I would definitely recommend this as an exercise for any sole proprietor or freelancer because the results might surprise you as well. But then it also got me thinking about whether or not time tracking is a good idea for employees of larger companies. From what I’ve seen, these are the pros and cons of time tracking:
There’s no greater benefit to time tracking than the ability to directly bill clients for hourly work. This is probably the single best reason to do time tracking! It gives you the numbers to back up the client fees and it helps you determine if your fixed fee services are as profitable as you’d like. The more specific you get with time tracking (i.e. tracking work not only be client but also by specific task or project for that client), the better the data will be for you to look at and figure out where your prices or workflows need to be tweaked.
Time tracking makes employees accountable for their time, which is really important if you’re using freelancers or hourly employees. Knowing that they’re going to have to account for their time makes employees more likely to put their heads down and get work done instead of socializing or surfing the internet. It also eliminates the time bias that employees sometimes exhibit for their favorite clients – forcing them to spend time evenly on clients regardless of their personal feelings towards them.
For whatever reason, time tracking seems to make people more efficient (myself included), which is why it’s a great exercise even for professionals that don’t have to report to anyone (like sole proprietors and freelancers). There’s just something about knowing that a stopwatch is running in the background that helps to light a fire under everything that you’re working on. It’s sort of like the difference between running for leisure and running for time trials. Regardless of why you’re running, you’re likely going to give it your all (or what you think is your all), but when you’re being timed, you’re more likely to pull out what you need to give that extra little push at the end. From my experience, I’ve found that time tracking can save as much as much as 55% efficiency on certain tasks!
Unfortunately, your employees will probably hate you for making them clock in and out on projects and tasks because of the aforementioned accountability and efficiency. The truth of the matter is that requiring time tracking for full-time employees day after day indefinitely has a high potential for burning out employees. Going back to the running analogy from earlier, you can only run in time trials for so long before you need to rest, get some water, and walk to stretch out your muscles. For this reason, I’d recommend only doing time tracking over a short period (like a week or month) if the purpose is to assess your fees structure or only require employees to log time on projects that require a trail for billable hours.
At some point, hurrying to do everything because you’re on the clock means that you’ll end up compromising quality for speed. Being fast is great, but at the end of the day, you can’t pay the bills just on speed alone. You need to balance efficiency and quality to deliver the right product to your clients.
Kate Pierce is the owner of LionShark Digital Marketing LLC, a West Michigan internet marketing company. Her areas of expertise include Paid Search, Search Engine Optimization, Business Blogging and Web Copywriting. She lives in the Grand Rapids area with her husband and son and enjoys cooking, watching sports, and spending time together as a family. Like a true digital marketing expert (i.e. geek), she loves talking about current marketing trends… so don’t say you weren’t warned!