Please be careful not to make this a complex affair. Maybe your organization never monitored attendance, particularly employees' clock-ins and clock-outs, so closely.
Now, the chief of the organization finds some employees misusing it, which in turn affects the overall performance and quality of work. They want to take corrective steps.
Steps to Address Attendance Issues
1. Call senior team members for a meeting with the MD to discuss and share concerns and arrive at attendance guidelines.
2. Probably, you could come up with two sets of guidelines - one for customer-facing/support and the other for design/development/quality/business support, etc.
3. To avoid inconvenience for customers, let the customer-facing team be compliant with a regular schedule (e.g., 9 - 6 with a 1-hour break and no flexibility).
4. For the rest, let it be a flexi-shift with a clock-in time of 10 AM and a daily threshold of 8 hours and a weekly threshold of 40 hours (if on a 5-day workweek).
5. Introduce a reward scheme (e.g., Silver Star - monthly threshold with xx hours and above, Gold Star - Half-Yearly threshold xxx hours and above, Platinum Star - Annual threshold xxxx and above with some financial incentive).
6. Run the scheme for 1 year, and if finding many defaulters, introduce forced discipline rules like posting Loss of Pay, deducting Leave, etc., on behalf of employees who account for more than 'x' days of late coming/early going.
I hope this helps. Let me know if you need further assistance.