Time tracking has definitely reached a point on the agendas of most business leaders. However, already before the new time tracking law was introduced in 2024, the tracking of working time and its business benefits were in focus.
TL;DRTime tracking delivers measurable business benefits across profitability, invoicing accuracy, productivity, planning, and compliance, and these were compelling even before the 2024 Danish time tracking law made systematic registration a legal requirement. Acubiz outlines ten specific benefits while acknowledging the implementation concerns most business leaders raise, from employee pushback to the practical challenge of building a consistent process.
This we understand, since it involves a lot of benefits that almost all types of businesses can capitalise on. On the other hand, most business leaders also have several concerns related to the implementation and operation of a time tracking process.
With this blog post, I will look into the main benefits and at the same time, I will touch upon a few points to pay attention to.
Business benefits
1. Increased profitability
Time tracking provides the opportunity to get insight into how an organisations personnel resources are utilised. In other words, it will become easier to get an overview of what the salary costs are spent on. It will also be possible to keep track of project finances and work dynamically with prioritising resources, if some activities are consuming too much of these.
2. Precise invoicing
Registration of time usage related to external projects, tasks, assignments and customer and client cases creates a solid foundation for precise invoicing. I most cases, an increased billing rate can be achieved. If the process is digital and automated, it also means that the invoicing process can be executed fast and effectively. This caters for an increased cash flow and improved liquidity.
3. Increased productivity and smoother workstreams
With time tracking it will become easier for the employees to steer through projects. It will also be easier for e.g. a project team to have full overview of the progress, and at the same time also the individual employees’ progress on specific subtasks.
4. Better planning through insight
After some time with a well-defined process for time tracking and the right tools to support the job, data on time usage is compiled. These data can be used to create insight into the magnitude of specific tasks and the actual time usage spent on different types of tasks and projects. This kind of insight can be used for future planning and benchmarking purposes.
5. More precise communication
Detailed time registration towards e.g. projects or assignments, whether they are internal or external, makes it easier to craft precise communication targeted at various stakeholders regarding progress, milestones, expected completion and potential delays.
6. Compliance to rules and agreements
Time tracking provides overview of the employees’ actual working hours. In the cases where working time rules and collective agreements needs to be complied to, it is crucial to have control over actual work time in the organisation. This has after the introduction of the EU’s new law on time tracking from 2024 become nothing but essential to all businesses.
Now, you might think that “this was only 6 benefits of time tracking, but the headline promised 10 benefits!” Well, that is right, but do not worry, if you read on, the last 4 benefits are right around the corner. But before that, we will take a quick look at the potential obstacles (or challenges, some might say) that I see, related to the implementation of time tracking.
Potential challenges with time tracking
One of the main concerns that many business leaders have, is related to how a requirement of doing time tracking will be received by the employees. Fact is that there is a risk that some employees will perceive it as increased supervision and control. On the other hand, it is also a fact that other employees will not be bothered the least.
One thing is certain though, it will call for a change of behaviour in the organisations, because the employees need to adapt to a new task in day to day business. Another point of attention is therefore also on the actual time that it takes to do the time registration. Here, it is obviously important to find a tool that is easy and intuitive to work with.
In particular, the concern about the employees view of time tracking leads me on to the next benefits – because they are focused on the advantages for the employees.
Employee benefits
7. Personal efficiency
Time tracking provides the individual employee with the opportunity to work with his/her personal efficiency through utilisation of the insight into own resource spend, that is built up.
8. Structure and overview
A tool for time tracking is also a tool for keeping overview of current tasks, projects, and deadlines as well as it is a tool for planning the efforts.
9. Identification of patterns
Time tracking also provide the employee with the option to identify patterns in his/her individual work. This can be used to point out the various time wasters, that all people often are hit by at some point and want to eliminate.
10. Visualise actual working time
For the employees, it is also an advantage to be able to visualise actual working time, including overtime. This gives a foundation for a fact-based dialogue with managers and colleagues.
These employee benefits are very important when we are talking implementation of a time tracking system. Because no matter how you will toss and turn it, and point out all of the benefits for the business, it is crucial that you, as a business leader, also manage to explain the employee benefits when it is implemented. This is not much different, than if we we were dealing with an implementation of any other tool, that requires the change of daily routines. We know that from our more than 20 years of experience with implementation of Expense Management solutions.
So, remember, that if you want time tracking to be a strong tool for your business, it requires great leadership.
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Frequently Asked Questions
What are the main business benefits of implementing time tracking?
The post identifies ten benefits: increased profitability through better resource utilization, precise client invoicing leading to higher billing rates, improved productivity, better project planning through historical data, higher employee satisfaction from clear workload visibility, reduced administrative time on timesheets, better compliance with labor regulations, improved decision-making through data, support for remote work management, and a foundation for accurate salary and payroll processing.
How does time tracking improve invoicing accuracy?
Registering time against specific clients, projects, and tasks creates a precise, auditable record that supports invoicing for exactly the work delivered. This typically leads to a higher billing rate because previously unregistered time is captured. If the process is digital and automated, the invoicing workflow runs faster, improving cash flow and reducing the receivables cycle.
Is time tracking legally required in Denmark?
Yes. A time tracking law was introduced in Denmark in 2024 requiring systematic registration of working hours. However, the business case for time tracking was compelling before the legal requirement, and companies that had already implemented a digital process found compliance straightforward. Companies still using manual or informal tracking need to address this now.
What are the main concerns managers have about implementing time tracking?
The most common concerns are employee resistance to being monitored, the administrative burden of maintaining a consistent registration habit, and the cost and effort of implementing a new system. The post addresses these by pointing out that well-designed digital time tracking tools minimize daily friction, and that the data benefits quickly outweigh the implementation effort.
