FTE Definition
FTE Calculation
FTE Analysis

 

 

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FTE Definition: (full time equivalent definition)

The definition of FTE (full time equivalent) is the number of working hours that represents one full-time employee during a fixed time period, such as one month or one year. FTE simplifies work measurement by converting work load hours into the number of people required to complete that work.

FTE Calculation

Calculating FTE is a two step process.
 
Step 1. Determine how many hours one full time employee works. Start with the scheduled hours and subtract holidays and PTO (personal time off).  Add overtime; whether paid OT or unpaid for exempt (salaried) employees. This will calculate the annual working hours for each job position.
 
Step 2. Determine how many hours of work load there are for each job position and divide this workload total by the FTE working hours of one employee. This calculates the number of full time equivalents that are needed. Depending on your operation and the nature of your management goals, use Life Cycle Phase, Process, Product, or Customer metrics workload.

FTE Working Hours Calculator

 

This resource management tool calculates the number of working hours that one FTE works in each job position of an insurance company's policy services unit.

 
 
 

FTE Workload Calculator

 

This resource management tool calculates the number of FTEs (resource capacity) that the workload forecast will require. Policy life cycle work measurements are used. Resource management tools like this help managers forecast their resource needs and resource budgets based on their annual business plan. 

 
 
 
FTE Management
 
FTE management is the analysis, decision making, and implementation processes that determine:
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how many employees are needed
- the skills each job position needs and the total available skill hours the department needs
- how work will be assigned to employees
- how organizational and staff performance will be measured
- whether job positions will be generalists or specialists
- which organizational structures will be adopted, such as virtual shared services and expert centers, etc.

FTE Analysis

FTE analysis is the methodical analysis of current work activities with related time and cost measures. This helps managers understand the root causes and drivers of workload levels, organizational performance, and productivity improvement opportunities.

FTE Models

FTE Models assemble and relate work measurement data to job positions, processes, products, customer segments, and other performance drivers. FTE models are constructed with statistical tools and methods, and are organized as data models with charts and graphs. Data models are used because they accurately measure and relate work metrics such as incidence, time and cost while also making scenario forecasting (what if analysis) easy and very accurate.

FTE Analysis Models will enable you to:

  Reduce and optimize resource costs

  Meet customers' service expectations and increase customer retention

  Define and maintain the skills that your processes need

  Utilize all of your human resource capacity and skills in the most productive ways

  Provide rewarding work and careers to your employees and improve employee retention

  Optimize the balance of generalists and specialists

 

FTE Management Exhibit - Resource Capacity & Process Cost Management Application

 

This is a screen shot of Orient Point's Results Navigator. This application forecasts resources capacity and process cost for products and customers in complex operations. It is used regularly by operations, finance, human resources, product managers, customer segment managers, and executives.

 

The many complex operational variables require specialized management tools that forecast resource capacity and process, product, and customer costs.

 

 

"I've engaged Orient Point Consulting since 2001 at Chubb and now at XL. I've always been able to solve my problems and achieve my goals by using their activity information models as my core information for analysis and planning."
Jeff Brown
,
Senior Vice President, Chief Processing Officer, XL Group
 

Learn More
 

"AIM is a unique and valuable tool for us. It delivers new information needed to make better decisions and achieve our goals."
Larry Agoglia, Managing Director & COO, Citigroup Private Bank

 

 

 

The Business Case for Resource & Process Models and Management Applications

 

Our clients discover new ways to improve organizational productivity and performance, and solve the problems that are preventing them from achieving their revenue growth goals.

 

They have the information and tools to align areas of their organization for their strategic goals. Often this is accomplished by re-designing processes, changing the mix of specialists and generalists, and establishing new Shared Services Centers and Expert Networks that are customer and product focused rather than process focused.

 

Our clients tell us they always recover a multiple of the project cost within six months.
 

 


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