To Boost Your Business, Track Your Time (Nearly All of It!)

Management guru Peter Drucker once said “you can't manage what you can't measure.” I prefer to say, “Anything that’s measured can be improved.” By measuring how you spend your time, you can increase your effectiveness, your income, and even your quality of life.

Time is one resource that’s truly irreplaceable...once it’s gone, it’s gone for good. The days whiz by and before you know it, you’re in your fifties. (Trust me!) How you “spend” or “invest” your time matters not just to your business and financial success, but also to your quality of life. Are you using your time in ways that provide the most return? Whether it’s quality time with your family and friends, or time focused on business development, you should see “dividends” on the investment, even if they’re intangible.

But this is a blog for solopreneurs, so let’s stick to business.

Why track your time?

1.       To know how much to bill the client. Obviously, if you’re billing by the hour time tracking is vital.

2.       To know how long it takes to do something. This is helpful so that eventually you can get to the point where you can charge a fixed price for your services and make more money per hour. (This article explains the value of fixed pricing.)

3.       To know if you’re spending your time wisely. For example, last fall I invested over 20 hours preparing a response to a request for proposal. My company didn’t win the work. I’m certain those 20 hours would have produced a better return (more new business) if I had done 20 one-on-one phone calls with prior clients or potential clients.

4.       To help create accountability to make sure you’re doing enough of the right things to help your business grow. This includes tasks that you may not enjoy doing, like business development. If you’re self-employed, the general rule of thumb is you should spend 20% of your time doing things that will help grow your business (e.g., business development, marketing, etc.). If you’re working 40 hours a week, that’s 8 hours a week. Are you anywhere close to that? You won’t know if you don’t track your time.

What to track?

At a minimum, how much time you spend for each client, even if you’re not charging by the hour. This way at the end of the contract you can judge if you priced it correctly or if you need to make an adjustment the next time you do that type of work.

Ideally, track how long it takes to do a certain task so you can make the switch to fixed-fee pricing. For example, if you do workshops or any sort of assessments (say, a culture assessment or diversity assessment), you’re probably not making as much as you could if you charged a fixed price instead of hourly.

Business development or “outreach”. Set a goal, even if it’s one hour a week to start, and track the time to make sure you’re doing it.

Time spent on proposals so you can assess if it’s time well spent. (How much time did you invest? How many projects did you win?)

Track anything else you want to improve! How much time you sleep, exercise, spend writing blogs...

How to track it?

If you’re old school, you can use an Excel spreadsheet (sample here), but most people use software or an app like Toggl or FreshBooks. (PICA members can download a list of recommended tools here.) If you work at a desk, you can use a physical device called like Timular or Timeflip.

Remember, time is money. Make the most of it!