Average amount of money a company pays to hire one of your consultants.
Formula:
(
Sum(New Time Entry,Total Billable Amount)/Sum(New Time Entry,Hours)
)
Especially relevant for consultants or law firms where certain employees can be temporarily hired by another company to get a specific job done. This KPI, therefore, monitors the money these employees are earning for the firm when they are hired temporarily by another company. This rate is paid directly to the firm as the provider of the service because employees usually have an already agreed monthly wage. Even if they don’t have this agreement, is the firm the one responsible for deciding the amount that will be paid to a certain employee. This metric keeps track of the average rate, which means it takes into account all your employees with these characteristics. This is a useful number to look at in order to have a more accurate insight into the profitability of your team. It can be used together with the KPI called Sum of Reported Hours to have a better overview of the team’s performance. For instance, if they are working many hours but not earning much for the company, it’s an indicator that the billable rate is actually low.