Know exactly where time is being spent by using accurate project time tracking. This guide will show you how.
Schedule overruns, critical tasks being delayed by roadblocks, and undercharging thanks to incorrect estimates are leading nightmares that project-based businesses struggle with.
In fact, one in six IT projects deals with schedule overruns of 70%.
The one solution that can correct these concerns? Project time tracking.
By measuring how long it actually takes to get specific tasks done, you can improve your workflow, boost productivity, set better project timeline estimates — even grow your profit.
In this guide, we’ll show you how to drive all these benefits from tracking time. By the end of it, you’ll leave feeling ready to improve your employee wellness, create better project schedules, and curb revenue leakage. Read on.
Project time tracking refers to keeping an eye on how long it takes to complete different tasks in a project.
The aim? To find out exactly how long it takes to complete each task (we typically underestimate the time it takes to do something).
For example, by tracking the time it takes to complete individual tasks that go into writing a blog post (researching, interviewing, outlining, drafting, editing, and publishing), you can make an informed estimate about how long it typically takes to write blog posts.
In turn, having this time-related information helps you set realistic timelines for project completion.
And once you’ve an idea of how long each project takes to complete, you can better estimate how many projects you can take in a specified time period.
Ultimately, time tracking helps you:
Time tracking isn’t limited to tracking hours that go into completing a project, though. You can also trace where you and your team are spending your time in a day to understand which tasks (whether related to a specific project or not) take the most time.
For instance, by tracking time, you can see how long admin work such as replying to emails takes in a day. As a result, you can better plan your workday (say goodbye to creating unrealistic daily to-do lists) and set SMART goals for the month and quarter.
On the surface, it may seem like the only major benefit of tracking time is improving productivity. However, there are a ton of advantages to measuring where your time goes — not only for you but also for your team and for project management.
Let’s take you through these time tracking perks:
By keeping tabs on how long it takes employees to complete tasks, you can identify which tasks take them the most time and which ones they can complete quickly and accurately.
Use the time tracking data you gather to:
Time tracking also helps coach staff on time management.
For instance, mentor employees on tracking their time to understand when they are the most productive. Then educate them by using time management techniques such as eating the frog (doing the most challenging and time-consuming task on their plate) when they’re the most active.
You can also mentor employees on protecting their productive work hours by blocking that time for focused (deep) work.
It’s human nature to make project assumptions. For example, incorrectly estimating how long it takes to complete tasks. Time tracking helps to overcome this issue — technically known as planning fallacy.
Here’s how: find out how long it takes to complete specific tasks on average. For example, how long it takes to create project briefs. Then use the insights to set benchmarks for completing tasks.
Doing so comes with three benefits:
Tracking hours spent on a project shows how long it takes in total — without rushing the work. Do that a couple of times and you’ll start developing an (almost accurate) understanding of how long similar projects take to complete.
Not only is this useful for pricing future projects but also for sharing price estimates with the profit already factored in.
In fact, a key pillar of growing project profitability is understanding the exact hours that go into a project and how much folks working on the tasks charge. From there, you can tell the amount you’ll be spending on getting the work done and factor in the profit you’ll make.
Project time tracking also boosts productivity by showing you tasks that take excessively long to complete.
Use the information to optimize your processes and curb revenue leakage — start with understanding the constraints then look for ways to solve them and speed things up.
If these tasks involve extensive manual work, consider automating them. Tools like Zapier are useful for cutting back manual work, for example. You can also hire an automation expert to review your processes and suggest ways to optimize them.
Lastly, delegate tasks that are holding you back from deep, strategic work that brings you clients. For instance, if research work takes long, work with a freelancer who offers research as a service.
This benefit of time tracking is super beneficial for businesses taking on creative client projects.
Essentially, creative work or projects involve strategic work that takes a lot of thinking and strategizing time. By tracking where strategists and creative workers are spending their time, you can tell if they’re dedicating enough time to brainstorming, planning, and similar work.
The truth is: with the influx of client work and an increasing task load, it’s easy to get work done in a formulaic manner — using a set of outdated frameworks, for example.
While frameworks are helpful, they shouldn’t cap your thinking. This is where time tracking helps you outline if you are actually putting in work into strategizing, brainstorming ideas, and similar. If you find yourself giving less time to creative work, you can easily catch the slip and make room for more creative work in your project schedules.
What’s more, use project time tracking to stay on top of project progress by tracing how many hours of the dedicated time have already been spent, what your team has accomplished, and how much more time would be needed on top of the allotted time.
By tracking project hours, you can easily identify schedule overruns before they occur. For example, by reducing work on the team’s plate or moving deadlines for other tasks around.
This is an effective way to stay on top of your schedule and correct things well in time without having to update the client about needing more time.
Speaking of which, project time tracking helps you accurately update clients as well considering your time tracker can tell how many hours of work are remaining.
On top of all these benefits, tracking time helps you note how often employees are taking breaks.
If you’re a business committed to employee wellness, use the data to keep burnout at arm’s length. In fact, by pairing employee time tracking and by staying on top of the last time an employee took a vacation, you can create an employee-centered work culture.
Note that time tracking often meets resistance. Read our dedicated guide on how to introduce time tracking without alienating your team. ➡️
Before you use project time tracking, it’s crucial to get the foundation right.
So what’s this foundational step, you ask? It’s telling your employees you won’t be tracking time to micromanage them or to keep an eye on them.
This is crucial because time tracking has a negative connotation to it that can leave employees feeling distrustful. So make sure you clearly communicate the purpose behind tracking time — improving project management and overall team and project productivity.
