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Time tracking is about as much fun as watching paint dry. No one likes bickering with clients and team members about why a status report took five billable hours. But sometimes, having the data from the team’s time tracking can come in really handy. Let’s talk about time tracking best practices and how to gather the information without a little less pain.

One best practice worth mentioning right off the top is to invest in time tracking software, which can help automate the time tracking process and make it more efficient for your team—more on this below!

10 Time Tracking Best Practices For Project Managers

If you’re currently a project manager, especially in an agency setting, here are some best practices to help gather and leverage time tracking data.

  1. Avoid using time tracking punitively
  2. Automate it
  3. Do spot checks
  4. Look back when planning ahead
  5. Use data to make your case
  6. Get feedback from team members
  7. Bring data to sprint retros
  8. Analyze data across projects
  9. Set benchmarks for performance
  10. Audit time tracking practices regularly

1. Avoid using time tracking punitively

While time tracking can help you understand profitability, especially if your team members’ time is billable and you’ve agreed to bill clients for a certain amount of work, you never want to use time tracking data punitively (this will only make your team hate it, and it's a consistent reason why time tracking is bad, according to teams).

When looking at a set of tasks and team members, it might be obvious that it will take a more experienced or more senior team member less time to complete a task than it would a newer or more junior employee. But what happens when the data in the time tracking system shows that an employee is performing at a less-than-optimal pace?

Using time tracking punitively is a recipe for employees fudging their timesheets or reporting inaccurately. While you may use your time tracking data to start a conversation about underperformance, it shouldn’t be the only factor in the conversation.

2. Automate it

While having time tracking happen automatically feels like a thing of the future, time tracking software can help make this (close to) a reality. Having time tracking software that embeds in your project management tool or as a Chrome extension can help automate time tracking in real time.

Team members (including you) can start a timer whenever a task is initiated and stop or pause the timer as other things come up. You also may be able to set up notifications to remind you to start the timer when you initiate a task, depending on the software you choose.

The less each team member has to think about time tracking, the easier it will be to get people to adapt to your time tracking tool. If you can’t automate time tracking fully, consider a timesheet app or other digital time tracking solutions so that your team doesn’t have to fill in their timesheets manually. This can make timekeeping easier for everyone involved (including project leaders).

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3. Do spot checks

As the project manager, you should review your team’s time utilization regularly. This includes billable and non-billable hours. This might mean analyzing every week or every sprint. As you get close to the end of the contract period, this might be daily to ensure your team doesn’t run over the allotted hours.

This deep and regular analysis of time data will help with risk management, as you can spot issues with the timeline and pacing of the work. These issues are easier to course-correct when they’re smaller than they would be if you waited until later when they’re big problems.

timesheet info graphic
It's a good idea to have an occasional look at your team's timesheets directly.

For example, if you’re three weeks into a three-month project and you realize your team should have only used 750/3000 hours, but they have already burned through 1000, you have options.

You can ask them to slow down utilization or let your client or stakeholders know you might run out of hours before the end of the contract or project and you might need a change order. If you wait until your team has burned 2999/3000 hours, you won’t have as many options for course correction.

4. Look back when planning ahead

Your time tracking data can help you predict how long specific tasks will take. For example, if you manage website development projects, you might want to look at your last three to five projects to determine how long it took the team to set up the development environment, design the homepage, or set up analytics.

While your projects may vary in size and scope, having some data at the task level can help you and your team better conduct project planning, and create more accurate project estimates in the future.

Let’s say you’re estimating and planning for the time needed to redesign a medium-sized ecommerce site. You will most likely need to increase the time from the amount spent redesigning a smaller nonprofit’s site with limited functionality. However, the data may still give you some insight into a good starting point for a more complex project.

5. Use data to make your case

When communicating with key stakeholders or clients about project progress, having data can help support conversations. Most stakeholders in a project should understand the importance of time management. 

For example, if you’re able to demonstrate a pattern of a developer underestimating the time it takes to complete key tasks when you go to their manager to discuss needed adjustments, you’ll have specific data to show where the estimates don’t align with reality. The manager will then be able to dig deeper and understand that this is an estimation issue, not a time management issue.

