Timesheet Benefits Every Business Owner Must Know

Intro

In the modern business landscape, keeping track of employees’ work time holds profound significance. It provides insights into how resources are being utilized and how their time is spent across various projects.

Traditionally, businesses have heavily relied on timesheets to capture work time data in a tabular format to track work hours. However, with the advent of technology, many digitally mature organizations have pivoted to digital timesheets due to their indispensable functionalities and also witnessed significant improvement in their bottom line and project deliveries.

So, in this blog, we will discuss the key benefits of leveraging timesheets for employees and how it can help streamline payroll processing, improve the team’s productivity, and foster a positive relationship with clients and teams.

What Is a Timesheet?

A timesheet is a tool that businesses use to track employees' total work time during a certain period. Businesses can use employee work time data from the timesheet to process payroll, bill clients, estimate project deliveries, and track absenteeism patterns. Majorly three types of timesheets are popularly used by businesses:

Paper-based

Paper-based timesheets, including printable time cards, punch cards, registers, etc., are the most traditional ones used to record employee work hours. However, these archaic timesheets required manual time entries and were prone to human errors, data security, and time theft.

Spreadsheets

Spreadsheets reformed the timesheet layout to make the timekeeping process more organized, streamlined, and less hectic. The tabular nature, simplicity, and ease of use make spreadsheets, especially in Excel formats, one of the most sought-after timesheet solutions for businesses. In fact, businesses can even use excel timesheet templates available in multiple formats to track employee time on a daily/weekly/monthly basis.

Digital Timesheets

Paper-based systems and spreadsheets had several limitations in terms of functionality and were also susceptible to time theft, data security, and erroneous data entry, which gave way to digital timesheets such as the time tracking software that not only captures time data with precision but also offers umpteen functionalities, such as detailed reporting, approval paths, validations, and more.

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Going forward, we’ll dive deeper into why businesses should leverage time-tracking software, also known as online timesheets, and how it can help them improve their profitability and competence.

10 Timesheet Benefits Every Business Owner Must Know {#10-timesheet-benefits-every-business-owner-must-know}

* Accurate Billing for Clients

Whether it is accounting, freelancing, or any other firm, keeping track of the hours worked on several projects to calculate invoices for different clients is crucial.

For businesses that charge clients on an hourly basis, the timesheet serves as a record for the clients and helps generate accurate invoices.

A digital timesheet helps businesses gain insights into the contextual work time data spent across different projects, ensuring clients are billed correctly and promptly. This helps maintain healthy relationships between clients and business owners.

Such time tracking software also comes with configurable reporting features that uncover details regarding time utilization and help clients keep abreast of where their money is being utilized and if it has been put to good use.

The detailed reports enable clients to view how much time the resources have dedicated to completing different parts of the project, thus serving as proof of billing calculation and accuracy.

* Streamlined Payroll Calculation

Timesheets are beneficial for organizations that recruit hourly-based workers as they help organizations keep track of employee work hours.

Time tracking software tracks the total work and overtime hours, which helps businesses compensate employees fairly and accurately based on the number of hours worked.

This software also keeps a tab on employee work hours, leaves, accruals, overtime, holiday allowance, etc, helping businesses manage the employee payroll efficiently along with the allowances and additional pay.

Also, with timesheets, employers can easily meet payroll-related regulations around overtime, shift-based allowances, etc., to comply with mandatory laws.

On top of that, in case of any conflicts in payroll processing, employers/managers can always refer to the timesheet data to verify the work hours and the total hours devoted to specific projects.

This way, digital timesheets cut down the time and costs spent on administrative tasks, thus liberating staff from the manual processing of time data entries so they can pay heed to more productive work that can bring value to the organization.

* Prevents Micromanagement

The team managers or the supervisors often micromanage the activities of employees to administer what employees are working on and how much time they’re taking to complete a task.

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With the help of timesheets, managers can eliminate the need to micromanage employees and easily find out what they’re working on, how much time they’ve consumed to complete their tasks, and how their resources are being utilized overall.

Thus, timesheets save managers from supervising and micro-managing their teams, reducing the likelihood of conflict between managers and team members.

* Better Forecasting and Estimation

One of the major advantages of using digital timesheets is that their data can be used to estimate resources like time, labor, and cost for future projects.

