How Internal Billing Makes Your MSP Departments Play Fair

Ensuring that each department’s financial performance in your MSP is accurately reflected isn’t just about balance sheets—it’s about fairness. Without internal billing, it’s like letting your sibling borrow your car and gas money without pitching in. Sure, they’re technically family, but come on! When the helpdesk keeps leaning on the projects team without proper internal billing, your financial reports turn into fiction. Internal billing across profit centers makes sure everyone knows who’s paying for the gas—and who’s joyriding without a care.

The Pros of Internal Billing

Implementing internal billing isn’t just a fancy accounting trick; it’s how you get a clear picture of who’s carrying the team and who’s coasting.

1. Transparency in Resource Utilization: Suddenly, the helpdesk realizes their endless calls to the projects team aren’t “free.” It’s like explaining to your friend why ordering extra guac costs extra. Accountability improves when people see the bill.
2. Data-Driven Decision-Making: When every inter-department handoff is priced out, management can finally spot the bottlenecks. Maybe it’s training the helpdesk. Maybe it’s stopping Karen from routing every printer issue straight to the sysadmin. Either way, the data doesn’t lie.
3. Efficient Resource Allocation: Internal billing is like a traffic cop for resources. If one department is draining time and money like a subscription you forgot to cancel, it’s time for a reroute.

The Cons of Internal Billing

But hey, no system is perfect, and internal billing has its share of hiccups.

1. Administrative Workload: Someone has to do all this tracking, and no one gets into IT because they love spreadsheets. (Okay, maybe a few people. We see you, spreadsheet whisperers.)
2. Inter-Departmental Conflicts: “Why am I being billed for 3 hours of ‘consulting’ when they only fixed a typo in a script?” Prepare for turf wars, but at least now you’ll have receipts.
3. Risk of Misaligned Incentives: Some teams might play hardball—“Nope, not touching that ticket; it’s not in my budget.” Collaboration might take a hit if people start treating colleagues like bill collectors.
4. Tracking Complexity: Accurately allocating costs feels like assembling IKEA furniture without the manual. It’s possible, but it’s going to involve a lot of guesswork and probably some tears.

My Journey to Internal Billing Enlightenment

When we first scaled, the helpdesk was calling in favors from the projects team like they were best friends sharing fries. The P&L sheets made the helpdesk look like profit heroes, while the projects team was drowning in invisible work. Once we implemented internal billing, it was like flipping on the lights in a messy room. Suddenly, everyone could see just how much “borrowing” was going on—and that clarity led to better decisions (and fewer excuses).

How to Actually Do This Without Losing Your Mind

1. Start with Timesheets: Get everyone to log inter-departmental help. Yes, it sounds like micromanaging, but you can’t bill ghost hours.
2. Journal Entries for the Win: Have your accountant step in to record those internal bills. They’ll probably grumble about “another thing to do,” but hey, accountants love order. Deep down.
3. Go Full Robot: Invest in an automated billing system. It’ll track, tally, and reduce the risk of someone “accidentally” forgetting to record their 5-hour coffee run.