A Guide to Time Tracking in a Professional Setting

Time tracking refers to any method by which an organization or independent professional records working hours. This is an important part of accurately determining how much compensation an hourly employee or freelancer is owed for their work. 


Employers can use it to ensure that employees are managing their time wisely and appropriately. Time tracking also provides an opportunity for managers to better understand the daily workflow. Some organizations may also have a policy of showing clients the daily schedules of workers as a part of their cost breakdown. As such, the value of time tracking can sometimes go well beyond its basic role in hourly compensation. 

Benefits of Time Tracking

Time tracking offers many benefits to an individual professional or an organization. These benefits include:


  • Budgeting: Time tracking can help you identify what elements of your business operations are burning the most in your budget, which can help you more effectively assess your budgeting needs and priorities. 
  • Transparency: Time tracking is not only a good way for employees to be transparent with their employer regarding their workflow, but also offers an opportunity for businesses to more effectively outline a workflow for any cost breakdowns that they offer to clients. 
  • Accountability: Time tracking helps keep employees accountable for their productivity and time usage.  
  • Productivity: By monitoring time expenditure, you can more easily determine how long it takes to do each task efficiently, and that information will help you establish optimal time frames for tasks. It can also help you identify productivity issues, such as an unforeseen variable that causes a task to suddenly take much longer than usual. 
  • Optimization of operations: If you can more easily pinpoint underlying productivity issues through time tracking, you can then adjust operations to account for these problems. Additionally, time tracking helps you determine whether a change in business operations is successful or not, based on whether projected time expenditure lines up with reality. 
  • Resource allocation: Time tracking helps you allocate resources by allowing you to identify what tasks are taking up the majority of operating hours. In addition, you can determine which areas may be suffering due to lack of resources, as may be indicated by unusual time expenditure. 
  • Sales: If you have a comprehensive outline of business operations and the time and resources associated with daily tasks, you will be better equipped to justify things like pricing and time allotments to clients. This will also reassure the client when they compare the quality of your work with the time you put into it. 
  • Reputation maintenance: If you give clients poor estimates or other incomplete information, it can begin to reflect badly on your business. 
  • Pricing adjustments: Depending on how much time and resources are being dedicated to a task, you may determine that the product or service is more or less valuable than its current price. 

However, to fully reap the benefits of time tracking, you will need to choose a time tracking method that complements your business structure. 

Time Tracking Methods

Common time tracking methods include:


  • Manual: For manual time tracking, employees are responsible for logging their own clock-in and clock-out times, as well as any additional information such as task breakdowns. This could be logged on anything from a physical piece of paper to a digital spreadsheet. 
  • Swipe card or punch clock: In this case, an employee needs to manipulate a physical machine that will automatically log their corresponding clock-in and clock-out times. 
  • Time tracking software: Time tracking software can vary widely in terms of system and features, with many programs including elements such as PTO tracking, scheduling options, overtime tracking, and even facial recognition. In general, however, time tracking software is a digital system that facilitates time tracking, often through digital punches.
  • Geofencing: This option utilizes GPS technology to log the times an employee arrives at and leaves the job site. 


If you select a time tracking software as your method, there are many options to choose from. 

Choosing Time Tracking Software

If you are trying to choose the right time tracking software for your business, consider taking the following steps:


  • Review your operations: Which time tracking method will work for you will depend on your unique business operations. For example, manual time tracking methods could be inefficient for large businesses
  • Consider your goals: You should not only think about what your business operations look like today, but also what they will look like in the future. You don’t want your time tracking system to become a hindrance down the line. 
  • Look for advice within your industry: If you are unsure which system would work best for your business, consider which systems other, similar businesses use. 
  • Think about cost: Pricing for time tracking software can vary widely depending on features, and it is important to go into this decision-making process with your ideal price range in mind. 
  • Ask your employees for their opinions: Employees know their workflow well and therefore may have helpful insights regarding which system would work best with that workflow. 
  • Do a test run: Sometimes guess-and-check is the best way to determine which system is most effective. 


Don’t be afraid to change your mind when you’re choosing a time tracking option. Don’t get discouraged or dig your heels in if a system doesn’t work well. Consider the issues you ran into and use that information to assess other options. 

Implementing Time Tracking

The introduction of time tracking or changes to your time tracking system can be difficult for employees to adjust to. It is important to make time tracking procedures clear during new employee onboarding, as well as to provide sufficient time and training for any existing staff. The following steps can help make the transition less jarring:


  • Be transparent: Employees may feel more uncomfortable with the situation if they feel like they have limited information or are not actively involved in the transition. 
  • Offer supporting data: If possible, provide data that illustrates how and why the change to new software should be helpful. 
  • Anticipate pushback: Anticipate objections so that you can be ready to address them. 
  • Manage expectations: Make sure that employees know what to expect at every stage of the process. 
  • Be understanding: Naturally, some employees will be uncomfortable with significant changes, especially those that make them feel more closely monitored. As such, it is important to approach concerns with empathy rather than becoming combative. 

Ask for feedback: If you solicit feedback from employees, you may not only get helpful information regarding the new time tracking system, but may also make them feel more actively involved in this change.