“What are the 35 hours on the invoice actually based on?” A question every service provider knows. If all you have is a rough estimate, you’ll spend a long time searching and explaining. If you’ve tracked the hours properly and assigned them to the project, you can back up the effort immediately.
That’s exactly what project time tracking is for. In this article, you’ll learn how it works, when it pays off and what to keep in mind when introducing it.
What is project time tracking?
With project time tracking, working time is assigned to a specific project or client. That way, it’s always clear how many hours were worked on which project, which matters for invoicing or post-project costing, for example.
Project time tracking and working time tracking: the difference
Working time tracking records when and for how long someone worked. Project time tracking adds what they worked on. The two are connected, and if you record them separately, you track time twice. It’s best to have both run together in one software.
How to tell you need project time tracking
Agency, consultancy, IT service provider, law firm or engineering office: as soon as time is a major part of what you sell or spend, the question of project hours comes up. These situations are typical:
- You bill by effort and the hours have to be collected every time. Time is spread across different Excel lists, scraps of paper or employees’ heads. Before the invoice can go out, you have to ask around and add everything up.
- You bill a flat fee and don’t know in the end whether the project paid off. With fixed prices, the invoice is set from the start. Whether the effort matches it only shows in the time actually tracked.
- Quotes are based on estimates. Without the experience from past projects, every new quote is estimated and roughly calculated all over again. That leads either to jobs that don’t pay off or to quotes that are too high.
- Several projects run in parallel and the overview is missing. Who is working on what, how far along a project is and who is away during the hot phase is hard to keep track of without a central system.
- Clients ask how the effort breaks down. Without documented hours, it’s hard to justify invoices without discussions.
How absence.io solves these problems
- Collecting hours: With project time tracking, you set up projects and clients, and your employees record their working hours directly for them. The hours are assigned to the right project and client from the start. With a structured export that you can create at any time, you see who worked how many hours on which project.
- Flat-fee billing: Even with flat fees, your employees record their time for the respective project. In the export, you see how many hours were actually spent and can compare them yourself with your agreed price.
- Calculating quotes: The hours per project and client are recorded in a structured way. After completion, you can evaluate how much time a comparable project actually took and have a solid basis for the next quote.
- Keeping an overview: For each project, you can set a status and show where you currently stand. absence.io also manages vacation and other absences. In the team calendar, you can see at a glance who is on vacation, off sick or on a business trip, and when requesting an absence, you can name a substitute right away. That way you know who is away while you plan a project, not only when a deadline is coming up.
- Answering client questions: With the hours recorded by client and project, you can document the effort clearly when a client asks.
Project time tracking in Excel
For a very small team with few projects, a well-maintained Excel spreadsheet can be enough. Many start this way, for example with an Excel time tracking template.
At the latest, Excel reaches its limits in these situations:
- Several employees enter time in different files and the versions don’t match.
- The hours have to be added up manually per project and client at the end of the month.
- Vacation and sick days have to be taken into account separately.
- There is no overview of who is working on what and who is away when.
Then it’s worth switching to software in which time is assigned directly to the right project.
What to look for in project time tracking software
These questions help you with your choice:
- Simplicity: Can time be recorded quickly on the side in everyday work? Only what is simple gets used by everyone.
- Interplay with absences: Are vacation and sick days in the same system, so that time and absences fit together?
- Scope: Do you need a full project management tool, or is lean time tracking for project management enough?
- Setup and cost: How quickly is the software ready to go, and is the pricing transparent?
How to introduce it successfully
- Define projects and clients: Decide in advance how you want to structure your projects.
- Agree on common rules: When and how is time entered?
- Involve the team from day one: The benefit only appears if everyone works with the software.
- Use the reports: Regularly look at how many hours go into which projects. You’ll learn from that for your next quotes.
Conclusion
Project time tracking makes effort visible and billing much easier. It pays off wherever several projects run and hours have to be backed up. If you manage project time, absences and employee records in one software, you also save yourself the hassle of piecing things together from different lists.
With absence.io, you can try project time tracking free for 14 days or book a demo to see how it works.