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How Time Tracking Can Benefit Small Businesses

How Time Tracking Can Benefit Small Businesses

Unlike large corporations, small businesses run delicate operating models that can’t marginalize the effects of low turnovers. What they have is a flexible system of operation that entrepreneurs can easily supervise and fine-tune at will to keep the books in order. Time tracking is a major part of this.

However, all this elastic administrative power must be leveraged with precision and skill to produce results. One of the many strategies small business owners use to keep things organized is employee time management.

Since timekeeping shapes payrolls, startups can’t afford to get it wrong. It’s all the more critical in remote workplaces where employees are paid by the hour.

That’s not all. Time tracking also helps business and project managers handle various elements of their organizations. An effective system keeps everything orderly and stress-free. In effect, you need to know how to track work time if you expect to make reasonable headway in your business.

So, what are the benefits of time tracking?

Increased Awareness/Grasp of Company/Project Components


As a business manager, the importance of having a firm grasp of your employees, client base, projects, and even company goals cannot be overstated. A report by Harvard Business Review (HBR) outlines the various difficulties that business managers face today. These challenges include leveraging important data to shape company policies. Even small businesses managers are not exempt from these struggles.

Time tracking data can help business owners understand how their companies work. The system can be used to measure staff efficiency, estimated project completion times, and payroll accuracy. With a solid work time tracking app, it’s easier to get a grasp on these company components to make better decisions.

For example, the data shows you which team member performs better at specific assignments. This way, you can allocate work to the right talent, boosting efficiency.

Better Workflow with Time Tracking

In order to organize their workplaces and better engage their employees, some business managers have had to rely on third-party professionals. In truth, you can easily manage workload once you understand the time factor within the organization.

Often, the problem with managing workflow comes from having too much time with too little to do, or vice versa. However, the solution lies in efficiently monitoring the amount of time you and your employees work. Once you do that, it’s easy to identify performance ‘hot spots,’ bloated activities, and unused time.

With this data, you can remove bottlenecks, improve work speed, and optimize workflow. You can remove unnecessary processes and assign important tasks to employees during peak hours.small business coach

Easier Monitoring of Productivity Ratings

Time tracking is a tool for reliable comparison of company components and dynamics. Why would a business manager be upset upon knowing that last year’s turnover was better than this year’s? It is because businesses are expected to get better with time.

With small businesses, more time often indicates experience. More experience often indicates greater efficiency. Greater efficiency ought to result in higher performance. Now, higher performance is often the gateway to increased productivity.

Time tracking allows you to gauge your employees’ efficiency, productivity, and even experience. More than this, it helps you to measure and compare the partial and overall productivity of a single employee, teams, departments, or the entire organization.

Understanding your workers’ strengths and weaknesses means you can assign jobs better and help them improve.

Enhanced Payroll Efficiency with Time Tracking

As a small business, your payroll is likely your biggest overhead. This expense affects everything from your profit margin and cash flow to your ability to secure credit. That’s why you have to make sure you get it right if your small firm is to thrive.

Small businesses with inefficient time tracking systems often face payroll issues. The situation is worse when the company is made up of work-from-home staff.

Time tracking applications are excellent at generating timesheets and tracking billable hours. Using the right solution will see to it that your staff is adequately paid without complications.

Reduced Risk of Employee Multitasking and Stress

Working long hours is not equal to working productive hours. A well-cited Stanford study even concluded that “Long weekly hours and long daily hours do not necessarily yield high output.” It further stated:

“Employees at work for a long time may experience fatigue or stress that not only reduces his or her productivity but also increases the probability of errors, accidents, and sickness that impose costs on the employer.”

So, time tracking is as important to the health of your employee as it is to the smooth running of your organization. Establishing a ‘time-ceiling’ for when and how long employees should work daily can help. It will prevent your organization from burying itself in futile drudgery.

Easier Team Management as You Utilize Time Tracking


Time tracking is one of the best ways to manage teams. As earlier explained, good time tracking practices will help you get a solid understanding of the components of your organization. With respect to your employees, it will be easier for you to get them to ‘tick.’ This is the same as knowing the recipe for effective employee engagement and inclusive performance.

Once you can track and manage time in your organization, you will find it easier to assign tasks and expect timely executions and implementations. Also, it won’t be all that complicated to have useful interpersonal relationships growing at the workplace. That’s because your employees will know when to socialize and when to focus on work.

Also, although many contemporary studies insist on high productivity ratings from specific hours of work, your organization might be the exception. After all, a small business has proportionally fewer components to work with by way of employees and overall targets. So, time tracking will help you recognize where your organization stands: where more hours result in low performance and vice versa.

Increased Employee Awareness of Company Goals

Time tracking can be used for more than just directly boosting employee performance or generating timesheets. You can also use it to make your employees more sensitive to the goals of the company. As this Forbes report explained, you are more likely to get more loyalty and work out of employees that know what your organization is all about than those without the faintest idea.

The same fact holds for the incorporation of company culture. Using a reliable time tracking app, for example, can show you what your employees spend most of their time doing. This information will help you identify things to make available to your workers and what to discard. As any successful business manager will tell you, a united workplace spirit is vital to the growth of any small business.

Keep Optimizing the System with Time Tracking

Overall, time tracking is good for your small business. It helps you prioritize, organize, and make the components of your organization integrate smoothly. Always ensure you use valuable data to develop better policies. Collecting feedback from your workers will also help you leverage time tracking better.

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