In this episode of Workflow, Brian and Tom talk about the different ways time is tracked, when time tracking sucks, and when it doesn’t.
00:42 What’s happening at Rindle
05:10 How is time tracking used today
08:02 Why time tracking can suck
17:13 When tracking time does make sense
19:13 The arguments for time tracking
32:59 Tips for taking action!
- The Win Without Pitching Manifesto by Blair Enns
- Why timesheets are the enemy of creativity by Adam Morgan
Brian 00:00 This is Workflow, episode two. Workflow is the podcast that helps teams figure out the best way to work, collaborate, and get stuff done. Brought to you by Rindle.
Brian 00:28 Hey, everyone. I’m Brian.
Tom 00:29 And I’m Tom.
Brian 00:30 And we’re the co-founders of Rindle, and also your hosts for Workflow. Today we’re talking about time tracking. All right, Tom. So before we start talking about time tracking, let’s give a little update. What’s going on on Rindle?
Tom 00:42 Sure. So, we are in the process of testing what we call V3, which is basically a big structural change to Rindle behind the scenes, and it’s also adding some new features. One of the biggest new feature it’s adding is something called mirrors, which maybe you can explain a little more what mirrors are.
Brian 01:03 Basically, I think we originally called them reference tasks and it kind of evolved mirrors, but basically you can have a task live in two different places at one time, and it’s really literally the same task. So you don’t have to do any double data entry or updating in two different places if you need a task to live in two different places. So a couple … And I think Tom, you used the description of kind of it being a shortcut, similar to putting a shortcut on your desktop.
Tom 01:30 Exactly. That’s exactly, basically what it is. And basically everything is shared, so comments and assignments and subtasks are all shared across the reference, because it’s literally pointing to the same exact … or, mirror, I should say, because it’s literally pointing to the same exact task. It’s pretty awesome. We’ve been fooling around with it. It’s, so far, it’s feeling pretty interesting to use.
Brian 01:52 Yeah, I’m excited. I think we’re still flushing out kind of use cases, but I think a simple use case that I’m excited to kind of implement on our side, that I think probably relates to most people, but every week we have a marketing meeting and our head of marketing kind of takes notes and documents that in a task and said, “Okay, we had a call on this day. Here’s kind of what we talked about generally,” and then documents tasks. So we allocate tasks or talk about things that the team has to do. Those are recorded as sub tasks on a task.
Brian 02:24 And what we struggle with, which is great because it’s grouped for the meeting, so we can always see, okay, well these are the tasks that were discussed during that meeting, but we struggle to kind of move those through a workflow. So we could detach them from the task, right? But then they’re detached from the meeting reference and in that context, so mirrors, if we … would basically allow us to move those sub tasks through a workflow while still letting them sit in that main task from the meeting notes.
Brian 02:50 And that’s really one use case I think that everybody can kind of relate to, and then as we mark complete sub tasks, as we mark them complete, as we finish them, they’ll, because they’re mirrors, will automatically update on that sub task underneath the main meeting notes. So in real time, anybody who looks at that main task for the meeting, will see what’s completed over the things that have moved through the workflow.
Tom 03:14 Yup.
Brian 03:15 So that’s one use case, and we have other use cases for our kind of product management workflow and other things, but we’re excited to kind of play around with it and also get some of our customers on it and see how they use it.
Tom 03:27 Definitely, yeah. It’ll hopefully add a little more clarity and higher level view if it works out properly, so, pretty excited.
Brian 03:37 Cool. So let’s move into the main topic of the day, time tracking, and I think this has been something that we talk about a lot. We both have history with time tracking in our previous jobs and career path, and it comes up today with customer interviews that we have and things like that. So it’s a topic dear to our heart. So, what is your kind of general experience with time tracking in your career?
Tom 04:06 It’s a love hate relationship, right? As someone who has to enter time, I hate it, as someone who was in management for a period of time, like it’s obviously kind of necessary to some extent. But, overall I think I dislike it more than I like it.
