How to track labor time so it reaches the right job
Hours get written down somewhere, and by the time they reach the books the job and the cost code are guesses.
In a company that tracks time well the superintendent and the field team fill out the daily report: the production done that day, the subs and the company's own labor, and the equipment on site with the hours used. Time is entered by cost code in the labor and direct job expense sections. The PM approves the time on the PM's own projects, which keeps people from buddy punching or milking the clock. Payroll then processes the time and any required paperwork, such as certified payroll.
Three moves, in order
Step 01: Job cost structure
Seven cost categories and three levels of granularity, built so the estimate and the ledger use the same words.
Learn this part of the job
SPM The Construction CFO publishes this course. It's a separate company from this one, and the course is on its own school site.
Other problems step 01 solves
Other things that go wrong
What owners ask
How do you keep time on the job site?
Hours get written down somewhere, and by the time they reach the books the job and the cost code are guesses. In a company that tracks time well the superintendent and the field team fill out the daily report: the production done that day, the subs and the company's own labor, and the equipment on site with the hours used. Time is entered by cost code in the labor and direct job expense sections. The PM approves the time on the PM's own projects, which keeps people from buddy punching or milking the clock. Payroll then processes the time and any required paperwork, such as certified payroll.
Which part of the system fixes this?
The step is number 01, job cost structure. Seven cost categories and three levels of granularity, built so the estimate and the ledger use the same words. It's drawn from chapter 1 of CONTROL: C.F.O.S. Construction Financial Operating System.
Is this normal for my trade?
Across the 48 trades that publish a figure, net profit at $1M to $5M averages 7% after taxes. If you're well under that and this page describes your month, the two are usually the same story. The published average tells you where the pack is, and your own job costing tells you where you are, which is the number that pays payroll.
Where do I start?
Put labor, subs and equipment hours on the daily report, filled out the same day.
Is this where an installation usually starts?
It usually is. Step 01 has nothing ahead of it in the chain, and it supplies step 03 and step 04. That's why most installations begin here, and why fixing this one unblocks work you haven't started yet.
Wrote CONTROL, the 8 step system behind these figures. More about the author.