Two Years of Tracking Time: It’s worth it!

Just about two years ago I began tracking my time every day while working. In fact, all of us at Tornado started tracking our time. During this two year period I’ve noticed a few key trends and wanted to share my findings.

I’m more motivated and work harder.

Having a timer running all day long that tracks both my billable and non-billable time has forced me to constantly evaluate my productivity. In a strange way it acts as a constant reminder to be productive at work. The key is to have the timer running all the time. That way you always have to change the timer from one task to another.

At the end of every day, I know exactly how much I’ve earned for our company.

Believe me, there is nothing more inspiring than to look at the time log for the day and see that I earned $700 (or whatever the amount is).

It’s a lot easier to bill customers.

Prior to tracking my time with software, I would jot down notes about what I was working on. Little did I know I was actually forgetting about half of what I had worked on. Plus, it was difficult to remember the exact day I had worked on a project.

We’ve developed some internal tools for helping us sort through all of our time entries and place them on invoices.

We also switched so that most of our projects are billed hourly.

The biggest difference we immediately noticed was a lack of stress surrounding client change requests. Suddenly, customers requesting changes became an opportunity to earn more money rather than give free time to a client (if it was within scope).

Two years ago 95% of our projects were on a fixed-bid cost basis. We would estimate a specific dollar amount for each project, and then work hard to try to keep the gig within that estimate.

What we’ve noticed now is that we write half as many proposals, and instead our customers (new and old) work with us on an hourly basis. If you’re in the design business and are looking for a change I can’t recommend it enough.


The biggest change though has been in our momentum. We literally accomplish twice as much as we used to get done. In the past, we would get bogged down with writing customer proposals, spending hours spec’ing out projects, and dealing with customer change requests. Change requests are now an opportunity rather than a cost.

If you’re not sure where to begin, I recommend giving time tracking a try. Make a goal to track all of your time for one week and at the end of the week evaluate your results.

By the way, as a result of tracking my time, I know that 47% of my time in 2007 was billable. Our goal with our upcoming product is to make it easy for everyone to track all of their time.

Measure everything important and track everything worth tracking

I’ve been thinking about the next generation web design studio quite a bit lately. What makes a team efficient? How can small teams maximize efficiency?

Bob Parsons who runs Go Daddy has written about tracking and measuring important business numbers. I read this and said “yeah, I need to do that.”

One thing I learned early in my business career is that anything of significance that is measured and watched, improves.

Back before I started Parsons Technology I became impressed with something I read about John D. Rockefeller. In fact, I still think about it and use it to this very day. I learned that Mr. Rockefeller was one of the few people in his industry (perhaps the only one) who knew exactly how much it cost to extract, refine and deliver a barrel of oil. In fact, he was entirely aware of all his costs. Knowing this information (and acting on it) gave him a huge competitive advantage. He knew how much he could price a barrel of oil for and still turn a profit. He was always keenly aware of each area of revenue, cost and market share, and he worked on improving in every area. As a result, he did cost saving things like manufacture his own oil barrels, have his own cartage company, and on and on.

The first sentence is the most important. Read it if you skipped over it.

This all brings me to my point. I think it’s very important to track the numbers that make your business a success. I’ve tried to do this over the years and have tracked a large number but never to the extent I want (for numerous reasons, not that I didn’t try).

As I said, I’ve been thinking about the next generation web firm and wondered what numbers you track in your business or where you work? The obvious things like revenue and billable hours are obvious, the less obvious are things like average employee utilization across a period of time, or average timespan to develop a site… How does this affect the bottom line? Does it give you a competitive advantage? I’ve got loads of ideas about things that can be tracked. Putting systems in place to actually track them (consistently) is the next step.

Safe Jobs

On Saturday morning I packed up my camera and went to a little open house a friend of mine was throwing. It was a great time and of course I got to take pictures with my flash. There were a bunch of new people there that I had never met, and one guy in particular caught my attention.

After asking the two key questions people ask (where do you live and how do you know so and so) someone asked what he did for a living. He said he worked for the city. Then he commented that it was the safest job in the world and said that he would probably have to murder someone in order to get fired.

Maybe it’s time that our cities adopt the GE management idea and regularily trim the bottom 10% from their workforce.