Brian 04:29 Yeah. I think I am the same opinion. You know, you and I worked at an agency together in a previous life where we tracked time, and I know that you worked after that at a startup who actually tracked time as a non agency environment, but I think from that experience, I was definitely scarred for life after having to track time for five years, and basically fought a battle there as well to see are there other ways to do this, can we not track time? So, I think our general opinion is that time tracking sucks, though I think there are definitely some use cases that we can kind of go over where time tracking makes a lot of sense.
Tom 05:08 Sure.
Brian 05:10 Cool. So let’s start out by just talking about like, how is time tracking used today, just so we kind of outline the picture, right? So creative agency industry, like that’s where we come from primarily, and that’s obviously a trend that’s happened. A lot of agencies track time, billable hours, man hours, things like that. But you know, you basically track how much time a project takes, bill your client for it, et cetera. That’s pretty common use case.
Tom 05:35 Yep. It is interesting though that, most times in that industry, projects are usually quoted not by the hour. So they’re quoted just by like a project as a whole.
Brian 05:46 Yeah.
Tom 05:46 So it does kind of make it interesting as to why hours are necessarily tracked so carefully, because it’s not like you just …Like in legal or accounting, you’re actually billing for the hours that you work, and in a creative agency, typically you’re billing for the project.
Brian 06:05 So another use case how time’s tracked today is freelancers. We work with a couple of freelancers that do this as well, and so if you’re … Let’s say you’re freelancing and you’re saying, “Hey, I’ll work 20 hours a month for you and kind of apply my time towards whatever you want me to work on.” Obviously as a freelancer you’ll want to possibly track your time to make sure that, hey, well I’m not … You know, make sure I’m not doing 30 hours instead of 20 like I promised, because that affects the bottom line. It may not be necessarily to submit a time sheet in, but it is internally, as a freelancer, to track kind of your promise to the customer, and also that you don’t go over.
Brian 06:44 So I know we work with some freelancers, too, that we have that exact relationship basically, and we don’t necessarily ask for a time sheet, but we do have an understanding that, hey, you’re going to work 20 hours a month for us.
Tom: 06:5 Absolutely. Yeah. And I think that we are kind of unique that we’re not looking for a time sheet in that scenario, but I think a lot of people actually are interested in seeing a pretty granular breakdown when it comes to freelancers. So I mean, as much as we don’t like it from our agency background, but I think maybe in a freelancer scenario, no matter what the conclusion is, I think it kind of is a necessary evil, right? For everyone’s sanity. For the freelancer to make sure they’re getting paid properly, and for the company who that freelancer’s working for.
Brian 07:28 So another use case you even just touched on it earlier are firms, like legal firms, accounting firms. So they’re inherently, or historically, track time and bill by the hour for things, and I think that’s what’s driven a lot of what’s happening in other industries, from those industries. And in addition to that, just man hour services. So things like lawn mowing and cleaning houses and other services like that. If you’re kind of tracking or billing by your man hours and how long it takes you to do something, that’s typical in that kind of service business.
Brian 08:02 So that’s kind of a quick overview of just kind of how time tracking views, and I think we could talk about why we think time tracking sucks so much, and I think the biggest thing for me has always been just that it’s inaccurate. For me, just the … If you’re relying on humans to enter time and track time, for various reasons, it’s inaccurate, and most of the time it’s that people don’t like tracking time, for one. But secondly, a lot of times they don’t do it diligently. They were like, “Oh, I’ll do it at the end of the week,” or whatever it might be, and they don’t remember, so there’s no way that they could actually track it accurately. So I don’t know if you have any experience in that area.
