Time tracking best practices for consulting firms
Modern professional service businesses often need to manage a hybrid workforce. Whether your team members are working on-site, at home, or away at meetings, a reliable time-tracking app makes billing hours and attributing time to clients easy.
Overview of time tracking
Accurate time tracking creates great outcomes for both your business and the client. By following time-tracking best practices, professional service firms can create efficiencies using data generated by employee monitoring through time-tracking systems. For example, identifying that your staff is underutilized gives you the confidence to take on more projects and tasks, knowing you’ll have enough resources available to deliver the project within time and budget.
What benefits does time tracking offer your company?
To the uninitiated, tracking your time online can seem like something that happens automatically, but to receive the biggest pay-off, you’ll need to get everyone at your firm invested in the benefits of time tracking. The more time you put into establishing good time-tracking best practices, the more benefits you can unlock.
Effective resource management
In order to plan resources for the future, it is essential to understand how your resources have performed in the past. How much time do specific projects and tasks take? How accurate are your estimates? And if they are inaccurate, which part of the project threw the plan off the rails? These are some of the questions that you will be able to answer with a time tracker, which will inform plans for future resource allocation.
Accurately track time to improve recoverability
Employee time is your professional service firm's most precious resource; you don't want to miss invoicing billable working hours to your clients. With a simple time-tracking app, team members can log the number of hours worked promptly and accurately from wherever they are. Using time logged by employees for your invoices will ensure you bill your clients accurately, getting the most out of your team members' time.
Powerful time-tracking software will also allow your people to attribute their time as billable or non-billable helping you accurately invoice clients.
Preventing budget burn in this way is a key advantage for project managers, and helps to deliver work on time and on budget.
Increases productivity
It’s hard for staff to hit maximum productivity if they are busy editing and sending disparate spreadsheets. Employee monitoring through effective time tracking streamlines a handful of everyday business activities, such as billing and administration. Data from timesheets can flow through to payroll and client invoicing, streamlining your business and saving time and money in the process.
Offers transparency
As a manager, it can be easy to lose sight of what resources are doing at a given time. Being able to see how your employees spend their working hours will give you a transparent understanding of what people are working on and enable you to speak confidently about your work with clients. It’s not about micromanaging, but there are coaching opportunities that arise from seeing how staff spend their time.
This also enables you to see which part of a project has taken more time than anticipated, helping you create more accurate estimates or fee structures for clients in the future. Following time-tracking best practices ensures that you maintain this level of transparency and efficiency.
Do's of time tracking in an organization
The best way to track time is to make the effort to set up systems that work for your individual business. These time-tracking best practices are a good place to start.
Understand the purpose of time tracking
When you take the time to recognize the benefits of time tracking, you’ll understand what you’re trying to achieve by doing it.
Ask yourself why you want to track time. What difference do you want it to make?
Get your team on board
In order to be successful, time tracking requires the cooperation of your people. To achieve this, make sure the tool you use to track time is intuitive and put in the time to show people how to use it properly. This includes troubleshooting; for example, how to edit time if it’s been logged under the wrong date or task, as well as how to submit a timesheet.
Create a framework before you start to track time
To enable the best insights from time tracking, we recommend first importing all the data you need to track time - for example, project stages, resources, budget, and any custom time codes. This will allow users to attribute their time in the right place.
Pay specific attention to getting the complexity and number of time codes right to suit your company, so it’s quick and easy to adopt. Different types of businesses have different needs, and you can customize your tools to suit your firm.
Automate wherever possible
Automation is what makes time tracking so effective, such as time tracking data feeding into invoicing.
Have someone oversee time entries for a project
Make sure someone is responsible for monitoring time tracking within their project.
For example, establish a rule that managers will review time entries every week to ensure they’ve been accurately submitted. Managers will then be able to provide guidance to staff who need more support using the software appropriately and make suggestions to improve staff time-tracking practices.
Make it a habit to track time
Have a company rule that staff need to submit timesheets by a certain time every day. This helps to ensure time tracking is regular and reliable. You may also consider requiring daily time-tracking, as sometimes it is actually easier to do something every day than it is to remember every Friday.
Track billable time
All time is valuable, but billable time needs to be recorded accurately to invoice clients correctly. Your organisation will need to make a decision on if all non-billable time is to be recorded as well. The benefit of doing that will be accurate utilization reporting and being able to investigate bench time to see what was important enough to pull a resource off of billable work.
Choose your level of granularity
Decide if you will log time on the project level, the phase level, the task level, or the sub-task level. Typically more than two levels within a project can be getting into an overly detailed territory that could be accomplished with notes or comments on the time entries. Make sure if you add a level of specificity, that it will be worth it through the insights you receive.
Don’ts of time tracking in an organization
While making sure you do the right things with your time-tracking systems, there are also some common pitfalls to avoid.
Don’t procrastinate
As with anything, the longer you wait to do things, the worse the results tend to be.
If you think you want to use time-tracking software, don’t put off making it happen. Make sure you follow through on onboarding staff properly and fully implement the software to maximize the benefits.
Ensure staff log time frequently, ideally at the end of each day or at the end of the week. Forgetting to log time or putting it off to another day increases the risk of logging time incorrectly. One thing that makes this easier is using a tool that has in-built integrations to other software like Jira and DevOps, as well as its own start/stop timer to record time accurately.
Don’t cut out important tasks
When mapping out a large project, it can sometimes be tempting not to include small tasks that don’t seem important. However, this comes with the risk of having those tasks overlooked in the execution of the work.
It’s crucial you plan projects to the level of detail required for teams to follow the required processes.
Don’t over-resource your people
Project managers are judged on their ability to deliver projects on time and on budget, and placing unachievable expectations on them is a common reason why deadlines are missed.
One of the advantages of a good time-tracking tool is it has easy copy-and-paste features that enable users to replicate repeated tasks, giving you confidence on how long a given task should take.
It may also be worth allowing extra time for any unexpected occurrences during projects.
Don’t implement time-tracking tools without reading product reviews
If you find a time-tracking tool that looks promising, check out user reviews and pay attention to how easy people find it to use. If you’re new to time-tracking software, look for reviews from businesses similar to your own. Their experience will provide you with guidance for what will best suit your industry.
Take home message
Time tracking is a great way to save time and money within an organization, but it’s important to put in the effort to establish the right rules and processes. Without this, the full benefits of time tracking won’t be realized, which will lead to wasted time and money correcting embarrassing errors.
Understanding the benefits of time tracking for your organization will enable you to hone in on how you can realize them. It’s critical your entire team is on board and invested in using time-tracking tools correctly, so pay particular attention to this part of the process.
Selecting a time-tracking tool is also a crucial step that can set you up for success from the very beginning. Projectworks is designed specifically for professional services businesses, made by professional service veterans that understand how it works and how to capitalize on the opportunities that time-tracking can provide.
Related Articles
Engineering services today: trends, challenges, and opportunities
Explore the latest trends and insights shaping the future of engineering services in 2025, from economic challenges to tech-driven growth opportunities.
On time, every time: How to stop late timesheets with timesheet reminders
Did you know 22.3% of global time entries are submitted after the week they’re due? Discover an easy way to avoid this problem at your firm.
The 5 most common project management methodologies: pros & cons
Explore the top project management methodologies and find the best fit for your business.