For example, before a team embarks on a new project, they need to estimate the specifics, such as the timelines, milestones, and resources required. In that case, the manager can utilize the timesheet data of previously worked projects where the nature of the tasks is similar to the one that is being undertaken.

Thus, with the help of historical data of previously worked projects, businesses can improve their estimation of labor, cost, and timelines for upcoming projects, prevent cost overrun, and ensure timely project delivery.

* Tasks Management and Prioritization

“Timesheets empower organizations to better manage the workflow, identify areas of improvement, and allocate resources strategically that will contribute to successful project deliveries and positively impact the bottom line.”

Timesheets are a valuable tool for discerning the nature of the tasks and the time they usually require to complete.

Managers can check the timesheet data to discern which projects and tasks take up more employee bandwidth and which ones less. With the help of this analysis, managers can make informed decisions around task prioritization, allocation, and management.

For example, managers and employers can do away with projects that don’t serve much value and consume more resources’ bandwidth.

Also, managers can understand which tasks take a lot of time and which ones less. This analysis helps them improve the workflow by prioritizing the tasks so that urgent tasks can be worked on first and tasks with late timelines can be worked on later. For example, if a sales team works on admin and outreach tasks that consume a lot of their bandwidth, however, if they’re required to work on personalized cold emails for clients that take relatively less time and are of high priority, then they can be asked to work on emails first.

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* Insights Into Productivity Trends

Timesheets not only track the work time data of employees but also help managers ascertain productivity trends and identify areas where employees lag behind.

For example, managers can look into the timesheet data of employees to find which tasks are consuming their utmost bandwidth and which tasks they can work on comparatively quickly.

This data helps managers discover where employees are lagging behind and the areas in which they are excelling. According to the time taken to accomplish a work, managers can utilize them for various projects with specific needs.

Also, managers can identify the resources that are taking too much time on the generic tasks compared to other employees and provide them with the essential training and guidance to improve their performance.

In fact, with the time tracking software in place, managers can generate reports catering to specific areas to better assess employee performance, productivity trends, and workload levels. This detailed insight can help them allocate their resources better, distribute the tasks effectively, and optimize the workflow to improve overall productivity and efficiency.

* Optimum Resource Utilization

One of the biggest concerns for businesses is whether or not their employees are equally pulling their weight and are not fudging their time over non-work activities.

The timesheet keeps track of what employees worked on, for what duration, and on which projects. This clear visibility into resource time data ensures that resources are neither underutilized nor overutilized, and if required, their tasks can be delegated to prevent burnout in employees.

In addition, if managers find that the bandwidth of the resources has been utilized to its full potential and more resources are required to distribute the work, then they can flag the need for temporary staffing or high-volume hiring and request management to recruit additional resources accordingly.

* Keeping Clients Abreast of the Project's Progress

For client-facing projects, the timesheet can work wonders as it allows clients to see a detailed breakdown of how much time is spent on several tasks and infer the project's progress.

This analysis not only helps clients with the intricate details of the project but also lets the team involve clients in the project journey, ensuring their expectations regarding timelines are aligned with the team and making adjustments whenever required.

* Better Project Management and Timely Delivery

The timesheet gives a holistic view of the time spent across several tasks and mitigating the scope creep in the project.

Thus, equipped with the timesheet data, managers can address the project bottlenecks, onboard more resources if required, compare real vs. actual timelines, and make informed decisions to ensure that the project doesn’t derail from its track.

This real-time visibility into the timesheet data helps managers optimize the workflow and make proactive decisions from time to time to keep the project on track and ensure timely delivery.

* Reduced Unplanned Absences

When you don’t have a solid record of employee absence or use the manual process to record it, the absenteeism pattern may likely go unnoticed, leaving your employees uncertain about what is expected of them.

Digital timesheets keep track of unplanned absences and flag if these absences have become a trend. By finding absenteeism patterns in some employees, managers can take proactive actions to minimize their occurrence, improve engagement, and help employees abide by the necessary rules and regulations of the organization.

Bottom Line

In the business landscape, every moment counts, and timesheets pave the way for businesses to gather data about employee work time and analyze it to make informed decisions. Businesses can use any of the timesheets, whether it's paper-based or spreadsheets. However, the susceptibility to errors, time theft, and manual processing makes them incompetent for modern usage and clears the way for time-tracking software. As mentioned earlier, these modern timesheets not only improve the resource utilization for the businesses but also help them gain real-time insights into key business metrics for better decision-making.