Direct costs include wages for employees and direct transaction costs such as BPO labor that is attributed to a client or business unit. Indirect costs are items such as utilities, rent, etc. Indirect costs may also include supervisor and executive salaries. You'll have a much better understanding of a client's profitability if you're able to compare it to a thorough number of overall costs.
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Tracking employee time by task and client allows you to measure the productivity of an employee while also tracking the total number of hours a task took to complete for a specific client.
BPO firms thrive at process management and rely on closely monitored production tracking and incentives to yield sizable productivity increases at typically lower costs.
The proportional allocation method will give you a better sense of which clients are adding to your bottom line by assigning a percentage of an indirect costs to all or several departments or revenue categories (clients) in your business.