One of the most feared words in professional services is the dreaded “bench”. Bench is a term used to describe service delivery employees who are not actively billing on a project. Instead of being in the game, they are stuck on the bench.

Company leaders tend to dislike bench time because it doesn’t generate revenue, and it lowers company profitability. Delivery employees dislike bench time because they love their work and want to keep their jobs. Both groups realize that if the firm has too many people on the bench for too long, there will be no choice but to reduce headcount.

A universal law of professional services is that there will be bench time. It simply isn’t possible to keep everyone fully billable indefinitely. For most professional services firms, bench time isn’t just likely, it is preferable. Why would a firm want bench time if it hurts revenue and earnings? There are a couple of reasons:

1. For a firm to grow, it must be able to take on new projects within a reasonable period of time. If the delivery organization runs at maximum utilization, it won’t be able to handle new work until existing projects finish. Clients generally don’t want to wait weeks or months, and thus, they will select another provider with better availability. In order to grow quickly, the firm must have available bench to apply to new projects.
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2. The company needs to continually deliver strategic internal initiatives. These projects could range from marketing efforts to process development to productivity tools. Many of the most effective marketing tactics in professional services can only be executed by delivery experts. For example, if the firm is hosting a webinar to attract new prospects, a delivery lead will need to develop the content, create the slides, and rehearse the webinar. If that person is 100% billable, the webinar will be lower quality and less effective.
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So, bench time isn’t just inevitable, it’s desirable. But, as with most things, it is only desirable within reason. Excessive and prolonged bench time causes real problems for the business.

One of the most important tasks of firm leaders is to balance supply and demand to ensure that bench time is in an acceptable range. If the firm has insufficient supply (of available delivery employees), clients will be upset (due to project delays) and revenue will be depressed. If the firm has insufficient demand (not enough client work), too many employees will hit the bench and layoffs will eventually be necessary.

The most effective tool in balancing supply and demand in a professional services firm is the forecast. The forecast is a projection of future business and it is developed by combining the sales pipeline and revenue backlog. The forecast and existing resource allocations directly inform the pace of recruiting and hiring within the firm. With an accurate forecast in hand, firm leaders can manage the bench to a desirable range and maintain a healthy income statement and company culture.