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“Yes, and it created a mess. My foremen complained. My bookkeeper complained. The timecards were loaded with errors and the data didn’t make any sense. We gave up.”

Terry’s response brought back many painful memories for John. He had fought this battle for years. He explained to the foremen why job costing was so important to the amount of work his company could provide them. That worked with some but not all, and he finally laid down the law: When he made recording labor time by work task a non-negotiable part of their job, the entire team started doing a better job with the paperwork.

“Terry, first of all, you need to track the time spent on the major tasks. You will never be able to estimate and schedule accurately without that information. Second, you must be firm with your foreman and bookkeeper. They will record and store that information accurately. Oh, and change your time cards. Assign cost codes to each major task and put the codes on the back of the timecard.”

“How many different codes should I use? Do I try to catch all of their activities?”

“Focus on the activities that account for 80% of their time. My rule of thumb is ‘Never try to track more than four activities per crew per day.’ When I was your size, my foremen tracked time by the major components: ground preparation, layout, forming, pouring and finishing, cleanup, and drive time. The projects my company now performs allows us to have specialized crews.

“Each crew has its own set of cost codes. For example, our forming crew tracks layout time, forming time, and break-down and clean-up. They also track the part of the job they are working on, whether it is footings, slabs, or walls.”