Timekeeping is a Useful, But Temporary, Evil

Somewhere in the middle of the 1300s, something came to be that transformed the economic lives of much of the planet: this invention, which followed the invention of sandglass and the mechanical clock, was the “time-rate wage.” It couldn’t exist without some sort of timing mechanism, but once it appeared, it changed everything about labor. Now we could measure the value of inputs.

Fast forward 700 years and humans the world over freakin’ hate what hasn’t changed all that much over those centuries, but is now referred to as the “timesheet.”

But I am here to tell you that it still has a role, and since the only thing you might hate more than timesheets is reading about timesheets, I’ll keep this short and declarative.

Timesheets Masterclass

Timesheets should only be temporary. No business should use them all the time. They are a tool to surface information, and once you have those answers, abandon them with glee. See below for the only valid reasons to use them.

Timesheets serve one basic purpose: to improve the next estimate. If you are using them as a management tool or some factor in employee reviews, you deserve the scorn heaped on you behind your back.

Timesheets raise the floor but never the ceiling. They can help you get paid for all your time, but you’re getting paid for all your time using the most basic way to get paid and you’ll never get value pricing from timesheets. If you aren’t getting paid for all your time now, then start by using timesheets to fix that (raise the floor). But then abandon them and jump to more value-based methods that take things other than input into account (raise the ceiling).

Everybody lies on timesheets except contractors who want to get paid, and that’s only true for honest ones. Incentives skew everything else. If you’re always telling people to stay within the scope, that’s what the timesheets will say and people will work extra time without recording it. But if people are afraid for their jobs, they’ll inflate the time they are spending in order to look valuable to the organization. And unless these records are being kept on a daily basis, they are all bullshit reconstruction anyway. Oh, and by the way, contractors are the only ones who get them to you on time, too!

There is no correlation between shops who are religious about timekeeping and profitability. Another word for “no” is “zero” as in “zippo”.

Value pricing is hard and usually more of a reaction. It’s hard because you have to price the client and to do that you have to understand a lot more about a prospect’s situation. But it’s also inspired by this weird reaction that clients don’t value us. You can pursue it if you want, but you can make a whole lot of money by just having better systems and productizing more of what you do. Most of you should think about it, understand it, but then not do it.

Bonus Information

Here are the only five scenarios where using timekeeping makes sense, and then only temporarily until you have enough information:

• Spot checking a productized offering.
• Introducing a new service offering.
• Fixing a utilization issue (say anything <60% of the staff as a whole, including everybody), where you need more information.
• Coaching a problem employee.
• Mollifying a client who requires it before you can fire them and find another who doesn’t.

Want to get all philosophical? Here’s a great article about time over the ages. Those are your vegetables for the week. Stay tuned for some steak next week.