Actual cost and effort calculation for a demand and demand task

  • Release version: Australia
  • Updated March 12, 2026
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    Summary of Actual Cost and Effort Calculation for a Demand and Demand Task

    The actual cost and effort for demands and demand tasks reflect the real expenses and time spent during specific periods, calculated using approved time cards and hourly rates. Monitoring these metrics is crucial for demand managers to understand the overall expenditure involved in transforming a demand into a product, feature, or enhancement.

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    Key Features

    • Cost Calculation: Actual cost is determined by multiplying hours worked (from time cards) by the resource's hourly rate.
    • Effort Calculation: Actual effort is simply the sum of hours reported in time cards for demand tasks.
    • Hourly Rate Determination: Rates are derived from a hierarchy: rate model (if applicable) → default labor rate → default system property.
    • Resource Assignments: These are not used to allocate resources to demand tasks; they roll up to the work entity created from the demand when qualified.
    • Time Recording: Additional hours must be recorded separately using the Time Sheet Portal and will add to demand costs but not to demand tasks.

    Key Outcomes

    The calculations for actual cost and effort at the demand level are as follows:

    • Demand Actual Cost: Total of all demand task costs plus any extra activities.
    • Demand Actual Effort: Total of all demand task efforts plus any extra activities.

    For example, if a demand has three tasks, each with a resource spending eight hours, the actual costs and efforts can vary based on the rate model used:

    • With a rate model, total demand cost could reach $4,800.
    • If using the default labor rate, the total may reduce to $3,600.
    • In the absence of a defined rate, costs could drop to $1,200.

    Understanding these calculations helps ServiceNow customers effectively manage their demands, ensuring accurate budgeting and resource allocation.

    Actual cost and effort represent the realized cost and time spent working on demands and demand tasks during a specific time period. These values are calculated based on approved time cards and hourly rates for resources.

    Overview of calculation

    Working on demands and demand tasks involves cost and time that add to the overall expenditure of converting a demand to a product, feature, or enhancement. Demand managers must track the actual cost and effort incurred in assessment and planning activities.
    • The actual cost is calculated by multiplying the hours reported in the time card by the hourly rate of the resource.
    • The actual effort for a demand task is calculated based on the hours reported in the time card.
    • The actual effort and cost for demand tasks roll up to calculate the actual effort and cost for the demand.

    Hourly rate calculation

    The hourly rate for calculating actual cost is derived in the following order:
    1. If a rate model is associated with the demand, the actual cost is calculated based on the hourly rate defined in the rate model.
    2. If a rate model is absent or if an hourly rate isn’t found in the rate model, the hourly rate is derived from the default labor rate.
    3. If an hourly rate isn’t found in the default labor rate, the hourly rate is derived from the default system property.

    Resource assignments and Time cards

    Don’t create resource assignments for allocating resources or groups to a demand task. Resource assignments created in the demand are used for resource estimation of the work entity created from the demand. These resource assignments automatically move to the resulting work entity when a demand is qualified and converted.

    When you submit a time card for a demand, the actual effort and cost aren’t reflected in the resource assignment. Resource assignments aren't associated with the demand by default. The actual cost and actual effort remain with the demand and aren't transferred to the created projects, even if you manually associate a resource assignment.

    If a resource spends extra hours working on a demand that aren’t associated with demand tasks, this time must also be recorded. The resource submits the time card for recording extra hours using the Time Sheet Portal. This extra cost and effort is added to the demand but isn’t reflected in the actual cost and effort for the demand tasks.

    Demand-level calculations

    The actual cost and actual effort for the demand are calculated as follows:
    • Demand Actual Cost = actual cost of all demand tasks + actual cost of extra activities
    • Demand Actual Effort = actual effort of all demand tasks + actual effort of extra activities

    If a demand has no task or assigned resource, you can capture the actual cost by submitting a time card against the demand. Once the time card is approved, an expense line is created on the demand. The expense line is processed and the actual cost of work for that time card rolls up to the demand in the Demand Actual Cost column.

    This example demonstrates actual cost and effort calculation for demand tasks and rollup to the demand.

    Scenario setup - For demand D1, the demand manager creates three demand tasks (DT1, DT2, and DT3) and assigns resources R1, R2, and R3 to each task respectively.

    Table 1. Hourly resource rates
    Resource Hourly rate in the rate model Hourly rate in the default labor rate Hourly rate in the system property
    R1 $200 $150 $50
    R2 $250 $200 $50
    R3 $150 $100 $50

    Each resource spends eight hours on the assigned demand task and submits a time card.

    Table 2. Scenario 1: Rate derived from the rate model
    Actuals Demand task DT1 Demand task DT2 Demand task DT3
    Actual effort 8 hours 8 hours 8 hours
    Actual cost 200 * 8 = $1600 250 * 8 = $2000 150 * 8 = $1200
    Demand rollup:
    • Demand Actual Cost = $4,800
    • Demand Actual Effort = 24 hours
    Table 3. Rate derived from default labor rate(Rate model not associated with demand.)
    Actuals Demand task DT1 Demand task DT2 Demand task DT3
    Actual effort 8 hours 8 hours 8 hours
    Actual cost 150 * 8 = $1200 200 * 8 = $1600 100 * 8 = $800
    Demand rollup:
    • Demand Actual Cost = $3,600
    • Demand Actual Effort = 24 hours
    Table 4. Rate derived from default system property(Rate model not associated with demand and hourly rate not found in default labor rate.)
    Actuals Demand task DT1 Demand task DT2 Demand task DT3
    Actual effort 8 hours 8 hours 8 hours
    Actual cost 50 * 8 = $400 50 * 8 = $400 50 * 8 = $400
    Demand rollup:
    • Demand Actual Cost = $1,200
    • Demand Actual Effort = 24 hours