Time Tracking Benefits

All businesses where employees spend most of their working hours away from office or working on a computer can benefit from time tracking.

Time tracking benefits, and advatages and disadvantages

What is time tracking?

In essence, time tracking is the process of recording the time spent on work, certain tasks, or projects.

If you’re just starting out with time tracking, you might be looking for answers to some of the following questions:

Stay tuned because we’re going to answer these questions for you in the next paragraphs.

Let’s find out who are the people who use time tracking.

Who tracks time and why?

Most of us are part of the business world in some way.

And, most businesses in that world rely on time tracking software, especially if their employees spend a lot of time working on a computer or away from the office.

Time tracking is useful and beneficial for all businesses that:

Overall, many professions, organizations, and businesses can benefit from tracking their work hours. They include:

Let’s see how and why they track time.

Freelancers and independent consultants

Most freelancers and independent consultants use time tracking to:

Difference between a freelancer, a contractor, and an employee

Hybrid, remote, and virtual teams

Most hybrid, remote, and virtual teams use time tracking to:

Businesses with field workers

In a business that employs field workers, such as construction companies, time tracking can help:

Businesses that work with clients

Businesses that work with clients are various agencies, tech and IT companies, and even non-profit organizations.

These businesses use time tracking to:

Businesses that bill by the hour

Companies that work with clients and bill by the hour, such as law offices, use time tracking to:

Businesses that want to improve productivity

Even businesses that don't work with clients but are interested in getting more efficient, rely on time tracking to help assess their employees’ productivity levels.

They want to know two things:

Time tracking will help employees evaluate how they spend their working hours and motivate them to be more productive and better organize their time.

25 ways to increase productivity

Businesses that offer flexible working hours

Businesses with flexible working hours track time to:

How can time tracking save money?

The actual amount of money time tracking can save you depends on:

However, there is a significant difference between the revenue of companies that track time and those that don't.

Unlike companies that don't track time, companies that track time:

All of this leads to more quality projects and stronger relationships with clients.

These clients usually become returning clients who gladly spread the word about your company.

Finally, clients who spread the good word about your company attract more clients and help increase your revenue.

Moreover, time tracking software can save you money by automating a lot of administrative work and helping you analyze where you spend your time.

Let’s learn how.

Time tracking increases productivity

Time tracking helps you gain a better insight into how you spend your time, so you can prioritize better.

For example, if you're trying to improve your productivity, you can time track your typical workday and analyze how you've spent your time.

After viewing a time tracking report of your day, you can:

Your daily time tracking report
09.00–09.20 Checking your inbox and replying to emails 20 minutes
09.20–10.00 Delegating work to team members 40 minutes
10.00–10.30 Doing research for a projects 30 minutes
10.30–10.50 Checking your inbox and replying to emails 20 minutes
10.50–11.50 Administrative tasks 1 hour
11.50–12.15 Browsing your Instagram feed 25 minutes
12.15–12.45 Lunch and coffee break 30 minutes
12.45–13.45 Helping a team member with a task 1 hour
13.45–14.00 Browsing today’s trending news on Twitter 15 minutes
14.00–14.20 Administrative tasks 20 minutes
14.20–14.50 Checking your inbox and replying to emails 20 minutes
14.50–15.40 Discussing a project issue with your team 40 minutes
15.40–16.40 Reviewing project documents 1 hour
16.40 Reworking the project schedule 20 minutes

This time report can help you identify:

Clockify productivity report when you track time
A weekly report you can generate in Clockify

Once you become aware of how you spend your time at work, you can aim at being more productive and efficient.

Being more productive and efficient will help you:

Top productivity resources on the Internet

Time tracking helps you make better project cost estimates

Another way time tracking methods can help you save money is by enabling you to track time you spend on projects and better understand the actual project costs.

Maybe you don't actually charge your clients the rates you should be charging.

For example, imagine you encounter some issues while working on a project, and finishing everything takes longer than expected. The project costs rise beyond your initial estimates because of this, so you have to present that to the client.

