What should be considered when calculating per person profitability?
When your organization is looking at an employee’s profitability, should you also be considering their productivity? By looking at just one metric or the other, can your organization fully evaluate if your employees are performing to their full potential?
As a professional services firm, the first step to having a better understanding of your organization is to figure out how many hours each employee needs to bill in order for the organization to be considered profitable. To get an accurate calculation, you need to do more than just subtract the employee’s salary from their revenue; you also need to factor in an employee’s benefits and company overhead costs.