A few years ago, Sweden was in the headlines for experimenting with a six-hour workday.
Every enterprise is looking for ways to improve its bottom line and gain profit in a given time. From hiring the right talent to training their existing employees, organizations spend significant amounts of money to fill specific skill gaps to meet the clients’ demands and finish projects within time. In a recent study, it was shown that untracked resource time and activities result in a loss of millions of hours and billions of dollars in productivity. In short, if you are unable to track time and expenses, it is like giving away money.
So, How Does Accurate Time Tracking Improve Your Bottom Line, and How do You Measure It?
Time tracking aims to understand the time contributed by the employees towards various projects and helps calculate the value that these projects are generating. It is the key to measuring productivity, running workflows efficiently and getting a complete view of your business.
In addition, over the past year, disruption to global businesses has compelled several organizations to shift focus to enabling remote work without affecting employee work-life balance and efficiency. Time tracking can help you ascertain the value generated by such investments as well.
Here’s how time tracking improves your bottom-line results.
Accurate Time Tracking Magnifies Success with Fast and Timely Billing
When considering project time tracking, the first point that often comes to mind is accurate costing and billing. Any error in billing affects your client’s trust directly. Additionally, you will also have to spend more time and resources on the project to redo all calculations, find and verify the errors, and summarize the mistakes to the client.
According to the Pareto Principle, or the 80/20 rule, almost 80 percent of consequences come from 20 percent of the causes. For example, sending an invoice that is missing details, that isn’t 100 percent accurate, or is somehow faulty (cause) ultimately leads to you not getting paid on time or not getting paid at all (consequence).
Time management software ensures that you are accurately billing your clients by the hour and enables you to measure the exact time spent by an employee 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 you can also estimate the expected time and budget of your projects that are still in the pipeline. All this will free up more time to devote to tasks that really move the needle for the business.
Time Tracking Boosts Profitability with Real-time Actuals to Estimates
One of the essential and unsaid rules of any project is to finish it within the estimated budget and by the given deadline. And for the same reason, it is necessary to estimate time and cost correctly while planning for a project.
Organizations usually assign a fixed budget based on the size and complexity of the project. The accurate tracking of time by the resources helps project managers understand the performance and the average time a resource takes to complete a particular type of activity. This information will be beneficial during estimating time and resources for future projects, especially if the activities are similar in nature.
Time tracking software allows project tasks to be plotted on a timeline and highlights any blockers that may lead to the project not getting completed by the given deadline. Through automated time-tracking, you can easily calculate the efficiency of the workforce involved in a particular project. This will help you to arrive at a much realistic completion time for any new project, raise flags if there are any delays, and involve additional resources to finish the project in time.
Time Tracking Increases Productivity with Real-time Visibility
When you have a well-defined schedule for your resources’ tasks, priorities, and activities, their productivity will increase automatically. Employees work best when they have set targets with a clear-cut timeline that avoids any confusion. The project managers, in turn, have complete visibility over their resources and their current workload. With this information, project managers can easily create the timeline of each project, chart out the upcoming steps as per the project goals, and deploy more resources to the project if needed.
Time tracking can help you calculate idle work hours for your employees, which can be utilized in different projects to stop time wastage. Once you have all the insights about your resources, e.g., time logged, absenteeism, etc., you can ensure resources complete their work within a dedicated timeframe and prevent it from dragging on any longer than it has to. Employees can also view work hours, available vacation days, etc., to request time off when required. You can also have customized reports containing real-time metrics so that there is updated data available all the time.
Another vital contribution of time tracking is towards hiring decisions. Based on the workload, time constraints, return on investments, and future requirements, an informed decision towards hiring an additional workforce, including freelancers or contingent employees, for a project or a set of projects can be taken.
Optimize to Make the Most of Your Time
As the world starts to embrace a flexible work culture, tracking time has become more critical than before in understanding employee work behavior and productivity. Until you know how your employees are spending their time, you can neither predict nor improve employee performance.
The bottom line is that automated time tracking, by helping you track the employee work hours, also allows you to improve your billing, hiring, and project management process. Business-critical decisions can be made when you have insights into your workforce productivity and capabilities.
From a manager’s perspective, automated time tracking helps bring clarity and predictability so that project-specific strategies can be developed and the overall process can be streamlined. At the same time, it helps employees manage their work efficiently and provides opportunities for further growth at an individual and organizational level.
When used effectively, automated time tracking can be a key driver of ideas and innovation for your organization and help you achieve profitability. With fewer errors and enhanced employee output, you will always get superior results, eliminate underperformance, and give a boost to your business. Watch our webinar to learn more about how time tracking solutions can enhance resourcing, project billing, and invoicing with project planning and costing.