Time tracking per employee, client, and projects
Production Company uses raw material as one of the key resources. Trade companies use goods as the main resources. A key resource of Real Estate Company is an attractive location and buildings. Service companies use people as key resources. Intellectual property is one of the key resources of Software companies.
But for all companies, crucial resources are human resources. People create raw material, buildings goods intellectual property. People do this with the use of their time for work.
Our question is: How do you manage the time of your people?
One company with 50 people spent a total of 100,000 hours per year as working time.
- How do you manage these 100,000 hours?
- What are billable hours?
- Which is the time structure per activates and tasks?
- Which is the time structure per client and projects?
With time tracking software you can plan, organize and control time consumption per employees, clients, tasks and projects.
Time tracking of employees is relevant for productivity i.e. minimization of unproductive behavior of employees. Besides, with analysis of time utilization per client and working task, you can make a valuable assessment of employees.
Time tracking per client offers tracking of all-time consumption per client, how many hours is billable per client, what tasks are done, what is the cost of engagement, what is the profit per client. You are able to make a calculation in which clients do not achieve satisfying profit and margins. Besides, you can make an invoice based on real-time spent on all data and get an invoice appendix in a form of relevant timesheet.
Time tracking per activity provides an analysis of the efficiency of working tasks.
Time tracking per projects offers an analysis of profitability of certain projects and service lines.
Usual tool for time tracking is some of the online timesheet solutions.
What is a performance-driven organization?
When the company implements as a system of KPIs planning and monitoring that helps it to achieve its long term objectives we say that company is a performance-driven organization.
In preparation for company strategy, some measurable goals should be settled. A balanced scorecard list is usually a mandatory part of the strategy. It includes four objectives:
- Financial objectives
- Marketing objectives
- Internal objectives
- Development objectives
The performance-driven organization determines relevant KPIs within all types of objectives. Most of them are based on time management and time consumption.
For example, in Service Company it is very important how much time managers spent on business development and what is structure on business development related to time. How much they spend on finding new clients, preparing proposals, meetings with potential clients, networking etc. Only with such information the company is able to manage its marketing objectives.
One of the leading consultancy companies, PWC Netherlands presented numerous time-based KPI in its annual reports. For example, by the latest report, percentage (billable) client hours versus hours non-billable of working hours is 63% vs. 37%.
They invested a total of 574,000 in people training.
Also, the total hours that partners and directors spent on audit engagements are relevant KPI. That share is 6.65%.
What are the usual key performance indicators?
Key performance indicators (KPIs) represent selected numbers through which you control and develop your business.
As mentioned, key resources of Service companies are human resources, so the determination of KPIs is usually based on the working hours of employees.
General KPI is the total number of hours spent. You can track the total number of hours spent per client, employee, and service line. KPI of total hours is not relevant if it is not compared with the previous period or planned or budgeted time. If you follow the movement on total hours you will be able to determine a gap between achieved hours, and hours form the previous period or plan and perform relevant actions to close the gap.
Besides, very important KPI is % of billed hours in total hours as well as total billable hours.
KPIs could be usually divided into three categories:
- Financial indicators
- Commercial indicators
- Productivity indicators
What are the financial indicators?
- Revenue per hour: This is your real hourly rate. If you do not have a real hourly rate per client, you cannot be aware of the profitability of clients! If you have time tracking per client, you can easily calculate this ratio dividing total invoicing amount with billable hours. Does your real hourly rate meet your expectations in cooperation with the client?
- Costs per project: do you know what the cost of service you provide to the client. And what is cost per hour?
What are the commercial indicators?
- Total number of clients
- An average number of different services provided to clients?
- Total hours spent on commercial (marketing) activities: with online timesheet, you can follow total activities spent on commercial activities such as targeting, meetings with potential clients, networking, digital marketing activities.
What are the indicators of employee productivity?
- Total hours spent per employee: this KPI is important for the management of employees and its allocation to projects. If someone spent more time than expected, you need to consider his engagement and potentially reallocate him to different assignments.
- Structure of work activities per employee: with an online time tracker you will discover what do your managers do? How effectively they manage employees and clients. How much time they spent on curtail activities and how much on low-value activities (administration, routine activities)
- Overtime: By insight in working tasks per employees in your online timesheet, you can answer a key question: Is overtime result increase in project requirements or comes from the non-productive behavior of employees?
- A number of employees hired per project (client): with an online time tracker, you will be correct in assignment project to different employees.
How time tracking results may be used for performance measurement?
When total working hours are precisely allocated to employees, tasks, projects, or clients such allocation allows calculating utilization rate per project and client, overtime hours, cost of each service, cost of engagement for the certain client etc.
Also, without time allocation you will not be able to calculate the cost of each department and service line.
With an online timesheet, you can set up and control all time-based KPIs and other KPIs that require time allocation to be calculated.
How to get team performance from timesheets?
When employees record their time in an online timesheet, the platform uses all data about time spent per working tasks, projects, and client. Such data are processed and user of the platform is able to see selected results for each individual employee, client, and project. Each employee has his own time analytics and dashboard, so the manager may settle the time-based objectives that can be measured throughout the platform.
The employee has the possibility to timely detect its unproductive behavior and improve his results.
As presented in the picture above, the first step is data entries by employees that require only five minutes of their time. They record data on time spent per working task (with the option of selecting a task from the drop list or detailed description of task), client and project, and hourly rate. After that, time analytics provide advanced reports for employees, projects, and clients.
Final results are the improvement of productivity, better time utilization, better tracking of project costs, client time tracking and excellent data for invoicing.
What are the solutions for online timesheets?
There are a lot of online timesheet platforms that offer time tracking on a live basis. We trust such platforms disrupt users and remove focus from business activities to very demanding data entries. When you require a user to start a “play button” every time when he works different tasks, it could be time demanding, especially if you consider high-level multitasking.
On the other side, there is online timesheet with full automation. Based on tracking which windows and files are open at user computer and on the basis on that time tracker allocate time to apps in use. Such live tracking cannot provide relevant time analytics.
The best online timesheet should require only a few minutes from each employee for entries of time per task, project, and client. Obviously, in manually entries there is a possibility for fake or wrong entries by employees. However, online timesheet should provide notifications for the identification of wrong and fake entered data.
Can I try Time Analytics as an online timesheet?
Time analytics is a performance-based online timesheet that is very easy for use.
Each day an employee spends about a few minutes for filling its time per project, tasks, and clients.
Time Analytics offers a FREE trial version for 14 days as users can have enough time to make an assessment if such an online timesheet if suitable for their company.