Tom 08:45 Yeah, I agree that it’s not accurate. I also think it a kind of detours from the creative process, if you will, right? So if you’re in the middle of doing something and you’re not thinking about tracking time necessarily, you’re thinking about whatever, whatever you’re working on it. So like, it’s hard to train yourself to be like, “Oh, let me stop what I’m doing, go and make sure I’m tracking the hours properly for this, then jump back to what I’m doing,” and then you’re only doing that thing for maybe like a half an hour and then you switch to something else. It seems like absolutely an inaccuracy because then you … That’s what you should do, but ultimately that’s not what you probably do, and you’re never going to be able to go back and be like, “Okay, yeah, I spent 45 minutes on this project, and an hour on this project, and a half an hour in between on these two things because I got an email and …” It’s just, it definitely is inaccurate.
Brian 09:41 Yeah. That’s a good use case because I mean, people inherently just don’t work like that. Right? They don’t work, start, stop, start, stop, especially if you’re doing anything creative or anything that requires a lot of thought or some time to put effort in. Like you just don’t think to be like, “Oh, let me stop, track my time now, and pick back up again.” It’s very hard to kind of get into that mindset, even as a creative person or maybe even as a coder, as a developer. You’re in the groove. You don’t want to stop and be like, “Okay, let me stop and track my time to this project and then moving onto something else.”
Tom 10:09 Or especially if you … like, in the world that we live in, right? Like especially in the agency world where everything is kind of rushed, and you get interrupted with something, and you have to switch kind of rapidly because you are on multiple projects at the same time. And if something comes in from a client or a project manager, you typically stop and look at that. Right? So it is very … It’s difficult.
Brian 10:31 Yeah. I think, too, like just to add to the inaccuracy, is potentially deliberate misuse. So because, and we experienced this even at the agency work we worked at together, but you know, people would be four weeks behind on time tracking.
Tom 10:47 If not more, yeah.
Brian 10:48 If not more, which should never really happen, but if it is happening in your environment, you probably feel this pain. But there’s just no way that that person can track those correctly, so they’re just kind of padding hours in places, just putting blocks of time in places just trying to get your time in, and by no means is that accurate. It’s not helping the budget or whatever you’re trying to track with that time for that project. So, you know, if you’re letting that … I think every time, every week at our agency, there was an email that went out of people who didn’t submit their time yet. Every week.
Tom 11:21 Yup.
Brian 11:21 I don’t think there was ever a single week where everybody submitted their time.
Tom 11:23 And you never really wanted to be on that email. But the same people typically where every single week, and that actually kind of leads right into the next major thing, which is it definitely affects the culture when you actually are sending out emails like that to … like company wide, like, “Oh, you forgot your time.”
But also, the same people are on it every week and it kind of … It’s just like, well, clearly this doesn’t matter too much if management isn’t going to these people and being like, “You need to take care of this.” Right? Like, yeah.
Brian 11:58 Well, I think inherently, if you’re talking more about time tracking than you are about project work, that’s a problem. And I think I experienced that personally, not only with the Friday emails and everybody’s going, “Oh, who’s on the list? Who’s not on the list?” You know? Tracking down the people who are too lazy to track time and talking about that and gossiping. But even down to the project work, where I would potentially pull somebody into a meeting, a brainstorming meeting because I thought they could add some value, and my boss is telling me, “Hey, do you know how much that person costs an hour? Do you have the budget for that?” So immediately we’re talking about now hours instead of the deliverable, or providing a great result for the client.
Tom 12:41 Well, yeah. And so it hurts the client. It’s also micromanagement, if you will, right? Like people are watching what you’re doing or how long you spend at the water cooler. It’s Kind of off-putting.
Brian 12:56Yeah. I think that gets to the point of the Big Brother. Right?
Tom 12:56 Yeah.
Brian 13:00 So if you’re asking people to track time, you know, why is that? And I think some of the reasons are well, you know, we’re trying to track time to figure out if projects are profitable. So at the end of the project we can look back and say, “Yep, we spent exactly the amount of time we thought and we’re profitable, or not.” The other thing, very common thing, is are people being productive, right? Are they actually putting in time every day? Are they working? Are they slacking off? You know, if they don’t track their time, they’re not doing anything. So it really becomes this big brother thing, and I think it’s even a bigger problem because even in our agency, like we had people who had to track time, and then there’s some people who didn’t have to track time.
