This Slideshare presentation is a partial preview of the full business document. To view and download the full document, please go here: http://flevy.com/browse/business-document/it-bench-resources-retention-profit-and-loss-analysis-with-business-strategy-820 This document has been written on the analysis of IT Services Bench resources cost and benefits for their retention. With recommended business strategies to be followed. Some of the sample scenarios have been discussed and analyzed for costing, profits and loss. The differences were emphasized on firing and hiring the same profiles after few months for new business requirements. Their costing has been assessed and the new resources performance has been analyzed with their CSAT rating loss to the company. The SLAs can also effect with this approach. Finally, recommendations were given on the benefits of retaining the resources served for above and less than a year by considering their performance, costing and profits. Their new skills training costs were also assessed and estimated on the maximum bench period can be used for them.

1. Author: Shanthi Kumar V, IT Management Consultant
Contact: vskumar35@gmail.com
IT Bench Resources Retention Profit
and Loss Analysis
With Business Strategy Alignment
Find my other documents at: http://flevy.com/seller/vskumar

2. 4
We need to consider the below analysis to assess the resource retention and its
benefits.
Long-term goal
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3. 7
Resource A Resource B Resource C
Experience in Years 3 6 10
Role Developer Designer PM
Skills
Hourly Billing Rate [in Indian Rupees] 1,000 INR 1,300 INR 1,500 INR
Monthly Revenue [in Indian Rupees]@160hrs 160,000 INR 208,000 INR 240,000 INR
Monthly CTC [in Indian Rupees] 50,000 INR 70,000 INR 100,000 INR
Monthly Profit by Resource 110,000 INR 138,000 INR 140,000 INR
Note: This scenario is based on Indian IT operations with less operating cost. By adding 40-60% of additional
amount to each of the INR value, you can convert them into your local currency to measure the formulas. The
same procedure can be applied or can be added the profit margin depends on your local expenses and billing
rates. You can see in next slides for further measurement.
A Scenario for Cost Analysis and Measurement
IT Billable Resources retention Profit and
Loss Analysis
100,000 INR70,000 INR50,000 INRAdditional benefit to company in revenues by month
130150175Resource productivity increase in % after one year
1,680,000 INR1,656,000 INR1,320,000 INRYearly Profit by resource
1,200,000 INR840,000 INR600,000 INRYearly CTC
2,880,000 INR2,496,000 INR1,920,000 INRYearly Revenue
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4. 10
• Let us assume, you want to terminate them as per the traditional practices.
• After one or few more months passed, you need the same profiles for a different client.
• And you need to invest on the below areas to bring the new resource:
• Recruitment.
• Interviews.
• Offers.
• HR Orientation.
• Company business knowledge transfer.
• Resource growth time estimation for the customer account.
• Bonding with team.
Note: You can see in next slides on the new resource hiring cost.
With Is the Loss with Traditional Practices
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5. 13
Recommendation
• By observing all the above analysis, one can come into the below conclusion:
• Sudden decisions on firing and hiring can burn the company's growth.
• The freely earned resources can flow away with firing activity.
• Drastic loss can occur on new resources deployments.
• As per the Profit and loss analysis for one year passed resources, the above given
plans can be followed.
• If the resources services are within one year, proportionally the billing period needs to
be counted and assessed the resource strengths for training on new skills.
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6. 1
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