One of the first things I thought about was the idea that “safe” means different things to different people. To this guy, safe means a steady paycheck and benefits. And I suppose he won’t have to dust off his resume too often.

To me, a safe job means that I’m in control of how much money I can make. That doesn’t always mean I get to pick when I work, but ultimately I am in charge.

So this got me thinking. Is there a way to combine both of these worlds. I think that profit sharing plans are a start, however I like some of the things that Semco does in Brasil. They basically put people in charge of their salary along with the ability to hire and fire their managers. Since their co workers can also vote to remove someone, there’s a lot of incentive to be fair.

I know that not everybody is in a position to introduce plans and systems like this, but I think it’s wise to consider and aim towards that goal. The trick always comes down to whether the people on your team have an owners mentality.

What’s the point of this post? Well, I just read a fun article called 10 Reasons You Should Never Get a Job. I have been approaching my business with this model recently. Building up an all-service business is hard because you have to spend time in order to earn money. That’s why I’m slowly moving into ideas that earn residual income. It’s not easy but everything has much greater potential.

And that’s really what it’s all about.

Time Tracking Software

We just launched a site called which is a list of great time tracking software and web services. We’ve researched our future competition and studied the features people want the most.

We realize that not everyone will find our software to be perfect for their uses. So check out this new web site and we hope you find something that works for you!

Time Saver: Launchy for Windows and Quicksilver for OS X

Launchy for Windows is the program that helps me save 10 minutes every single day. I use it to launch programs and to pull up folders on our network. The best part: it’s free (and open source!). Now is a great time to try this program as they just released version 2.0 with tons of improvements.

Quicksilver for OS X is the Mac equivalent and is just as good and available for free.

How I stay organized

I’m not perfectly organized. I’m probably a bad example of organization. But at work, I like to think I am organized.

1. Time Tracking: I track all of my time at work religiously. I know exactly what I was doing and when on any day this year (billable and non billable work). We currently use Complete Time Tracking Pro for time tracking, but are working on our own time tracking system called Minuteglass.


2. Calendar: I organize my days with Google Calendar. In our office, we have a “Tornado Deadlines” calendar so any time we promise a client something it’s added.


3. To-Do-Lists: We use Todoist for tracking our to do list. We have a separate category for every one of our customers and share it in our office. Everyone knows what items are due today and in the next two weeks.


4. Email: In Outlook, I flag emails that need to be responded to. Only after that is completed, added to our Todoist task list do I unflag it. Or when the email is responded to.


What other tools do you use for tracking your life? There are so many ways to track projects and time and money. We’re working on a few that we will be releasing as well.

The good news is that everyone in our office uses these same tools (team of 3 people). This makes collaborating that much easier!

Update: In January, 2011 we use Gmail a lot more, still use, and also use a number of tools across the Mac and PC platform.

Update 2: In August, 2013 my main tools are: Harvest (using the Mac app), Wunderlist for to-do list, Sparrow for email, and Google Calendar for my calendar. I also started using Evernote for keeping track of docs and client files, and use Dropbox for storing client projects.

Don’t Break The Chain!

With mild success I have been using Jerry Seinfeld’s productivity tip to track my workout routine.

The idea is that you put a big red X on your wall calendar for every day that you do your work (in Jerry’s case, it was every day he wrote comedy). The idea then is to not beak the chain.

Here’s how it worked.

He told me to get a big wall calendar that has a whole year on one page and hang it on a prominent wall. The next step was to get a big red magic marker.

He said for each day that I do my task of writing, I get to put a big red X over that day. “After a few days you’ll have a chain. Just keep at it and the chain will grow longer every day. You’ll like seeing that chain, especially when you get a few weeks under your belt. Your only job next is to not break the chain.”

“Don’t break the chain.” He said again for emphasis.

Several sites have popped up since this tip emerged that help you track your chain of productivity. My favorite so far is (very aptly named). Anyways, it’s a great tip, and it definitely keeps you motivated.

My Thoughts on Deadlines

For years I struggled over the concept of deadlines and wondered why it was so very difficult to meet them. And then I realized that in order to meet deadlines for software / web development projects, you really need the commitment of both the developer and the customer. You can always move the deadline, but if that’s what you want to do, at least call them milestones.

