Overview

Understanding personnel costs is critical to managing your organization's financial health and operational efficiency. This guide explains how Performance Analytics transforms your staffing data into actionable insights that support strategic decision-making.

Key Metrics

These carefully selected metrics provide a framework for evaluating your organization's personnel investments and efficiency. Each metric tells part of your organization's staffing story.

Primary Personnel Metrics

Personnel as a % of Total Operating Expense
- Calculation: (Personnel Cost / Total Operating Expenses) × 100
- Purpose: Measures relative personnel investment
- Benchmark context: Industry standard ranges by organization size
This fundamental metric helps you understand how your staffing investment compares to peers and industry standards.
G&A Staffing as a % of Staffing Expense
- Calculation: (G&A Staffing Cost / Personnel Cost) × 100
- Purpose: Evaluates administrative efficiency
- Components: Admin, Finance, IT, HR departmental costs
This metric helps you evaluate your administrative overhead and identify opportunities for improved efficiency.

Understanding Personnel Measures

The foundation of good analysis is understanding exactly what goes into each measure. These definitions ensure you're making appropriate comparisons.

Personnel Cost Measure

Components included:

Base salaries and wages
Benefits
Personnel-related taxes
All departmental personnel expenses

This comprehensive measure captures your total investment in human resources.

G&A Staffing Cost Measure

Includes total departmental wages, benefits, and taxes for:

Administration
Finance
Information Services
Human Resources

Understanding your administrative costs separately helps evaluate operational efficiency.

Analysis Applications

These analytical tools help transform raw data into actionable insights for both operational and strategic decision-making.

Operational Efficiency

Year-over-Year Analysis
- Track personnel cost trends
- Monitor staffing efficiency
- Identify cost growth patterns
Tracking changes over time helps identify both opportunities and potential concerns.
Peer Comparison
- Compare against similar organizations
- Evaluate staffing models
- Benchmark compensation levels
Understanding how your organization compares to peers provides crucial context for decision-making.

Financial Planning

Budget Analysis
- Personnel cost forecasting
- Staffing level optimization
- Benefit cost management
These analyses help inform your budgeting process and resource allocation decisions.
Resource Allocation
- Department-level analysis
- Administrative overhead evaluation
- Support function efficiency
Understanding where your personnel resources are invested helps optimize their allocation.

Interpreting Results

Raw numbers only tell part of the story. Understanding context and patterns is crucial for meaningful analysis.

Context Considerations

Organization Size
- Budget level impacts
- Facility scale effects
- Program complexity
Size significantly influences optimal staffing patterns and costs.
Operating Model
- In-house vs. contracted services
- Volunteer utilization
- Shared service arrangements
Your operating model provides essential context for interpreting personnel metrics.

Common Patterns

High Personnel Cost Ratio
- May indicate:
  - Labor-intensive programming
  - Limited outsourcing
  - Higher service levels
- Analysis needed:
  - Program requirements
  - Service delivery model
  - Automation opportunities
Understanding these patterns helps identify whether high costs are justified or need attention.
Low Personnel Cost Ratio
- May indicate:
  - Efficient operations
  - Heavy outsourcing
  - Potential understaffing
- Analysis needed:
  - Service quality impacts
  - Contract cost evaluation
  - Capacity assessment
Low costs aren't always positive; understanding the full context is crucial.

Using the Analysis

Effective analysis should drive action. These sections help you translate insights into improvements.

Strategic Planning

Resource Allocation
- Staffing level decisions
- Department sizing
- Support function investment
Use your analysis to inform strategic staffing decisions.
Operational Decisions
- Insource/outsource choices
- Automation investments
- Service model changes
Let data guide your operational choices.

Performance Monitoring

Regular Review Points
- Monthly tracking
- Quarterly analysis
- Annual benchmarking
Consistent monitoring helps identify trends and issues early.
Key Indicators
- Cost ratio trends
- Departmental variations
- Peer comparisons
Focus on indicators that matter most for your organization.