The 40-Hour Conundrum: How to Talk With Your Team About Time Tracking

Time Tracking in Agencies: Beyond the 40-Hour Myth

As agency owners and managers, we often grapple with the challenge of tracking time effectively. This is not about hitting 40 hour logged every week; it's about understanding how time is spent, optimizing productivity, and making informed business decisions.

In this post, we'll dive deep into the world of time tracking, exploring its purpose, common misconceptions, and how to use it as a tool for growth rather than a source of stress for team members.

The 40-Hour Conundrum

Many agencies still cling to the notion that employees should be logging 40 hours per week. But as Gray MacKenzie, ZenPilot CEO and founder, points out, this approach often misses the mark:

"The expectation to set for people isn't that we track 40 hours of time. The expectation is that we track all of our working time."

This shift in perspective is crucial. Instead of focusing on hitting a specific number, the goal should be to accurately capture all productive work time. This includes the time spent on tasks, projects, client communication, and even those quick five-minute checks of work emails.

Why Track Time at All?

Before diving into the how, it's essential to understand the why. Gray emphasizes that time tracking serves multiple purposes:

1. Informed decision making: "I'm doing this to best shape the decisions that we as a company make. I want time tracking data so that we can better shape our offerings, how we price them, who's working on what."
2. Performance optimization: Time tracking data allows managers to help employees allocate their time more effectively. As Gray notes, "It's really just a capital allocation problem. Your capital is your time that you have. And I want to allocate that in the highest return ways possible."
3. Business insights: Accurate time tracking provides valuable insights into project profitability, team productivity, and areas for process improvement.

Changing the Narrative Around Time Tracking

One of the biggest challenges in implementing effective time tracking is overcoming the negative connotations associated with it. Many employees view it as a tool for micromanagement or a way to justify their worth to the company.

Gray suggests reframing the conversation:

"We need to be really intentional and clear in articulating expectations to because many cultures have been like: 'you get paid for the hours that you work'. And so there's a natural tie that we all build in our minds between how much time we're I working and that justifies whether we're doing a good enough job to get paid."

Instead, focus on how time tracking data can help employees work smarter, not harder. It's about optimizing their efforts and aligning their work with high-impact activities.

The Reality of Productive Time

One of the most eye-opening aspects of time tracking is realizing how much time is spent on non-billable or low-impact activities. Gray shares some common findings:

"Almost always, when we look at that, the amount of time that someone estimates they spend in communication and the amount of time that they actually spend in communication as a bucket, like, thinking of what to write, asking AI to help them write it, looking for data, on stuff, trying to pull reporting, and then actually like just monitoring email... that's almost always a much larger time waster."

This insight can be invaluable in identifying areas for process improvement and helping employees focus on high-value tasks.

Using Time Tracking Data Effectively

The true power of time tracking lies not in the act of tracking itself, but in how you use the data. Gray emphasizes the importance of regular reviews:

"The best practices here are you probably need to take a month and on a weekly basis, we are going to sit down. We're going to look at your time report for last week. And this is my opportunity as your manager to redirect and say: 'well, you spent 15 hours editing the podcast, which is not that impactful out of the grand scheme of things that we're doing here'."

These reviews should be framed as coaching sessions, helping employees understand where their time is best spent and how to improve their productivity.

Beyond Individual Productivity: Business-Level Insights

While individual time tracking is valuable, the real power comes from aggregating this data at a business level. Gray suggests looking at this data monthly or quarterly, looking at how much time is spent versus revenue earned by department, by client, by work category or service line and potentially by team member as well.

This data can inform crucial business decisions, such as:

1. Pricing and packaging of services
2. Team allocation and staffing decisions
3. Process improvement initiatives
4. Service line profitability

Overcoming Common Time Tracking Challenges

Implementing effective time tracking isn't without its challenges. Here are some common issues and how to address them:

1. Incomplete tracking: Encourage employees to track all working time, not just billable hours. This provides a more accurate picture of where time is spent.
2. Guilt and shame: Employees may feel guilty when they see how their time is actually spent. Address this head-on: "The goal here is to help them become a much better operator, more efficient. They should be able to spend less time in many cases working on a certain task or be able to reallocate that time on higher impact stuff."
3. Lack of clear categories: Ensure you have clear categories for time tracking that align with your business needs. This might include client work, internal projects, administrative tasks, and professional development.
4. Resistance to change: Some employees may resist detailed time tracking. Address their concerns and emphasize how it benefits both them and the company.

Action Steps for Agency Owners

Ready to improve your agency's time tracking practices? Here are some concrete steps to take:

1. Clarify the purpose: Communicate clearly to your team why you're tracking time and how the data will be used. Emphasize that it's about optimization, not punishment.
2. Set clear expectations: Define what should be tracked and how. Provide guidelines on the level of detail required and any minimum thresholds (e.g., track anything over 15 minutes).
3. Choose the right tools: Implement user-friendly time tracking software that integrates with your project management system. Gray recommends using ClickUp for both project management and time tracking to keep all data in one place.
4. Establish regular reviews: Set up weekly or bi-weekly reviews with team members to go over their time tracking data. Use these sessions as coaching opportunities.
5. Analyze business-level data: Review aggregated time tracking data monthly or quarterly. Look for trends, inefficiencies, and opportunities for improvement.
6. Make data-driven decisions: Use the insights gained from time tracking to inform pricing, staffing, and process improvement decisions. Share these decisions with your team to reinforce the value of time tracking.
7. Implement productivity techniques: Encourage techniques like time blocking, the Pomodoro method, or batching similar tasks to help employees make the most of their working hours.
8. Lead by example: As an agency owner or manager, track your own time diligently. Share insights from your own time tracking to demonstrate its value.
9. Celebrate improvements: Recognize and reward team members who show significant improvements in their time management and productivity.
10. Continuously refine: Regularly assess your time tracking processes and categories. Are you getting the insights you need? If not, adjust your approach.

Conclusion: Time Tracking as a Growth Tool

When implemented thoughtfully, time tracking can be a powerful tool for agency growth and employee development.

This is why we talk about it so much here at ZenPilot. Our mission is to help create more healthy, more profitable, more productive teams. Time tracking, when used effectively, supports all three of these goals.

Remember, the goal isn't to track every minute or to hit an arbitrary hour target. Instead, focus on using time tracking data to make informed decisions, optimize processes, and help your team work smarter. By shifting the narrative from control to empowerment, you can turn time tracking from a dreaded task into a valuable tool for personal and agency growth.

As you implement these strategies, keep in mind that change takes time. Be patient with your team and yourself as you refine your approach. With consistent effort and clear communication, you'll soon see the benefits of effective time tracking reflected in your agency's productivity, profitability, and overall success.