What Exactly is FTE?

With so many terms and abbreviations being used by contact centres and BPOs, it is important that those working in the industry have clarity on what they mean.

Which is why, we wanted to share the answers provided by our Community of industry professionals when King asked for clarity on what is meant by the term FTE:

I have heard the term FTE freely used as a indication of headcount required in a team but i feel that more often then not is the FTE figure irrelevant to practical headcount requirement.

I would like someone to explain / calculate FTE in simple language / simple arithmetic. Let me give a head start by a simple example, & we can tweak the parameters once we (‘I’) get the basics right :

We have a 17×7 operation.
Coverage is 06:00-23:00 hours, open 7 days a week, only Full Time workers on 8.5 hour shifts
Calls per day = 1700 (evenly distributed as 100 per hour)
AHT = 360 secs
Shrinkage = 0 %

What is the Full Time Equivalent “FTE” for above example ?

What does this figure signify ?

Question asked by King

What is FTE?

FTE stands for Full Time Equivalent, and is a metric used in call and contact centres to represent the number of full-time employees needed to perform a job. It provides a standardized way to measure workforce capacity.

If your staff consists only of full-time employees, your FTE simply reflects the total number of employees required.

For example:

1 FTE equals one person working full-time, typically Monday to Friday.
1 FTE can also represent two people working part-time, such as half a day each.

In terms of the number of hours, then one FTE could be either 37.5 hours or 40 hours per week, depending on the number of hours per week that you work in your organisation.

If you only have full-time staff, your FTE is therefore the number of staff you require.

It has no bearing on number of calls, shrinkage etc.

In BPO, the meaning of FTE is merely the number of full-time staff required. This can be factored as full-time staff + part time staff (2 x 50% hours = 1FTE)

With thanks to Dave

How to Calculate the FTE Required

The easiest way to work out how many FTE are required is to use an Erlang Calculator – here is a link to a Free Erlang Calculator

You Need to Include Level of Service

You’d need about 37, this is assuming a reasonable service level delivery.

You need to take into account what level of service you plan to deliver to your customers in order to come up with and FTE figure.

By taking a service level (most commonly a % of calls answered in x seconds) into account this inflates the FTE requirement above that simply required to deal with the workload (1,700 x 360).

If we assume that on top of the work that needs to be done we need to have an additional 25% of resource (i.e. work forms 75% or .75 of the total requirements) then the amount of employed hours is therefore

7 x 1700 x 300 / .75 / 3600 = 1,587

If we assume that an FTE works 5 days a week, 8.5 hours per day and shrinkage is 0% then the FTE requirement is

1,587 / (5 x 8.5) = 37.3

With thanks to Eamon

What is the Best Calculation Method for FTE?

Let’s skip the 75-25% work load from the equation (for sake of simplicity!)

I agree with calculation method :-

Weekly Workload (in secs) = 1700 calls x 7 days x 360 secs AHT = 428400 secs
Weekly Workload (in hrs) = 428400 / 3600 = 1190 hrs
Staffing available (in hrs) = 8.5 hrs x 5 working days per week = 42.5 hrs

FTE = 1190 / 42.5 = 28 (per week)

Similarly, FTE required per day is 20 which will fulfil our hourly FTE requirement of 10 which is constant throughout the week.

The problem lies in fact that neither have we considered start / end time of activity, nor have we considered shift start / end times. That is where the FTE calculation seems a waste to me.

If we reconsider a different start end time of activity e.g. 09:00-21:00 HRS, the FTE calculation still gives a weekly FTE 28 & daily FTE 20

However, now the hourly FTE required is 14.17, and these 20 FTE per day are not enough to maintain a regular coverage of 14.17, so where then lies the practical use of FTE ?

Adding Occupancy to FTE Calculations

I also agree with adding occupancy and other factors to evaluate workload.

My intention in excluding it from equation was to keep the focus on my main concern.

i.e. the FTE calculated on a weekly level (28) does not help us meet the hourly FTE requirement if the activity timing in the example is 09:00-21:00 (all other workload, etc kept unchanged)

You can do the calculation with or without increase in workload, either ways the issue still persists.

With thanks to King

You Need to Use Workload

If you ignore workload as you have above, it appears that you would not have sufficient agents, but in the scenario it was assumed that agents would work for 75% of their weekly hours.

If you extended the opening hours, but did not assume an increase in work then the 75% may drop to around 60% (as an example), this would then increase the required staffing levels and therefore increase your FTE.

You Need to Aim for Practical Application Not a Theoretical Solution

It makes sense what you are saying, but with 10 agents per hour 36 Hrs and 100 calls x 360 AHT, 36 Hrs

You are assuming that 8.5 of your agent/day hours are 100% productive, in effect you have determined the time required to deal with your calls, with all things are equal, calls/hour, AHT/call.