Better project cost estimates
Clockify allows you to set different rates for different tasks of the project

With the help of time tracking software, you're able to generate accurate reports to present to clients and point out all the issues that led to increased project costs.

Moreover, you're able to create better estimates for future projects and save money in the long run.

Time tracking saves the time spent on paperwork

Running a modern-day business without time tracking software would translate to doing all the important paperwork manually.

This robs you of the time you can otherwise spend on more profitable activities.

For example, if you don't use time tracking software, you will have to manually:

This amounts to 1 hour and 20 minutes every day, or 6 hours every week you spend on paperwork. If you bill your work by the hour, that's 24 hours' worth of lost profit per month.

If your hourly rate is $50, that means you could save $1,200 per month by simply using a time tracking app.

Time tracking software helps you save time and money by automatically generating reports, invoices, and handling payroll in a matter of minutes.

Export reports in Clockify
Exporting reports takes less than a minute with Clockify

We’ve gone through the general benefits of time tracking for saving your time and money.

Let us now dive a little deeper and learn the benefits of time tracking for:

Time tracking benefits for teams

Working in a large team comes with a set of specific challenges:

Things become even trickier in remote or hybrid teams, both for managers and team members.

You and your team members might be unaware of how much time everyone spends on certain tasks or if everyone is doing their share of the work. In such a setting, it becomes much more difficult to synchronize all work and complete projects within set deadlines and budgets.

Thanks to time tracking software, both managers and team members can gain insight into what every team member is doing and when.

This will allow the entire team to work more efficiently and come up with better schedules.

It will also help teams achieve better results on future projects.

In essence, time tracking helps teams:

The complete team management guide

Time tracking maintains high motivation and productivity levels

With time tracking, it becomes possible to know what your team members do during work hours and how much time they spend on each activity.

Dashboard shows you who works on what at the moment and how they week looks like
You can easily track and analyze your team’s activity with Clockify

When team members record their time and make it public, it becomes inevitable that they start comparing results.

They may ask themselves:

These questions can be quite motivational and inspire team members to be more productive and in control of their time.

Time tracking resolves potential issues and conflicts

Sometimes, there may be a problem with a project segment, causing a delay in the project delivery.

But, if your team is using time tracking software, identifying the root of the problem becomes much easier.

Once everyone discloses their time tracking results, your team may be able to learn who is having issues and with what. When they do, the next step is to resolve these issues together.

Moreover, conflicts may arise regarding the amount of time allocated to finishing a project.

Why can this be a problem?

Well, different team members may have different opinions on how much time it will take to get the project done. So tracking the time they spend on each segment will give room for improvement within the following segments.

Thanks to tracking their time, team members will have a better understanding of the time it takes them to finish their assignments. Consequently, they'll be able to set more accurate project deadlines.

Time tracking helps you organize and prioritize better

When teams rely on time tracking in their daily work, they are more likely to organize their schedule better.

This mostly refers to being able to prioritize their tasks based on urgency, importance, or profitability.

Better organization and prioritization mean that the team will be more likely to finish their assignments within their deadlines.

What’s more, by organizing and prioritizing their tasks better and focusing more on profitable activities, teams help cut project costs.

Time tracking helps you reach personal and professional goals

When you work closely with your team, you probably come to the point where your professional goals align. You might all be aiming to do the following:

I think you get our point.

How does time tracking fit into this scenario?

When team members track their time regularly, they become coordinated and find it easier to contribute to the team's overall results.

Moreover, they look up to and motivate each other to improve.

For example, if you want your time efficiency to be as good as your colleague's, you can analyze your tracked time in order to identify your time sinks and see what you can work on.

This would be your professional goal.

Once you do that, you can organize your time better and learn to prioritize to reach the personal goal of achieving the same, or better, time efficiency as your colleague.

Overall, time tracking can help motivate team members to work harder on reaching all of their goals — be they personal or professional.

This concludes the section on the benefits of time tracking for teams.

Let’s move on now to learn what time tracking can bring to small businesses.

