Accounting hours worked: the pros and cons

Hi, Habr!

When in conversations with IT people we are talking about the accounting of labor hours, holivor lights up instantly. And it does not matter with whom to talk about it: the topic touches both ordinary developers, and team leaders, and top managers. We offer for discussion our vision of the topic, taking into account the hours - maybe we will move a little in search of truth in the process of discussion.
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Where do legs grow from?

As usual, it all starts with the structure of a person and the characteristics of his behavior. In psychology, there is a phenomenon called “CD gap”, where “C” is “competence”, “D” is “difficulty”, and “gap” is “gap”. When a person has a gap between his competencies and the complexity of the task before him - this is a big problem for him. As a rule, in such a situation, the brain is trying to quickly come up with or take from the outside a set of simple rules to create the illusion of controllability of chaos. The word “illusion” was written specifically, because the set of rules did not fill the lack of competence, otherwise everyone in the world would have been super-successful long ago.

We apply science to a specific situation

Here some IT-company grows, and suddenly its profitability begins to fall. Based on our practice of communicating with dozens of general directors from different industries, the most frequent reasons are almost the same for everyone, and there is no “sudden”:

• the company has lagged behind the market and does not update products;
• there is no marketing and positioning;
• the company was overgrown with not very helpful employees;
• Tops forget to count and plan profits;
• internal conflicts between key individuals;
• the company just lost the course.

Yes, sometimes there are subtleties, but the main reasons are given above.

So, profits fall, shareholders are shocked, what to do is not clear. This is where the “CD gap” phenomenon turns on: many start to “patch holes” and turn on the mechanism of repression - to introduce restrictions, bureaucracy and other emergency measures (see details in the book “Russian management model” by Prokhorov). Locally, this may give a small increase in profits, but in the long run will lead to the departure of adequate people from the company.

Among the panic measures is usually and tracking man-hours. Management wants to calculate inefficient employees using mathematics, or simply inject it so that it is like the others. But if you think about it - it makes no sense. Everyone knows who works well and who knows poorly. And if they don't know, there is a lack of competence.

Necessary and sufficient minimum

We do not claim that the registration of hours is not needed at all, we believe that it simply should not distract people from work.

Yes, if you work in an agency structure (integrator, advertising agency, web studio), you will have to consider the project budget and, accordingly, the hours. There are only two reasons:

1. in the case of customer disputes, time spent reports can be an argument in your favor;
2. You can roughly understand the profitability of projects.

The word "about" about the profitability of projects in agencies written on purpose. Based on experience, it is possible to accurately calculate the profitability of a project only in the case of complete isolation of the project team. For these purposes, it is best to allocate it into a separate legal entity. Otherwise, any system of distribution of total costs will contribute to its error.

In our practice, we use four gradations of project profitability: “failure”, “soon failure”, “good” and “excellent”. This is quite enough to solve the managerial problem of choice: to abandon the project, simply continue working or actively develop relations with the client.

To ensure such a gradation, it is enough to enter simple rules:

• at the end of the working day, the employee distributes his 8 hours to tasks;
• distribution quantum - 1 hour;
• no penalties and bonuses are attached to the actual time logging.

The most important thing is to bring the cause of the introduction of accounting to all employees and make sure that they understand it. We are all people, we can agree with everyone, if the goal is good. Beginners simply need to be taught that accounting is a regular and simple procedure, how to brush teeth 2 times a day - as a rule, there are no problems with beginners.

Target architecture

In my opinion, there are two viable methods of doing business in IT:

1. the creation of long-term expensive projects for the order (it does not matter, the customer is internal or external);
2. line production of cheap standardized projects.

In both cases, the problem of taking into account the actual time is not worth it for obvious reasons. In the case of an expensive long project, the team simply works entirely on one project. To calculate the flow in this case is a trivial task. In the case of a stream, most of the tasks should be automated or described in detail by instructions, like in the kitchen at the network pizzerias. The share of probabilistic creativity is reduced to a minimum, and KPI among employees becomes simple - how many tens or hundreds of nuts it has screwed in a month. Profitability in this version will be provided by two indicators: the speed of the process, the volume of incoming requests and the smooth linking of their growth.

All intermediate organization options are usually unstable due to the need to constantly juggle resources and difficulty in planning the load of employees. If your IT company is in such a state, this is an alarming sign and it's time to think about positioning and strategy.

Summary

Yes, sometimes the accounting of hours is needed, but if it is already implemented - do not tighten the nuts too tight.
But, in an amicable way, with a normal business organization, there is no particular need for hours logging.

Ps.

I apologize, I forgot to tell you what quite clever tops do when profitability falls and there is a “CD gap”. Everything is simple - they compensate for the lack of competencies in order to have them enough to solve current problems. Those. either they hire cool specialists to the staff, or they include external consultants.