3 Reasons Why Tracking Time is Important (2m:45s)
Ready the horses, man the walls, heat the oil, and get out your timesheets. The goBRANDgo! crusade against untracked time has begun.
This time, we are going to win.
Admittedly, we’ve found ourselves losing this battle more often than not in the past. As a company that doesn’t charge clients hourly, we periodically lose sight of the value in tracking time. After identifying the importance of tracking time, we’re ready to fight back.
Managers have many different views on the importance of tracked time and how to leverage it. The majority know it’s important, but most would disagree why and how to use it.
There are the companies that micro-manage their employees with time tracking, ones that let the hours slip away as an act of defiance in structuring creativity, and others that hold paychecks hostage in light of unmarked time sheets.
The truth is, as a manager, if find yourself continually going over budget and stretched past capacity, then you don’t know the importance of tracked time. It is necessary that you make it an company priority by creating metrics that are relevant and dependent on your tracked time.
While there are many different ways to put a price tag on your product or service, the following formula demonstrates the power of tracking time.
$ Hourly Rate x Estimated Hours To Complete Project = Price Tag
Validate Estimated Project Hours (0m:45s)
How many times have you completed a project only to realize it wasn’t profitable? Well, if your team met the deadline and maintained scope, there is a good place to look for what went wrong.
First, ask yourself how much of your team’s day went into this project in order to meet the deadline. Were other projects put on hold? Were all company resources devoted to one project?
The point is that if you spent overestimated hours ensuring you’ll complete the project by the deadline, you’re not doing an hourly rate justice. The hourly rate success is entirely dependent on accurately estimating project hours (see formula above).
Tracking time ensures that estimated hours to complete a project are accurate and provide evidence for recalculating these time estimates when necessary.
- Tip #1: Track hours per task, rather than the entire project’s time. This will help you identify when and for what the budget broke.
- Tip #2: Often times, when estimated project hours are exceeded it is in direct correlation with a wandering scope. Use time tracking per tasks to quickly identify and redirect stretching scopes when hours exceed the estimates.
Validate Hourly Rates (0m:20s)
However, if your team remains within range of the Estimated Hours to Complete Project, yet the profitability is still questionable then it’s time to reevaluate your hourly rate. If your hourly rate doesn’t accurately factor in all of your expenses, then it’s not doing your estimated project hours justice.
Therefore, without tracking your time you’ll never be able to validate if your hourly rate is accurate.
Know Your Forecast (0m:30s)
Over time, tracked hours will accumulate and provide averages for the duration each task requires in your process. Knowing your company’s bandwidth is extremely important when deciding whether to accept or defer new business. Although entrepreneurs would love to accept every customer that knocks on their door, a company’s capacity does not allow it.
Having these averages gives your company the ability to forecast future capacity, which in turn helps manage your company’s growth.
So now, go ahead and track your time surfing goBRANDgo!’s website as 2m:45s of “empowergizing”.