Free goal tracker app

Time tracking benefits for small businesses

Just like other businesses, small businesses have to finish projects within a deadline, get returning clients, generate profit, reach their goals — and all of this with a limited budget and fewer employees.

Because of these limitations in resources, time is a valuable asset to small businesses. You have to carefully allocate available time so that all aspects of a project are finished in the most efficient way possible.

In order to make use of available time and ensure people stay competitive, small businesses have to pay special attention to:

If you own or work at a small business, time tracking can help you with all of these points.

Here’s how to do it, in more detail.

Time tracking helps prioritize tasks

In small businesses, employees often have to take on multiple roles within a project and juggle a lot of work, all within a strict deadline.

Small business owners are also pressed for time, as they have to supervise all employees and assignments.

When employees track the time they spend on each activity, it becomes clear how much time they put into assignments within a project.

By tracking their time results, small businesses can prioritize better because:

Time tracking helps track all expenses

Small businesses usually have a limited budget, so they have to manage tasks in a way that keeps their revenue at a healthy level.

It is vital that owners track all expenses and take into account:

Track all expenses
Clockify allows you to easily track all your expenses and reduce your costs

Once you prioritize profitable projects and assignments and make sure everyone is doing their share of the work, you can expect your expenses to decrease.

Time tracking helps keep productivity at the highest level

Keeping productivity high during working hours is the best thing you can do for your small business and your employees. Here’s why.

Employees can engage in 90 minutes of high-frequency activities

Working on one task for the entire workday with only one or two breaks will only make you feel drained and eager to finish, no matter the quality.

According to science, our brains experience 90 minutes of high-frequency activities, followed by 20 minutes of low-frequency activities.

This means that working for 90 minutes and then resting for 20 will help you concentrate better and achieve better-quality results.

Thanks to time tracking software, you can even schedule your breaks to make sure you really take them.

Schedule your day
When creating a schedule in Clockify, you can incorporate your breaks, too
How much time do we actually spend on recurring tasks? (Study 2021)

Employees can plan and distribute their time better

Answering emails and attending unproductive meetings aren’t your most important tasks.

But, even though they often bring little value to your work, you still have to address them sometime.

Yet, if you start tracking the time it usually takes you to answer emails you can:

Employees can have an insight into everyone’s time results

When everyone has insight into everyone else’s time results, it allows the team to compare their results and encourages them to be more productive and efficient.

When you know others are aware of how you spend time at work, you'll aim to be more responsible with your time.

This will motivate you not to waste hours answering emails, checking your phone, watching videos on YouTube, and procrastinating.

It will also encourage you to take advantage of your productivity and finish your most important tasks for the day first.

Time tracking helps avoid bad habits

For many, multitasking is a great way to finish more tasks in less time. Or is it?

On the other hand, procrastination is a habit many would love to get rid of.

But, in essence, both multitasking and procrastination can be your productivity’s greatest enemies.

How can time tracking help employees abandon these bad habits?

When employees track time, it becomes much harder to multitask or procrastinate. Employees have to record:

By doing this, they get more accurate time results and have a better insight into their daily schedule.

Once multitasking or procrastination are reduced to a minimum, small businesses can truly thrive.

Since many businesses depend on returning clients, becoming sustainable and building reputation and credibility should be a top priority. And, this is only possible if everyone does their share of work and finishes projects on time.

Time tracking benefits for managers

Managers are the most important link in any business organization because they:

But, if managers don't know how much time each project requires, their job becomes much harder.

This is where time tracking can do its magic.

Thanks to time tracking software, managers can get all data they need and maintain control of their responsibilities.

Time tracking data provides different benefits to different types of managers:

Let’s explore the advantages of time tracking for each group a bit further.

How can project managers benefit from time tracking?

When all team members track their time during work hours, the project manager can use this data to easily handle vital paperwork and supervise team members and their work.

Time tracking records make it easier to process all documentation, particularly, everyone's payroll.

You can easily calculate the amount of money that you should pay each team member, based on their total hours worked and hourly rates.

By tracking the team's time, you can make sure you don't underpay or overpay team members for the time they've spent working on a project.

