At first glance, having your employees track their time manually probably seems like the easiest thing for everybody. You won’t have to buy, install, and figure out how to use potentially expensive software. You won’t need any special equipment.
In fact, having your employees log their time manually is not a good idea. While, sure, there’s a learning curve involved for whatever time tracking software you choose to use, it is still your best option.
Reasons to Use Time Tracking Software
1. Reduce Human Error
How many times have you transposed numbers or letters as you were writing something down? How many times have you thought that someone wrote down a seven when they actually wrote down a one? Using software reduces these errors by 100%. It also reduces the likelihood of payroll errors being made because someone is bad at math.
2. Sadly, Employees Lie
Your people are, more than likely, ultimately trustworthy. Still, there are times when an employee is going to lie. Often these lies occur not for any big or nefarious reason. They occur because the employee is rushed and would rather round up than take the time to do the proper math to figure out how many hours they actually worked in a given day. Or perhaps they want to cover up the fact that they were just a few minutes late for work one morning.
Rounding 4:56 up to 5:00 or 8:06 down to 8:00 doesn’t seem like a big a deal. It’s only four or six minutes, right? Still, four minutes here, three minutes there – it adds up over time and could wind up costing you a lot of money!
3. Track Projects as Well as Hours
While there are some very basic time tracking software options that simply track the number of minutes and hours used, there are some software programs that also track the amount of time your employees spend doing different tasks.
Lawyers, for example, use this type of time tracking software because it allows them to give their clients detailed – to the second – invoices for the amount of time spent working on specific cases.
4. Improve Time Management
If you choose to use the heavy-duty, project-tracking, time tracking software, you also give yourself the ability to track your company’s productivity. Are your employees spending too much time on email and not enough on a specific project? The software will tell you. You can analyze your employees’ time management and figure out where improvements can be made. This makes your company more productive and more profitable.
5. Payroll Mistakes Are Expensive to Fix
When you rely on humans, you increase the risk of having to deal with payroll mistakes. Payroll mistakes can be quite costly to fix. If your employees’ wages and time worked aren’t reported correctly, you could find yourself in big trouble with the state and federal governments. This is dicey in a salaried environment and completely terrifying in an hourly wage environment. The last thing you need is for the state to think your employees are working overtime but not getting paid for it.
How to Choose the Best Time Tracking Software
Figuring out which type of time tracking software your company should buy doesn’t have to be difficult. It is, however, more involved than simply closing your eyes and going with whatever box you pick up first at Office Depot. There are a few different factors that will need to be factored into your decision.
1. Cost
Cost is, obviously, one of the biggest considerations you need to take under advisement. How much can you afford to spend? Even if your budget is limited, you should still be able to find the software that will best serve your business. You might, however, have to go with a lesser-known or start-up brand. Figure out how much you can afford to spend before you start shopping. This way you won’t be tempted to splurge a little bit on something fancier than your budget will allow.
2. Accessibility
Do you want your employees to log in via a centralized “deck”? Do you want them to log in independently via their own office computers? Or do you need time tracking software that can be accessed from anywhere in the world? If you have telecommuters or employees who travel often, cloud-based or web-based software is going to be your best option. For a small retail shop, however, a centralized “time card” system is a better bet.
3. Simple Tracking or Complex Tracking?
What do you want to track? Do you want to know only when someone logs in and out for the day? Do you want to be able to track every minute a person spends “on break”? Do you want to be able to see how much time your employees are spending on specific tasks while they are at their desks? Decide this before you shop. You don’t want to get talked into software that tracks every minute your employees spend while at work if all you need is a simple in/out system.
4. Integration
Try to find software that will integrate easily with your existing payroll software. This way you don’t have to worry about compatibility issues or your payroll person having to spend hours transferring data from one program to another by hand (remember that human error we talked about?).
Really, the choice isn’t whether or not you should use time tracking software. The choice is which type of time tracking software you should choose. Use the tips in this article to help you figure out which options are best for you and for your company.
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Erin Steiner has written extensively about time tracking and other business topics for clients all over the web. She also covers personal finance, marketing, and cultural topics.