Why do You Need a Timesheet System

It is vital to have a system to collect and analyze statistics on working time in companies where a considerable share of the costs makes expenses for the staff. We’ll call it a Timesheet System (TS). Accounting of costs of staff working time in companies providing custom development, legal, financial or information consulting services is carried out due to the fact that customers are billed by the hour of specialists. But the usefulness of Timesheet System is not reduced even if external need of working time billing is absent and conditions of contracts with customers are not related to the implementation of staff time directly.

The complexity of entering data into Timesheet System for the employee should not exceed 5-10 minutes per day. In companies where Timesheet System is already deeply integrated into culture of management and into the corporate information system for several years the time of data entering may be longer due to the fact that more detail of a day, as well as detailed comments on the performed tasks are required from the employee. But this is a fine-tuning. To achieve the main value from Timesheet System You should start from a simple scheme and minimize requirements for detailing of working time. Because the time for which you pay an employee is your costs. And I’m sure you want to spend it for the reporting in a lesser extent.

To minimize the time of data entering it is necessary to set a reasonable level of detail as well as to automate the process of collecting and consolidating daily reports of staff.

To be able to fix the real results of their duties execution the employee must first honestly reach them.

In my practice, I demand that the employee fill in information about working day with the detailing up to a half an hour. Mostly the TS-screen by one employee per day consists of from one to five points. The main object of the allocation of time is a project (service, activity) to the benefit of which the employee worked during the day. For geographically distributed companies whose units are serviced from the central office a region also can be used as an object of time tracking.

The approach of using Timesheet System is applicable for commercial services, departments of construction, projecting, development, design, etc. In some companies the culture on using Timesheet System even covers a so deep back office such as accounting and personnel departments.

For example, the Time-sheet of employee of abstract Estimate and Contract Department for the day might look like follows.

With regard to this example the creative idea to digitize into a separate field the number of formed acts will come to you. Or you’ll ask a staff member to detail with which specifically customers he interacted. You should not do these for several reasons. First, to account for these parameters there must be other systems in the company. Themselves parameters are diverse and their quantity is difficult to determine in general case. Secondly, it becomes violated the principle of minimizing the time to enter a data. Third, 80 percent of the beneficial effect from Timesheet System will be achieved with an already existent detailing.

And there are several positive effects of Timesheet System right away.

1. The motivation for the employee to use its time with а benefit

From employee side is not known whether any of leadership will analyze the reports from TS. It is not known what they influence for (in the initial stage of implementation of the System at least). But for the majority of employees it becomes more difficult to write, for example, “Project of Maintenance = 2 hours = Forming one typical acts of services rendered”. The point is that any sensible leader at a shallow submerging into the analysis instantly will have a question about the actual output of the employee. If the System is automated so that a summary report comes not only to the head of a subordinate but also to his head, it becomes very difficult to write anything causing issues. But to be able to fix the real results of their duties execution the employee must first honestly reach them.

Either subordinate clearly does not understand what he should do, or he deliberately misleads you, or some wrong process in the company prevents him to use its time effectively. Anyway you should sort things out and don’t tighten.

2. Timely event-to-action for the manager

The first of what managers encounter with analyzing the reports from the System is a stream of records such as “Commercial department = 2 hours = Parsing e-mails” or “Project of Maintenance = 3 hours = Visiting a meeting”. But in reality all the working time (if the employee really understands what he was doing) can be split into several of the proposed projects (without perfectionism) and to fix in the System like follows: “Commercial Department = 2 hours = The data for Quotation has refined. Customer agreed to receive suggestion until 01.02. Estimation that was made is checking now by Mr. Firsen” or “Project of Maintenance = 3 hours = Financial managers agreed with new print-form of the document which I’d present during our meeting”. But if the analysis of the subordinates activity shows that it’s difficult to fix such effectiveness, so there is a yellow light for the head! Either subordinate clearly does not understand what he should do, or he deliberately misleads you, or some wrong process in the company prevents him to use its time effectively. Anyway you should sort things out and don’t tighten. In addition there always will be some employees who will fill the stats of their working time maximally clear and informative for you. And you will feel the difference between the output of two experts in their similar responsibilities.

3. Availability of a correct base for allocation of the staff cost to projects

Information system that accumulates data on the statistics of working time (whether part of the overall information system or a separate interface intended for Timesheet) as a report returns the maximum reliable basis for allocating indirect costs to projects (regions, services). As a first approximation the cost of common production staff may be allocated to global projects of the company. Next, depending on the details of working time analytics and on allocation rules – to products within the projects. More complex allocation algorithms may also be implemented. But even the top level analysis of staff costs which allocated thus already become objective and gives the most relevant picture of resource utilization. Errors in completing the table by some employees are unimportant in the accumulated result and statistics in the long term will still be objective.

A software component of this project is primitive and may be implemented quietly on the basis of one of the open-source products either by a way of simple improvements of your corporate system by IT-department.

Increasing complexity of the process of collecting statistics is the introduction of compulsory confirmation (acceptance) of staff TS-screen by a manager. I do not think that it’s reasonable if certainly there is no need for confirmation of useful staff time from the customer on the contract. Introduction to the process of confirmation person creates unnecessary bureaucracy since the spent time is already a fait accompli and there is no point to confirm it further. Furthermore, a new point of permanent depending on the availability of the department head appears in daily activities, which is not desirable. Another issue is that the manager being a full and responsible member of this organizational system should give time to the analysis of consolidated TS-reports for the past day (week, month). It should be selectively immersed in the task results, check them with his introductions and have to give feedback to employees. The System is convenient when on a notification basis it sends a summary statistic of working time by the e-mail to manager at the moment when employee writes the data.

The project of Time-sheet System implementation like any other project of automation in first is an organizational project and then informational one. A software component of this project is primitive and may be implemented quietly on the basis of one of the open-source products either by a way of simple improvements of your corporate system by IT-department. Main guarantee to generate the expected value during the implementation of the System is Your self-discipline, consistency (regularity) of formulation of tasks and further control of results. Effect on Your efforts along the way is increased productivity of staff and timeliness of management decisions.