In today's business landscape, every minute counts. Organizations are striving to optimize productivity, streamline operations, eliminate waste, and foster a healthy work-life balance for their employees. Because labor is typically your most expensive resource, employee time is invaluable and incredibly influential on almost all other KPIs.
Unfortunately, many organizations are still using manual punchcards or Excel spreadsheets to track time - often because of misconceptions about the cost and ROI of a timekeeping system. The truth is, implementing time-tracking software offers a positive return on investment. Let's explore that further.
The Benefits of an Employee Time & Attendance Program
When calculating the ROI of transitioning to a time-tracking solution, it's important to consider both tangible and intangible benefits.
Some tangible and most obvious benefits include accurate time reporting/fewer payroll errors, and better control over income and expenses, while some of the intangible benefits that still bring monetary value include enhanced insights, improved employee engagement and satisfaction, and compliance with complex labor laws.
Accurate Time Reporting
Accurate time reporting is critical for several reasons:
- it drives accurate payroll and, subsequently, employee satisfaction and retention
- it ensures payroll expense is an accurate reflection of hours worked
- it reduces the likelihood of payroll errors, which can be costly and drive dissatisfaction among employees
- it reduces the burden of payroll administration
- it lowers the organizational risk of non-compliance with rules and regulations
Because labor is most often an organization's most significant expense year after year, time reporting is the first place to look if you need to tighten up expenses or improve expense capture on the billing side.
Better Control
Accurate time reporting keeps the employer in control of their income and expenses. The more accurate the data, the more data-driven decisions you can make as you budget, forecast, and price your goods or services.
To expand on that, when you have access to historical data, you can better understand how many hours it takes at each level to perform a specific task and therefore price your products and budget accordingly. For example, a coffee shop can use timekeeping data to quickly determine the cost of labor associated with a single drink or sandwich and then make adjustments to ensure the ROI supports its goals.
Data-Driven Insights
An effective time-tracking system delivers data in a meaningful way, so you can use it to make informed business decisions. For example, when you automate timekeeping, a single report can summarize late punches for all staff in a single time period, so you can reinforce expectations and apply policy consistently.
Additionally, you can run an absenteeism report to determine whether trends exist around absenteeism and then take steps to reduce risk, plan for shortages, support staff, and drive compliance.
Productivity reports can help you better understand productivity. Who is most productive? When are employees most productive? Are those factors you can control to drive productivity? Time-tracking software can help answer those questions.
Streamlined Time Off Management
Manual management of time off is administratively burdensome and error-prone. Time-tracking systems automate the accrual of time off, time off requests, and approval tracking, making it easy to track and report.
Employee Satisfaction
Employee satisfaction inevitably results from implementing a timekeeping system, and the reasons are multifold:
- the likelihood of payroll errors decreases, so employees are less likely to have complaints about their check
- the likelihood of delays in payroll decreases, so employees are more likely to be paid on time
- the employee burden is lifted as clocking in and out is simplified, so employees can focus on what they do best
- there is transparency around both payroll and time off in the employee self-service portal, so trust between employee and employer increases
While employee satisfaction is often classified as an intangible benefit, the return is tangible. Satisfied, engaged employees stay with their companies longer, produce more, and deliver high-quality work, all of which contribute directly to your bottom line.
Compliance with Complex Labor Laws
Organizations face serious fines and penalties for non-compliance with labor laws, like overtime rules and meal and rest period rules. These complex regulations vary from state to state and require careful tracking of hours across the workweek along with clear documentation and records retention.
Time-tracking systems are designed to stay abreast of these rules and provide the automation and reporting you need to stay compliant, avoiding steep fines and penalties.
Choosing a Time-Tracking System
Time-tracking systems come in various shapes and sizes to meet the needs of every industry and organization. Before choosing a program, it's important to consider what your organization hopes to accomplish and which solutions can help you. Some of the characteristics of a well-rounded system include:
- a myriad of options for the employer to choose from: an online portal, biometric clocks, timecards, or a smartphone app to meet employee and employer needs
- the ability to accommodate and automate time off requests
- integration with other systems to directly feed payroll, project management, client billing, and more, depending on the needs of your organization
- availability of meaningful data derived from time and attendance insights, including productivity, absenteeism rates, and more
Are you interested in experiencing a free demo of Payday's Time and Attendance program? Feel free to get in touch with us at your convenience for a no-commitment demonstration.