Tom 13:00 Mm-hmm (affirmative), yeah.
Brian 13:43 So it creates this divide, you know, where you’re like, “Oh the peons are tracking their time and every little hour needs to be tracked,” and the management and above or whatever, you know, don’t have track time ’cause they’re better than us. I think that whole big brother feel just affects a culture more than you know, and you think, you know, “Oh, we’re gonna track time, we’re gonna understand so many things.”
Brian 14:03 But in the end you’re affecting the culture so much, you know, the customer’s a secondary thought, you’re talking about time most of the time, and you’re basically, you know, looking over everybody’s shoulder all day long, trying to track every little thing they’re doing. It’s just such a negative culture, and in our case, in an agency world, that was terrible because we were supposed to be creative. So how can you be creative if most of the time you’re talking about these things?
Tom 14:26 But it is a false sense of control because it’s not actually the managers directly above those people that are worried about those hours, it’s the managers above the managers. It’s like the higher level people at the company that are attempting to like, use this time as a mechanism to determine how like, how utilized the employees were. And all you had to do was kind of talk to the managers to know like, “Oh this person is working a ton versus this person’s not working a lot.” Right? Like, you know, you can’t really just go off the hours to determine that, it’s really, that’s why you have a layer of management in place, right? Like, in order to figure it out.
Brian 15:13 Yeah. You know, and if you’re managing your team correctly, you will understand if people are being productive or not. If people aren’t doing their jobs, you should know it. If you’re not, then management needs to be, the management kind of approach needs to be improved. But the time sheets is just a flat number, it’s not gonna tell you how productive somebody is, it’s not gonna tell you how creative or how good of a job they’re doing. It’s not gonna tell you how they’re affecting to bottom line for client projects, or whatever it is they’re doing. It’s just not gonna tell you that. It’s gonna literally just tell you that they put time in somewhere.
Tom 15:47 Yeah, and when it comes to even things like development, like you can’t even compare, like time entries for two different people because there’s so many variables that could affect like why the same item might have taken like two hours on one project and four hours on another project. There’s just so much going on there.
Brian 16:04 Yeah, it does affect all these things that we’re talking about, like it’s inaccurate, it’s affects the culture, it gives you a false sense of control, yet we do it just because you know, it is kind of an easy way for us to wrap our heads around. Like, well how can we measure this, right? And time is just kind of a go to, right? Like, “Oh obviously we’ll just track hours.”
Brian 16:24 But you really have to consider if that’s the case, you know, does it make sense? Does it fit well into my business? And is it affecting my business in other places where it’s not worth it, right? Or, and ask yourself the question basically, “Are there other ways to do this? Is the hour the only measuring tool that we have available to us? Or can we measure our project in different ways?” Beyond those three things that we just mentioned that, you know, the fact that it takes time to track time has always been upsetting to me. I literally had to track my time every Friday, and I would put a time entry in for 15 minutes to track my time, or every day I would put in 15 minutes.
Brian 17:01 So the fact that I’m actually tracking time against tracking time is just, you gotta take a look and say, “Is this really helping?”
Tom 17:09 So when does it make sense though? When does it make sense to track time?
Brian 17:13 So yeah, some use cases for time tracking that do make sense. You know, when you’re delivering time as a product and not things, I think it makes sense. So like, even some of the examples we gave earlier, as far as, you know, the different types of time tracking that happen. You have creative agencies, freelancers, firms, et cetera. So lawyers are great example of selling time, or any kind of, really any kind of consultant to me. So if you’re hopping on a call and somebody’s paying you for your time, and you’re gonna be on that call for an hour and you’re gonna bill out for that hour, you’re literally selling time.
