Personnel cost to perform the process "manage sales orders" per process FTE

This measure calculates the amount of personnel cost per full-time equivalent (FTE) employee for the process "manage sales orders." Personnel cost includes employee salaries/wages, bonuses, benefits, etc. The "manage sales orders" process encompasses many operations, including inquiries, quotes, order entry, maintenance, order fulfillment, delivery, installation, and accounting. The measure requires calculating all costs generated by full-time equivalent employees, allocating only the portion of the employee's time that relates to the process. This measure is part of a set of Cost Effectiveness measures that help companies understand all cost expenditures related to the process "manage sales orders."

Benchmark Data

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Measure Category:
Cost Effectiveness
Measure ID:
102948
Total Sample Size:
2,582 All Companies
Performers:
25th
-
Median
-
75th
-
Key Performance
Indicator:
No

Compute this Measure

Units for this measure are dollars.

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Personnel cost to perform the process "manage sales orders" / Number of FTEs who perform the process "manage sales orders"

Key Terms

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FTE - (full-time equivalent employee)

To calculate the number of full-time equivalents employed during the year for each respective process or activity, you must prorate the number of employees and the hours spent performing each process/activity. Assume that a full-time worker represents 40 hours per week. Provide the average number of full-time equivalents employed during the year for each respective process. Include full-time employees, part-time employees, and temporary workers hired during peak demand periods. Allocate only the portion of the employee's time that relates to or supports the activities identified for an applicable process. Prorate management and secretarial time by estimating the level of effort in support of each activity, by process.

For example, a part-time secretary in the finance department for XYZ, Inc. charges all of his time to finance department activities. He works 20 hours per week. The secretary splits his time evenly supporting employees working in the general accounting process and the financial reporting process. Thus, his time should be allocated by process. So, if he works throughout the year and supports these two processes, his time would be split evenly as:

20hrs/40hrs = .5FTE * 50% for general accounting = .25FTE for general accounting

20hrs/40hrs = .5FTE * 50% for financial reporting = .25FTE for financial reporting

Personnel Cost

Personnel cost is the cost associated with personnel compensation and fringe benefits of employees (i.e., those classified as FTEs which includes both full-time and salaried/hourly employees) contributing to each respective process. Personnel cost should include all of the following costs.

Employee Compensation: Includes salaries and wages, bonuses, overtime and benefits.

Fringe: Includes contributions made towards the employees' government retirement fund, workers compensation, insurance plans, savings plans, pension funds/retirement plans, and stock purchase plans. This should also include special allowances, such as relocation expenses and car allowances.

Cost Effectiveness

Cost effectiveness measures are those in which two related variables, one of which is the cost and one of which is the related outcome related to the expenditure are used to determine a particular metric value.

Measure Scope

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Cross Industry (7.3.1)

  • 3.5.4.1 - Accept and validate sales orders (10194)
  • 3.5.4.2 - Collect and maintain account information (10195)
    • 3.5.4.2.1 - Administer key account details (10201)
    • 3.5.4.2.2 - Retrieve full customer details (10202)
    • 3.5.4.2.3 - Modify involved party details (10203)
    • 3.5.4.2.4 - Record address details (10204)
    • 3.5.4.2.5 - Record contact details (10205)
    • 3.5.4.2.6 - Record key customer communication profile details (10206)
    • 3.5.4.2.7 - Review involved party information (10207)
    • 3.5.4.2.8 - Terminate involved party information (10208)
  • 3.5.4.3 - Determine availability (10196)
  • 3.5.4.4 - Determine fulfillment process (10197)
  • 3.5.4.5 - Enter orders into system (10198)
  • 3.5.4.6 - Identify/perform cross-sell/up-sell activity (17404)
  • 3.5.4.7 - Process back orders and updates (10199)
  • 3.5.4.8 - Handle sales order inquiries including post-order fulfillment transactions (10200)