USD 7.4 billion.
That’s the revenue businesses lose every day to unrecorded billable activities. It’s not any different for IT services organizations.
Fast-growing businesses like yours are turning towards technology to track employee time spent on billable tasks to ensure accurate and timely client billing.
Whether you bill clients based on hourly rates or need to justify project costs, tracking time accurately is imperative for business growth. But how can your business unlock strategic benefits that go beyond billing accuracy? By implementing a global, customizable, scalable, and robust time-tracking system.
Is Disparate Time Tracking Holding Back Your Business Growth?
When each IT service or project has its own method to track work time, then it becomes difficult to compare and analyze the time data accurately. Inconsistencies in time data can make it challenging to create accurate invoices, and gain insights into resource allocation, project progress, and overall performance.
Also, most organizations rely on manual approaches to project time tracking, approvals, and expenses. They find themselves on a complex path of delayed billing and all the negative effects that come with it, including high overhead costs, inhibited cash flows, reduced profits, and revenue leakages.
Disparate time tracking poses several challenges, including:
- Inability to deliver projects on time and within budget
- Operational business inefficiencies causing revenue leakages
- Overlapping functionalities leading to increased costs
- Lack of real-time visibility into accurate time data
- Poor governance and lack of labor law compliance
- Disconnected ecosystem with multiple integration touchpoints
- Reduced impact of digital transformation initiatives
On the other hand, accurate time tracking allows you to gain complete visibility into your billable and non-billable hours.
This presents you with several advantages as well, such as:
- Achieve faster billing cycles by reducing the time required to create correct invoices
- Secure payment for every minute spent working on a project
- Promote responsibility and transparency, which enhances client satisfaction
- Maximize utilization as there is better control over resource time
- Uncover opportunities to boost project profitability and revenue
What Do Businesses Gain by Leveraging a Unified Time-Tracking System?
Have you ever found yourself managing a global project in which half of your consultants are still filling their project timesheets manually, while the other half of your consultants are using a variety of legacy or in-house platforms to fill their timesheets?
As a result, you spend longer than you’d like to, trying to make sense of the available data, while trying to acquire real-time visibility into the project status, allocate resources, and correctly bill your customer.
Assuming that a company with 10,000 employees has about 20 million working hours available each year, how would you accurately track and calculate the billable hours for all the employees around the world?
And do you know?
The billable hours decreased in 2022 to 1,404 from 1,418 in 2021, according to SPI.
Instead of tracking project time across a fragmented ecosystem, you need a platform that gives you complete visibility into where your global employees spend their billable time.
With this, organizations may:
- Reclaim hidden billable time
- Reduce administrative duties associated with timesheets by up to 75%
- Accurately manage the time spent on client billing and resource use
Powered by a single system, real-time analytics, and deeper insights, businesses can fulfill their dynamic needs and speed up business operations to boost profitability via the following:
Real-time Tracking of Estimates and Actuals
To keep your projects on track and proactively ensure course correction before overruns happen when working on several projects, you must regularly monitor the hours and costs every day. One of the biggest problems that your business leaders could be facing with their teams is understanding which projects are delivered. The usual questions they ask are:
- Are we on track and within budget?
- What is the estimated time to complete it?
This is where a time-tracking software can help by allowing managers to establish goal hours and expected costs for each project to compare estimates and actuals.
It’s necessary to have a project dashboard in place that not only provides a centralized view of your projects and early warning indicators, but also minimizes project overruns and reduces revenue leakage.
A linked enterprise’s real-time data will provide a complete picture of project time, costs, resources, and billing, allowing managers to make proactive, data-driven decisions to minimize project overheads and optimize revenues.
Improve Billable Hours
Accurate costing and billing are the key components to consider especially frequently the first thing, when it comes to project time tracking, you must pay attention to accurate costing and billing. Each billing error instantly undermines your client’s trust. More time and resources are needed for a project in order to redo all calculations, identify and verify problems, and convey the errors to the client.