Tom 17:50 Well, like any, I think maybe any like service that you’re providing. Like you’re providing the service to them, like copywriters are probably another good example, right? Because they’re doing a specific thing, like not maybe copy writers as much as copy editors. Like if you’re just editing copy, like if you’re doing edits for a fixed period of time and you’re charging someone for that, right? Like I think it might make sense in that scenario versus creative, which doesn’t necessarily make sense, right?
Brian 18:20 Well, I think it too, to that point, you know with the copy editing and things like that, a freelancer, like that use case we talked about earlier. You know, somebody who is charging you for your time to do something and that could include copy editing, it could include, you know, tweaking some Facebook ads, whatever it might be, but they’re really selling their time at that point. They’re not selling a thing or a project, and I think that’s, you were just transitioning into you know, what agencies like we used to work at, they sell yes, everybody’s using time, but they’re ultimately selling a thing. They’re selling a project, an application, a video, right? Whatever they’re building, it’s a tangible thing that has a start and an end that they’re delivering.
Brian 19:01 So I think that’s where it starts to break apart a little bit because it really makes sense for when you’re literally selling time compared to when you’re selling a project. It’s just a different animal.
Tom 19:13 Cool, yeah. So how do you figure out like, so I’m an agency and I’m selling a thing, right? So I’m selling a logo design. How do I figure out how much to charge for that logo if I don’t kind of use time as some sort of gage?
Brian 19:28 When I give my opinion to people about, “Hey, you know, should I track time or not?” Or, “We track time.” I usually lead in with, “Well, I don’t like tracking time for these reasons,” right? A lot of reasons we already discussed today, and the argument is always, “Well, how do I know how much my projects cost?” Right? You know, one thing to kind of know where your costs lie, are using benchmarks. So using time tracking to create benchmarks isn’t a bad idea, right?
Brian 19:51 So if you’re doing your first landing page you ever did or your first logo design you ever did, track the time against it. But you’re not making it a practice where you’re tracking time against every logo, you know, for five years. And that’s when you get into the problems that we talked about before where it starts to affect your culture and you think you have accurate reports and you really don’t, all these things. So if you use it as a benchmark, then you at least can do an analysis and say, “Okay, you know, this logo,” or do three logo projects and track time, right? So the average time was X and the average cost was $3,000 for a logo, right? Whatever it might be.
Brian 20:27 And you can use that as a baseline then or a benchmark to then create your pricing strategy for a logo design. That is something you can revisit, too, every year, right? So if times change, if resources change, things like that, you know, do a couple more benchmarks at the beginning of the next year. See if they’re still intact, has it gone up, has it gone down, the reasons why, and adjust accordingly.
Brian 20:47 And then, the other question I get a lot is, “Well, you know, how do I make the project profitable?” You know, or, “How do I understand if the project is profitable if I’m not tracking time?” And I think this definitely gets into a bigger discussion about just how you price your projects in general and how you think about pricing. And one thing that I personally use was something called value based pricing. Instead of thinking hourly for everything and how many hours does it take to do something, and then I will mark it up by this much percentage and I will sell it to my customer. Start thinking more about the value that we’re bringing to the table and charge accordingly. And that main concept basically came from The Win Without Pitching Manifesto book by Blair Enns, and I implemented that concept in the agency I worked at after the agency we worked together in New Jersey. So this was in New York and you know, it basically immediately you know, we didn’t track time, you know, to begin with. And we used this value based pricing strategy and the whole attitude of the agency was completely different. I mean, everybody was way more upbeat, way more positive, nobody talked about time and this and that, and we collaborated around project and you know, customer problems as a team. And there was no discussion, “Well, don’t pull this person in, they’re too expensive.” Or, “That’s gonna drive your cost up,” and all those things.