Most people suck at managing projects

Most people have more than one project going at a time, and when one deadline is moved it moves the other ones (whether you want to admit this or not).

The odds of a large project finishing on time are close to zero. — From Rapid Development (Amazon)

Today I learned that close to 25% of all airline trips are late

Wow, that’s stunning. It just goes to show that most people are optimistic and can’t even predict when a project will be done. There are countless tools that exist today to try to facilitate creating accurate estimates, but most of them are useless because we are all so busy, and a million things impact our days, thus impacting our schedules.

If missing deadlines wasn’t enough, there is a horrible failure rate in software development projects. Some people say 5 – 15% of all projects fail.

Say no, do less

Tips on the gentle art of saying no. I’m not going to comment further since I’m really bad at this.

Throw deadlines out

Stop thinking you can accurately predict the future. Give your customers a realistic expectation that you can have their project done during a window of time. You’ll quickly find that most people don’t need an exact “delivery date” for their projects. Instead they just want to know progress is being made.

I’m not suggesting that it’s good to be late on your projects, just that you accept the fact that it’s nearly impossible to meet deadlines the way you’ve been going after them, and you should change your procedure.

The deadline dance is not always productive.

Ten High Value Uses of Your Time

Richard Koch, author of The 80/20 Principle: The Secret to Success by Achieving More with Less wrote this list of the top ten highest-value uses of your time.

  1. Things that advance your overall purpose in life
  2. Things you have always wanted to do
  3. Things already in the 20/80 relationship of time to results
  4. Innovative ways of doing things that promise to slash the time required and/or multiply the quality of results
  5. Things other people tell you can’t be done
  6. Things other people have done successfully in a different arena
  7. Things that use your own creativity
  8. Things that you can get other people to do for you with relatively little effort on your part
  9. Anything with high-quality collaborators who have already transcended the 80/20 rule of time, who use time eccentrically and effectively
  10. Things for which it is now or never

How to make an extra $4,687.50 this year

That’s enough to take the family on a nice vacation. Once our company switched to billing per-hour for (almost) all of our projects, our profits soared. We’re delighted because we’re now doing an amazing job tracking our time. Both billable and non billable.

The figure that I mentioned above — $4,687.50 — represents the accumulation of only an hour and fifteen minutes a week in billable hours. A paltry fifteen minutes a day, at $75 an hour, adds up to a nice vacation at the end of the year. Counting only 5 day weeks for 50 weeks a year.

Amazing, huh? Imagine what you could do if you tracked an extra hour a day.

Most companies just give away time like this. It’s too-small to track, they say. But the reality is that if you use an efficient tool for tracking time, it’s easy! And it pays off, as you can see.

Minuteglass is that tool (just wait until we launch!)

I hope that this demonstration helps you appreciate the value of tracking your time. It’s stunning, really, how most people don’t track time. If you charge your customers an hourly rate, it pays to track your time with a solid time tracking tool. It’s important to “independent agents” and also large companies of any size.

Benefits of tracking time:

  1. Earn more money by tracking your time better.
  2. Keeps you focused on your task at hand. When the clock is running, you know you need to be productive.
  3. Motivation: At the end of the day, if you can look at your time log and see how much you accomplished, and how much money you earned, it boosts your enthusiasm for what you do.
  4. It helps you estimate future projects (you can see how long a similar project took).
  5. Even if you don’t bill your customers an hourly rate, it’s great to know how much you work, and really know.

Tips for Staying Organized: On Paper

Paper is great. You can easily use it to stay organized. In many ways, paper is better than any software tool for keeping up to date on your tasks. You can take it anywhere!

I present you with four links that will help you organize your projects and your life on paper.

  1. Moleskine PDA — Using your Moleskine notebook as a project and task organizer. Simple but clever.
  2. The Emergent Task Planner — An amazing paper based tool for staying on track in your day.
  3. Paper Prototyping — Paper prototypes invite people with little-to-no technical background into the design process.
  4. Remember names at meetings by making a map — Sometimes the obvious ones are the best.

My favorite tip of all time is this: Grab a sheet of paper and write down what you are going to accomplish today. Then make a new sheet every single day (or every night, before you head home).