Similarly, if you’re communicating with a stakeholder or project sponsor about challenges with the timeline or burn rate, using data gathered from time tracking instead of just anecdotal examples gives you a bit more credibility and objectivity.

6. Get feedback from team members on time tracking methodologies used

Team compliance with time tracking is critical. This is why you should check in with your team periodically to see if they have feedback on how time is being tracked. They might have ideas to get more information from the time tracking data (tracking by task or feature instead of by project or another way) or to make it easier for them to enter data.

I have worked with teams that have experimented with time tracking to the team’s benefit. Some have tried different tools or methodologies like block scheduling for efficiency or tracking by feature instead of individual tasks.

7. If you’re agile, bring your time tracking data to your sprint retros to start conversations

When it comes to agile project management, a sprint retrospective gives the team an opportunity to look back and reflect on the last sprint and how they might be able to improve moving into the next one.

Having data about how the team spent their time in the sprint can provide valuable information that the team might want to leverage in the next sprint. Data around sprint velocity, the amount of time spent on a specific task or feature, or how close the team was to their estimates are all valuable data points that can be distilled from time tracking.

If your time-tracking tools have reporting capabilities, you might want to leverage them to review time entries across team members and projects to spot trends. Even if you can’t automate this type of reporting, this is what spreadsheets are made for!

Looking at how your team members are spending their work hours can help you make better decisions when it comes to staffing projects. For example, if one team member can knock out ten bug tickets in the same worktime it takes another team member to do five, that might be worth looking into.

Assuming all tickets are of similar size and scope, understanding how efficiently team members are performing can help you and your colleagues make better staffing decisions.

9. Use time tracking to set benchmarks for team performance

Having an idea of the number of hours something should take can help you as a project manager understand how much work is reasonable to expect from a member of your team. The data you get from time tracking over a longer period of time can help you set benchmarks for how much work you can expect team members to complete.

For example, if one of your team’s responsibilities is creating training and documentation at the end of every project, you should be looking at the data from your time tracking app to understand how much time was spent doing this at the end of each project.

10. Audit time tracking practices and team entries regularly

Having good data relies heavily on having accurate timesheets within your time-tracking system. As a project manager, you may want to audit your time-tracking practices regularly to ensure that you’re getting the most valuable insights from the data.

This process might look like spot-checking time cards to ensure time is entered accurately and that all team members are submitting completed timesheets at the end of the week. While we already discussed not using time-tracking data punitively, there might need to be consequences for team members not completing their time reports as required.

Time Tracking Methods

There are many ways project teams can track and report on time spent doing their work. Here are a few of the most popular methods of time tracking:

Manual time tracking

Manual time tracking might happen by scrawling the information on a post-it note by your monitor with a pen and paper, and then submitting it via email or a company-created timesheet each day or week. 

Regardless of how your organization defines manual time tracking, it’s usually the most time-consuming method for employee time tracking. The only exception to this might be if you’re a freelancer and you need to log into multiple systems each day to log your time. In this case, it might be most effective to manually track and submit once each day (or week if you can get away with it).

Automated time tracking

Automated time tracking is designed to make tracking time tied to specific tasks easier. This might happen by starting a timer directly in your project management software or by using a Chrome extension or integration from your time tracking software to natively track time spent on a specific task.

Time tracking by task

Whether tracking is automated or manual, it might be important to track time by task. This can help streamline reporting and make communication with clients or stakeholders go more smoothly. 

For example, if a team is tracking by project and a stakeholder wants to know exactly how long it takes to complete a certain task or develop a specific feature, it will be harder for you as the project manager to analyze this if you have to go back through all of the project entries to determine who worked on the task or feature, when and for how long.

Tracking by task can also become more complicated if your team likes multitasking. It can be especially challenging to keep a timesheet clean when you have touched three or more tasks within an hour.

What’s Next?

Do you feel like your time tracking practices might need a little bit of an upgrade? If you want to know how your peers handle time tracking (as there are no clear rules about this), become a member and join the conversation in Slack with 1000+ of your peers about how they handle it in their projects.

By Marissa Taffer

Marissa Taffer, PMP, CSM is the founder and president of M. Taffer Consulting. In her consulting practice, she helps organizations with project management processes and tools. She also serves as a fractional project manager supporting digital agencies, marketing departments, and other consultancies.