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Tracking and Invoicing Billable Hours Without Wasting Time

September 12, 2006
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Related Topics: HR Services and Administration, Human Resources Management Systems (HRMS/HRIS), Featured Article
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No matter where staff is located—in the field, a home office or corporate headquarters—management, accounts receivable and customers all want an accurate report of time and money spent. But turning in time sheets typically isn’t a priority with lawyers, consultants, accountants and others in professional services. So their employers are always seeking simpler ways to measure billable hours and expenses.

    Increasingly, independent sales organizations and even virtual businesses that employ technical experts who repair anything from heating and air conditioning systems to computer hardware want to be able to feed employee hours and expenses directly into an accounting system, says Jeffrey Rosengarden, CEO of business software developer HighTower Inc. in Skokie, Illinois.

    "What they are looking for is an easy means of tracking billable hours against multiple projects," says Clive Longbottom, service director of business process analysis at technology research firm Quocirca Ltd.

    For years, professional services workers have racked their brains to remember a month or six weeks after putting in the time exactly how and on which account it was spent.

    "Time management has tended to be after the fact, rather than during," he says. And while employers might sometimes wish their staff could work 28 hours per day, no company operating in a corporate governance climate set by Enron and codified by Sarbanes-Oxley actually wants billings like that on their books.

    Timekeeping also has thus far neglected a growing worker segment—the "mobile professional." And there can be problems integrating remote computers, phones and PDAs and their disparate software packages with the technology backbone of the corporate back office, where budgets are reviewed, invoices and checks are cut and cost-benefit analyses are run. An automated and accurate accounting of billable hours can initiate quicker, error-free bills to clients, profiles for new business proposals and timely employee reimbursements. Several companies are working on technology for tracking employee time, and are trying to improve and expand their products for greater worker convenience.

    A new release of HighTower’s Timekeeper software can run on Macintosh computers, PCs, PDAs and Pocket PCs as well as over the Web. It’s a recognition of the mix of technologies that exist in businesses today.

    "An ad agency, PR agency, any agency is going to have Macs and PCs," Rosengarden says. "But no matter who’s inputting time and expenses, no matter where they are or what platform they’re on, they’re able to do their jobs and bill for their time."

    Employees see the same screen no matter the device they use, and back-office staff can view billable hours, along with relevant account information, pricing contracts and so on, in a single form. Timekeeper integrates billable hours with the popular Sage Software MAS 90 and MAS 200 ERP accounting systems so there is no risk of error from manual entry and no additional time required for the accounts receivable process.

    Timekeeper can generate customer invoices, employee paychecks and expense reimbursements automatically, according to the company. Alternatively, administrators can approve, edit and selectively post entries for invoicing. Secondary approvals by salespeople or customers themselves are optional means to making invoicing more accurate.

    Mid-Valley Engineering, an engineering consultancy in Modesto, California, adopted Timekeeper when it had only 20 or 30 employees—100 fewer than it has now.

    "Our primary driver was growth," says Todd Sparrow, vice president of finance and administration.

    Employees work on any given day on multiple projects—residential and commercial work as well as jobs for government agencies. Timekeeper made accounting for their hours much more efficient than the cardboard timecards the firm formerly used. Information input to Timekeeper syncs with billing features in Mid-Valley’s Sage MAS 90 system to initiate client invoices.

    For other companies, timekeeping software replaces Excel spreadsheets. These homemade time sheets are prone to error, and the detail included typically needs to be manually entered into an enterprise system.

    "That was painful for management," says Lakshmi Raj, co-founder and co-CEO of Calgary, Alberta-based Replicon, describing the problems cited by clients of her company. "They couldn’t bill their clients on time. That caused problems with cash flow." That kind of operational headache takes focus away from firm growth, she says.

    Replicon’s Web TimeSheet is a pure Web program. Data moves to most enterprise resource planning, project management or accounting programs. The emerging future for the product is its application to internal projects, Raj says.

    Hewlett-Packard’s in-house IT team, for example, uses it to manage the work it does for other HP departments. "It has the same problems as a service company," she says, namely, identifying active projects and monitoring them for timely delivery and controlling costs.

    But with the introduction of any timekeeping application, managers are able to show employees how their time should be used to maximize firm income.

    "Time utilization increases 50 percent to 100 percent," Raj says. "Managers can show employees what’s billable and what’s not to prompt them to make better choices with their time."

    "Productivity of U.S. companies has increased by more than 40 percent in the past year," she says. "Companies are focused on productivity, and employees want more visibility into what they should be doing to help the company grow."

    Qqest Software Systems of Sandy, Utah, offers TimeForce, which, like Timekeeper, is adaptable for companies with a handful of employees up to those with hundreds. Qqest’s latest offering is a device that uses cellular technology for connectivity to the central database, capturing data for a mobile workforce.

    "Every environment is different. When we approach a potential client, we try to identify the best combination of collection devices [and features] for their needs," says company director Daniel Higbee. Qqest’s flexibility extends to integration capability with more than 180 payroll and human resources systems.

    "The future will be around flexibility," Quocirca’s Longbottom says. "The days of a consultant just charging by the day or hour for just being available are rapidly going. Customers want full time sheets with provable, auditable records of what was done when."

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