Time is Money, Alot of Money ...
I freaking hate timesheets. There, I said it.
In fact, there are very few things in the world that irk me the way timesheets irk me. The topic sets my nerves on edge and I’ll tell you why:
Timesheets are a major black hole of profit loss.
What is a Timesheet?
Timesheets have existed in some form or another since one person first engaged another to perform a work on the basis of hourly compensation. And they do serve a valuable function by categorically dividing an employees work hours for accounting purposes. A few hours to this task and a few hours to that project number shed a great deal of information on the operation and profitability of a company.
So what’s my beef?
If timesheets stayed in that tidy corner of just accounting for time spent I would have no complaint. I do however take issue with the way timesheets are implemented.
A Typical Timesheet
Let’s assume that Carol works for an AEC firm as a production CAD drafter. She spends her entire week working on a variety of projects and even doing some non-billable work. The Monday rolls around and she has to face the troubling task of filling out the dreaded timesheet.
What did she do on Tuesday? What day did she work on that drainage plan? Can she really put 2 hours of training time down in a week she had to work overtime? What’s more, Carol has to record more than time. She has to enter details. A general statement of work performed.
It’s not entirely unheard of that, over the course of a week, Carol may bill her time to half a dozen job numbers and overhead. This could easily comprise 25-35 separate entries over the course of the work week. If Carol performed more than one task for each billable entry per day she could be looking to populate that timesheet with well over 50 “detailed” entries.
Where the Waste Appears
So, you might be thinking “What’s the big deal? Timesheets need time and details.” And you are right.
But let’s stop and consider the very thing that a timesheet is meant to track: time.
Let’s conservatively assume that it takes 30 minutes for Carol to accurately fill out her timesheet to a degree that is required for proper tracking. Over the course of a year Carol will spend over 26 hours filling out timesheets.
That is time that is not being applied to productive, revenue generating jobs. And it has its own cost because Carol is billable at a rate of $85 an hour. A simple calculation shows us that Carol’s timesheets cost the company $2,210 a year.
However, Carol doesn’t work alone. Carol works for a SMB firm that has 148 employees. A little more math reveals a total cost of $327,080 in lost billable hours.
Timesheets are Money
I don’t think that anyone can say that $327k is a small amount. But, some people might say “Well Curt, your numbers seem sort of high.” So, let’s finally assume that some people take longer to fill out their timesheets, but a greater take less time. So lets adjust that number by 80%. Out new adjusted total is $261,664 per year.
More than a quarter of a million dollars up in smoke, just because timesheets are “how we’ve always done it.”
What’s the Alternative?
So how do we overcome the timesheet black hole? I don’t know.
I am not saying I have all the answers, or any answers. What I do know is that whether you use a punch clock, or a spreadsheet, or one of the various programs to keep your timesheet up to date, we are essentially keeping time the same way we have for over 100 years.
When you look at it that way and add to it the costs, how can anyone think that “business as usual” is the way to go on this matter …
