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[Solved] [Cost] (Noob question) What is the difference between Unit cost and Labor cost

Added by Yat Tung Siu over 7 years ago

I am a team leader that is responsible to assign my team members to different projects (20 - 40 projects every week). I have access to 1 kind of resource only, which is the total menhour available every week. It replenishes to full every Monday morning and deplete totally on Friday evening (assuming no crunches).

Every project has a limited budget, depending on the project scope. I need to plan ahead and decide how much time is required to get tasks done. It is not a timesheet report. It is done before my team starts working.

If my team cannot finishes the task on the time I specified, i.e. I expect overbudget shortly, I will have to gain approval from project owners to authorize extra budget, or reduce the project scope, or crunch.

I am trying to use OpenProject to plan and track how the time of my team is spent on different projects.

In the budget menu, I am confused by “Planned Unit Costs”, “Actual Unit Costs”, “Planned Labor Costs” and “Actual Labor Costs”.

What is the difference between Unit and Labor cost? Do they track costs in a different manner? Consider I have 1 kind of resource, should I just use one of them, or both of them, to track? Which one is better for me, please?

Thanks in advance.


Replies (3)

RE: [Cost] (Noob question) What is the difference between Unit cost and Labor cost - Added by Robin Wagner over 7 years ago

Hello Yat Tung Siu,

thanks for your question.
Unit cost and labor cost indeed refer to different aspects:
Labor costs are calculated based upon the time users track on work packages and their assigned hourly rate. The hourly rate can be specified for each user and each project (e.g. when you use an internal project in which you want to track only the personal costs versus a customer project in which you want to track the billable time). (You can assign the hourly rate in the user configuration in the admin settings (by clicking on a user’s name and switching to the tab “Rate History”)).

Unit costs on the other hand provide a way to log costs independent of the logged time. If you have any costs which are independent of the time invested (e.g. general travel expenses, raw material etc.) you can track this via unit costs.

Given your explanation, labor costs are probably sufficient for your needs. To the progress of your budget, be sure to assign the work packages on which time is tracked to the budget.

Best regards,
Robin

RE: [Cost] (Noob question) What is the difference between Unit cost and Labor cost - Added by Yat Tung Siu over 7 years ago

Thanks, Robin, for answering my doubts.

Best regards,
Tung.

RE: [Cost] (Noob question) What is the difference between Unit cost and Labor cost - Added by Ragesh R about 3 years ago

Hi...I have one clarification on Labor cost...I had installed latest open project and configured the rate and linked to user...Also budget been created for unit and labor...but when ever i create a work package with time spend ..Labor cost is not calculating automatically as like the user video o shows....!!..Unit cost is calculating...but Labor not updating ..pls advice if i miss anything..?

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