s been covered today in the report as well. Step two is read the full report. Okay. The session here has covered a handful of headlines. The report covers everything else.
It looks at every operational pillar and highlights. Where the majority land, as well as the gap between the top and bottom performing businesses. On, on those, answers, it looks at how much of a difference there is between industry type or business size. The report features, stories for, from firms that have been on this journey, including their challenges in their own words. So you’ll recognise some names, hopefully in the report as well, of people that have contributed to it.
And of course. Some immediate actions you can take to get ahead of the pack. Okay, so that’s step two. And step three, subscribe to the Handbook the Operations podcast, which I host. we’ve got an upcoming miniseries on the Maturity Gap which is gonna, feature some of the content and resources that we’re producing to help.
You level up. So that’s gonna be looking at kind of even tactical levels across each of those maturity pillars or operational pillars on things you can do to level up your organisation. And of course, I interview brilliant people, in-house ops folks, as well as, industry experts.
So there’s, there’s loads of stories on the podcast through interviews as well of people, sharing their challenges and success stories and recommendations. Okay. If anybody has any questions, you’re welcome, to ask.
[00:39:31] Frankie: Yeah, I think whilst everyone’s thinking of their questions, just. Jumping into the chat, there was a point from Jennifer and Jennifer, if I don’t do this justice, feel free to, unmute and correct me. But it’s basically around, and the question is sort of please juxtapose best practises versus process for review.
Maybe a little bit more around, around that.
[00:39:49] Harv Nagra: Manishh, you were talking about this. do you wanna take that?
[00:39:52] Manish Kapur: Yeah, absolutely. it’s very difficult to embed any kind of process. You know, when I’ve kind of done a process mapping workshop exercise, we mapped out the process, I would say there were only 30% of the players there.
You know, the hard battle now is to get that embedded, and when you look at your process from start to finish, you’ll probably find that there’s countless steps. A lot of it you’ll do on autopilot, but it’s only when you actually map it out, you realise that you’ve got a load of steps.
Trying to implement that step by step is near impossible. You’ll go crazy trying to do it. So what’s better is to go, okay, we need to have an element of flexibility. We need to be agile. So to try and get every one of these steps followed every single time is not gonna happen. However we need to identify is there are some steps which are non-negotiable, that if you miss that particular step, something will go wrong.
So we’ve mapped up this process. It might end up having 50, it might end up having a hundred steps, but what we’ve identified is 10, 15, 25 key steps that have to be done. It could be that we ensure that we get the scope approved internally. Everyone agrees with what the budget’s going to be. It’s about making sure we get the brief signed.
The client signed off the brief. So we don’t have how to redo the work that we have an internal review to make sure we are happy with it before it goes to the client. So you are identifying what I consider the best practises, which is the steps that you need to do to ensure that you are able to deliver the best work on time and to budget.
And that’s how I differentiate between a standard process and also identify the best practises. Hope that answers the question.
[00:41:29] Frankie: Thank you so much, Minish. That’s great.
There’s, we’ve got another one here. this is, this is also a fab question. And it’s around addressing the possible conflict between role Clarity and doing more with less. Does everybody just pitch in ever work?
[00:41:43] Harv Nagra: Mm. You know what I think that’s a kind of a chaotic era kind of frame of reference where everyone just has to wear every single hat.
And we’ve all been in organisations that are run like that, and it’s not very effective. You can’t do your job well as an account manager if you’re also having to go, you know, buy milk and, you know, be meeting with the IT company and stuff like that. So, if everyone’s. part-time hr, part-time operations, part-time finance, part-time, like, you know, office manager.
It just, it, it becomes inefficient. So I, I think, Getting more with less really means like productivity in my point of view, within that role. So, you know, the things that a project manager needs to do, can you do more of that efficiently with the use of tech and automation and AI and all that kind of stuff?
What it doesn’t mean is. Those people should be responsible for disciplines that are outside of their main area of a focus. That’s where the blurry job descriptions come in. No one’s responsible for an anything, and everyone’s responsible for everything. It doesn’t work. And it’s, a low maturity mindset in my point of view.
Guys, do you, do you agree or disagree?
[00:42:49] Manish Kapur: Percent? Yeah, I think ultimately it’s about productivity. It’s not about saying we are gonna get per one person to wear multiple hats and do loads of different roles. It’s about allowing them to be more effective in the role that they’ve actually got. So they could take on more project work if they’re able to do the stuff that they do best and take away some of the manual elements or, so that’s why I see it from doing more, from less.
