The world of creative agencies can seem glamorous on the outside — brand-name clients, big projects, and viral campaigns — but from working with creative agencies for over a decade on their backend processes, we’ve learned that the reality behind the scenes is that many of them quietly struggle with profitability.
This is true regardless of the agency's size or fame, or the quality of its accounting department. Many agencies are actually losing money on individual projects, specific clients, or even operating at a net loss.
Why is this happening?
It’s because the combination of project management and accounting for creative agencies is unlike most other businesses. Specifically, the #1 cost center for creative agencies is employees. And that cost is surprisingly inconsistent and hard to pin down.
As we’ll explain in detail below, it’s not a simple hourly rate for each employee. Each project, each client, has different employees and different resources moving in and out of it in any given month. And this mix changes significantly month over month.
To properly manage this requires systems that give you precise visibility into this web of resources, employees, and projects. Yet, and this is the rub, most creative agencies are stuck using generic project management and accounting tools that do not give them this required visibility.
As a result, when making resource allocation decisions (like who to assign to what project, or how many hours they should work on it this week), they don’t know the profitability situation, and end up making these decisions blindly. You can imagine the result.
We built Workamajig to solve this. It’s project management and accounting software in one, with complete communication between those two sides, designed specifically and exclusively for creative agencies. Every detail of how the software works is tailored and customized to their workflows.
- It gives accurate, real-time visibility into the metrics and profitability situation of every project and every client.
- It doesn’t require accountants to close the books after month-end to see whether a given client or project was profitable.
- It allows decision makers, such as account managers, to see and make decisions based on this information when assigning resources to projects.
Below, we outline these issues in detail and show exactly how Workamajig solves them.
If you’re a creative agency and have experienced some of these problems, we encourage you to reach out to see if Workamajig could help.
Why Generic Systems Create Blind Spots for Creative Agencies
Most project management tools, like ClickUp and Asana, let you assign tasks, track time, and plug in flat hourly rates for cost estimates. However, these calculations are almost never accurate for creative agencies because they assume everyone costs the same every hour of every day — and agencies don't work like that. Employees' actual hourly costs fluctuate (and dramatically) based on utilization.
Take a retainer employee with a monthly cost of $10,000: if they spend 50 hours on a project one month, their effective hourly rate is $200. But if they only spend 10 hours on that same project the next month, that jumps significantly (5x!), to $1,000 per hour.
The same monthly cost spread across different work hours means wildly different actual costs per project. And generic PM tools can't account for these fluctuations. They don't even handle basic cost factors like actual salary data, benefits, PTO, or overhead.
As a result, "profitability" reports in PM systems are based on rough estimates instead of true costs. By the time you discover the real margin, it's too late.
Beyond that, these tools don’t properly connect to accounting systems. They technically integrate, but they don't work with the same types of data or share data at a deep enough level.
Accounting software like QuickBooks wasn't designed for project-based work. It records invoices and expenses but has no concept of project progress, WIP revenue recognition, or retainer burn tracking.
You can't see delivered value vs. billed amounts, and there's no connection between your work and its financial impact. Labor appears as generic dollar amounts, unable to account for team member cost variations or track profitability in real-time.
Agencies waste hours reconciling time logs, expenses, and invoices across disconnected platforms, introducing errors and delays. And at the end, they still get approximations and lack true, accurate project cost visibility.
Read more: Why Generic Software Doesn’t Work for Agencies
The Cost of Flying Blind
Without reliable cost data, you're making critical decisions based on assumptions or outdated numbers. And this lack of financial clarity creates a cascade of problems:
- Project managers can't spot budget overruns early enough to course-correct
- Retainer balances get depleted without warning
- Clients who seem profitable on paper are actually eroding your margins
- You can't strategically assign resources because you don't know the true cost of different team members
- Pricing new projects becomes educated guessing since you can't learn from past project profitability
- Cash flow planning is basically impossible when you don't know if you're actually making money
- You keep taking on the same types of projects that lose money because you can't tell which work is profitable
- Scope creep flies under the radar — extra work gets absorbed without anyone realizing the hit to your bottom line
- Team utilization is a mess because you can't see the real cost of having people idle vs. overworked
By the time you measure actual profitability, you're already behind and scrambling to recover.
This isn't just a reporting issue — it's an operational problem that undermines your ability to grow sustainably.
