Comprehensive Guide to Small Business Time Tracking Tools
There are literally thousands of options for tracking your employees’ time, but finding the time to sort through all those options is almost impossible. Many business owners feel overwhelmed and are hard pressed for time, with many obligations competing for their attention. We have some suggestions to help you navigate through the different options and find the proper time tracking tool.
- Pros – little to no cost, and easy to use
- Cons – no security, lacks reporting, and additional labor required
Requiring employees to fill out paper timesheets is the most affordable way of keeping employee time with no upfront costs besides the paper and ink. Employees can easily fill out the times as they come and go with no assistance or training required. It is the hidden costs that make this option unattractive. Owners or managers are required to manually add up employees’ time at the end of every pay period, using up hours of their valuable time. Paper timesheets are easily manipulated by employees and there is nothing, save the employee’s own integrity, to prevent this from happening. Even honest mistakes quickly add up, resulting in increased labor cost. This method is best utilized in a smaller business environment with only a few employees, who can be monitored by management to watch for time manipulation, but it is still not the ideal solution for any business.
- Pros – quickly clock in/out, no recurring cost, and little to no employee training required
- Cons – high upfront cost, no reporting, and employee oversight required
Hanging a mechanical punch on the wall was the preferred solution 50 years ago. It allows employees to quickly clock in or out by stamping a time card in a machine. It is simple to use and requires only the recurring costs of paper punch cards and ink. However, the upfront costs can be very high. A single unit can run between $500 and $1000. Management or the HR staff is still required to perform the arduous task of adding up employees’ time, which would be better spent elsewhere. Security is still an issue, since employees can participate in “buddy punching”. Short of watching each employee clock in and out, mechanical punch clocks provide no way to prevent this. While this method of employee time tracking was popular for many years, there are more secure and efficient options which will certainly save you money.
Online Time Keeping Applications
- Pros – Real time reporting, ability to track accrued time, and automated payroll processing
- Cons – Monthly recurring fees are required, security may still be an issue
Welcome to the 21st century. Online time keeping provides reports in real time allowing you to view employee hours instantly without any hand calculations. It also allows you to keep track of accrued time such as vacation, sick, or PTO time, which is impractical if you use pencil and paper or a punchclock. Your payroll processing will be automated, saving precious hours that used to be spent adding up employee hours. Certain applications may also provide you with the ability to track late and early arrivals or overtime, helping you to more easily manage your workforce and keep payroll costs down. These types of solutions typically have a low upfront cost, but the long term costs maybe excessive. Since you are paying for a service and not a product, there will always be a required monthly or yearly fee. Most companies charge anywhere from $5 to $20 per employee. Employees can clock in and out from anywhere that has internet access. This flexibility can be a major benefit, but also presents security issues since employees can easily clock in from locations or devices that are prohibited. Most applications have come up with ways to prevent this with varying degrees of success. The businesses that find this type of solution most appealing have employees who work on the road or from remote offices.
- Pros – One time upfront cost, capabilities equivalent to online application, and added security
- Cons – Updates may be required periodically
The most popular type of tool is on-premise timeclock software. Since you are buying a product and storing the data on hardware you already own, there should be no recurring costs, only a one-time purchase price. There may be annual fees associated with support or upgrades, but those are usually optional add-ons. All the capabilities that are found in an online application would also be available in an on-premise solution. However, different software programs may offer different or limited feature modules. Ensuring that employees are being honest in their time management is much simpler because the program is housed in an environment that you control. For even more security and control, biometric devices are an additional option, which are generally not available with online applications. The one down side to an on-premise solution is that if an upgrade is required, you generally have to install that yourself and update each computer that is running the program.
Tips for Selecting a PunchClock, Online Application or Timeclock Software
Regardless of which type of solution you decide is best, the procedure for choosing which company to use is the same across the board. Here are some best practices when making your selection.
- Look at their reviews – Check out customer and independent review sites. Chances are if other people like it, you will too.
- Use a free trial – This will be difficult to do with a punchclock, but if you are looking at an online or on premise software solution, then you should be able to find a free trial of the software. Be wary of any site that requires a credit card to use a “free” trial.
- Know the real cost – Be sure you have identified all the costs associated with product, including any recurring monthly or annual fees, maintenance costs and additional add-ons.
- Find out who you are doing business with – It is always a good idea to know a little bit about the company, how long they have been in business, what types of industries they service, and where they are located.
- Talk to their customer service reps- these are the guys you will be dealing with when payroll is due in an hour and the product is not working. Make sure they are available quickly and during the hours you will need them.
Deciding which type of product is best suited for your business and then choosing which application is right for you can be arduous process. Using the information provided here will ensure that you get it right the first time.
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