Time is the most important business resource for service providers, especially in the booming gig economy. Next, we’ll explain why they should keep track of their project’s working hours using modern time tracking apps.
Gig economy and time tracking
Companies operating in the gig economy and work-order-oriented have high personnel costs. For instance, these include software manufacturers, marketing, PR and Internet agencies, engineering offices, consultants, or IT service providers, to name just a few. For such companies, the working time of their employees is the most important, most expensive, and at the same time, scarcest resource. Skilled worker shortage is key. Regardless of whether they offer their services by the hour. Or calculate projects with fixed prices, they ultimately sell hours of work. For this reason, time tracking is the basis for realistic budgets, cost estimates, price and cost calculations. Therefore, for the most realistic project planning possible.
However, in practice, service providers often have great difficulty in recording their working hours efficiently. While electronic work time tracking has become indispensable in the industry, many “knowledge workers” who work on computers still use Excel, if at all, to create their timesheets.
Many office workers often fail to recognize the benefits of recording time on their own. They perceive manually creating work records as cumbersome task that only has to be done because the boss wants it to. Ultimately, this leads to hourly records, which often give a completely unrealistic picture of everyday business life. Each employee works exactly eight hours a day, arriving and leaving on time every day.
Companies that want more information are using modern time tracking apps like TrackingTime. They provide effortless and easy time tracking for efficient billing and data analysis through clear reports. Next we will explain other advantages that convince more and more companies.
How many hours of work is required to develop a website? And, how long do I need to design a new logo? Or, how many hours should I bill to create a landing page? How do I calculate the expected profit of a project? Designers, developers, marketers, and and anyone providing creative services must keep asking such questions again and again. Namely every time they receive a new project request. Many often have to rely on their guts to get an answer.
In the worst case, this can be very expensive. If you set off a budget for a project calculated at a fixed price, the company can even lose money at the end of it. Any company can handle an incorrect project calculation. However, if this is not an exception and becomes the rule, it can have serious consequences for the company. In practice, it is not uncommon. IT projects in particular often get out of hand. According to a study by the management consultancy McKinsey, budgets for IT projects are exceeded on average by 45 percent.
Modern time tracking tools like ours, which offer project management functions, promise a remedy. They provide more cost transparency by allowing users to record every work performed for individual project tasks in detail. You can also specify whether individual services are billable or not. At the end of the project, decision-makers can easily calculate project costs using the reporting functions offered.
Better budgeting, more realistic planning
Another advantage of time tracking tool that is directly related to the topic of cost transparency concerns project budgeting. The actual values that were determined in past projects can serve as a well-founded data basis for budgeting a new order. For example, to estimate costs for a new website, if you have already successfully completed some similar projects, you will now be able to estimate the time expenditure better. That is to say, more precisely. An exact estimate of the effort is a crucial prerequisite for realistic and fair budgets. Clients and service providers alike can benefit from fair prices.
If you want to carry out projects on time and within an economic framework, you can hardly avoid planning the project. As detailed as possible. The knowledge from past projects that served as a basis for budgeting can also be useful. Most professional time recording programs support the specification of deadlines and time estimates that can simplify the comparison of target and actual values.
For agencies and the self-employed, who work in the creative industry and work on an hourly basis, consistent time recording can be an important factor in accounting for justified working hours. Many professional solutions not only allow convenient, detailed time tracking but also have integrated invoicing tools with which you can invoice the recorded working hours directly.
Building customer trust is key for the Gig economy
Accurate billing service not only simplifies billing. Through a transparent way of working, service providers can build a close relationship of trust with their customers. As a rule, clients are not experts in the field of service providers and therefore cannot possibly estimate how much work is really involved in developing an app or correcting a programming error. However, if they can find out exactly what they are spending their money on, then they will give the service provider more confidence.
More flexible working conditions
When used correctly, web-based time tracking solutions bring additional non-monetary benefits. Most of the tools for business teams that are available on the market today have more or less extensive reporting modules that can enable more flexible working conditions. For example, our TrackingTime app, which is available for web, desktop, and mobile, has a simple stopwatch function for real-time time tracking. The software shows on the online dashboard at any time what each team member is currently working on. It does not matter whether the colleagues work in the office, on the go, or from the home office. There are also easy-to-create working time reports that show the hours worked by individual employees in detail in any period. Thanks to such features, management can check at any time whether the working hours that have been agreed with external service providers or remote employees are actually met.