How To Figure Out Your Hourly Rate

Time TrackingFreelancers and people new to the service industry ask this often enough: Should I charge an hourly rate or should I give people specific quotes?

Going hourly is often the best, and the easiest since you can avoid the headache of trying to charge more when a client changes the scope of a project (that happens more often than not, in my experience).

Neil Tortorella from Creative Latitude has written an excellent guide for those thinking about billing your projects hourly. He answers the important question of how much to charge per hour to meet your profit goals.

The process to figure out your hourly rate:

  • What’s your target salary? How much do you want to make in a year?
  • On top of that, you’ll need to figure in other associated costs like taxes, FICA, insurance, etc.
  • Total up the number of working hours available to you, subtracting vacation, sick days, and holidays
  • Figure out what percentage of your day is non-billable and subtract that (typically 25% – 50% depending on a lot of factors)
  • Divide your target salary by the number of working days you have
  • Figure out what your overhead is, and calculate the total cost of overhead for each working hour
  • The final rate is the number you’ll use to do your estimating, whether you charge by the hour or by the job. It’s the number you can’t afford to go below.

Does that make sense? Read Neil’s article for the full details.

I’ll spend some more time in the future talking about providing clients with fixed-bids, and how to avoid problems with scope creep and avoiding endless projects.

Smashing The Clock, Best Buy Imagines a Better Workplace

Imagine a workplace where you were rated based on your productivity.

Imagine a workplace where a results were rewarded, and not just sheer working hours.

Imagine what would happen if you could work less, even 4 days a week.

Did America go down the right path when we began the 40 hour work week?

Smashing The Clock is an interesting article about an experiment at Best Buy called ROWE, for “results-only work environment.”

At most companies, going AWOL during daylight hours would be grounds for a pink slip. Not at Best Buy. The nation’s leading electronics retailer has embarked on a radical–if risky–experiment to transform a culture once known for killer hours and herd-riding bosses. The endeavor, called ROWE, for “results-only work environment,” seeks to demolish decades-old business dogma that equates physical presence with productivity. The goal at Best Buy is to judge performance on output instead of hours.

BusinessWeek Online: Smashing The Clock

Twenty Time Savers

Among the twenty time saving tips listed on this page, the one that hits home the most is this one: Do difficult things quickly; waiting doesn’t make them easier. It’s a fact of life that sometimes difficult tasks present themselves. Getting those ones out of the way first can free your mind and allow you to concentrate better.

Here are the rest of the tips:

  1. Learn to set priorities on things like goals, tasks, meeting agenda items, interruptions.
  2. Start with “A-priority” tasks; is it the best use of your time?
  3. Fight procrastination; do it now if it’s important.
  4. Subdivide large, tough tasks into smaller, easily accomplished parts.
  5. Establish a quiet hour, even though it requires will power and may not always work.
  6. Find a hideaway. The library or office of a co-worker who’s traveling.
  7. Learn to say “no” when you’ve got something important to do.
  8. Learn to delegate.
  9. Accumulate similar tasks and do them all at one time.
  10. Minimize routine tasks; spend only the time they deserve. Shorten low-value interruptions. Throw away junk mail and other low-value paperwork. Delegate, shorten or defer indefinitely the C-priority tasks.
  11. AVOID PERFECTIONISM. Remember the 80/20 maldistribution rule.
  12. Avoid over-commitment. Be realistic about what you can do in the time you have.
  13. Don’t over-schedule. Allow some flexible time for crises and interruptions.
  14. Set time limits. For example, some decisions shouldn’t take more than three minutes to make. Know how to recognize these.
  15. Concentrate on what you are doing.
  16. Use big blocks of time for big jobs.
  17. Do difficult things quickly; waiting doesn’t make them easier.
  18. Try to handle paper only once.
  19. Think the job through before acting.
  20. Finish as you go; get it right the first time.

It’s a great list, isn’t it?

Now let’s talk a bit about the 80/20 rule

If you got through that list and wondered what the maldistribution rule is, here’s a quick explanation: Twenty percent of the things you have on your “to do” list will provide you with eighty percent of the payoff.

It is also referred to as the Pareto principle, or the 80-20 rule.