Brian 22:17 And I think the key to value based pricing is that you know, hopefully you’re building in enough value there and your price is high enough that it will cover possible issues or things that you might consider going over budget when you price it by the hour and then you have to deal with change orders and stuff like that. If you value price, you may not even need to do a change order because you have enough value built in where it’s like, “Hey, you know what? We see this issue, it’s a little bit of a change, but we’re just gonna over deliver and make the customer happy and not make it about these petty little changes and stuff.” Right?
Brian 22:52 So, but I think in the end, I think that approach, if you think of your team as value based people, so when you think of a problem it’s not just, “Well, I’m gonna code a page for you and deliver that page to you.” That is very hourly based, but what about all the strategy and things when a customer comes to you and says, “Well, we don’t know. Should we do a landing page? What kind of marketing approach should we take? How should we present this?” That’s all strategy. So in that is not an hourly thing, it’s a value thing. Like, do we bring enough expertise to the table where we can charge enough money for this project and not worry so much about how many hours it’s gonna take?
Tom 23:27 So it sounds like that fixed the culture problem, but does it improve the final deliverable?
Brian 23:37 I believe it did because I never felt stretched or I never felt that I didn’t have the right people in the room. Where previously I always did, and you know, always about, “Oh, you know, if you bring these people on they’re gonna start putting hours on the project,” and all these things. So I always felt like, you know, we were more efficient because we collaborated more efficiently. We pulled the right people in a room, we got to the bottom line and got to a solution a lot quicker, as opposed to kind of beating around a bush and then maybe doing something that wasn’t so great then having to go back and change it.
Brian 24:13 Of course there’s situations of course where if you pull in everybody you know, and their brother into a project and you run it for four weeks, obviously you’re using tons of resources, right? So there’s obviously judgment involved here, but for the most part I think that really gets into, “Well, what’s the answer to? Well, you’re so against tracking time, then what is the answer?” I think value based pricing does have a lot to do with it, and you know, if you start to think of your agency as, or your company or whatever, as an hourly deliverable, it really becomes more of a commodity, right? And you are positioning your company based on price, right? So you’re basically saying, “Oh what did the other agency quote you for? Oh, we can beat that.” So automatically becomes a price positioning strategy, right? And you’re always gonna be up against it, and this is even another example of this is, too. You know, we, and I know Tom, you remember this probably too, but we used to you know, underbid the first project, right, with the customer. Because you’re a big client, right? And we’re gonna win their business, and then in the long run, we’re gonna make that money back, right?
Tom 25:25 Yeah.
Brian 25:25 But the problem is, you’ve already set the tone with what kind of agency you are, what kind of company you are, with the first proposal. You already said, “We are a thrifty solution. We are not the higher end, more costly solution that’s gonna deliver an awesome result for you. We’re gonna be the cheap agency.” And then when you try to go raise that price later, they’re like, “Wait a minute. I thought we signed on with the cheap agency.”
Brian 25:52 So to me it’s a whole mindset, which is why sometimes it’s hard to change. If you’re already setting that tone and positioning your company that way, it’s really hard to change sometimes. But it’s really a mindset and it’s really hard to change sometimes, but it’s really a mindset and approach of the whole company, it’s like “Hey we have experts here. We’re really good at what we do, and we’re going to position ourselves that way and we’re going to charge for it and we’re going to be profitable. We’re going to put time in. If a customer doesn’t want to work with us because we’re charging too much then they’re not a fit. If you’re not losing that customer then people are saying “Wow you’re too expensive, then you’re not charging enough probably.”
Tom 26:24 Yeah, definitely. I mean it’s said time and time again, especially in, uh, in software development, or SASS software, that most people, 99% of people are not charging enough for their products right? They could definitely be charging more if they’re providing enough value, they could be charging more. But no one wants to, I think it’s this feeling that you’re not good enough, you’re never quite good enough, especially if you’re really close to the product. It’s hard to be like, “Oh man I wanna charge more, more and more.”