If your team tracks their time, you can access everyone's time results and activity reports whenever you want.

This way, you'll know how each team member spends their time at work.

Analyzing your team's time tracking data will allow you to identify any time sinks and find the best way to deal with them.

How can corporate managers benefit from time tracking?

When all employees track their time, the corporate manager has an insight into the workings of the company.

Time tracking can help them answer some of the following questions:

See how much each team member works every day
With Clockify, you can see how much each team member works during the week

Time tracking results enable you to gain insight into current project progress and project costs and deadlines.

Thanks to these insights, corporate managers can create better plans and estimates for future projects.

How can account managers benefit from time tracking?

Account managers present a vital link between a company and its clients, and it’s their job to maintain a good relationship between the two.

Thanks to time tracking data, their job is much easier than it used to be.

When all team members track their time, you can use this data to:

After all, building a trustworthy relationship with your clients should be your top priority in the long run.

Time tracking benefits for freelancers

If you're a freelancer, you're in charge of how you spend your time. This makes organizing your schedule all the more important.

Tracking time can help freelancers:

140+ Best Freelance Jobs Websites

Time tracking helps freelancers bill clients accurately

More often than not, freelancers have to communicate remotely with their clients.

Because of this, it's important that you document your work progress and the time you spend on all projects.

If you’re using time tracking software to document your work, you can generate accurate reports for your clients and determine your fees (total hours worked x hourly rate).

Moreover, tracking time helps you avoid being paid less than you deserve for your time and efforts.

Finally, it minimizes your chances of charging too much and helps you maintain a trustworthy relationship with your clients.

Time tracking helps freelancers better evaluate project costs

Evaluating and calculating project costs is much easier for freelancers when they can rely on a time tracking app.


Well, time tracking can help you determine how much time you have spent on every task of each project.

How does this work in practice?

Example #1: Some freelancers may realize that they spend too little time on profitable segments of a project and too much time on unprofitable activities.

Example #2: Some freelancers may find that their hourly rates are too low for the time and effort they invest into finishing certain projects.

See project progress
Clockify allows you to see how your project progresses and compare estimated vs tracked time
Freelancing & Consulting Average Hourly Rates (2021)

Time tracking improves freelancers’ productivity

Freelancers often work at home and find it more difficult to stay focused since they are more vulnerable to distractions and procrastination.

But, if you track your time during work hours, you’ll better understand if you use your time productively or not.

For example, if you want to assess your overall productivity, you can track every activity during the day.

At the end of the day, you may realize that you have spent:

That’s a total of 4h and 40min you spend idle during the day.

Once you understand what you’re wasting your time on, you'll feel motivated to be more productive and more responsible with your work hours.

Time tracking helps freelancers understand their work limitations

As a freelancer, you may feel that the more projects you take on, the more money you'll earn. But, that doesn’t have to be the case.

What’s more important for you as a freelancer is to understand your work limits.

How can you do that?

Well, if you start tracking time, you’ll understand how much of it you usually spend on completing one type of project. This way, you’ll realize if you’re taking on more work than you can handle.

For example, you’ve decided to take on 5 different projects to complete within a month.

This can end in two ways:

Once you determine the amount of work that is too much for you to finish within a certain time period, you'll be able to create better estimates for deadlines and the workload you should accept.

So far, we’ve talked about the benefits of time tracking for teams, small and large businesses, and freelancers. But what about their clients?

Let’s see how clients can benefit from tracking time.

Time tracking benefits for clients

Clients need to know whether they can trust you.

Your clients will rely on your time tracking data to:

Let’s take a closer look at the advantages of time tracking for clients.

Time tracking helps make accurate estimates and quotes

When looking for a professional to take on their project, clients have to take into account their planned budget for the project and the ideal time when they'll want everything done.

Task tracker app project screenshot
Setting estimates and tracking progress are of vital importance for your clients

By turning to a company or individual professional that tracks time during work hours, they'll know that the estimates for the deadlines and quotes are as accurate as possible.

