Outsourcing the Support Desk Raises Revenue per Employee by a Quarter

Match the period or be wrong by a factor of four

The measure is conventionally annual, and revenue arrives in quarters and months. Feeding a quarter's 25 million into an annual calculation returns 100,000 when the real annualised figure is 400,000; feeding a month's returns a twelfth of the truth. This tool asks which period the revenue covers precisely because the mistake is silent — nothing about 100,000 looks wrong, and the number only fails when someone compares it with an annual benchmark. Whenever a per-head figure is quoted without a period, the first question is which one, and the second is whether the headcount was averaged over the same window or taken on the last day.

Revenue per head says nothing about profit per head

The fastest way to raise this number is to take low-margin work, because revenue grows and headcount often does not grow as fast. A reseller that adds hardware to a services contract can double revenue per employee in a year while earning less on every deal, and the metric will record that as an improvement. Profit per employee answers the question people usually mean, and the pair read together separates a genuine gain in efficiency from a change in what the company sells. Where only one can be tracked, the second is the more honest.

Frequently asked questions

Should part-time staff count as one each?

Not if the figure is meant to measure productivity. Convert everyone to full-time equivalents — two people at half time are one unit — otherwise a company that runs on part-time shifts looks dramatically less productive than an identical one that does not. The same applies to anyone who joined or left mid-year: counting them fully overstates the denominator, and averaging the monthly headcount is both simple and closer to the truth than either endpoint.

Is a higher figure always better?

Only within one business model. Software companies and trading houses show figures many times those of a restaurant chain, and neither is evidence of better management — one sells something that costs almost nothing to copy and the other sells meals that have to be cooked. The comparison that carries information is against the same company a year ago, or against direct competitors with the same shape. Across industries the number mostly measures how much of the value chain sits inside the company rather than how well it runs.