Draft reference — content review pending
Revenue per Billable Employee
Eligible service revenue divided by the average number of billable full-time-equivalent employees during the selected period.
Business question
How much eligible service revenue is associated with each average billable employee equivalent?
Formula
Revenue per billable employee = eligible service revenue ÷ average billable full-time-equivalent employees.
Calculation notes
Define the revenue scope, billable-employee population, FTE calculation, treatment of part-time staff and contractors, and the opening, closing, or periodic-observation basis for average headcount.
Edge-case guidance
If average billable FTE is zero, the measure is not meaningful. Document partial periods, employees changing roles, acquired or transferred teams, revenue recognized over time, and work delivered by non-employee contractors.
Required data
| Input | Type | Status | Available source hints |
|---|---|---|---|
| Eligible service revenueService revenue included under the agreed scope and recognition policy for the selected period. | Currency | Required | Accounting software · Excel · Google Sheets |
| Average billable FTE employeesAverage billable employee full-time equivalents under the agreed population and averaging rules. | Number | Required | Project management system · Excel · Google Sheets · Manual records |
Interpretation
Use the measure to view revenue relative to billable workforce capacity. It can inform staffing and service-model decisions but does not independently prove employee quality, efficiency, or profitability.
Caution
Higher revenue per billable employee can reflect price, client mix, staffing changes, or revenue timing rather than better work. Do not use it as a standalone employee-performance judgment.
Implementation recommendation
Agree on revenue scope and FTE rules with finance and people owners, then pair the measure with utilization, project margin, quality, and on-time completion.
Target guidance
Set the first target from comparable historical performance for revenue per billable employee, then adjust it for the service model, strategy, delivery capacity, seasonality, data quality, and client commitments. Review the direction with the accountable owner and consider this trade-off: increasing the measure through workload intensity or lower staffing can weaken service quality, resilience, and team health.