See what share of available hours was billable, and how many more billable hours your target needs.
Utilization = billable hours ÷ available hours × 100.
Gap = available hours × target − billable hours.
A team of IT technicians has 1,800 available hours in a month and bills 1,350: 75%. At an 80% target they need 1,440 billable hours, a gap of 90 hours, or about $8,550 at a $95 bill rate.
Service firms, agencies and field teams use utilization to see how much paid time turns into billable work. Low utilization can mean too little work, too much admin or travel, or hours not being recorded.
Define available hours consistently, for example paid hours minus holidays and approved leave.
A three-person interior design studio has 720 available hours in a month after holidays and bills 610 of them: utilization is 84.7%. Its 80% target needs 576 billable hours, so the studio passed the target by 34 hours. Because the target is reached, the calculator shows no gap and no lost revenue figure.
Utilization is billable hours divided by available hours, so a month with more vacation raises the rate without any extra billing. The revenue gap uses one average bill rate, which overstates it if junior staff would fill most of the missing hours at a lower rate. The result is misleading when time is entered late or estimated at week end, since forgotten entries look like non-billable time.
Utilization tells you how many hours were billable. Realization tells you how much of the value of those hours you actually invoiced and collected after write-downs and discounts. A fictional studio bills 610 hours with a standard rate of $95, worth $57,950. After a discounted fixed fee on one project, it invoices $52,155, so realization is 90%. A team can hit its utilization target and still miss revenue if realization is low, so track both.
Base each target on a typical week for that role, not on what the busiest person achieved last quarter.
It depends on the role; client-facing roles are higher than managers.
No; people need time for admin, training and breaks.
Paid hours minus holidays and leave, defined consistently.
Record all billable time and reduce non-billable admin.
The calculator shows that the target is reached and no gap. Running well above target for weeks can mean admin, training and client follow-up are being skipped or done after hours, so check what non-billable work is piling up.
Use each person’s scheduled hours minus paid time off and holidays, not a full-time 40. A part-timer scheduled 24 hours a week with no time off has 24 available hours that week.
Only if your contracts allow you to bill it. If not, record it as non-billable so it stays visible.
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EZTime records employee hours and totals them for payroll. Book a demo to see it with your own team.