Our Agency Ditched Timesheets And So Can Yours
Timesheets introduce a struggle for accurate entries and a utilization-driven mindset that distracts from our goal: doing great work.
In a business and agency environment, processes are often thought about additively: what can we start doing to make our work better? What’s not thought about often enough is the opposite: what can we stop doing?
At Invoke, as part of our commitment to embracing evolution as a company, we asked ourselves what parts of our process were outdated. At the beginning of the year, we took a serious look at how we used the classic agency process of time tracking.
To be frank, it wasn’t working. With a tight-knit team working on multiple projects at a time, it’s consistently difficult to get accurate timesheets, tough to use this information for effective team resourcing, and the mindset of focusing on hours and utilization had cascading effects throughout the team.
It ended up being a simple decision: we ditched time tracking. Here’s why we did it:
Face it, timesheets are made up.
We’re all trying our best, but — more often than we’d like to admit — the process for entering timesheets involves sitting down at the end of the day (or even the end of the week) and saying “I think that took about an hour and a half.” This results in hour entries that are made up or significantly rounded.
That leaves all the data collected by time tracking in question. The reason we track time in the first place is so we can take action on this data. We use it to inform estimates, calculate utilization, bill clients, and more. But if we can’t trust the input, we can’t trust the output.
Resourcing the team based on time tracking is less effective than simply trusting our team.
One of the most frequently expressed pain points during our ongoing project retrospectives was that team members didn’t feel they could do their best work when they were being pulled in and out of projects for the sake of protecting hours (if you want honest feedback like this, you can read my story on retrospectives here).
To be an effective product team, the whole team needs to be involved and invested in the process from start to finish without being distracted by time. Having a developer skip out on meetings for a couple weeks while strategy focused on conducting interviews and research can lead to a lack of coherency in the team and extra time spent catching up. Even worse, it can end up with team members going back and reinterrogating the problems and priorities because part of the team was left out of the loop and are no longer aligned with the project direction.
At Invoke, we have a close-knit, senior team that is in-tune with the delivery process, how each of us work, and what we have to balance. By making sure each team member is on 2–3 projects at a time, maximum, we give people the ability to recognize inefficiencies across projects in the moment and spend their time on what is most impactful.
Tracking hours against a budget doesn’t give us more budget.
The cost is fixed, and we are doing our best to work within those constraints. When we are too focused on tracking against a certain number of hours, it’s easy to think that it’s necessary to “save hours for later” — especially for potentially complex product builds. Our communication turned into warnings for people when they were spending a lot of hours or or they’d be pulled from a project to preserve hours.
Instead of thinking about the time spent, we think about delivery dates for milestones within a sprint — both on an individual level and at a project level. If everyone is able to collaborate and complete milestones within a sprint that lasts from this date to that date, the company remains on budget. How a person utilizes those individual hours is up to where they can see room to provide value.
At a project level, our projects are now estimated based on this cadence — what can we accomplish in a given sprint. It’s still a timeline, but it’s not nearly as rigid as hourly estimates. Knowing we have a certain number of team members on a project means we can estimate the level of momentum a project will have. We have conversations with clients about how much effort and value will be required, versus how long something will take, and this helps us keep the narrative on focusing on the right priorities.
Structuring projects on sprint schedules keeps everything in a project moving, while maintaining the right level of accountability and flexibility. If we structured billing based on the milestones themselves, this wouldn’t provide us the flexibility to discover, grow, and pivot throughout a project — and that’s essential when your work is based on exploring brand new areas of opportunity with clients.
Time tracking takes time — time better spent elsewhere.
It’s not a huge task, but it still ultimately takes resources to manage resources. Not only for the project managers that are taking action with the data produced, but for the employees that are doing the data entry.
Freeing up the time itself — as well as removing the burden and dread of knowing you’ll have to do it later — lets the team focus more strongly on how they can work better. This led to a renewed vigour in how the team approaches personal development. Since we’ve removed time tracking, several blogs have been written, courses and seminars have been taken, multiple conferences have been attended, and more explorative tinkering is happening on prototypes for both ourselves and our clients.
All of this generates more value than time tracking.
How has this impacted the business?
The ultimate question: did it work? So far, the answer is a resounding yes from both a qualitative and quantitative approach. What we’ve seen so far is that:
- Financially, our revenue forecasting is more stable when we sell projects by sprint versus billable hours.
- Our partner relationships are stronger as our client and team mindsets have shifted away from billable hours and towards value creation and product delivery.
- Success measurements have improved. This includes the number of projects delivered on deadline, client satisfaction, length of client relationships, number of client recommendations and referrals, number of new products, and services or methodologies developed by the team.
The goal of these changes was to completely re-engineer our team around value. We wanted to continue with a culture of accountability, not utilization. By removing time tracking, we show that we provide solutions, not services, and we highlight our effectiveness, not our busyness.
In full transparency, there are still some instances where we use time tracking. Occasionally, we take on a piece of client work that is a time and materials engagement. We also are sure to use time tracking for internal product work that requires it for SR&ED reporting.
However, even in those cases, our team knows that they aren’t simply time tracking in order to complete a 40-hour puzzle for the week. They know that they have the support of the entire team in finding and completing the work that provides the most value for our projects and their own development.
If you’re thinking of cutting time tracking, have already cut it, or even if you’re using it and it’s working out great — we want to know. Get in touch with me on Twitter: @ohdubz.