Also, the chances for a sudden rise in expected fees will be minimal. They'll know the company or individual professional are aware of the time needed to finish such a project, so they'll have more trust in their deadline estimates.

Time tracking helps provide accurate billing

Teams that track the time they spend on a project can accurately calculate their total hours worked.

This means they can also charge their clients accurately because they'll have all the data necessary to bill clients according to their hourly rates.

Clients will never have to worry about overpaying or underpaying the people they hired for the job. They'll have access to reports that show all the completed assignments and expenses.

Time tracking shows that the project is progressing

Sometimes, clients can feel uneasy if they don't know how the project is progressing. They will probably ask the following questions:

And, if this project is a part of a larger business plan, clients will want to know whether they can start planning their further steps or not.

As part of their planning, clients can ask those they hired to send them time tracking reports on their progress. The reports will provide answers to all their questions.

These reports can be daily, weekly, or monthly, depending on the size of the project and the client's interest in its progress.

By having insight into these reports, the clients can learn:

PDF time exports
With Clockify, you can send daily, weekly, or monthly reports to your clients

Once clients know all the facts related to the project progress, they can start working on:

Creating a trustworthy, long-lasting relationship with a client can be much easier with the transparency provided by time tracking software.

When clients hire people who track time, they'll know they have found professionals who value their own time, and who will, by extension, value the client's time.

How to start tracking time?

If you’re completely new to time tracking, let us guide you through time tracking basics.

Tracking your time is very simple, especially when you find the software you can use easily.

What are the crucial steps you need to take to start tracking time?

While you’re examining your weekly time logs, you can ask yourself several things:

Asking these questions will help you realize if you’re spending too much time scrolling through social media or if you could spend more time with friends and family.

Another important aspect to inspire you to start tracking time is finding the motive to do so.

Find your own motive for tracking time

You should remember that every person is different and has a different set of priorities. So it’s important to know why you have decided to track your time.

Once you’re clear on why you want to track your time and how you can do it, let’s see what activities you can track with a time tracker.

What activities to track with a time tracker?

Depending on your personal or professional needs, you can track time for pretty much everything.

People usually use time tracking software for:

You now know how to track time, why to do it, and what activities to track. It’s time to learn what types of software you can use for all this.

Different types of time tracking software and how to use them

Depending on your specific preferences and work organization, different types of time trackers let you track time in different ways.

Best time trackers consolidate these diverse types of time tracking software into one versatile solution and are well suited for any business or use case. These include:

Let’s see how each of these works.

How to Choose the Best Time Tracking Software

Timesheet software

Employees log their hours via time clock or timesheet in an app
Clockify’s timesheet software

With timesheet software, you can:

Free Printable Timesheet Templates

Timekeeping software

Clockify's timekeeping software
Clockify’s timekeeping software

Thanks to proper timekeeping software, you can:

Time recording software

Clockify's time recording software
Clockify’s time recording software

When you use time recording software, it allows you to track time in 4 ways:

With a timer

By entering the time manually

By using an auto-track time option

By recording time in a timesheet

Time clock software

Clockify time clock software
You can use Clockify’s time clock software on your computer or mobile phone

If you opt for time clock software, you will be able to:

Automatic time tracker

Clockify automatic time tracker
Clockify’s automatic time tracker

Automatic time tracking software can be installed as an extension and used to monitor and track the time you spend on certain programs and apps.

With automatic time tracking, you can:

Why track time with Clockify?

Standing out from the crowd, Clockify is the most popular, most intuitive, and a very easy-to-use time tracker on the market.

Regardless of the size of your team, your place of work, or your work arrangement, Clockify will be able to satisfy your time tracking (and other) needs.

If you manage both in-office and remote teams, you can monitor their productivity levels with the help of Clockify’s visual reports feature.

Moreover, freelancers and independent consultants can also rely on Clockify for time tracking and optimizing the time they spend on each project and client.

Thanks to its availability across platforms and devices, Clockify supports the flexible lifestyle adopted by many freelancers.

All in all, using Clockify can and will help you stay productive, improve your time management skills, and make overall progress.