I found a site that goes in depth on the 80/20 Rule of Time Management:

Vilfredo Pareto, an Italian economist, “discovered” this principle in 1897 when he observed that 80 percent of the land in England (and every country he subsequently studied) was owned by 20 percent of the population. Pareto’s theory of predictable imbalance has since been applied to almost every aspect of modern life. Given a chance, it can make a difference in yours.

And lastly, a tip that wasn’t included on the list

The last tip I want to provide is this: If you stop and actually track your time, both billable and non billable, and actually make an effort to do so, you’ll find that as you become more aware of how you use time, you waste less of it.

Google 20% Time

I’m sure you are all familiar with how Google let’s it’s engineers and other employees spend 20% of their time on side projects. According to Google’s Vice President of Search Products and User Experience, half of new product launches originated from 20% time. (source). That’s a great return on investment, and I suspect it originates from the fact that employees have something to look forward to, and their job doesn’t become mundane.

Move Your Desk

I’ve changed my environment ever so slightly here at Tornado, by moving to an empty desk in the same office. My new work space is clean and it has changed my perspective. Try it sometime when you’re in a rut. You can always move back to your old spot.

You can’t hit a target if you don’t have a target to hit

targetAre you always behind schedule and constantly working towards the next deadline, afraid that you might miss it? It’s quite possible that you are suffering from the side effects of not having deadlines.

Hence the title of this post: You can’t hit a target if you don’t have a target to hit.

Real World Translation: Your projects will always be late if you don’t have targets written down that you can meet.

You wouldn’t believe how important deadlines can be towards the health of your company and your well being. Over the years, I have gone through stages where I had a deadline for every project, and other times where I didn’t. Life is much easier when every project has a start date and an end date, with milestones along the way.

When every project has a deadline, you know when you are ahead and when you are not. So make your next to-do item this: Schedule my projects and start with start and end dates for every project.

Getting Things Done – An Interview with David Allen

I discovered a great podcast from a site called In a 2 part interview, personal productivity guru David Allen talks about “Getting Things Done,” and goes in depth about the key principles, the subtleties of the system, and some potential trouble spots.

Click here for the podcast with David Allen.

Shortly after I read Getting Things Done I had a great struggle over the concept of having a folder for everything. I hate using file folders because you can only fit so much into each of them, and once you have a lot of things inside of them, it begins to get cluttered. Plus, with file folders. You can’t throw them around because they would spill all over.

That’s when I discovered what I call “project folders” (large catalog envelopes that can fit 11 x 17 sheets of paper). I can put everything related to a project inside of one, and it all fits. I don’t even have to organize what is inside of each folder, because I know it’s there, so I can easily find it in under a minute.

I would not say I have embraced the “GTD” lifestyle. A few key things changed my life, and I think that’s how most people look at GTD. Read the book, find one or two things you can embrace, and at the end of the day, one or two things can make a big difference.

Advantages of Time Tracking

I was reading the Wikipedia’s article about time tracking today, and ran across some great content about the advantages of time tracking. Here they are:

Time tracking can lower costs in 3 ways: by making payroll processing more efficient, by making costs visible so you can lower them, and by automating billing & invoicing.

Time tracking can increase revenue through automating billing, which tends to make it easier for a company to get correct invoices out for all hours worked by consulting staff. This speeds up payment and eliminates the hassles of ‘dropping’ bills.

By lowering costs in 3 ways, and increasing revenue in one way, timesheet management technologies that are web-based can improve the health of companies.

In the project management world timesheets can also be used to build a body of knowledge about how much effort tasks take to develop. For example if developing a training plan has historically taken a month, then it can be assumed that creating a new one will take a month.

Track all of your time, not just the billable time

I’ve discovered that most people only log their time in their timesheets if it is billable. I’m going to give you a new reason to track all of your time, even the unbillable moments in your day.


Imagine being able to pull up a graphical chart showing your billable time compared to your unbillable time. You could see at a glance that a large chunk of your day was either billable or unbillable. Companies call this an employees utilization, and the goal is to have a large proportion of your day be billable.

It’s great information to have, because you can keep appraised of your overall effectiveness.

Well, our tool will give you the ability to see how your time is utilized, but it won’t tell you this unless you log all of your time. Billable and unbillable.

Don’t worry, we’re going to make it super easy to do all of that, so it won’t be a pain.