See your team's current and future state of utilization.
What is Utilization and why is it important?
Utilization is a useful metric for evaluating how well you’re planning, and how well you’re making progress toward those plans. It is an important, but lagging indicator of how good you are at proactive planning — not necessarily how good you are at resource management.
Business leaders often fall into the trap of trying to maximize utilization as much as possible. In reality, driving utilization too high can lead to even more detrimental effects on morale and the business. Good insight into your utilization can help prevent People and teams from underperforming or being burned by heavy workloads.
So what is Utilization? Simply stated, it is the number of billable hours divided by capacity. Regardless of the billing model established (T&M, fixed fee, etc.) think of billable hours as anything associated with generating positive revenues. Standardizing this across the organization allows agency leaders to quickly see the revenue generating potential of the team.
Billable Capacity vs. Total Capacity
Total Capacity: Total available hours per week multiplied by the number of billable People
Hours per week (determined via the Customization Setting page) is a baseline number of working hours your People are expected to be available per week. Typically, this is 40 hours per week, but could be higher or lower depending on your internal policy.
Billable Capacity: Total available hours set aside for billing per week across all People
Billable Capacity can be established by role or per individual and should be thought of as the goal for target billings. This represents the number of total hours per week that you expect to be billable to clients. This is usually role dependent and varies organization to organization. As an example, you might want your Director level workers only billing 20 of their 40 hours each week to account for internal management time.
Utilization - Overview
What does this report tell me?
This report displays a simplified view of what was planned for capacity, target and projected hours on projects.
The header will break down the Projected Utilization, Planned Utilization, and Target Utilization for the time frame selected across projects. You can dial in on Departments, Roles, Financial Models, etc for greater visibility.
Over capacity is shown in pink— this takes into account PTO and holidays as well.
Capacity: Total available hours per week (typically 40) less any defined PTO / Holiday
Billable Capacity: Total available hours set aside for billing per week
Total Planned: Allocated hours that have been added to Parallax project shapes inclusive of projects that are “awaiting start”, “in-progress”, or soft allocations to projects in the pipeline; filters can be applied to remove pipeline projects, or only "in-progress" projects (as examples) and Total Planned will adjust accordingly
Total Actual: The total hours that have been submitted through individual timesheets during the selected time period inclusive of billable and unbillable hours
Planned Utilization % : Total planned hours divided by total capacity, shown as a percent
Planned Billable Utilization %: Total planned hours divided by the total billable capacity, shown as a percent