Time and attendance systems
Time and attendance systems are the 21st century equivalent of the paper time sheet. This type
of software automates day-to-day tasks such as tracking work hours and calculating benefits accrued,
providing valuable information and making your business more efficient.
Whether due to overwhelming paperwork, rapid growth, or new efficiency initiatives, companies
are turning to time tracking systems in record numbers. Vendors are responding to this demand
with products designed for a variety of technical requirements and niche industries. As a result,
time and attendance packages can now help your company automate not only the morning roll call
but also your labor forecasting and management activities.
This buyer's guide will help you evaluate your company's needs so you may choose the best time
and attendance software for you.
<< Back to top
Is time tracking right for you?
Companies turn to time and attendance software to address any of several needs. Some realize that
the administrative hassles of managing paper time slips exceeds their ability to manage them and
remain sane. Mistakes made when adding up time sheets also lead many companies to search for a
more accurate way to calculate payroll hours.
Concerns about time theft can also spur the decision. "Time theft" describes the practice of
over-reporting the amount of time spent on the job. This can be as innocent as employees who
round up the amount of time they have been at work or who stretch a break to last longer than
scheduled. Even 5 to 15 minutes extra per day can add up to an extra week of pay per year per
person. Multiply this cost across all your staffers and you can see how much it can affect your
profitability.
Most companies find they need a time and attendance system when they have about 25 employees
they need to track. With basic systems now available for less than $1000, even smaller companies
can find a time tracking system valuable.
Larger companies with more than 250 employees often turn to more robust time and attendance
systems for their labor management needs. With these systems, you can not only track when employees
log in and out, but also proactively manage your workforce. Critical decisions such as implementing
elaborate scheduling rules, understanding workforce productivity, and forecasting HR needs into
new business areas cannot be made without basic labor management analysis. Time and attendance
software creates a report profiling your company's human resources, helping you make the right
choices for your business.
Not every company needs a time and attendance system, however. If your staff is primarily salaried,
time sheets have been manageable, and you do not need detailed information on how your workforce
spends its time, a time tracking system is probably more than you need.
<< Back to top
How time & attendance software works
Time and attendance software is elegant in its simplicity. It collects employee time data and enters
the information into a database. The collected data is then reviewed and approved by a manager
so it can be used for payroll processing and custom reports.
Entering employee arrival and departure times into the system is remarkably easy. Employees
use unique identifiers to log in and out, typically a card with a magnetic stripe or barcode
, or a proximity card. Proximity cards allow employees to wave the card by the time entry device
instead of actually swiping the card through a reader. PC- and Web-based solutions are gaining
in popularity, and phone-based solutions are also available.
For security purposes and to avoid "buddy punching," where employees log in for each other,
some companies offer a biometric input device that checks fingerprints or handprints to ensure
that the correct person is logging in and out. Iris scanners are also available but not widely
deployed due to privacy concerns.
Most companies rely on administrative staff to enter attendance information for salaried workers.
However a growing number of companies let employees enter their own information directly into
the time and attendance system, including flex-time hours, vacation time and sick day information.
For companies with remote offices, data entry systems that use touch-tone telephone service
or the Internet complement the traditional methods of collecting time data.
<< Back to top
Time card software features
As you compare offerings, make sure to focus on evaluating the features that you intend to use
most often. For example, if your company would like to use your labor data for other workflow functions,
a careful evaluation of a system's reporting and data export functionality is necessary. In turn,
a detailed analysis of less relevant features may not be warranted.
For smaller companies
Basic time and attendance systems provide routine time tracking of employee log-in/log-out times.
These time clock packages also offer schedule management, which allows supervisors to create and
maintain a schedule for each employee. In addition, supervisors can set rules for scheduling staffers,
including setting break times, holidays, and even whether overtime is allowable. With most systems,
you can also track tardiness and patterns of absenteeism.
Regardless of the specific features your company requires, understanding what basic accounting,
auditing and reporting tools the vendor offers is critical. Managers must have easy access to
employee data and the tools to audit it for accuracy. The ability to generate calculations retroactively
is a particularly useful feature, especially for correcting error and calculating changes in
salary or benefits.
For larger companies
More complex labor management systems designed for larger companies feature more functionality
and more robust reporting. Managing labor data according to an employee's job description, project,
or location is common in these systems. Some even track production for those employees paid by
per unit manufactured. This type of job costing is invaluable for companies that need to evaluate
their workforce productivity or forecast their workforce needs..
Many software vendors make products geared for a specific industry, such as healthcare or education.