Workamajig’s Solution: Purpose-Built Project + Financial Management
We solve this problem with an all-in-one agency management solution that combines a full-featured project management system with a comprehensive accounting system (fully replacing QuickBooks or Xero) in a single platform.
Unlike generic tools that force you to estimate or manually patch together data, our platform was built from the ground up to handle the unique complexities of agency work — with tools like retainer burn tracking and WIP billing that are essential to getting an accurate handle on profitability, and that you can't find in generic systems.
That means every hour logged isn't just a time entry — it's a precise financial transaction, automatically tied to the actual cost of the person doing the work.
How Workamajig Eliminates Guesswork
The only way to accurately track agency and project profitability is to tie every hour of work to what it actually costs you — including each employee’s actual compensation, salary, benefits, time off, everything — and not a made-up hourly rate.
Workamajig is the only platform that does that automatically, right inside your workflows, as part of how you manage projects.
True Cost Tracking (at Every Level)
Workamajig doesn’t assume a fixed hourly rate. It stores each employee's actual salary and cost data — including benefits, overhead, everything — so when time gets logged, the system automatically knows the real cost of that work. Not a rough estimate.
The result:
- You get accurate costs per project, per client — across the whole agency
- You can see exactly where projects stand against budgets as work happens, not after wrap
- You can compare what you estimated vs. what actually happened to fine-tune project plans and pricing
No more surprise losses on projects that looked profitable in your PM tool (but weren't).
Work in Progress (WIP) Accounting
Most accounting tools only count revenue when you actually send an invoice. For agencies with long projects, this means you look unprofitable for months, then suddenly spike when the project bills — making it impossible to know how you're actually doing moment to moment.
Workamajig calculates WIP automatically, tracking the value of the work you've finished but haven't billed yet. You know how much unbilled work is sitting in your pipeline, whether your project progress and billing are in sync, and what your agency's actual financial position is — without waiting for the next billing cycle.
This gives you and your finance team a clear, accurate picture of cash flow and profitability as work actually happens.
Retainer Burn Management
Most PM or accounting tools treat retainers like any other invoice — there's no way to track how you're using that budget or when it's running out. Your team could be (and probably is) over-servicing clients without anyone realizing it.
Workamajig tracks retainer burn automatically. Every hour logged and expense recorded draws down the retainer balance instantly.
You can see exactly how much budget is left at any point, catch overages before they happen, and either adjust the work or upsell additional hours. This saves you from having awkward conversations with clients about surprise charges, while protecting your margins.
Revenue Forecasting
Most agencies estimate future revenue using spreadsheets and manual data pulls, which is slow, inaccurate, and risky.
Workamajig connects revenue forecasting directly to your active projects, proposals, and retainers. When deals close or scope changes, your forecasts update automatically. You can see expected revenue months out, run "what-if" scenarios like losing a big client or landing a major new one — and actually have solid numbers to base hiring and resource decisions on.
This completely changes how you can run and scale your agency.
Rather than crossing your fingers and hoping you can afford that new hire, you know exactly what revenue is coming and when. Rather than scrambling when a client leaves, you can see the impact immediately and adjust accordingly. You can confidently pursue new business knowing how it fits into your financial picture.
Suddenly, you're making informed decisions rather than taking expensive gambles.
Financial Reporting (You Can Actually Rely On)
QuickBooks can show you P&L and balance sheets, but you can't break down profitability by client, project, or department without a lot of manual work and heavy customizations.
Workamajig's financial reporting is built specifically for agencies. You can slice and dice your data in ways that actually matter:
- Track profitability at every level — by client, project, campaign, or across your whole agency
- Run cash projection reports to see expected cash flow months ahead without estimating
- Analyze work-in-progress reports to track unbilled work value and avoid cash flow surprises
- View overhead allocation details to understand what projects actually cost you
- Monitor team utilization vs. realization rates to see how much of your employees' time is billable
You can create and save custom reports to easily reference the data most important to your agency and growth goals.
All reports pull from your live project and accounting data, so you see the complete picture without having to stitch data together in spreadsheets.
Project Management Built Around Real Costs
Workamajig isn't just about getting clear on costs — it's designed to improve control over how you actually run projects and help you see more profitable outcomes.
Our system comes with customizable templates so you can save proven project workflows, standardize what actually works, and replicate those processes across your team. No more reinventing the wheel or hoping everyone remembers the approach that worked last time.
