We observed an overwhelming number (>90%) of Project Enterprises primarily in IT and Engineering Services’ space believe that
“Improving the billable utilization of their human resources is the way to increase their enterprise profitability”.
In September 2018, Whizible conducted a survey requesting the key respondents from the IT and Engineering Services enterprises to register their opinions on the three statements crucialfor determining the profitability of project-based enterprises
- Costs of Project Enterprises are largely fixed
- Compensation to Human Resources is a large part of fixed cost
- Increasing Billable Utilization of Our Human Resources is critical for profitability
We believe that these three statements define the key parameters important for driving the profitability of project enterprises
1. Costs of Project Enterprises are largely fixed
People and technology required to deliver the services are the key resources for project based service organizations. Deployed technology assets are either one-time costs or in the new world of renting these assets, it is variable, but insignificant. Skilled people are not easy to find; so these organizations need to hire them irrespective of the fluctuating nature of the demand for their services. This makes the costs of a project enterprise largely fixed in nature.
2. Compensation to Human Resources is a large part of fixed cost
The employee compensation used to be a large component of the total fixed costs for any project enterprise. But with the innovations in engagement such as flexible and project based work contracts (gig economy) may shift some of these to variable costs. Also, technology such as artificial intelligence, machine learning, augmented reality, etc., the job mix is likely to change.
3. Increasing billable utilization of enterprisehuman resources is critical for profitability
Our survey participants agreed with the first two statements and the third statement is an extension of the first two. To maximise the enterprise profitability, two actions are critical
- Not letting its workforce sit idle on the bench and
- Aiming at increasing the utilization of its human resources for billable project activities
How is your organization measuring its ‘resource utilization’? What gets measured gets improved
Whizible is a project enterprise management software. Whizible has helped its customers improve their project service automation and enterprise project portfolio management processes. Some benefits that Whizible implementation has delivered for their customers are operational improvements such as:
- Increase in billable resource utilization up to 12%
- Decrease execution delays by up to 20%
- Decrease effort to billing cycle by up to 60%
For more information, please contact Whizible on
Call: +91 72760 71111
Subscribe to Whizible Blog