Many employees think time tracking exists so managers and leaders can watch their team’s every move, but this is far from the truth. So why is time tracking important? 

So why is time tracking important in business? Time tracking, when executed properly, can positively impact the entire organization. What exactly does it bring to the table that makes businesses worldwide adopt it?

Here are the top reasons why time tracking is important for both employers and employees.

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Improved productivity

Time tracking lets employees measure the time they spend on specific tasks. It makes sense to think that time tracking data is nothing more than records of hours and minutes, but there’s more to it than meets the eye.

Time-tracking apps give you access to performance metrics beyond your employees’ working hours. You’ll see activities that consume the most time, times when team members are most active, and have a gauge of the apps and websites that become distractions.

With an advanced workforce management tool like Hubstaff, you can access advanced insights like focus time, industry benchmarks, and productivity trends. Employees can leverage this data to identify work they excel in or areas of inefficiency so they can make the right adjustments to their workflow.

Hubstaff Insights work time and activity highlights.

Enhances billing accuracy

Billing is an inherently delicate process regardless of which industry you work in. There’s zero room for error — they can even result in legal repercussions.

Time-tracking software won’t magically fix all billing issues. However, it ensures that employees are compensated appropriately and the company does not incur any overpayments or losses. You can use these reliable billing records as references in the future should the need arise.

Tools like Hubstaff can even convert time tracking data into detailed timesheets to eliminate the mistakes that come with manual admin work. 

Better project management

Project management can’t exist in a vacuum. For it to be successful, it requires people with strong collaboration skills, superb time management, and a great project manager to oversee everything.

But even for the most capable project manager, it’s impossible to start a project and expect to complete everything as you originally planned without understanding how your employees use their time. No project was ever successful without the right project management tools and a project manager who knows which tasks to prioritize and who best to delegate them to.

Time tracking enables project managers to assess the time needed to complete projects so they can set realistic deadlines. It also allows them to make calculated adjustments midway through the project in case of unexpected situations.

Reduced time on administrative tasks

Imagine you were a software developer hired by a company to write code. On top of that, imagine being tasked to:

  • Manually keep track of the time you spend on every task
  • Input your hours on a spreadsheet multiple times a day
  • Fill out and remember to submit your timesheet

That sounds like a lot of work, and it is. However, time tracking can automate this entire process — and save everyone a lot of time.

More accurate invoicing

Invoices are one of the most polarizing aspects of managing a business.

Do an excellent job, and no one even notices. Make even a small error, and catastrophe ensues. A recent article by Versapay found that over 60% of C-level executives have overseen a lawsuit or a threat of one due to an invoice dispute.

The report also found that 98% of businesses believe upper management gets burdened with invoice and payment disputes.

Wakefield + Versapay: The State of Digitization in B2B Finance statistics

Source: Wakefield + Versapay

When you track time, most time tracking apps auto generate the financials. For instance, Hubstaff’s online invoicing calculates your clients’ total bill from the time your team spent on their projects and each team member’s hourly rate, ensuring timely and accurate invoices.

Increased work flexibility

More and more companies are shifting to remote work, and the 9-to-5 is becoming less prominent. Modern workforces are prioritizing flexibility, so it’s up to businesses to accommodate that need.

Time tracking not only makes that flexibility possible; it makes it work. A time tracking tool lets employees keep track of their work and create timesheets anywhere and anytime.

Additionally, time tracking helps promote a culture of autonomy in your workplace. Let your employees know you trust them to make the best use of their time. It’s also important to communicate that they also share some responsibility in prioritizing their well-being with a healthy work-life balance.

Adherence to compliance requirements

Certain industries, such as health care, manufacturing, or government contracting companies, must adhere to compliance requirements that mandate accurate timekeeping. Time theft and fraudulent timesheets (even accidental instances) are punishable by law.

Human error isn’t 100% avoidable, but why take the risk with manual timesheets when you can automate with time tracking?

With time tracking, every second on your timesheet translates to a second of work. Many time trackers also have built-in activity monitoring features, so you’ll have additional proof of your time records’ authenticity if needed.

Smoother payments

As fun as it is to get paid, processing payments can be a tedious task. Can you imagine having a fully remote, global team of 100 people and sending payments to them twice a month? We’re quite sure you’d agree when we say computing for a large team’s payroll isn’t something most are looking forward to.

Time tracking can automate payroll

In case you didn’t know, time tracking can automate payroll, too. Time tracking tools let you set hourly rates for your employees to automatically compute payments. Not only does this save you potentially hundreds of hours, but it also ensures payment amounts are correct.

Time tracking apps also integrate with payment platforms like PayPal and Wise, allowing you to send direct payments to international employees.


We might be biased, but we think time tracking plays an important role in increasing productivity.

There is a caveat, though, and one that we stand firmly with. If you want to implement time tracking so you can constantly look over your team’s shoulders, we don’t think you should do it. Time tracking can make everyone’s work much easier, but not if you keep employees in the dark.

If you want to reap the benefits of time tracking, transparency is the name of the game — but it goes both ways. You’re asking a lot from your employees, so they deserve to know what you aim to achieve with time tracking.

Get on the same page with your team, treat them respectfully, and then start tracking time. That’s when you’ll see how powerful it can be.

Category: Time Tracking