Realization rate
also known as realisation rate · billing realization
The share of worked hours that actually get billed and paid, after write-offs and discounts. Where planned revenue leaks away before it reaches an invoice.
For example, a team logs 100 hours on a project but only bills 85 after non-billable rework and a goodwill discount - an 85% realization rate. The missing 15% is revenue that was earned in effort but never invoiced.
Why it matters to your firm: realization rate exposes the gap between the work you do and the money you keep. A low rate - from scope creep, over-servicing or discounting - can quietly erase a project's profit even when utilisation looks healthy, so it is one of the most revealing numbers an agency can track.
Aim to keep realization above roughly 90%; much lower means scope creep, over-servicing or discounting is eating into billed work.
Realization rate = hours billed ÷ hours worked × 100
Differs from utilisation, which measures billable vs available hours.
Realization rate calculator
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