Hitting Revenue Targets Is Impossible When You Don’t Control the Inputs

Introduction - When You Don’t Control the Inputs

Most construction and engineering businesses set revenue targets with good intentions. The board agrees a growth number, sales teams are pushed to deliver it, and operations are expected to “make it work.” When targets are missed, the conversation usually turns to poor sales performance or market conditions.

At Jones Financial Accounts (JFA), we consistently see a different root cause. Revenue targets fail because the inputs that actually generate revenue are not controlled, measured, or planned properly.

In engineering businesses, revenue is not created by ambition, it is created by engineers, time, skills, and availability.

This is not just a big-business problem. For £500k–£10m construction and engineering firms, getting this wrong can mean the difference between controlled growth and constant firefighting.

Why Targets Fail Without Manpower Planning

Revenue targets are often set top-down, based on last year’s results plus a growth percentage. What is rarely tested is whether the business physically has the capacity to deliver that level of work. Engineers are treated as a flexible resource, rather than a fixed constraint.

Without manpower planning, businesses overpromise delivery, overload teams, and rely on overtime or subcontractors to bridge the gap. This creates stress, inconsistency, and margin erosion. Targets look achievable on paper, but are impossible in reality.

From a CFO perspective, this is a structural planning failure. If the delivery engine cannot support the target, the target is flawed, not the team.

Targets must be built bottom-up, starting with available engineering capacity. This means understanding how many engineers you have, how many productive hours they can realistically deliver, and how that translates into revenue.

Once capacity is clear, revenue targets become grounded in reality. This approach may initially reduce headline growth ambitions, but it dramatically improves delivery confidence, cash flow stability, and long-term profitability.

Linking Engineer Availability to Revenue

Many businesses track revenue and headcount separately. Sales forecasts sit in one spreadsheet, payroll costs in another, and no one connects the two. This disconnect creates unrealistic expectations.

For example, if an engineer can bill £90 per hour, but only has 1,600 realistic billable hours per year after holidays, admin, and downtime, that engineer can only generate £144,000 of revenue annually. No amount of pressure will change that number.

When leadership ignores this reality, the business chases revenue that cannot physically be delivered. The result is rushed jobs, quality issues, and declining margins.

Revenue forecasting must start with engineer availability. Each engineer’s realistic billable capacity should be calculated and linked directly to revenue targets.

At JFA, we help businesses build simple models that show how many engineers are required to support each revenue milestone. This gives leadership clarity on whether growth requires hiring, pricing changes, or operational improvements, instead of blind optimism.

For a wider view on financial oversight, see:👉 https://www.jonesfa.co.uk/blog/why-every-small-business-should-have-a-monthly-finance-health-check

Holiday, Sickness, and Skills Modelling

Most forecasts assume engineers are available all year. In reality, people take holidays, get sick, attend training, and occasionally leave unexpectedly. These factors are rarely modelled properly.

Skills add another layer of risk. Not all engineers are interchangeable. When specialist skills are concentrated in one or two individuals, the entire delivery plan becomes fragile. One absence can derail multiple projects.

Ignoring these realities inflates revenue forecasts and creates constant re-planning at operational level.

A robust forecast adjusts for non-productive time and skill constraints. This means reducing assumed billable hours to reflect reality and mapping skills to future workloads.

This level of planning may feel conservative, but it creates stability. Projects are delivered on time, subcontracting is planned rather than reactive, and margins are protected. Practical forecasting tools are available here:👉 https://www.jonesfa.co.uk/resources

Realistic Targets vs Boardroom Pressure

Boardroom pressure often leads to targets that “sound right” rather than targets that are achievable. Directors feel compelled to commit to growth numbers without challenging whether the inputs support them.

Over time, missed targets damage morale and trust. Teams stop believing the numbers, forecasts lose credibility, and leadership decisions become reactive rather than strategic.

This is especially dangerous in engineering businesses, where long project timelines mean errors compound over months, not weeks.

Strong leadership sets targets that stretch the business without breaking it. This means using capacity-led forecasting, probability-weighted pipelines, and clear delivery constraints.

When targets are realistic, teams commit to them. Delivery improves, margins stabilise, and leadership regains control. Finance should sit at the heart of this process, not review it after the damage is done.

Practical Steps to Control the Inputs

Start by calculating realistic billable capacity per engineer.

Map skills against confirmed and potential work.

Only then should revenue targets be finalised.

Most importantly, make finance part of the target-setting process.

Revenue targets should never be approved without understanding manpower capacity and delivery risk.

Key Takeaways

• Revenue targets fail when delivery inputs are ignored

• Engineer availability directly caps revenue potential

• Holidays, sickness, and skills must be modelled

• Realistic targets protect margin, morale, and cash flow

If your business is constantly chasing revenue but struggling to deliver it profitably, the issue may not be ambition, it may be control of the inputs.

Wrapping up today's insights, tomorrow we simplify another accounting challenge.