It’s a theoretical solution, but one that you would never be able to practically apply

With thanks to Scott

FTE Requirements Will Not Differ

Regardless of operational hours your FTE requirement will not differ as your workload, your figures, does not change.

FTE is mainly used as a finance metric purely for costing purposes, you will always staff to heads.

Calculate the Number of Hours You Need

You also could calculate the number of hours that you need to deliver the service, add on any shrinkages then build your shifts, from this you can derive the FTE figure.

FTE is a currency mainly used for finance purposes and helps simplify the costing process.

With thanks to Steve

Your Headcount and FTE are Different.

Your headcount and FTE are different.

A calculator will tell you HOW you need to staff (in hours) this is your FTE.

It’s up to you to staff to that.

With thanks to Dave

Need Your Help In Staffing for a New Campaign

I am new with Workforce planning. We have a new campaign that we’ll be starting and the client gave these figures as part of their requirement:

Number of agents required : 100 (70 voice and 30 non-voice)
Working hours : 12 hrs, 9 AM to 9 PM EST, Monday – Friday, 5 hours, 12 PM to 5 PM EST, Saturdays and Sundays
Number of calls per agent daily : 200 calls
AHT : 180 seconds

How many agents should we hire for this campaign since it is based on FTE?

What other information do I need to ask the client about so we can arrive at a good forecast?

Question asked by Anna

Ask Your Planning Department

I would suggest that you ask your planning department.

This is a fundamental core part of your business and something you, or your staff, *SHOULD* be able to do.

As a note the numbers below cannot be correct.

200 calls per agent per day with an AHT of 180 gives 10 hrs Talk time per agent.

Never ever let the client dictate FTE numbers before you’ve had chance to look at said numbers.

With thanks to Dave

It Could Be Interpreted in Two Ways

There are lots of terms bandied about in call centres – FTE, agents, AHT’s etc and these can all be interpreted in different ways.

Looking at your figures from your client the number of FTE required could be interpreted to two different ways.

“Number of agents required: 100 (70 voice and 30 non-voice)” – if you are handling the entirety of the workload on this campaign (i.e. you are not handling a subset of a larger group of calls) then this could interpreted as the MAXIMUM number of agents required at the busiest part of the day.

Broadly speaking then that would equate to 141.7 FTE based on a 37.5 employed week. Assuming a 80% – 20% split of Full-time to part-time resource that would be 167 agents

However, if you interpret it as a flat agent requirement across all the opening hours (e.g. if you are handling calls at the front of the queue and calls overflow to another resource) then the agent requirement is much higher – 255.4 FTE based on a 37.5 hour employed week. Again assuming a 80% – 20% split of Full-time to part-time resource that would be 301 agents

Given a potential difference of over 100 FTE and 130 heads, it is worth asking your client for a clearer definition of the work to be done.

I’d ask things like

How many calls do you expect the entire operation to handle each week?
Will the operation be solely responsible for handling those calls or do they overflow elsewhere?
Is the agent requirement the maximum required at peak or the minimum required across all the opening hours?
Given the “200” calls per day do you envisage that agents would work 12 hour shifts? (Dave is correct at an AHT of 300 secs that would be 10 hours of handling time per day per agent, given breaks and some downtime the minimum shift would be around 12 hours long)

With thanks to Eamon

Calculating FTE Based on Monthly Data for an Arrival Based Process Will Not Be Accurate

FTE is for production (hourly line requirement), whereas headcount (HC) comprises of all buffers including leaves, absenteeism, attrition etc.

From Finance perspective headcount is what is supposed to be used, but from Service Level performance perspective, we should use FTE.

Calculating FTE count based on monthly data for an arrival based process will not be accurate. You would need to calculate hourly requirement and roll it up to daily / weekly / monthly and then add all the buffers to arrive at HC.

With thanks to Pamposh

Requirement of FTE for Outbound.

Demand of FTE for O/B utterly depends on the subsequent factors:-

Number of calls to be created.
Average time of O/B call.
Right party contact proportion.
Required time for handling the call.

Example:

If you know your total number of labour hours for one year then divide it by 2,080 (8 hours / day * 5 days / week * 52 weeks / year = 2,080 hours / year)

Suppose your department’s total labour hours reported to payroll for Jan – Dec were 13,104.

Then, 13,104 / 2,080 = 6.3 FTEs.

With thanks to lisa

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Author: Jonty Pearce
Reviewed by: Robyn Coppell

Published On: 12th Apr 2022 - Last modified: 3rd Sep 2024
Read more about - Call Centre Questions, Full Time Equivalent (FTE), Staffing