For any business, time tracking is a very important factor. When you have a clear understanding of how you are or your employees are utilizing the time you can work on your business plan to improve the productivity. Well managed time means higher revenues. A good analysis of the time spent in production, marketing, sales etc can give you a clear idea on how you can improve your business. Let us discuss on how time tracking can influence the success of your business.
Why is Time Tracking Crucial for Your Business?
Time tracking, the name itself briefs you what it is. It helps you calculate how much time is spent by each person, team or business on a particular task. It can be implemented for large clientprojects like website building or a specific project like coding a button. If you analyze how much time is spent effectively, you can measure your hours to know your revenue.
For instance, it sounds good if you have landed a $10,000 project. But, if you spend 100 hours on the project and generated $10,000 in revenue, then are you really happy for that? Did that project require as much time to be spent on? Or else, did you actually charge less for the project?
This is where you realize time management is absolutely crucial. If you manage time effectively, then you stand to generate incredible profits.
How can You Track Time More Effectively?
You can use spreadsheets to track time, or even you can use pen and paper. But, time tracking softwares work much more effectively as compared to manual work which again can be time consuming.
You can integrate time tracking software like FreshBooks in your business areas like accounting and invoicing, HR (human resources) module, project management and payroll. It helps you with saving time by connecting data around tracked time and results of billing and payments.
How does Time Tracking Help to Generate More Revenues?
If yours is a service-based business, then you make a bill by time or by a project. If you manage your time effectively then measuring the time that you spent accurately can increase your revenue. As you know how much time it takes to complete the project, you can use this data to improve your business. Below are the actionable ways time-tracking can drive value for your business.
1. Measure accurately:
Just look after the data you have previously for the projects you work on if a client approaches you with the similar one. So, you can measure the time investment and cost you incur more accurately. It’s how you reduce discrepancies between estimates and bills. In case your client questions an invoice, you have accurate tracking data to show.
2. Effective capacity management:
If you have your previous data, then you will have greater insight to to understand your team’s work capacity more effectively. You can analyze on whether or not to take up the new project or clients. With a fair understanding of the time required to complete a project you can determine the capacity of your team as well and take determine the output accordingly.
3. Make sure your project gain profits:
Just take a look at the data you worked on to estimate whether your strategies are working or not. You need to compare your time tracker with the profits you make. You should be able to understand whether you are spending more time on unprofitable projects and whether your clients drive revenues.
4. Identify areas where you need improvement:
Time tracking helps you to identify the tasks which are taking too long. You can think where a revision is required and can take corrective action on that. Think about whether you need to change how you are approaching the tasks. Also, think how much you are charging for it?
5. Calculate your productivity:
If you track the time you are working with, you can know how you are spending time to complete the task. Analyze the hours you spent as a dead time or the time you spent on unprofitable activities. Identify where the time is being wasted and eliminate it, so that the time you spend on your tasks actually drive results.
Implementing Six sigma strategies can go a long way in reducing non value added tasks and improving your productivity. There are numerous softwares that on can implement in the production floor to understand the true time that is required for a single product completion and you can go from there with data to create a workflow that is not just efficient but flawless. We need to understand that reduction of unproductive tasks and systematic approach to the completion of a value adding task can take your business to a new level. So let’s get on with it and identify the problem areas by doing a thorough time tracking to get exactly where you want to be!!