A cloud-based time-tracking platform ensures you bill your clients accurately, by the hour. It enables you to measure the exact time an employee spends on a particular project, thus reducing the chances of underbilling or overbilling. You can not only determine the completion time and amount spent on your ongoing projects, but also estimate the expected time and budget of your projects that are still in the pipeline.
A versatile bill plan accommodates various client/project billing needs like the fixed bid, time and materials, flat, or any combination that your business might need. With this, you can track the financial health of your projects, understand projects at different stages of execution, and improve visibility into cash flows. All this will free up more time for tasks that move the needle of your business.
Realistic Forecasts for Agile Projects
Accurate project time data is the fuel that drives near-reality project forecasting and budgeting. Organizations may precisely track time using a global time-tracking solution to obtain reliable data for improved project forecasts. Also, having full visibility into the project pipeline, available resources, and skills requirements ensures you can more accurately anticipate resource requirements when submitting project bids.
Even better, you can research the availability of resources by skill set and proactively hire or retain personnel to complete projects on schedule.
As the project advances, managers can use the project time-tracking tools to plan and monitor delivery in the here and now. The ability to observe how much time was spent on a billable activity, how much work is still to be done, and how long it’ll take to do it helps to prevent resource over- or under-allocation. This, in turn, helps execute projects within the designated time and budget restrictions.
Achieve Global Governance and Compliance
In the pursuit of key financial metrics – revenues, profits, margins & more – many IT services organizations fail to recognize the fact that enforcing governance rules and workflows while making it simple to carry out and report on projects, tasks, and engagements, is the key to managing global delivery teams.
With the development of remote, hybrid, and work-from-anywhere (WFA) project workers, this is even more important. Additionally, to make any sense of all the projects, work and time data, teams must adhere to well-defined guidelines, laws or policies so that these can be easily consolidated and reported on without adding overheads.
If you have a global business, then compliance with global and local labor laws, and working time directives is crucial. To ensure proper compliance with global labor laws, businesses should opt for a solution that offers:
- An in-house legal team
- Enforcement of working time directives at the time capture itself
- Built-in compliance library and dashboards to manage specific regional regulations & tax requirements, without worrying about employee location
Getting Future-Ready With Replicon
The advantages of automated time tracking extend far beyond client billing. Accurate time data enables streamlined and error-free billing. By automating their time-tracking processes, IT services organizations can eliminate manual data entry, reduce administrative burdens, and ensure timely and accurate payments to their employees. This not only enhances efficiency but also improves employee satisfaction and morale.
Here’s a case study that proves why it’s imperative to ensure accurate time tracking and seamless billing to maximize profitability.
Case Study: How a leading IT services and solutions provider focused on quality and innovation and developed a reputation for delivering reliable, scalable and cost-effective solutions to clients across various industries.
Challenge: The IT services business faced several challenges with its existing in-house time-tracking system. First, human errors were leading to difficulties in billing clients accurately on time, which significantly impacted the company’s cash flow.
Additionally, a lack of accountability for the hours worked on projects made tracking and managing employee productivity challenging. Billing clients accurately and updating them on project progress was time-consuming and costly, requiring extensive administrative work.
Thus, the company developed an internal system using a small application that generated an Excel spreadsheet to track each user’s time. Employees had to input their timesheets into two different formats—one for internal use and another for client billing—using Excel, which obviously consumed significant time.
Solution: The leading IT firm chose Replicon as their partner for intelligent and accurate time tracking to address their requirements. They discovered that Replicon’s scalable time-tracking platform could help them address their challenges and achieve their business objectives.
Streamlined Client Billing, Reduced Revenue Leakage & Enhanced Resource Management
Replicon’s unified time-tracking platform improves operational efficiency with integration, collaboration, workflows, automation, and less manual effort. It provides a centralized time tracking, billing, and financial management platform, integrating all key processes into one streamlined platform. Also, it accurately captures the time spent on projects, automates billing processes, and gains real-time insights into project profitability and financial health.
Volatile times are often the harbingers of progress and innovations. Uncertainty and market disruptions may continue unabated and further squeeze profit margins. That’s why IT firms should have in place a unified, scalable, and robust time-tracking platform to remain competitive in the midst of disruptions.