We Were Never Going to Hit 72% Utilization

There was this moment, one that changed how we looked at utilization forever.

We were expected to hit 72% utilization. Every month. No excuses. But we couldn’t hit it. We were always below it. And leadership at the time couldn’t understand why. To them, it was simple math: we have X employees, working Y hours… why aren’t we billing more?

So I decided to break it down. Not just in theory, but line by line, person by person.

I looked at actual availability. Statutory holidays. PTO. Internal initiatives. Scoping. Sales support. Non-billable work we’d been asked to do. Things like helping onboard new clients, sitting in on pre-sales calls, improving internal tooling. None of it billable. All of it real.

And what I found was this: even if everyone was 100% efficient with their remaining time, the highest utilization we could mathematically hit was 67%.

Not 72. Not 80. Not even close.

Which means by definition we were set up to fail.

And what followed was predictable: frustration. Burnout. People getting performance-managed for missing impossible targets. Morale started to drop. People were working late, trying to find time that didn’t exist. And leadership? They were still asking: why can’t we hit this number?

But we weren’t underperforming. We were being measured against a model that didn’t reflect reality.

Here’s what we did:
We educated leadership. We showed them the real math. We proved that if they wanted to hit 72% utilization, then the business had two options:

1. Strip away the non-billable work and give it to someone else.

2. Acknowledge that the target was unrealistic and revise it to reflect actual availability.

We weren’t resisting accountability. We were demanding clarity.

Because here’s the thing: utilization isn’t a static goal. It’s a derived number. It only exists because it sits between two other variables; billable hours and total available hours. And when you ignore everything that chips away at that availability, the whole equation breaks.

If you’re not accounting for internal effort, team time, and seasonality, you’re not modeling capacity. You’re guessing. And you’re punishing your people for a number they couldn’t hit even on their best day.

So now, we build utilization models from the ground up; based on actual team capacity, not hopeful assumptions. We start with the truth, even when it’s uncomfortable. Especially when it’s uncomfortable.

Because accurate math is better than wishful thinking. Every time.

Richard