Project Return

Why Timesheet Automation is Essential? - Part 1

November 22nd , 2019

The discussion to institute any automated system within an organization should revolve around some return on investment. A change in a system of any kind whether automated or not implies some effort, some cost, some expenditure of energy and resources.

These costs could be hard costs such as the purchase of new equipment or new software or soft costs such as a temporary drop in efficiency while a new system is implemented.

In order for it to be worthwhile to incur these costs, an organization must enjoy some future benefits from instituting a new system.

When considering a timesheet automation an organization should first determine what are the benefits it might bring to your organisation. One of the easiest and most common places to look for these benefits is in existing costs of not having such a system now.

Here are a few indicators that your current system or lack of a system is costing your organization:

  • Missing Billings

Your organization does not invoice for all the work accomplished on a project. Hours are somehow skipped over or cannot be audited and thus cannot be billed. Perhaps your current system is not timely enough resulting in billable hours that are discovered too late to bill them.

  • Missing Hours

Your organization is unable to determine what hours are being worked by each employee. Attendance hours seem to add up to one value, but the hours spent on projects or overhead or billed to clients just do not add up to the same amount as the attendance figures.

  • Excessive Overhead

Your business model indicates that you should be spending a certain percentage of your hours on overhead activities versus billable or product project activities. Your current system is unable to determine where overhead hours are being spent. You just know that the percentage of productive hours versus non-productive hours is completely unacceptable.

  • No ABC

Activity-Based-Costing has been the norm in the project management world for years. However, it is just taking off as a popular concept in management consulting and accounting circles. ABC allows an organization to drill down to the lowest level of resolution possible to identify unprofitable or unproductive areas of a project or an organization. If your existing timesheet system is designed to track hours only at the project or perhaps client level and is unable to manage charges at the task level, you will be unable to implement ABC.

  • The Dreaded 999 Code

Manual timesheet systems are often plagued with abuse of a "miscellaneous" or "999" charge code. Users who find it too difficult to look up a proper project code will often find the miscellaneous code an easy way out. Excessive use of this kind of miscellaneous code indicates that users are not charging hours to the appropriate task and project. This defeats any variance reporting system or putting the timesheet data to any useful purpose.

  • Double Entry

The needs of the Payroll department to determine payable hours and the needs of other departments such as Accounts Receivable/Invoicing and Project Management to determine billable or project progress hours are often at odds with each other. This may result in independent timesheet management softwares which do not merge with each other. Aside from the obvious inefficiency of double entry effort, inconsistent totals of the same information may result in hesitant or even bad business decisions.

  • No Variance Reports

If your current system does not allow actual hours to be tracked in the same resolution and with the same coding as they were budgeted, you will be unable to do a budget vs. actual comparison. Budget vs. actual variance reporting is the single most important management tool, particularly in a project environment.

  • No Integration with Other Corporate Systems

There are many corporate systems which could take advantage of on-line timesheet information. These include: Payroll, Billing, Accounts Receivable, Accounts Payable, Human Resources and Project Management. If your current system is either not automated or is unable to integrate its data with existing corporate systems, your organization is not as efficient as it could be.

If your organization is experiencing one or more of these conditions, automating your timesheet management system bring potential benefits. We will discuss about how automated timesheet management software can help your organisation increase productivity efficiently in our next blog.


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This article was provided by Gulit Upadhyay,

Sr. Digital Marketer at ProductDossier, a company dedicated to providing an Integrated Project Management Software. So that, you can achieve business excellence. View his detailed profile on LinkedIn at https://www.linkedin.com/in/gulitupadhyay/



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