(Specific, Measurable, Aligned, Realistic & Time sensitive).
Budgeted, forecasted and last year’s hours are recalculated based on the actual activity level, using the productivity from budget/forecast/last year
In the Management Perspective
Budgeted, forecasted and last year’s hours are recalculated based on the actual activity level, using the productivity from budget/forecast/last year – SMART.
Example: If a department serves twice the number of guests than forecasted, they will most likely need more hours than originally forecasted. If the comparison is made towards the actual number of forecasted hours, it would seem like they are spending more hours than they should. By using the forecasted productivity instead, and applying this to the actual number of guests, we simulate how many hours would have been forecasted if the forecasted number of guests had been correct, and we get a more appropriate comparison. This recalculation is done to be able to compare apples to apples, and the same principle also applies to Last Year and Budget. The actual budgeted and forecasted numbers can be found in both Other Budget and Forecast module and in the Time Sheet.
In the Cockpit Wallet
Both forecast and budget are then calculated by taking the actual activity and dividing it by the budget/forecasted productivity. Last year is calculated by dividing last year’s productivity and this year’s activity, so that the comparison is valid even if you have more or less to do in the department this year.
In the Cockpit Resource Hours
The MTD (month to date) in both budgeted and forecasted Resource Hours is calculated by using the SMART calculation, meaning that in this case PMI will look at the actual Cost Driver MTD and divide it by the forecasted/budgeted productivity to get the number of hours MTD possible to use.