The platform also auto-generates estimates from your actual historical cost data as you build project plans, factoring in overhead and contingencies automatically, so you get safe, profit-protecting calculations. Once approved, everything converts seamlessly to live projects with budgets and rates locked in.
It even includes billing schedules for automated billing prompts and triggers to keep billing accurate and aligned with delivery, pulling directly from actual work completed, retainers, or milestone progress — without manual data entry or errors.
Why Native Integration Changes Everything
When project, time, and financial data live in one system, you know actual, accurate project costs in real-time, not just after projects wrap.
This real-time visibility lets decision makers make operational day-to-day allocation decisions with accurate data — when previously, they would just have to guess, and the company didn’t know the end profitability until the books were closed and accounting did their analysis.
With Workamajig, project managers see the same financial data that accounting sees. Account managers know exactly where budgets stand when talking to clients. Leadership gets unified reports that don't require reconciling multiple systems.
This unified visibility transforms your operations.
- Resource allocation becomes strategic because you can see the real financial impact of staffing decisions.
- Growth planning becomes data-driven because your forecasts are built on actual integrated data, not estimates patched together from different tools.
- You can have honest budget conversations with clients because you know exactly where projects stand financially and can back up any recommendations with real data.
This is how profitable agencies actually work — with complete financial clarity driving every decision.
See How Workamajig Can Transform Your Agency's Profitability
Every instance of Workamajig comes with a dedicated account manager who serves as your Workamajig partner, training you on the platform and demonstrating how all the modules work together. This ensures that you can use our system effectively and simplifies the transition from your existing software to our integrated solution.
Your account manager will meet with you before onboarding to:
- Plan a discovery call where you can discuss your current processes and pains, as well as the specific problems you’d like to solve.
- Guide the set-up to ensure Workamajig is configured correctly for your people and projects.
- Train you on all Workamajig modules, showing how they’re intended to be used and how they support agency management best practices.
- Plan check-ins and provide ongoing support to address questions as they arise or troubleshoot problems.
- Optimize Workamajig as your agency evolves and needs change, so the system supports your operations at every stage of growth.
This consulting piece is entirely free; included in the basic Workamajig subscription. Most teams fully adopt the software and best practices, transforming their agency operations in less than 90 days.
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Ten Adams made the transition to Workamajig from spreadsheets and disconnected tools in under three months. Now, they manage time tracking, invoicing, and margin analysis in one unified platform. Read the case study. |
Agencies that adopt Workamajig:
- See their actual profit margins on every project and client
- Catch over-servicing problems before they tank profitability
- Deploy talent where it actually drives profit, not where it feels busy
- Make growth moves with confidence instead of crossing your fingers
- Price work based on hard data — not hopeful math
- End the monthly nightmare of reconciling scattered financial chaos
- Have real project data to back up every client conversation
Ready to stop flying blind? Let’s show you how Workamajig connects every dollar to every decision — in real time. Request a free demo with us here.
Workamajig Case Studies
Red Letter Communications
Red Letter Communications faced challenges with fragmented tools that made it difficult to track true project costs and profitability. By adopting Workamajig’s integrated platform, they gained real-time insight into labor costs, project budgets, and resource utilization. This visibility enabled them to optimize staff schedules, reduce over-servicing, and improve overall financial accuracy, resulting in stronger profitability and more informed business decisions.
MSI Communications
MSI struggled with project planning and budget control due to disconnected systems. Workamajig’s unified platform enabled them to track time, costs, and profitability accurately in real-time, bringing clarity to their financials and eliminating end-of-month surprises.
SCORR Marketing
SCORR used Workamajig to consolidate scattered financial and project data. As a result, they now manage retainers, staff allocation, and margin tracking in one place, drastically improving forecasting and operational efficiency.
You can find more case studies on our site here.
Find Workamajig in the Wild
Workamajig was built on agency management best practices and continues to evolve with the industry. You can always find our team at industry events — Magnet, Second Wind Conference, BABA, AMIN, tCAN, Mirren, WorldWide Partners (WWP), and more — discussing new technologies and methods for managing agency operations.
Here is where we’ll be next:
- Magnet — September 17-19, 2025
- AMIN — September 28 through October 1, 2025
Read more: The 24 Must-Attend Marketing Conferences for Agencies in 2025
Request a free Workamajig demo to see how our system can transform your agency operations!
Originally published August 24, 2025.