Personnel cost to perform the process "process customer credit" per process FTE

This measure calculates personnel cost per process full-time equivalent (FTE) employee to perform the "process customer credit" process, which evaluates customers' credit-worthiness, typically in conjunction with generation of a new order or creation of a new customer. Personnel cost refers to employee salaries/wages, bonuses, benefits, etc. This measure is part of a set of Cost Effectiveness measures that help companies understand all cost expenditures related to the "process customer credit" process.

Benchmark Data

Lock

Sorry! Not all users have access to all of our resources.

Want to unlock access to all of our resources?

Learn about Membership Arrow with stem

Measure Category:
Cost Effectiveness
Measure ID:
105485
Total Sample Size:
2,843 All Companies
Performers:
25th Median 75th
- - -
Key Performance Indicator:
No

Sample image showing interactive filters for more detailed measure peer group data and an interactive graph.

Compute this Measure

Units for this measure are dollars.

Back to Top

(Percentage of total cost of the process "process customer credit" allocated to internal costs * Percentage of internal costs of the process "process customer credit" allocated to personnel cost * 0.0001 * Total cost to perform the process "process customer credit") / Number of FTEs who perform the process "process customer credit"

Key Terms

Back to Top

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 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 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

Back to Top

Cross Industry (7.3.1)

  • 9.2.1.1 - Establish credit policies (10789)
  • 9.2.1.2 - Analyze/Approve new account applications (10790)
  • 9.2.1.3 - Analyze credit scoring history (14187)
  • 9.2.1.4 - Forecast credit scoring requirement (14188)
  • 9.2.1.5 - Review existing accounts (10791)
  • 9.2.1.6 - Produce credit/collection reports (10792)
  • 9.2.1.7 - Reinstate or suspend accounts based on credit policies (10793)