Gross, Net and the Descent Between Them
The descent from contracted hours to hours available for planned work, the six deductions that make it up, and why the total is always a surprise the first time.
Gross to net for one team quarter, as the planner worked it
Starting point: 13 weeks at 40 hours.
Booked and forecast together.
Fixed and known a year ahead.
A rate, not a prediction about anybody.
Booked centrally; the plan rarely sees it.
Measured once, for one quarter, never since.
Sixty-six per cent of contracted hours.
A third of the contracted hours never reach planned work, and the only line anybody had estimated was the first one. Every deduction here is ordinary and none of them is optional. This is one employer's own quarter, not a benchmark.
Contracted hours are what the organisation pays for. Available hours are what can be spent on planned work. Between them sits a descent of six or seven deductions, every one of them ordinary, and together they commonly remove a third of the total.
The unit used in “Gross, Net and the Descent Between Them” must remain stable from capacity estimate to actual result. For organisations assessing explore the relevant platform page in relation to task efficiency, time and project reports can support that reconciliation, provided leave, support work and corrections retain their own definitions.
Most plans start at the top of that descent and commit at the bottom, which is the single most reliable source of overcommitment in capacity planning.
As a separate benchmark for “Gross, Net and the Descent Between Them”, see KPMG people and change resources. Keep source data, calculation, override and decision visible as distinct steps.
Why it is a descent rather than a percentage
Because each deduction applies to what is left after the previous one, and because they are owned by different people. Leave is in one system, training in another, support in a rota, interrupts nowhere at all.
Writing it as a descent — a running total after each line — makes the arithmetic checkable and makes each line's owner visible. A single shrinkage percentage hides both.
The six deductions
- Annual leave, which is booked and forecastable.
- Public holidays, which are fixed and known a year ahead.
- Sickness, which is a rate rather than a prediction.
- Training and statutory time, usually booked centrally.
- Support, on-call and interrupts.
- Management, administration and meetings that are not the work.
Some operations add a seventh for travel. Few need fewer than six, and a plan with only the first two is the common case.
Which ones the plan usually knows about
The first two, because they are in a system the planner can see. The other four live elsewhere and are typically estimated at zero by omission rather than by decision.
That is the asymmetry worth noticing: the deductions a plan knows about are the small, predictable ones, and the ones it omits are large and variable.
Starting the descent in the right place
At contracted hours for the actual people, not at a notional full-time figure multiplied by headcount. Part-timers, people on phased returns and anybody who joined or left mid-period all change the top line.
Getting the top line wrong makes every subsequent percentage wrong, and it is the easiest line to get right because the contracts exist.
Stopping in the right place
At hours available for planned work, which is the only figure a commitment can be made against. Anything above that line is a figure about employment, not about capacity.
A plan that commits against contracted hours has promised the leave, the training and the support rota to a project, and will discover the promise is unfunded somewhere around week six.
The line nobody has measured
Support and interrupts, almost universally. Everybody knows it exists, nobody has a figure, and the figure is usually the second largest deduction after leave.
Measuring it once — two weeks of honest recording across a team — is the single highest-value measurement in this whole collection, and it is rarely repeated because the answer does not change much.
The temptation to net off too much
The descent can be taken too far. Netting off every meeting, every conversation and every moment not spent on a task produces a tiny available figure and a plan nobody believes.
The line is work that is planned and allocated against this account. General collaboration, thinking and the ordinary overheads of a job stay above the line unless they are specifically being scheduled.
Where the numbers come from
| Deduction | Source | How often to refresh |
|---|---|---|
| Leave | Leave system, booked plus accrual | Each plan |
| Public holidays | Calendar | Annually |
| Sickness | Last year's measured rate | Annually |
| Training | Learning system plus statutory list | Annually |
| Support and interrupts | One measured fortnight | Every two years |
| Admin and meetings | One measured fortnight | Every two years |
Two of the six need measuring rather than looking up, and the measurement is a fortnight of effort that lasts two years.
Doing it per person or per team
Per team for planning, per person for anything that touches an individual. A team figure is a planning input; an individual figure is employment information and should be handled accordingly.
The team descent is also more stable: individual leave patterns vary wildly and average out across six people, which is the only reason the quarterly figure is usable at all.
What the first run always finds
That the available figure is between sixty and seventy-five per cent of contracted, that nobody in the organisation had that number, and that several commitments in the current quarter were made against the contracted figure.
None of this is anybody's fault, and all of it is visible within an afternoon of arithmetic.
What to do with the number
Publish it with the descent intact rather than as a single percentage. The descent is what makes it credible and what lets somebody argue with one line instead of rejecting the total.
And repeat it every planning cycle, changing only the lines that changed, which is usually two of the seven.