What a Unit of Capacity Is
What one unit of capacity actually is, the five units in common use, and why a plan that mixes them is wrong before any forecast is applied.
One quarter of one team, counted by both sides
Both sides believe they are planning the same quarter, and the difference between their arithmetic is a person and a half. Neither number is wrong; they are answers to different questions that nobody wrote down. This is one employer's own reconciliation, not a benchmark.
A unit of capacity is whatever quantity the plan adds up, and almost no plan says which one it is using. The arithmetic proceeds anyway, because every unit in use is a number and numbers add.
The unit used in “What a Unit of Capacity Is” must remain stable from capacity estimate to actual result. For organisations assessing open the corresponding Monitask page in relation to recording freelancer billable hours, time and project reports can support that reconciliation, provided leave, support work and corrections retain their own definitions.
That is the failure this whole collection is about. A plan expressed in people, committed against in hours, delivered in days and reported in percentages is four plans, and only one of them can be right.
As a separate benchmark for “What a Unit of Capacity Is”, see PwC workforce resources. Keep source data, calculation, override and decision visible as distinct steps.
The five units in common use
A person. A full-time equivalent. An hour. A slot — a shift, a bay, a bench, a room, an appointment. And a currency amount, which is a unit of capacity whenever a budget is the real constraint.
Each is legitimate. Each converts to the others only through an assumption, and the assumption is where the error enters.
Why the choice matters more than the number
Units differ in what they hide. A person hides availability. An FTE hides the difference between one full-timer and two half-timers. An hour hides who can do what. A slot hides everything about duration.
A plan using the unit that hides the thing which actually constrains it will be exactly as wrong as the thing it hides.
The conversion that nobody writes down
Every plan converts between units at least once: a commitment given in people, a capacity held in hours, a report produced in percentage utilisation.
The conversion factor — how many hours there are in an FTE quarter — is the single most consequential number in the plan, and it is usually in somebody's head rather than on the page.
Where the factor comes from
| The question | A common answer | What it leaves out |
|---|---|---|
| Hours in an FTE week | 40 | Leave, training, support |
| Weeks in a quarter | 13 | Public holidays |
| Hours in an FTE quarter | 520 | Everything above |
| Hours actually available | 468 or fewer | Depends on the deductions made |
The gap between the third row and the fourth is the whole of the next section of this collection, and it is typically between ten and forty per cent.
The unit the demand side uses
Usually people, because commitments are made in conversations and conversations are about people. "We'll need a couple of engineers" is a claim on capacity expressed in the vaguest available unit.
That is not carelessness either. It is the unit the person making the commitment can actually speak in, and the planner's job is to convert it rather than to object to it.
Mixed units in one total
The clearest symptom of the problem: a plan whose total is the sum of rows expressed differently. Two FTE, plus three hundred hours, plus a support rota, plus "half of Priya".
Any such total is meaningless and will still be treated as a number, quoted in a meeting, and committed against. Converting every row to one unit before adding is the first operation in any reconciliation.
The unit for things that are not people
Rooms, machines, licences, vehicles, benches and beds all behave as capacity and none of them is an FTE. Their natural unit is the slot — how many of them, for how long, during what window.
A plan that holds people in FTE and equipment in slots is not mixing units wrongly; it is holding two accounts, which is correct. What it must not do is add them.
Choosing one unit per account
The working rule is one unit per side of the account, stated at the top of the page, with a conversion factor written beside it.
Hours are usually the best choice for the people account, because every deduction in the next section is naturally expressed in hours and because nothing is hidden by an hour.
Writing it down
A single line above the plan: "All figures are net hours available for planned work; one FTE quarter is 468 such hours; conversions from FTE use that figure."
Three clauses. In the organisations that write them, a whole category of argument disappears, because disagreements become disagreements about the factor rather than about whose number is right.
The test for whether your plan has a unit
Ask two people who use the plan what one unit in it means, separately. If the answers differ, the plan does not have a unit; it has a number that several people are interpreting.
That test takes four minutes and is the cheapest diagnostic in this collection. It is also, in most organisations, the one that produces the most uncomfortable silence.