Are certain employees in your organization consistently underutilized while others are overburdened with tasks?
Do you frequently encounter issues like project delays or sub-par quality?
Has your firm experienced a steady decline in revenue year over year?
If your answer to these questions is a resounding ‘Yes,’ it’s clear your organization could benefit from developing a utilization report.
A utilization report is a critical tool firms leverage to track, optimize, and maintain high workforce productivity. It enables managers to swiftly identify instances of sub-optimal utilization and make informed decisions to enhance employee performance, improve project success rates, and maximize organizational revenue.
In this blog, we will explore everything you need to know about utilization reports: their components, importance, and steps to effectively build one within your organization.
Let’s get started.
What is a Utilization Report?
A utilization report is a detailed record of how efficiently employees spend their time at work. It offers insights into billable and non-billable activities and a team’s or individual’s overall productivity levels. This information empowers managers to assess existing workloads and optimize resource utilization for organizational growth.
Basic Components of the Utilization Report
Here are a few components of the utilization report:
Employee Information
A utilization report includes essential employee details, such as their name, employee code, role, team affiliation, etc. This information helps evaluate individual performance and productivity, which is essential for performance appraisals and identifying areas for improvement.
Project Details
A utilization report includes project details such as the name, code, client name, start and end dates, and other relevant specifics. This data helps identify and track how employees are utilized across different types of work, including internal and external projects or BAU activities.
Time Period
In a utilization report, the time period refers to the specific duration, such as weekly, monthly, or quarterly. This element allows managers to assess resource utilization within that specific timeframe and optimize it as needed, maximizing organizational revenue.
Project Allocation
Project allocation in a utilization report refers to how resources are deployed or assigned to specific projects or tasks. It shows the distribution of resources between billable and non-billable projects, enabling managers to make informed decisions to enhance overall efficiency and maximize billable hours.
Productivity Metrics
Productivity metrics offer insight into the efficiency of each employee in accomplishing tasks that contribute to organizational goals. They provide a clear view of billable, non-billable, and total utilization of teams or individuals, helping firms optimize their resources and improve overall cash flow.
Now that we know what a utilization report is, let us move on to the types of utilization reports.
Types of Utilization Reports
There are a few different types of utilization reports, each focusing on different areas to help firms get the most out of the team and its resources. Let’s look at the most useful ones:
Employee Utilization Reports
An employee utilization report gives a clear insight into how each team member spends their time and efforts across billable or non-billable tasks and projects. This report is vital for improving workload distribution, boosting employee productivity, and maximizing overall ROI.
Group Utilization Reports
The group utilization report highlights the utilization levels for entire organizational teams or departments. The data helps determine if groups are optimally utilized against their capacity or availability. Accordingly, managers can implement necessary measures to maintain a balanced workload distribution and boost productivity.
Utilization Forecasting Reports
Utilization forecasting reports are projections that estimate the expected level of human resource usage in the near future. With this foresight, businesses can better plan and allocate resources for upcoming projects, reducing the risk of over or under-utilization and maximizing efficiency.
Read More: What is Resource Utilization? A Complete Guide to Improve Business Efficiency
With the details about the types of utilization reports covered, let’s now explore their significance.
Importance of Utilization Report
Maximizing organizational productivity and revenue is the ultimate goal of any business. Therefore, to achieve this, firms can leverage utilization reports that offer real-time insights into employee performance.
It empowers managers to evaluate the time employees spend on projects and non-project activities while comparing it with forecasted values. Moreover, it helps identify overutilized or underutilized resources within the organization. Accordingly, managers can make informed decisions to optimize resource allocations.
Lastly, utilization reports enable firms to proactively forecast utilization for current and pipeline projects and adjust resource schedules to ensure they spend maximum time on billable or high-priority tasks. This helps enhance workforce productivity, boosts profitability, and ensures long-term organizational success.
Now that we’ve covered the importance of this, let’s take a closer look at how to analyze a utilization report.
How to Analyze a Utilization Report?
Analyzing a utilization report provides significant insights into how resources are used and where improvements can be made. Here are some factors to analyze it better:
Total Utilization Rate
The total utilization rate measures how effectively employees use their capacity for billable and non-billable work. Ideally, this metric should approach 100%, indicating optimal use of equipment and workforce with minimal downtime or strain. It is calculated as:
(Total Registered or Scheduled Hours / Total Available Hours) *
Read More: How to Track Resource Utilization?
Ideal Billable Utilization Rate
An ideal billable utilization rate refers to the percentage of time that employees spend on tasks or activities that directly generate revenue for the organization, typically aiming for 70–80% efficiency. This range balances profitability with necessary non-billable activities such as training and meetings.
Forecasted Vs. Actual Utilization
This metric compares planned resource usage (as predicted in schedules) with actual hours (as logged in timesheets). Analyzing these differences helps managers assess resource efficiency, pinpoint shortfalls, and implement corrective actions to align performance with expectations.
Resource Over-Utilization
Resource overutilization occurs when resources, such as equipment, workforce, or facilities, are utilized way beyond their intended capacity. This prolonged strain can result in exhaustion, heightened stress levels, employee burnout, and reduced output.
Resource Under-Utilization
Resource underutilization occurs when available resources, such as equipment, workforce, or facilities, are not fully utilized to their maximum potential. This inefficiency can lead to decreased employee engagement, lower morale, reduced productivity, and potentially higher costs relative to output or demand.
Read More: Signs of Resource Underutilization and (how to) Course Correct Them
We now know about the factors to analyze the utilization report, and now let us move on to the steps to build one in a firm.