Such industries have established work routines and specific information requirements, helping
define specific scheduling and reporting needs. However, do not get roped into a purchase merely
because the name on the box matches your industry. A vendor should demonstrate why you need the
added functionality and justify any costs behind it.
Remember to focus on the key features you want when evaluating systems. The clearer you can
be in sharing your expectations, the faster a vendor can prove to you whether they can meet them.
Sitting down with your staff ahead of time and creating an operational needs and goals statement
is an excellent way to arm yourself against an enthusiastic sales pitch.
<< Back to top
Time card systems compatibility
One of the most common and most expensive mistakes buyers make is failing to ensure their current
infrastructure will work with the new time tracking system. While you can quickly weed out any
system that does not work with your current operating system, databases, and enterprise applications
(e.g., resource planning systems from PeopleSoft or SAP), a superficial analysis of the system's
requirements is not enough.
Any vendor under serious consideration should be able to demonstrate its compatibility with
your company's overall environment. This means that it should be compatible with the data input
devices you want to use, your current IT applications, your HR policies, and your payroll service
vendor. If you plan to set rules in your time tracking system, go through your company handbook
and see if the vendor can accommodate your time and attendance-related rules. Similarly, you
should ask about compatibility with your payroll service to ensure seamless integration.
Do not purchase a product based on the "upcoming" or "next-generational" pitches from a vendor.
Yes, understanding a vendor's future plans can be an important factor in your investment decision,
but to use a familiar analogy, remember that you are purchasing a car to drive today, not tomorrow.
If they do not fully integrate with your systems today, a vendor should offer a clear and workable
plan for creating a working system that addresses any conflicts you face, along with a timetable
for implementation.
The good news is that you will find most vendors offer systems that are compatible with typical
industry configurations. Most software vendors support the standard interfaces for data entry
systems and payroll services, and are flexible enough to accommodate common business rules..
Most also offer encrypted file transmission and other basic software security measures; the vendor
should be able to prove the system is secure from tampering both from internal and external parties.
<< Back to top
Time and attendance vendors
Time and attendance systems are sold directly from vendors or through resellers. Vendors will typically
handle large accounts themselves and pass smaller companies to local value-added resellers (VARs)
who handle sales, installation and training.
Start the purchasing process by investigating manufacturers. Make sure the companies you are
considering have the resources to support and continue building their business. Moreover, the
company should be committed to sustaining the product line you are purchasing. This is the time
to learn as much as you can about the company's reputation and financial stability.
When you are comfortable with the company producing the product, focus on choosing a reseller
with relevant expertise. Some will specialize in time and attendance software or human resource-related
systems, while others will take a more "jack of all trades" approach. While neither is inherently
better, it is always better to work with a company that has extensive experience in the application
that you want installed.
When considering VARs, ask how long they have carried the product that you are interested in,
and how much of their business it represents. This can help you gauge their commitment to the
package you are considering. To guarantee service in the event that your VAR drops the line,
you may want to see how many resellers there are in your local area. Inquiring about the VAR's
opinion on how responsive the system manufacturer is to issues can also be helpful when choosing
a system. When checking references, make sure to inquire about all phases of implementation including
installation, training and support.
<< Back to top
Time and attendance solution pricing
Like all enterprise software, time and attendance systems are sold in various configurations.
Typically, pricing is based on four variables. The server, or program engine, is priced according
to its functionality. Specialized features such as a health care module may be extra. The number
of employees who will use the system also affects pricing, with differing costs for administrators
and and employees. Finally, the quantity and type of data collection devices you use will also
affect your total costs. Web-based time and attendance systems typically have monthly fees instead
of an upfront server license but also price their systems by the number of employees.
A small company can expect to pay less than a $1000 for a basic time tracking system with scheduling
functionality and payroll service integration. Prices can climb swiftly into the tens of thousands
of dollars as you add more people and data collection devices to your system. Companies with
thousands of employees should expect to pay a bill in the $100,000+ range. Software customization
adds significantly to the price tag.
No matter what your setup, make sure the vendor itemizes what they are charging you for their
technology rather than just paying the full price for a closed box system.
<< Back to top
Buying tips
Installation planning. Agree in advance on a plan for installation that specifies
the duration of the job, and is clear about what in-house technology and staffing resources your
company is expected to provide.
Documentation. Make sure the company supplies manuals and user documentation
for the entire system.
Take training seriously. Ensure adequate training is provided to your staff.
Upfront instruction for the users of the more advanced reporting tools slashes ongoing support
costs and can be an important motivator for staff to adopt these new productivity tools.
VoIP time tracking. Some time tracking vendors now offer time tracking systems
that work with VoIP phone systems where employees can log in and out via their phone handset.
<< Back to top
|
