An important aspect of managing the costs of a project is tracking employee time and external expenses separate from other projects or operational costs. Although young companies are usually able to get away with using Excel spreadsheets and standard bookkeeping software to track all this information, as professional service businesses grow and start changing how projects get assigned, they often find these tools to be insufficient for their needs.
The solution is software that’s specifically designed to track the time and expenses associated with each project. But with so many time management systems on the market, picking the right one can be a challenge. With that in mind, we’ve written this buyer’s guide to help you as you start to narrow down your choices from the hundreds available.
Here's what we'll cover:
Time and expense report software gives professional services organizations the ability to monitor and control the labor and costs associated with every project. This, in turn, helps streamline their invoicing, improve bid accuracy and reduce unnecessary costs.
Time tracking software is often used as part of a comprehensive professional services automation (PSA) suite, which would also include features that support project management, help desk, resource management and customer relationship management, among others.
This type of software can be deployed in the cloud, or on premise. In the case of the former, the software is hosted online and accessed via Web browser. On-premise deployment, on the other hand, means the software is installed manually on a user's local servers and run directly on the user's machine. An online time tracking system may be preferable if you need remote access or prefer a lower up-front cost (since pricing for web-based systems is usually by annual or monthly subscription, rather than purchasing a license in full up front).
Features and functionality of time and expense reporting software include:
|Punch-clock and manual time entry||The most basic functionality, which free and high-end products alike will provide: the ability to electronically clock in and out and to manually enter or change clocking times as necessary. The more advanced the product is, the more likely it is to offer PINs, magnetic card reader hardware, automated start/stop capability (e.g., clocking out when your computer goes to sleep) or other features.|
|Expense tracking||Monitor costs of materials, tools etc., with the ability to tie them to individual projects or to general expenses.|
|Project-based accounting||If you’ve got 15 employees each working on five different projects, accurate time reporting requires knowing which projects they were working on when. So this feature is there to help you track revenues and expenses by client and project and then export in a way that your accounting software can understand.|
|Workload management||Some time and expense tracking software can help you monitor the bandwidth of each employee, providing clear reports that show you which ones are working on which projects, how much time they’re dedicating to each one, where they’re heading and when and when they complete a certain project. This helps streamline employee assignments, and becomes especially useful as company sizes grow into the hundreds of employees.|
|Resource planning||An advanced feature, this uses historical data and analytics to improve your ability to estimate any given project. This impacts the accuracy of your bids and optimizes your budgets, so you never end up taking a loss on a project again.|
|Mobile integration||Since many consulting companies travel extensively, the ability to integrate this software with your mobile device is often essential.|
We're able to offer this service to buyers for free, because software vendors pay us on a "pay-per-lead" basis. Buyers get great advice. Sellers get great referrals.