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Performance measures in an IT Consulting company.

Farrukh Ahmed's Profile

Hi everyone, I have been asked to create measures to analyze my Company performance (IT Consulting Firm). I would like to know what measures are being used in IT Consulting companies that help the Management to make meaningful decisions. I am aware of the Financial measures that are commonly used to interpret Financial statements, what I am looking for are the measures that are IT Consulting Industry specific.

Answers

James Scott
Title: Consulting CFO
Company: Early Growth Financial Services
LinkedIn Profile
(Consulting CFO, Early Growth Financial Services) |

IT consulting companies are about average billing rate, utilization rate and headcount. Tracking profitability by project is important, including full project management cost. Fully loaded labor is the largest cost, that cost should always be matched to billable hours, not total hours. Base utilization on available hours, not 2,080 (40x52), Available hours do not include vacation, holiday or training time.
Check out the earnings presentation for Perficient to see how they report http://phx.corporate-ir.net/phoenix.zhtml?c=83872&p=irol-irhome

Farrukh Ahmed
Title: Financial Analyst
Company: Software Labs
(Financial Analyst, Software Labs) |

Hi James,
Thanks for the tips.
I'll look at the presentation as well and will post further queries accordingly.
Thanks once again!

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