Systems cost to perform the process "process customer credit" per $100,000 revenue

This measure calculates systems cost per $100,000 revenue 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. Systems costs include a variety of specific costs related to computer hardware/software, network maintenance, data storage, etc., and all fees paid to full-time, part-time, or temporary employees or independent contractors hired to perform these services. 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

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Measure Category:
Cost Effectiveness
Measure Id:
103343
Total Sample Size:
1,370 All Companies
Performers:
25th
Median
75th

Compute this Measure

Units for this measure are dollars. Lower values are better.

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(Percentage of total cost of the process "process customer credit" allocated to internal costs * Percentage of internal cost of the process "Process customer credit" allocated to systems costs * 0.0001 * Total cost to perform the process "process customer credit") / (Total business entity revenue * 0.00001)

Key Terms

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Total Annual Revenue/Net Revenue

Total annual revenue is net proceeds generated from the sale of products or services. This should reflect the selling price less any allowances such as quantity, discounts, rebates and returns.
For government/non-profit organizations, please use your non-pass-through budget. If your business entity is a support unit and therefore does not directly generate revenue, then provide the revenue amount for the units you support.For insurance companies the total annual revenue is the total amount of direct written premiums, excluding net investment income.
Note: Business entity revenue needs to only include inter-company business segment revenue when the transactions between those business segments are intended to reflect an arm's length transfer price and would therefore meet the regulatory requirements for external revenue reporting.

Systems Cost

Systems costs include all expenses, paid or incurred, in conjunction with:

Computer hardware or computer software acquired by the organization or provided to the organization through service contracts.

Any related costs to process, service and maintain computer hardware or computer software. The costs of providing and maintaining services for each applicable process (e.g., computer system(s) processing (CPU) time, network/system communication charges, maintenance costs for applications and data storage). This includes the costs related to LANs, WANs, etc. This does not include one-time costs for major new systems developments/replacements. Consultant fees should not be included in depreciation of new system implementations. Include only those costs that occur more than six (6) months after implementation, as normal system maintenance costs. Any systems cost (e.g., maintenance) which is outsourced to a third party supplier should be captured in the separate cost category labeled outsourced cost.

Systems cost should include all salaries, overtime, employee benefits, bonuses or fees paid to full-time, part-time or temporary employees or independent contractors who perform services relating to computer hardware, computer software, processing or systems support.

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 (7.2.1)

  • 9.2.1.1 - Establish credit policies (10789) - Creating guidelines for providing advances. Set up credit standards, credit terms, and collection policies.
  • 9.2.1.2 - Analyze/Approve new account applications (10790) - Checking and accepting new requests based on eligibility criteria. Analyze the status of applicants and requirements to be met for a new account.
  • 9.2.1.3 - Analyze credit scoring history (14187) - Reviewing past credit scores to determine the if a line of credit will be extended to potential customers. This could also include extending additional credit to existing accounts.
  • 9.2.1.4 - Forecast credit scoring requirement (14188) - Planning credit score requirements based on established credit policies.
  • 9.2.1.5 - Review existing accounts (10791) - Evaluating existing account holders and their past performance. Regularly review existing accounts to get the required information about the status at present.
  • 9.2.1.6 - Produce credit/collection reports (10792) - Preparing account payable reports about payments to be made according to accounting rules and principles, and providing the reports to management.
  • 9.2.1.7 - Reinstate or suspend accounts based on credit policies (10793) - Closing or restarting accounts according to changes made in credit policies.