It’s not about trying to get people doing multiple different tasks ’cause they’re not always gonna be skilled to do it and something will go wrong. Use the tech that’s available to you to allow you to do the bits that you’re really good at and get rid of some of the tasks that you don’t enjoy doing.
That could be automated example,
[00:43:25] Rich Brett: I actually think it can work, but it will. It will stop working. And I think that’s the point. I’ve definitely worked at an agency where everyone did just pitch in and it mm-hmm. Actually drove everyone forward because it became quite a competitive arena where actually everyone was challenging each other.
But even that got to a stage where it’s like, yeah, but this doesn’t work because if that person then leaves or people will leave, you can’t do it. And I think that coming back to the question about being, being ready to scale. I think everybody just pitch in and scaling won’t work because mm-hmm. It just doesn’t allow you to have the right progress through of, you know, responsibilities and processes.
But it can, but at some point it won’t. I guess that’s my view.
[00:44:03] Harv Nagra: Certain size and maturity level maybe, and we all have to do that, but I think there comes a point where you end up starting to burn people out. And they can’t do their best work ’cause they’re doing everything.
[00:44:13] Frankie: I’m gonna jump in with one more.
What would you say the top indicators are that an operating model is truly ready to scale?
[00:44:20] Rich Brett: From my perspective, I think, you know, it’s that you’ve got a, a forecast that is looking as far ahead as possible because that proves the operating model can work and that you’ve got a system in place to understand that that’s coming.
[00:44:32] Manish Kapur: Mm-hmm.
[00:44:32] Rich Brett: But really the only real indicator an operating model is working and it’s scaling is that you’re actually doing it because mm-hmm. You can’t really know until you actually do it. But I think having that data that is telling you that and that when you look at that P&L versus your operations data, those two things make sense together.
I think that’s the bit that really shows that it works, because if one thing shows that everyone’s busy, but your P&L shows that you’re not making any money, then obviously there’s a disconnect there, and that means that you’re not probably ready to scale. So I think it’s about getting that data right.
Using that data to then drive your forward facing view on what you need to look at.
[00:45:07] Manish Kapur: Yeah, absolutely. I agree with that. I think, you know, you know, anyway, when things aren’t right, ’cause there’s a lot of internal pressure. We’ve got enough pressure coming from clients, but then internally when there’s a bit of friction internally, you know that something’s not right.
and the worst possible scenario is that you act upon it when people start to leave and you never wanna be there. You know, you want to pick up on what’s going on and saying, well actually, is this an internal issue and we need to deal with it? And it could be across all the pillars that you’ve already highlighted there half, but you do need to address it.
And I think it’s. Too often it’s like a one and done. People look at it and leave it and then focus on the growth, but then start to keep reviewing it to make sure that it is fit for purpose. And the other thing is, is that your ways of working can change depending on the type of clients you’re working with.
Project versus retainers are very different, for example. So you always have to have it under constant review and don’t just see it as something as a given, because then you’ll be one step ahead and the forecast is so critical. ’cause that will tell you when you need to start taking action. Mm-hmm. So important that when people say to me, you know, resource management, what’s the number one tool?
I say, well actually the forecast is your number one tool.
[00:46:09] Harv Nagra: Mm-hmm.
[00:46:10] Manish Kapur: That that will, this one allows you to actually plan the resource well in advance and be able to handle anything that comes your way if you need to bring in freelancers or whatever. And I think the forecast is absolutely critical ’cause that will allow you to solve a lot of problems before they become serious problems.
[00:46:25] Harv Nagra: Absolutely. And I’ll tell you my instinct when I first hear that question, I think of like, you know, technology and AI and things like that, like what’s next. But I think the important thing, like both of you have pointed out is getting the foundations right is actually the most important, you know, way to allow yourself to be set up to scale.
So really important points.
those were just the headlines and just the beginning of what we’re building out around business maturity this year. I’d love for everyone in the Handbook community to go on the maturity journey together this year.
So here’s what you can do. Take the business maturity quiz if you haven’t already, so you can benchmark yourself against your peers and identify what your maturity gaps are. Okay, read the full maturity gap report and see what separates top and bottom firms. And hit subscribe on the podcast so you don’t miss what’s coming.
In our maturity series, we’ve got a load of resources, conversations, and insights planned over the coming weeks and months. And trust me, you’ll wanna be along for the ride. Let’s go on this maturity journey together.
I’ll be back soon with the next episode.
