Why Your Business Should be Tracking Time and Labor Costs
Profit: it’s the reason a lot of businesses exist, and it’s probably an important aspect of your business. For businesses that rely on accurate labor costs, time tracking is vastly important.
Labor costs are part of doing business, but inaccurately tracking what they are can reduce your profits and at worst case - put you out of business.
But aside from keeping your business afloat, there are other important benefits of tracking employees’ time and managing your labor costs.
Time Tracking Benefits
Project Planning and Management
When you have accurate figures on the amount of time your employees take to complete a task, it allows you to plan timelines accurately for projects on your company’s plate. Tracking time also allows you to better manage your projects and ensure they stay on budget and on time and you can easily identify any bottlenecks.
By tracking employees’ time, you’re able to see where their time is being spent. If you find that employees are spending time on low-priority tasks or something else that isn’t productive, you can show them where they’re losing time in their days and help get organized to increase productivity.
If you work as a vendor for various clients, it is absolutely imperative that you bill them accurately for time spent on projects. A time tracking solution will allow you to accurately bill your clients for the amount of time that your employees are spending working on their accounts.
Not only will your billing be more accurate, but your proposals will be, too. When creating proposals, you’ll be able to look back at your employee data and know how much time is required for certain types of projects. It will allow you to give prospects accurate timelines and figures so that your proposals align with how much time your employees will actually spend on a project.
Your management team has all of their employees’ data at their fingertips about the amount of time they’re spending on projects and work-related tasks. This allows your management team to come to performance reviews armed with real-life data. Again, this can help identify bottlenecks in certain employees’ days and allows you to reward employees that remain efficient and get their work done on time and on budget.
The benefits of tracking time and labor costs are endless for your company. They allow full visibility into where your employees’ time is being spent.
Typically, a time tracking solution is part of a larger scale Human Capital Management (HCM) System. It is an all-in-one solution that allows you to manage your payroll, HR, hiring decisions, time tracking, benefits, and more.
Is your company ready to talk with somebody to see if implementing a time tracking tool with an HCM solution is right for you?