Capacity planning template
A capacity plan compares the hours each team or resource really has available with the hours of work planned for it, week by week, so you can see a shortfall coming while there's still time to act. This free Excel template works out available hours after leave and non-project time, utilisation and the hours spare or short, and flags any team that's over capacity or above its target.
Running a company of 30 to 200 people? Documents like this are now worth money.
It works for teams of people and, with machine hours instead, for equipment. Each row is one team in one week, so one sheet can cover a week or a quarter.
What's in the template
The workbook has a read-me, the capacity plan and a worked example. You enter each team's people, hours, planned leave, meetings and admin, planned demand and a target utilisation; the rest is worked out. The first week of the example, from a fictional IT support company:
| Team or resource | People (FTE) | Available hours | Planned demand (hours) | Utilisation | Spare (+) or short (-) hours | Target utilisation | Flag |
|---|---|---|---|---|---|---|---|
| Service desk | 12 | 382.5 | 300 | 78.4% | +82.5 | 75% | Above target |
| Projects | 8 | 280 | 312 | 111.4% | -32 | 85% | Over capacity |
| Field engineers | 10 | 275 | 210 | 76.4% | +65 | 80% | OK |
| Onboarding | 3 | 104.5 | 60 | 57.4% | +44.5 | 85% | OK |
Available hours = people × hours per person − leave − meetings, admin and training. Utilisation = planned demand ÷ available hours. The flag reads Over capacity when demand is more than the hours available, Above target when utilisation is over the team's target, and OK otherwise.
How to build a capacity plan
- Decide what you're planning: the teams, roles or machines whose hours limit how much work you can take on, and how far ahead. A rolling four to twelve weeks gives you time to act without guessing too far out.
- Start from contracted hours, then take off what's already spoken for: booked holidays, bank holidays, training, team meetings and admin. In the UK almost all workers are entitled to 5.6 weeks' paid holiday a year, so a plan that ignores leave overstates capacity all year round.
- Estimate demand in hours from the work that's booked (project plans, orders, scheduled jobs), plus an allowance for unplanned work based on the last few months.
- Set a target utilisation for each team. Teams that react to whatever comes in, like a service desk, need more slack than teams working through planned tasks.
- Read the flags and decide what to do about each shortfall before the week starts (see below).
- Update it every week with new work and leave, and compare last week's actual hours with the plan, using timesheets if you keep them, so your estimates improve.
Example: an IT support company in March
The example sheet covers two weeks at a fictional 52-person IT support company with four teams. In the first week the projects team has 280 hours available after meetings and admin, against 312 hours of planned work for a client's office move: 111% utilised and 32 hours short. In the second week a holiday and the start of a second project take it to 87.5 hours short. The service desk is over its 75% target in both weeks, while the field engineers and the onboarding team have hours to spare.
On paper the spare hours elsewhere cover the projects shortfall. In practice only the field engineers can do the cabling and site surveys, so the plan moves 30 hours of that work to them, taking them above their own target for a week, moves the second project's start back a week, and agrees a few hours of overtime. The service desk's hours stay untouched, because that's the team customers notice first when it's stretched.
Why 100% is the wrong target
A team planned at 100% has no room for a sick day, a rush job or a fault that takes three times as long as it should, and something like that turns up most weeks. Work then queues, and the queue grows quickly as a team gets close to fully loaded. That's why the template asks for a target below 100% for each team, set lower for teams handling unplanned work than for teams working through a planned list. A team that runs above target week after week is under-resourced, even if it's coping.
Closing a gap
- Move work in time: bring it forward into a quieter week, or agree a later date with the customer.
- Move work between teams, but only work the other team can genuinely do; the skills matrix shows who can.
- Add hours: overtime, temporary staff or a subcontractor. In the UK the working week is capped at 48 hours on average, normally measured over 17 weeks, unless a worker opts out. In the US, employees covered by federal overtime rules who aren't exempt must get at least time and a half for hours over 40 in a workweek.
- Say no, or not yet, to new work that would keep a team over capacity for weeks.
Common mistakes
- Planning on contracted hours with nothing taken off for leave, meetings and admin.
- Netting teams off against each other. Spare hours in one team only help another if the skills transfer.
- Counting only project work, so the support calls and small jobs that fill the gaps never appear as demand.
- Never comparing the plan with actual hours, so the same estimating errors repeat every month.
Frequently asked questions
How do you calculate capacity in hours?
Multiply the number of people (full-time equivalent) by their weekly hours, then subtract planned leave, bank holidays, meetings, admin and training. What's left is the time available for planned work. Divide demand by it to get utilisation.
What is a good utilisation rate?
No single figure suits every team. Set targets below 100%, lower for teams that handle unplanned work, and adjust them from experience: if a team keeps missing deadlines at its target, the target is too high.
What's the difference between capacity planning and resource planning?
Capacity planning asks whether you have enough hours overall to do the work. Resource planning decides which people do which tasks and when. Do the first before the second, or you'll be scheduling hours that don't exist.