Utilization - If you calculate utilization - what do you include? What is your equation?

James Evans
James Evans Member
edited February 2023 in Services Delivery & Operations

If you calculate utilization...

Do you calculate the factor differently for Exempt vs Non-Exempt resources? (Does the denominator hours change based on Exempt vs Non-Exempt?)

What hours do you include in the Numerator. i.e. All Billable hours? Education taken and/or delivered?

Do you modify the FTE based on job role? i.e. count a Team Lead as zero or partial FTE?

Best Answer

  • StevenForth
    StevenForth Founding Partner | Expert ✭✭✭
    Answer ✓

    We only calculate billable hours for utilization as that is what drives the business model, but we intentionally keep our target low, 50%, as that aligns with our business model. We follow a service led growth strategy so profitability on our services is very high as our consultants can leverage a lot of powerful software.