Actual cost and effort calculations for demands

  • Release version: Australia
  • Updated March 12, 2026
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    Summary of Actual cost and effort calculations for demands

    Actual cost and effort calculations in ServiceNow track the realized time and expenses associated with demands and their tasks. These values derive from approved time cards and hourly rates, reflecting the true expenditure involved in converting demands into products, features, or enhancements. Demand managers use these calculations to monitor costs and efforts during assessment and planning stages effectively.

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    Calculation Details

    • Actual Cost: Calculated by multiplying hours reported on time cards by the applicable hourly rate of the resource.
    • Actual Effort: Computed based on hours reported on time cards for each demand task.
    • Effort and cost roll up from individual demand tasks to the overall demand level.

    Hourly Rate Determination

    The hourly rate used for actual cost calculation follows this priority order:

    • Hourly rate from a rate model associated with the demand.
    • If no rate model or hourly rate exists there, the default labor rate is used.
    • If absent in both, the default system property rate applies.

    Resource Assignments and Time Cards

    • Resource assignments from the demand are used for resource estimation and move to the resulting work entity once the demand qualifies and converts.
    • Resource assignments for demand tasks do not transfer to the work entity.
    • Time cards submitted for demand tasks update actual effort and cost calculations but do not affect resource assignments.
    • Additional hours worked on the demand but outside demand tasks must be recorded separately via the Time Sheet Portal; these hours add to demand-level cost and effort but not to demand task calculations.

    Demand-Level Calculations

    • Demand Actual Cost = Sum of actual costs for all demand tasks + actual costs of extra activities.
    • Demand Actual Effort = Sum of actual efforts for all demand tasks + actual efforts of extra activities.
    • If no demand tasks or resource assignments exist, actual costs can still be captured by submitting and approving time cards directly against the demand.

    Example of Cost and Effort Calculation

    For a demand with three tasks assigned to three resources, each working 8 hours, actual costs vary depending on the hourly rate source:

    • Using Rate Model Rates: Total demand cost is $4,800; total effort is 24 hours.
    • Using Default Labor Rates (when no rate model): Total demand cost is $3,600; total effort is 24 hours.
    • Using Default System Property Rates (when no rate model or labor rate): Total demand cost is $1,200; total effort is 24 hours.

    This example highlights how the source of hourly rates impacts the calculated actual cost, while actual effort remains consistent based on reported hours.

    Actual cost and effort represent the realized cost and time spent on demands and demand tasks. Values are calculated from approved time cards and hourly rates.

    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 should 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

    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. However, any resource assignments for allocating resources or groups to a demand task aren't moved to the work entity.

    When you submit a time card for a demand task, the actual effort and cost aren't reflected in the 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. After 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.

    Cost and effort calculation example

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

    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. 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 roll-up:
    • 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 roll-up:
    • 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 roll-up:
    • Demand Actual Cost = $1,200
    • Demand Actual Effort = 24 hours