An Easy Way to Understand the Relationship Between Time Tracking and Profit

Effective and accurate time tracking is integral to getting paid what one’s efforts are worth. An example of how it does so is given below and can help business owners and freelancers to understand why this is the case.

Building the Game

For the sake of example, we’ll use a video game development project, vastly simplified to make it easier to follow. The project will involve four stages: narrative writing, concept art, programming and testing. In real life, there’s more to designing a video game than this, but it will serve to give an illustration of how time tracking is related to profits.

Our example team are freelancers; four people who all handle the smaller tasks that fall under their general area of expertise.

Narrative Writing

The writers will have the simplest job. They’ll bill by the hour for this project and their rate will remain the same for any type of writing. The editing will cost slightly more.

The writers spend 50 hours writing for the game. Subdivided, this works out to:

  • 25 hours writing narrative
  • 25 hours writing dialogue and formatting it for the game

In the end, they enter 50 hours at a rate of $20 per hour.

This makes it seem like time tracking may not even be necessary, but the next stages make it apparent why it is.

Concept Art

The concept art takes a total of 200 hours to complete. Within that, however, there are several different skillsets. The hours end up breaking down to.

  • 100 hours of drawing and modeling at $20 per hour
  • 50 hours of photography at $25 per hour
  • 50 hours of digital rendering and animation for $100 per hour

Already, it’s apparent that there are many different rates being charged and that each portion of this project is taking different amounts of time. Where the programming gets involved, it gets very complicated.


When the programming starts up, the billing gets complex. In the end, the programmers log the following hours:

  • 400 C programming at $100 per hour
  • 400 PHP, JavaScript and other web programming at $50 per hour
  • 20 hours of debugging at $100 per hour
  • 100 hours of HTML/CSS programming for the website at $20 per hour


Testing can be a complex process. It may be a part of the overall programming process, but there is likely some that needs to be done outside of the programmers to get an idea of user experience. For testing, the figures end up to be:

  • 1 testing session with expert players for $500 total
  • 1 testing session with random focus group at $1,000 total
  • 1 testing with industry writers for free

A Lot to Work With

As you can see, there is a lot of information here to work with. The information comes down to more than just the cost of the game, however. The costs of the various tasks involved likely have some impact on the profitability of the game in specific ways.

For instance, the $2,000 spent on web programming may translate to—just for the sake of example—100 subscriptions to the game through the website at $15 per month. That’s not going to take long to turn a profit so, clearly, time spent on websites for this game have proven to be profitable and may be in the future, as well. It’s a solid bet that they will.

Where the programming was concerned, imagine that the game was released and had quite a few bugs in it that had to be patched. In the future, the $2,000 that was spent on debugging could be increased, reducing the cost of programming patches from the game after release. The testing sessions with experts may also need to be increased, as they may spot bugs that the average player might miss.

How it Translates to Profit

There are plenty of ways that good time tracking software can make this information profitable. By taking a look at a color coded timeline, for instance, the reason that something fails to be as profitable as expected might be revealed. Maybe the hours the writers were given to come up with a narrative were too few and resulted in a shallow game. It would be apparent, looking at the timeline, that they took up the least time and money, so it would make sense to expand the percentage of development budget spent on this in the future to make games that are more profitable.

If the programming charges seemed high and the results were buggy, perhaps it’s time to consider a different team of programmers.

These types of issues can be realized through the numbers. When those issues are addressed, they can help improve the profitability of a company by letting the company know where their money is being spent and if the results are commensurate with those expenditures.

Any Business

The above example is simplified, and still very complex. In most organizations, the time and tasks involved in a project are likely to be much more complex to measure, but the results can be just as useful when they are recorded with good item tracking software. The reports generated afterward may reveal weaknesses in the business process and that may serve to make future efforts more financially beneficial to the company.

Bad information leads to bad decisions. Good information, however, provides the basis for good decisions. With the time tracking resources available today, it’s possible to record time spent on projects easily and accurately. That information can help a business to better understand both its strengths and its weaknesses.

That all translates to more profit. Because weaknesses can be identified, they can be avoided in the future. Because strengths can be identified, they can be exploited in the future toward more profitability. This works the same in any business, large or small. By understanding where the money is going, it’s easier to understand what is generating the best returns for the company in question.

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