Step 5.  Revenue Integration.  Tools like Salesforce.com or SugarCRM provide a great way to track bookings (depending on your business, even revenue). Integrating your time accounting system into these systems can give you a profit report (or an approximation of one).  Integrating the system into QuickBooks or other accounting systems can connect time periods for revenue recognition to cost, giving a good estimation of profit on a per-person-per-project basis.  For knowledge worker organizations internal to a company, proxies for revenue like business value delivered can be used.

Now you are successfully measuring per-person, per-project profitability. At every step, your situation is better than it was before. Once all of the above steps are complete, you'll know which employees are making money for the firm and which aren't, which engineering projects are profitable and which aren't, and which customers are profitable and which aren't. This is powerful information that can affect your strategy going forward, your rewards and compensation systems, and many other aspects of your business, just as it did for TKG.

Conclusion
Steve Covey argues persuasively in his book "The Seven Habits of Highly Effective People" that you should track your time even if it's just for yourself. If you do, you will certainly be surprised by the data. However, the business value really starts to get delivered in terms of understanding profitability for organizations of at least 5 people. Engineering firms that track project costs and ROI will always take the lead, leaving other firms in the dust.  Perhaps it's time to evaluate your firm's project accounting methods and how they are working for you.

Curt Finch is the CEO of Journyx (http://pr.journyx.com), a provider of Web-based software located in Austin, Texas, that tracks time and project accounting solutions to guide customers to per-person, per-project profitability. Journyx has thousands of customers worldwide and is the first and only company to establish Per Person/Per Project Profitability (P5), a proprietary process that enables customers to gather and analyze information to discover profit opportunities. In 1997, Curt created the world's first Internet-based timesheet application - the foundation for the current Journyx product offering. Curt is an avid speaker and author, and recently published "All Your Money Won't Another Minute Buy: Valuing Time as a Business Resource." Curt authors a project management blog at www.project-management-blog.com.