Timesheet software is not just for payroll anymore. Increasingly, operational process accounting and project accounting (often for client billing) is becoming important to professional organizations of all sizes.
Time sheet software is recommended for companies that have outgrown their current paper-based or homegrown timesheet system, are trying to use Microsoft Excel for timesheets or have multiple installed time collection systems that produce inconsistent data. Without timesheet software, it is difficult to understand project costs and send correct and timely bills to customers. And it can make payroll very frustrating.
How can you be sure you’ll get a system that works for your company and is immune to the most common problems experienced when buying a timesheet collection automation system? Let's take a look at some of the things that are important to consider.
First, it's important to have a Buying Process. Too often--in large and small companies alike--the key statement in the buying process is “Look at this cool thing I found on the Internet.”
The result of this usually is wasted time and money. Timesheet software is not a toy. It will touch everyone in your company. Nobody likes to track their time, so it has to look good. In fact, it has to look great. And be fast. And encourage accurate data collection in everyway possible. And be a real accounting system with double entry methodologies and approval processes. And have automatic reminders for the procrastinating, busy, forgetful executive (you know who you are).
First, you need a requirements list. This will enable you to eliminate scads of vendors that you will run across when you Google "timesheet." Ask all the different departments in the company that will be affected by the system for their input.
Here are a few potential requirements:
• Do you need to verify invoices sent to you by contractors, and test the timesheet system on them first?
• Do you need to have a system that prevents people from tracking time against projects they shouldn’t have access to?
• Do you need to send payroll data to ADP or Paychex?
• Do you need to send billing data or payroll data to QuickBooks (or SAP or Oracle)?
• Do you need to get the system rolled out now and don’t have time to wait for IT to buy a machine and transfer it to your IT shop when they’re ready?
• Do you need to split-bill back project costs to other internal departments?
• Do you need to fix your estimation process?
• Do you need Defense Contract Audit Agency (DCAA) compliance or very accurate IT capitalization data for the Sarbanes-Oxley Act (SOX)?
• Do you need to understand your R&D costs on a per-product basis?
• Do you need a tightly controlled but distributed purchasing process where everyone gets a company credit card?
• Do you need to reimburse for mileage?
• Do you need a low monthly fee rather than a giant one time fee?
Good timesheet software does all of that, if properly configured.
No Easter Bunny
I recently saw a statement on one vendor’s site that they can “implement in 2-3 days." And Santa is going to bring you a nice fluffy bunny sitting in a new Lexus.
No, you can’t roll your time tracking system out in two days unless your problem is simple enough to only include one of the above requirements. If you think your requirements are that simple, then you’re probably not looking very hard. If it’s really that easy, then you should just keep emailing around those Excel spreadsheets that you’re already sick of.
This technology is powerful and it can help your company become more profitable in a number of ways. It can lower your payroll processing cost while increasing accuracy. It can speed up your billing and convert more A/R to cash. It can automate travel expense reimbursement. And most importantly, it can tell you which projects are broken before you would ever have known it before.
Vendors who claim two-day rollout times are just plain lying to you. They’re preying on your "cool Internet toy I found" excitement in order to sell you shelfware. If you think it’s easy, then you won’t look too hard at their solution, you’ll just buy it.
Which is exactly what they want.