Brian 26:59 You know, I’d rather have a handful of clients that are paying me great profit margin, I’m making money on projects, and all my attention can go to that group of customers right? I’m not spread all over the place dealing with all the smaller customers who really aren’t a fit, but we’ll try to make them a fit ’cause we never wanna say no to money. I would relate that to even how we handle Rindle, our business, right? We are not a freemium product. We chose to go that direction, we are pay for only product.
Brian 27:28 I think that goes hand in hand with how we service our customers as well. Every customer we help and support, they’re a paying customer. We are not taking any of your attention as far as feature requests, or training or help or support or any of those things to a free customer base. We’re not contributing and paying for the product. I look at it that way, as far as an agency or any kind of service business. It’s like, you gotta pick your ideal client. If your not making money on those clients, it’s not very smart to continue doing business with those kinds of clients.
Tom 27:58 Well and that does go back to also the agency how agencies might try to … They aren’t trying to constantly like get business or whatever, but maybe they shouldn’t be taking jobs that they’re not a perfect fit for. If you are doing website development and you mainly use Word Press, you shouldn’t take a Drupal job right? Just because it’s a paying job. You gotta draw the line somewhere, and stick to that. Because if you don’t, then you can’t charge properly, and you will go like way over budget, if you will, no matter how you’re pressing the project, ’cause you’re not, you don’t have a focus, like you were saying before. You need to have a focus.
Brian 28:44 Yeah, I think if you can get down to what you’re saying, like really have a strategy as far as what you’re offering, like obviously the more you’ll understand about your product offering and your service, right? When you talk about pricing, how do I understand profitability and cost? Well if you’re just doing websites with Word Press, it’s a lot easier to understand that, then it is if I’m doing Drupal, custom CMS, all these other things.
Tom 29:07 Absolutely.
Brian 29:08 I think that makes a lot of sense, and I think that … if you wanna grow your business and strategically go after Drupal customers next, that’s fine. Do that, but do it in a controlled way, as a business growth way, not as a, “I’m just gonna take anything that comes in.” ‘Cause then you’re just gathering resources. You’re gonna have to hire Drupal experts right? You’re gonna have to train yourselves on how to sell Drupal. How is it different than Word Press? What are the benefits? All of this goes into play, and I think that’s what when you get into that scenario where you’re grabbing everything that comes your way, it really starts to fall apart quickly. That’s when you start running into problems, ’cause people are selling something they don’t understand, people are implementing something they don’t understand. Yeah, definitely I think that’s a really good point.
Tom 29:51 Yeah, and i think if you actually did that, then tracking time might not even ever come up, because if you’re only doing Word Press and you only know Word Press, it costs this amount because that’s how much roughly time it takes for us to do this. Why do you need to track the hours? It doesn’t matter, you know roughly how many hours it is within a margin of error. I think 37signals actually perfected that with their … I think they used to charge a flat fee for website development and pay by the week. It was one page per week. Something along the lines of that. That was the whole team on the webpage for that one week. Their deliverable was one page. That was that. If they spent less time or more time on it, it was what it was.
Brian 30:40 Yeah. I think that’s a perfect example of, is there another way that we can look at our cost and profitability? They broke it down by, “Hey we’re selling things by the week, and we understand the exact amount of people that’s gonna work on it for that week, we understand our costs, and we understand what we’re selling it for.” It’s really easy to break that down. It really took the complexity out of it. I used something called Team Strength in my … When we weren’t tracking time at that one agency I worked at. We looked at team strength. At the end of a project, or even estimating a project, I’d look at, “Who are the team members we think we’re gonna need to execute this project?
Brian 31:15 Then I’d just look at their value as far as cost, and be able to put together, “Okay if I have this team working on it for eight weeks based on the value of that team working each week, five days a week, here’s my general cost for the project. That’s a really quick way, without getting into tracking time and looking at a whole bunch of historical data that’s not accurate, just to understand quickly, generally this is what my cost is gonna be. When I go to estimate that project, if I have some experience in estimating, well this is generally how long this type of project comes in, we can get there pretty quickly without going through tons of data. I think, again, that’s something we used as a tool.
