Are You Underbilling due to Messy Time Tracking?

Do these examples describe time-keeping in your agency?

  •     •Employees finish assignments and enter less time than they actually spent.
  •     •Employees just forget to enter their time.

These habits contribute to overbilling, or worse, underbilling. We’ve heard many reasons why employees fail to accurately track time.


“We Don’t Have Time to do Timesheets”

This is perhaps the most frequently heard explanation for under-reporting time. It’s also the most puzzling one. What is so difficult about capturing time with all the possible means to do so (computers, phones, and even pen and paper)?


There are employees who enter their time throughout the day or at the end of the day. This is the best way to ensure accurate time entry, but unfortunately, this is rarely practiced. Most do their timesheets at the end of the week by “re-creating” time from memory. Then there are those who do timesheets at the end of the month, or even further back. No one’s memory is good enough to accurately recall what they did a week ago or more. Plus, it takes much longer to do timesheets this way. One frustrated Project Manager estimated each employee wastes 30 to 60 minutes scrambling to build their timesheets just before the weekly submission deadline.


Agencies who “guesstimate” time are either doing their clients and/or themselves a disservice. The only way to track time accurately is to record it immediately, or at least on the same day.


The solution is to make it quick and easy to log time. If Time Entry is integrated with Tasks and Assignments, everything is done in the same place. The action of entering time and marking an assignment complete are done seamlessly.


 “The Client Will Question the Amount of Time it Took”

This comes down to fear. Fear that the client will be upset. Fear that the client will push back. This leads to entering one hour of time when it actually took two hours.


If you bill clients by the hour, there is no excuse to underbill. Clients have already agreed to pay for services by the hour. It is not asking too much of employees to submit accurate timesheets, especially when doing so affects your bottom line.


“We Don’t Track Time Because We Don’t Bill Hourly”

If you don’t track employee time, how do you know how profitable you really are? Time data allows you to run profitability and utilization reports. You can determine which clients take up most of your staff’s time and compare it to the amount of revenue from those clients. Without this information, you would never know if you are losing money on a client because the retainer is too low.


Are you estimating each project? Without a history of time it took to complete similar projects, how can you estimate accurately? It’s common to simply copy an estimate from a previous job because it’s quick and easy; but what if the previous estimate was too low? It happens all too frequently - bad estimates are copied multiple times, repeating the mistake again and again. This sets up underreporting time because the employee does not want to enter time that exceeds the estimate. You could be underbilling and not know it.


It’s Your Responsibility to Bill Accurately

The bottom line: clients expect to be billed accurately. It is common to be audited for time reports by government clients and those whom you bill by the hour, but it can happen with any client. In addition to the number of employee hours, an audit would typically request project reference, dates, and the function the hours were for. Not collecting this information leaves your agency vulnerable to not being able to produce the data to survive the audit.


Make it easy for employees to track time. The fewer clicks, the better.


Time tracking that integrates with your Project Management and Accounting systems makes it easier for employees to track time and provides quick access to the data you need.


The Advantage agency management system is an all-in-one solution purpose-built for agencies and creative teams of all sizes.


We’ve been exclusively focused on helping our clients maximize productivity, efficiency and profitability for over 40 years, with almost a thousand agencies counting on us to help run their business every day.


With Advantage you get a team of US-based agency veterans supporting you every step of the way.  All implementation and training is done by experienced Advantage staff, and all clients have unlimited access to our live customer support line from 8am-7:30pm Eastern every business day.

Find out how Advantage can help you by contacting us for a complimentary demo or discussion about your unique needs.

Back to Blog