With the foundation strong, try any of these two approaches:
You can either use time tracking software or timesheets to encourage employees to see where they spend their time.
Where a time tracker assists with automatic time tracking, employees need to maintain timesheets using a tool like Google Sheets and manually add in what they’re working on and at which hour.
In contrast with using timesheets, using a simple time tracking app such as Clockify can speed things up significantly.
Employees only need to turn on their timer as they start working on a task and pause it when they are done with it. Next, ask employees to submit weekly or monthly reports of where they’ve been investing time.
Some prefer sharing screenshots. However, certain time tracking tools generate performance reports that employees can share with their managers.
Use the information to identify tasks that individual employees are fast and slow at and assign new tasks accordingly.
The downside to this method of tracking time though? It doesn’t let you reap the full benefits of time tracking for project management. You only get reports on employee performance with no overview of the billable hours of work going into a client project.
Most of all, without a birds-eye view of the hours of work going into a project, you can’t track its progress.
Plus, sharing the data — either as reports or as screenshots — also adds manual work to employees’ plates. You also need to manually go through individual employees’ timesheets with a fine-tooth comb, which only makes time tracking a cumbersome task.
Another way to track time is by integrating your project management software with the time tracking app.
This method overcomes the downside of not having an overview of the non-billable and billable hours of work going into a project. It also ensures all your time tracking data is in place while reducing the work on employees’ to-do lists since you can simply track progress in your project management software.
If you mean to use time tracking to budget future projects though, make sure you’re using a powerful project management tool that not only manages projects but also helps you set a budget, plan resources, and handle capacity management.
Runn, for example, is a complete project management software with timesheets and a time tracking Chrome extension for keeping tabs on time in just a click.
You can use Runn to record both billable and non-billable work and get reports on how much time you’re spending on non-billable work including the potential loss it brings you.
What’s more, use the tool to track project progress against a set schedule.
The best part? These time tracking, reporting, and project management features are all on top of other features such as capacity management, project budget planning and forecasting, and resource management that Runn offers.
And if your team is already happily using Clockify or Harvest to track time, there's no need to shake thing up: Runn is able to integrate with these apps and import the time tracking data from them as well.
Before you choose time tracking software, it’s important you understand the features you’re looking for in a tracker.
For example, are you looking for a standalone time tracker or a time tracker that comes with a billing system?
A good time tracker should help either automatically track time spent on tasks in real-time or let employees make entries in a timesheet. It should also let you edit the time entries so you can continue adding billable hours of work going into running projects.
High-level time tracking tools also let you create projects, divide them into tasks, and categorize them by clients. It should also let you set hourly rates and generate reports. Not to mention, the tool should give you a team view of who is spending their time on what.
So to begin with, ask yourself exactly what features you need for your automatic time tracker, then make sure the software you pick is:
A few of the top time tracking software you can choose from include:
Used by over five million users across companies like LinkedIn, Toggl is an easy-to-use time tracker.
Setting it up is simple. And it comes with 100+ integrations, which means you can use it to track your time across different software you have in your toolkit.
At the end of each week, Toggl sends you an auto-generated timesheet that lays out exactly where you spent your time throughout the week.
Toggl has a browser extension and offers desktop as well as mobile apps. You can auto-track time using it as well as generate monthly time reports for clients to show them the time you’ve spent doing their work.
Clockify is another highly-rated app. Its timer lets you track time automatically or log in manual time updates in timesheets.
It also helps you track employees’ billable hours, schedules, and project progress. Plus, you can use it to schedule projects and assignments to your team.
Besides tracking time and managing workloads, you can also use Clockify for invoicing — both for internal teams and contractors you work with.
Unlike Clockify and Toggl Track, DeskTime doesn’t have a freemium offer. Instead, you can try all its features in a 14-day free trial.
DeskTime offers fully automatic time tracking with no manual entry required, reducing room for human error.
The automatic timer starts as soon as an employee turns on their desktop and stops with them shutting it down. Using its URL and document title tracking features, the automatic timer also keeps tabs on exactly what the team is working on.
What’s more, you can use DeskTime to assign tasks and track employees’ vacation and sick days.
Workyard is a time-tracking software for the construction industry.
It tracks employee arrival and departure times using its GPS technology to identify your team’s precise location. In doing so, Workyard helps you reduce excessive payroll expenses that surface due to inaccurate time cards.
Moreover, you can use Workyard to track real-time labor costs alongside the work individual employee do.
HubStaff is another highly-rated time tracker that also lets you monitor employees.
That is: not only does HubStaff help you see where employees are spending time (by showing the sites and apps they use) but also shows you where they are stuck. The latter is possible with its Activity reports that give you screenshots to show both what and how they’re struggling with.
HubStaff is helpful for several industries including agencies and real estate. It offers about 30 integrations and a 14-day free trial for its team plans.
Used by organizations like Deloitte, Harvest also offers rich integrations and time tracking.
It gives you in-depth reports as well — letting you choose from different visualizations to review team performance, project progress, and understand costs and team capacity.
The free version is for individual users such as freelancers with a cap on projects to track. The paid version, on the other hand, comes with a 30-day free trial.
Project time tracking not only improves employee productivity but also makes sure you keep all projects on track with their pre-determined schedules.
In fact, by tracking billable hours of work going into projects, you can develop a better understanding of how to price them — increasing your project profitability. Additionally, by tracking non-billable hours of work, optimize your workflow and automate manual, time-consuming work.
When selecting a time tracker though, be sure to select one that integrates with your current tech stack and assists in not only tracking but also client reporting, project budgeting, resource management, and paying invoices.
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