When I retire, there will be many aspects of my career I’ll miss — but time tracking won’t be one of them. Early in my accounting days, we filled out daily timesheets in 15-minute blocks, from 9 to 5, and on weekends during busy season. These days, apps have made it easier, but the essence is the same: reporting who you’re with, where you are, and what you’re doing.
Both accountants and lawyers must track time, even in firms that don’t bill by the hour. Any client-facing service business needs to monitor how its employees spend their time. It may not be fun, but it’s essential. Every person billing client work needs to track time accurately and consistently. It’s not about perfection — it’s about discipline.
Time Tracking Fuels Forecasting
Professional service firms like law practices are built on human capital. Time is the product being sold. By tracking it, firms can assess the value and cost of each employee’s time — and understand the profit margin between those numbers. This insight is crucial for strategic planning. If a firm wants to grow by 20%, it must ask: Do we have the right number of attorneys? What overhead will we need to support the increase? How will that impact profitability?
Instead of debating whether to require time tracking, the real question should be: Do you want to know if growth targets are realistic?
Time Tracking Is Simple Once the Purpose Is Clear
There are many tools — Clio, PracticePanther, TimeSolv, and more — but the core function is the same: tracking billable and non-billable hours by matter.
Billing Models Still Need Time Tracking
Hourly billing obviously requires time tracking to generate invoices. But even flat-fee and contingency firms benefit. Flat-fee attorneys need to understand how long tasks take to price services correctly. Contingency lawyers must evaluate if their time investment aligns with the risk and reward of each case. No matter your billing model, tracking all hours is vital.
Understanding Utilization and Bill Rate
Time tracking provides the data needed to measure productivity and profitability. Utilization rate (billable hours vs. total working hours) and average bill rate (actual earnings per hour) help determine whether a firm is on track — or needs adjustments.
Strategic Growth: Pulling the Right Levers
These metrics can identify which types of cases are more profitable and guide pricing or staffing changes. If you want to grow 20%, look at your current bill rate and utilization. How much do they need to increase? Are those changes achievable?
Time tracking also reveals:
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Gaps between standard and actual billing rates.
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Underperformance that might require training or restructuring.
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Whether you’re over- or understaffed.
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Trends in certain types of matters that consistently earn less, suggesting a change in pricing or staffing strategy.
It even explains monthly fluctuations in billables — helping you adjust for vacation patterns or identify other causes.
Time Tracking Makes Growth Tangible
Tracking time lets you model your firm’s financial year and project revenue. If you’re not hitting targets, you can pivot. If you are, you can explore ways to scale — such as raising rates or improving leverage.
That’s when it gets interesting — even if you’re not thrilled every time you log your hours.