Brian 31:54 I would also look at that post project. I’d just look back at who worked on it, do a quick analysis, and understand generally if we’re profitable. But again, if you’re focused on value pricing, then that’s even less of an issue if you’re margins are high enough, you’re less concerned about that, which takes it away from, who cares about tracking time? We’re delivering amazing things for our client. One of the other things that people as me all the time too in this conversation is, well how do I know if people, if they’re ripping me off?
Brian 32:20 What if my employees rip me off if they’re not working. We talked a little bit about this earlier, and I think, I always say to them, it’s like, well, you need to be hiring good, talented people that essentially you will earn their trust and understand that, hey these guys are great, they’re talented, and I’m not worried so much if they rip me off. Again, if you have good management in place, then you don’t have to worry so much about if your managers should know that. If somebody isn’t, then they shouldn’t be working there anyway.
Tom 32:49 It’s probably a talk for another day, but hiring good people is very difficult to do, and it takes a long time. It’s hard to find good people.
Brian 32:59 Awesome, so let’s wrap this up and talk about just some tips for taking action. If you’re an agency, which our background, a lot of the examples we gave today are from the agency background. A lot of our customer based are agencies. Give the wind without pitching manifesto, give that a read. ‘Cause that’s something that definitely, when I was looking to change the way that we worked in that new agency I went to in New York City, I started with that book and it really gave me the motivation and understanding of how this could work. A lot of the things we talked about today are in there. They even get into how to pitch your agency, how to structure your whole agency, how to close deals with clients, and how to price everything.
Brian 33:41 Start there, if you’re an agency. If you track time in general, there’s an article by Adam Morgan from Adobe, that is, when I read it I was like, you go, that’s exactly what we think. That’s a really great place to start too, ’cause it really summarizes our opinion here that we laid out, plus some other really good points. It’s from somebody who works at a larger company like Adobe, the inside is very similar. This is not only happening in agencies or smaller companies or whatever the center might be, it’s happening at Adobe as well. It’s a great other reference, and we’ll put a link to that in the show notes.
Tom 34:22 Another thing you should do is, ask yourself a question, why do you track time today if you’re doing it? Based on those reasons that you come up with, are there other ways to accomplish the same things without tracking time? When you think about that stuff, think about the points that we brought up today about them being inaccurate about changing the culture and things like that. Is the payoff there? I would say from there, even make a pros and cons list, right? What are the pros of tracking time, and really analyze, are you seeing some of the issues that we talked about today in your own business?
Brian 34:57 Make that list of cons, ’cause you might be surprised as to how much it’s effecting your business, and if you can look at some different ways to track time, or different ways to get the results from tracking time. It might do your business a lot of good.
Then, if you don’t know where to start, do a test. I always say, try to start with a benchmark of a test project. Track time for a project, then the next project, don’t track the time and use the benchmark as a guide. See if that works, it’s only one project, it’s not gonna hurt anything. You can then start to understand, well hey, did it actually change anything? Did we still have an understanding of what’s going on? You can start there and kind of evaluate and progress, and get more aggressive from there.
Brian 35:37 I think also if you are in a manager position, maybe ask yourself, “How often have I actually gone back to look at the time that’s been tracked?” ‘Cause I think a lot of people would be surprised how little they actually use that, and it take a lot to put that in there, but if you never use it, what’s the point?
Tom 35:57 Well I think that about wraps us up for the day. If you have a question for us, you can call it into our voicemail number at 860-577-2293, or you can email it to us at, email@example.com. Our theme music is an excerpt from Thunder Rock by Magic Studio, used under creative comments. Subscribe to us on iTunes by searching for Work Flow, and visit rindle.com/workflow-podcast for a full transcript of each episode. Thanks for listening, and we’ll see you next time.