5 Steps to Build a Utilization Report in Your Firm
Developing a solid utilization report will help managers avoid under or overutilization and maintain an optimal resource health index. Here’s how you can get started:
Determine the Resources & Time-period
The first step in building a utilization report is to clearly define the number of resources (employees, teams, or specific assets) and mention the timeframe over which their utilization will be assessed. This will give managers a clear understanding of resource utilization over a specific duration, making it easier to evaluate performance and plan for future workloads.
For instance- An AEC firm planning a 12-month commercial complex project identifies the following resources and their respective timelines:
- Structural engineers (3): Active during the first 6 months to design load-bearing structures and conduct initial site inspections.
- Architects (2): Involved during the first 8 months to develop blueprints, finalize designs, and coordinate with drafters.
- Drafters (2): Engaged for 4 months to create detailed construction drawings based on architectural and engineering designs.
- Site supervisors (2): Active during the last 6 months, overseeing the construction phase and ensuring adherence to plans and standards.
This clear timeline ensures that each resource’s utilization is monitored effectively and aligned with the project phases.
Distinguish Between Billable and Non-Billable Tasks
The subsequent step involves distinguishing between billable tasks, such as client projects or consulting work that directly generates revenue, and non-billable tasks, including meetings or internal training. This distinction ensures precise billing and highlights opportunities to reduce non-billable time.
Continuing the example above, the firm tracks time spent on tasks throughout the month and identifies activities like designing structural elements, preparing construction drawings, and conducting site visits as billable. In contrast, tasks such as attending internal training, participating in team meetings, or handling administrative paperwork are classified as non-billable.
Read More: 5 Effective Ways to Maximize Billable Resource Utilization in Professional Services Firms
Use a Tool to Track Time Spent on Each Task
Managers can utilize time-tracking software to monitor and record time spent on tasks, including client-specific projects. This would ensure accurate tracking of task durations and project progress. By leveraging this data, organizations can optimize resource allocation towards revenue-generating work, maximizing billable hours, and enhancing overall profitability.
In the 12-month commercial project, engineers, architects, drafters, and supervisors log their daily hours using a time-tracking tool. Tasks are categorized as:
- Billable: Structural design, blueprints, and site supervision
- Non-billable: Meetings and training
This way, the firm collects data on how much time the resources spend on billable and non-billable tasks.
Calculate the Employee Utilization Percentage
The next step involves calculating the employee utilization percentage to assess the efficiency of each employee’s contributions. This analysis helps organizations determine if employees are overworked or underutilized, enabling managers to implement necessary measures to optimize organization utilization levels.
Let’s take one architect as an example. Assuming the architect has 160 available working hours (40 hours/week), they log 100 hours on billable tasks and 60 hours on non-billable tasks. Using the utilization formula:
Utilization percentage = (Billable hours / Total available hours) * 100
This indicates that 62.5% of architect’s efforts are dedicated to revenue-generating activities.
Organize the Data in a Chart Format
Presenting utilization data in a chart format provides a visual and concise overview of performance trends. Managers can quickly pinpoint utilization imbalances among employees. This enables data-driven decision-making to optimize productivity and enhance revenue generation.
By organizing the data into a color-coded heat map, with each color representing different utilization levels, the firm can easily assess resource performance. Here’s what each color represents:
- Green (Optimal Utilization): Utilization between 85% and 100% indicates employees are working efficiently and are optimally utilized.
- Yellow (Underutilization): Utilization below 65% signals that employees are not being fully utilized and have the capacity for additional work.
- Red (Overutilization): Utilization above 100% indicates that employees are working way beyond their capacity, which can lead to burnout.
For example, in the chart below, Architect Bob shows 54.76 % utilization (yellow), indicating he could take on more billable tasks throughout the weeks spanning from November 4th to 25th, 2024, as well as from December 30th, 2024, to February 10th, 2025. By organizing the data this way, the firm can take targeted actions to balance workloads, improve efficiency, and ensure optimal utilization across the team.
SAVIOM offers up-to-date utilization reports and color-coded heatmaps to help firms identify instances of resource over or under-utilization and take corrective measures promptly.
The steps mentioned above outline how to build a strong utilization report. Let us now see how modern resource management software can help.
How Can An Advanced Resource Management Software Help?
A state-of-the-art resource management software helps organizations proactively identify and address instances of resource over/under-utilization, maximizing their workforce’s full capabilities. Here are a few features that can help:
- The tool provides enterprise-wide visibility into the resource’s profiles, including skills, competencies, experience, etc., across the enterprise. In addition, its advanced filters help managers choose the best available resource for projects for efficient utilization.
- The drag-and-drop scheduling feature allows managers to reassign or split tasks to ensure optimal workforce utilization.
- With the tool’s advanced forecasting and capacity planning capabilities, firms can proactively plan for future projects and workforce requirements while keeping the utilization levels in check.
SAVIOM’s robust capacity planning dashboard offers insights into upcoming resource needs and helps maintain workforce utilization within the optimal range.
- Next, the tool generates detailed forecast vs. actual utilization reports and color-coded heat maps that enable managers to identify any over/underutilization of resources and take steps to optimize them.
Read More: How Can You Make Data-Driven Decisions with Resource Management Software?
Conclusion
Building a utilization report and optimizing workforce utilization is key to organizational growth and success. These efforts enable organizations to monitor resource allocation effectively and ensure that resources are engaged in productive activities. Ultimately, this leads to increased billable hours, heightened productivity, and substantial revenue growth for the company.
Does your business leverage a robust utilization report to improve organizational efficiency and productivity?
The Glossary
Read More: Glossary of Resource Workforce Planning, Scheduling and Management
