Central Costing Reference Tool

What is this?

The Central Costing Reference Tool (CT) ensures that benefits are calculated consistently across all change initiatives in your institution. The tool supports the collation of standard costing information into one reference source that can be accessed by all staff in order to calculate efficiency and cost savings. The figure below illustrates an example extract of a CT which provides the salary information required to calculate efficiency savings.

Staffing Costs

Grade

Annual

HRS/YR

Days/YR

SHR

COST

DAY RATE

Hourly Rate

1

13,953

1526

218

30%

£17,735

£81

£8

2

14,631

1526

218

30%

£17,592

£81

£8

3

17,039

1526

218

30%

£20,636

£95

£9

4

20,198

1526

218

30%

£24,629

£113

£11

5

23386

1526

218

30%

£28,659

£131

£13

6

28695

1526

218

30%

£35,369

£162

£16

7

35256

1526

218

30%

£43,662

£200

£20

8

44620

1526

218

30%

£55,654

£255

£26

9

53248

1526

218

30%

£66,853

£307

£31

10

59914

1526

218

30%

£75,505

£346

£35

 

What does the tool help achieve?

Overcome the barriers to sharing information

Developing a CT and populating it with accurate information can help you make significant progress towards creating a transparent benefits-driven culture in your institution. It highlights the standard costing information that is not readily accessible and therefore which business areas you need to engage with to provide this information.  This provides you with the opportunity to communicate to these stakeholders why this information is important and how it will be used. This activity establishes transparency and positive working relationships between the relevant areas.

Consistent reporting of efficiencies

The CT ensures that efficiency and cost savings are calculated consistently and accurately across all change initiatives in your institution, contributing to institutional and sector reporting.

Tips when using the tool

  • Ideally the CT is created and maintained by a central team who provide access to anyone managing a change initiative. Read-only format is useful to ensure that no accidental changes can be made
  • Finance and Procurement Services are key departments to liaise with when developing the CT
  • The CT should be reviewed and updated annually to take into account any changes to salaries and costs. Any changes should be communicated to users of the tool
  • Annual cumulative savings calculated across all change initiatives can readily feed in to the institutional reporting