Cost & Productivity Analytics
Financial intelligence for workforce optimization
Executive Financial Summary
Total Labor Cost
Q3 2024
$487.3M
Q4 Forecast: $502.8M
Cost Per Employee
per employee per quarter
$26,743
Annual: $106,972
Current: $26,743
⚠️ 7% above target
Revenue Per Employee
annual
$347,000
Labor cost as % of revenue: 30.8% (target: 28%)
Productivity improvements needed
Span of Control
Organizational Efficiency
6.8
avg direct reports per manager
47 managers outside optimal range
$1.8M annual savings
Restructure to improve efficiency
Labor Cost Breakdown & Trends
Cost Waterfall Analysis
How costs changed from Q2 to Q3 2024
Net change: +$14.2M (+3.0%)
Cost by Department Trend
Quarterly trend (last 4 quarters)
Department Cost Details
Q3 2024 breakdown
| Department | Q3 Cost | % of Total | $/Employee | Headcount | vs Budget | YoY Change | Trend |
|---|---|---|---|---|---|---|---|
Engineering | $156.2M | 32% | $38,400 | 4,067 | +5.2% | +12% | |
Sales | $98.7M | 20% | $44,200 | 2,232 | +2.1% | +6% | |
Operations | $87.4M | 18% | $21,300 | 4,103 | -1.2% | +3% | |
Product | $54.8M | 11% | $41,700 | 1,314 | +4.8% | +15% | |
Marketing | $43.2M | 9% | $32,100 | 1,346 | +1.8% | +8% | |
G&A | $47.0M | 10% | $28,900 | 1,626 | -0.5% | +2% |
Compensation Analysis
Market Competitiveness
Comp ratio vs market benchmarks
Overall Company:
25th percentile: 89% of our pay
50th percentile (median): 104% of our pay ⚠️
75th percentile: 118% of our pay
We pay 4% above market median
By Department:
Alert: Data Science 4% below market - attrition risk for 67 roles
Internal Equity Analysis:
Gender pay gap: -2.1% (women paid 2.1% less for similar roles) ⚠️
13 cases requiring adjustment - estimated cost $287K
Compensation Cost Drivers
Where compensation dollars go
Cost Escalation Analysis (3-year CAGR):
⚠️ Compensation growing faster than revenue
Upcoming Commitments:
Productivity Metrics & Benchmarking
Revenue Productivity
$347K
Revenue per employee (annual)
⚠️ Trend: Flat year-over-year
Operational Efficiency
2.3
Projects per engineer annually
Benchmark: 2.8 (⚠️ 18% below)
87 days
Sales cycle length
Target: 75 days (⚠️ 16% longer)
34/day
Support tickets per agent
Benchmark: 38/day (✓ Efficient)
Utilization Rates
67%
Billable utilization (consulting roles)
Target: 75% (⚠️ 8 points below)
Revenue opportunity: $4.2M if at target
Meeting Load (hours/week):
(down from 16.8 last year)
Productivity by Department
Benchmark comparison
| Department | Headcount | Output Metric | Output/Person | Industry Benchmark | Gap | Opportunity |
|---|---|---|---|---|---|---|
| Engineering | 4,067 | Features shipped | 2.3/year | 2.8/year | -18% | +$12M revenue |
| Sales | 2,232 | Quota attainment | 87% | 92% | -5% | +$23M revenue |
| Customer Success | 567 | Accounts managed | 47 each | 52 each | -10% | 98 fewer headcount |
| Marketing | 1,346 | Leads generated | 1,234/person | 1,450/person | -15% | +$8M pipeline |
| Product | 1,314 | Products managed | 1.8 each | 2.1 each | -14% | Faster roadmap |
Productivity gaps represent $43M+ revenue opportunity
FTE vs Contractor Analysis
Workforce Mix
Current blended workforce
Cost Comparison:
(contractor cheaper if duration < 9 months)
Contractor Concentration by Function:
| Function | Contractor % | Risk Level |
|---|---|---|
| Engineering | 12.3% | 🟡 Medium |
| IT/Infrastructure | 23.4% | 🔴 High - knowledge risk |
| Marketing | 8.7% | 🟢 Low |
| Finance | 4.2% | 🟢 Low |
Optimization Opportunities
Cost savings and flexibility analysis
Conversion Candidates
234 contractors
beyond 12 months duration
Recommended: Convert to FTE, save 27%
Short-term Cost Flexibility Analysis:
If revenue drops 15%:
(but 4-month severance + morale cost)
💡 Maintain 8-10% contractor buffer for flexibility
Budget Variance Analysis
Q3 2024 Budget vs Actuals
Variance waterfall breakdown
+$15.1M
over budget (3.2%)
Variance by Department
Q3 2024 detailed breakdown
| Department | Budget | Actual | Variance | Variance % | Primary Driver |
|---|---|---|---|---|---|
| Engineering | $148.3M | $156.2M | +$7.9M | +5.3% 🔴 | Higher salaries for scarce roles |
| Sales | $96.6M | $98.7M | +$2.1M | +2.2% 🟡 | Commission overperformance |
| Product | $52.3M | $54.8M | +$2.5M | +4.8% 🔴 | Unplanned senior hires |
| Operations | $88.4M | $87.4M | -$1.0M | -1.1% 🟢 | Delayed backfill |
| Marketing | $42.4M | $43.2M | +$0.8M | +1.9% 🟢 | On track |
| G&A | $47.2M | $47.0M | -$0.2M | -0.4% 🟢 | On track |
Forecast & Scenario Modeling
Q4 2024 Projection
Based on current assumptions
$502.8M
Projected Q4 labor cost
Assumptions:
- • Hiring plan: 234 new hires (avg start: mid-November)
- • Attrition: 3.1% quarterly rate (142 exits)
- • Merit cycle: None (scheduled for January)
- • Bonus accruals: $18.2M (annual payouts)
Scenario Modeling Tool
Model what-if scenarios for labor costs
Scenario Output:
$502.8M
Projected Q4 cost with your adjustments
Pre-built Scenarios:
Cost Optimization Opportunities
$26.2M
Total annual potential (5.4% of labor costs)
Span of Control Optimization
Current state: 47 managers with sub-optimal spans
Contractor Conversion
Current state: 234 contractors beyond 12 months
Productivity Improvement
Current state: 18% below industry benchmark (engineering)
Market Alignment
Current state: Paying 4% above median in some roles
Location Strategy
Current state: High-cost locations (SF, NY, London) = 45% workforce
Cost Intelligence Recommendations
Labor costs growing 4.7% vs revenue 3.8% - unsustainable trajectory
Engineering cost per employee 21% above company avg - review bands
234 contractors beyond 12 months - convert to save $3.2M
Productivity gap vs industry = $43M revenue opportunity
Q4 forecast $12.4M over budget - hiring freeze for non-critical roles?