Title: Does Dilution apply to Plans/Budgets in my Forecast?
Dilution applies to costs on timesheet actuals, but what about dilution of costs on Plans or Budgets? This page addresses Unanet's default dilution behavior for actuals as well as the option to dilute costs on plans/budgets via an export/import process.
Note: For the purposes of this page, "budgets" refers to Assignment Budgets.
What’s covered in this document:
Default Behavior of Planned Costs
Dilution does not apply to plans or budgets even when dilution properties are turned on. (There is an option to calculate dilution on plans/budgets in the next section below.)
This works well for many Unanet customers, since these forecasts will always be an estimate and since you never know how much or when people will work. If they are working on multiple projects, then it is extremely difficult to predict how much they will spend on each project. Even if they are full-time on just one project, you still don’t know when they’ll take vacation.
As a result, we have found that Unanet's forecasts are very close to what is possible to be forecasted since there are many variables in play.
The closest way to get an accurate estimated forecast is by planning the person at no more than 1 FTE (100%) sum total across all projects, including leave projects, into the future. The periods that best allow for that are weekly/biweekly.
Also consider the following:
- If you have semi-monthly/monthly timesheets, even If you plan the person at 100% utilization including leave, the cost will fluctuate each month based on 96 hours, 88 hours, etc., in a semi-monthly period.
- If you have weekly/biweekly timesheets and if you plan at 100% or 1 FTE, their period-by-period costs will be the expected salaried amounts as desired. If you leave people booked at +/- 100%, the cost will be based on hours * derived hourly rate and fluctuate.
- Either way, if you want to get cost forecasts as close as possible on a job-by-job basis then you should try to forecast at least some kind of estimate for vacation (either a spread or seasonal allocation).
In the screenshot below, dilution has been calculated on actuals for January through the end of March. As of April we are looking into the future at the cost on planned hours of 1 FTE per month. You can see that while the cost through the end of March is consistent by month, the cost by month as of April fluctuates considerably. This can cause issues when planning labor forecasts.
Ability to Dilute Costs on Plans/Budgets via Export/Import
Export out all Plans while calculating the diluted cost either in the export or via a process post-export. A Plan import then replaces the original rate with the diluted cost rate. This may be automated with the IMU to update nightly, hourly, or on demand.
Here is a list of high-level steps and calculations that may be followed.
- Business Hours per Month: Reference the person’s business week to determine the business hours in a month.
- Monthly Cost: Business Hours per Month * Person_Cost_Rate.
- Total Planned Hours: All planned hours for the month (to include PTO and Holiday).
- Diluted Cost Rate: Monthly Cost divided by Total Planned Hours.
- Use the Planned Work template and export all planned hours for the said employees, replacing the person cost rate with the diluted cost rate. Then import into Unanet to replace the person rate associated with the planned hours.
- Use the Unanet IMU for a nightly (or other scheduled) update or on demand update.
There may be many flavors of this option, depending on time period (semi-monthly or biweekly) and other options. Options might include allowing control of what date range the plan dilution applies to.
Ability to Dilute Costs on Plans/Budgets via query and import
With this method, a query is used instead of an export of the data. You connect directly to the Unanet database (if you are On Premise) or using the Cloud Data Warehouse (if you are Cloud). A query gives you business hours (based on the person’s business week) and calculated business days in a given month to get business hours in a month.
The queries are then used to generate an import file of Plans in CSV format. The Unanet IMU imports it on a scheduled basis.