Project Management · Module 1 · Week 1 Quick Reference
Module 1 · Project Pursuit · Week 1 · Reference
How client revenue becomes firm performance, and how one project contributes to it. Keep this guide available on the job, not only this week.
Quick Reference · front and backVersion 2.0The business system
Weston & Sampson earns net service revenue after direct expenses, such as subconsultants and other project costs the firm passes through. Net service revenue funds direct labor, overhead, and profit at the same time, not in sequence.
Profit, in turn, supports the firm's capacity to invest, retain employee owners, and take on future growth.
One unit of the business model
The business system above describes how Weston & Sampson earns and spends every dollar of net service revenue. The billing rate applies that same model to a single unit of effort, one billable hour from one employee. Wage, overhead, and profit are all still there, just scaled down to a size a project manager can price and schedule.
A direct labor cost of $35 per hour, run through the firm's confirmed direct labor multiplier, produces a billing rate near $114 per hour.
Rate components current as of July 2026. Confirm with finance before quoting.
The business model, scaled up
If the billing rate captures the firm's business model in a single unit of effort, a project's fee and performance reflect that same business model across a collection of efforts. When we build the fee, estimate the effort, and execute the project, we are running a small business inside the Weston & Sampson business.
Scope, effort, staffing, and fee meet on every project. Schedule paces the work. Risk is uncertainty that can change any of these assumptions.
This project's fee is $250,000. Direct expenses total $45,000, leaving $205,000 in net service revenue, the amount Weston & Sampson earns with its own labor. Scoping, effort, and staffing are what build that fee in the first place: scope sets what the team will do, effort estimates how many hours that scope will take, and staffing puts people against those hours. The figure below shows how those three inputs run into the fee, with schedule and risk acting on it from the side.
The project manager monitors the assumptions built into the fee and acts when scope, effort, staffing, schedule, or risk changes.
Once this project is awarded, its fee becomes booked work, revenue the firm can already plan against. Add it to the estimated value of the work still in pursuit, and the firm can predict the conditions it is planning into.
Pursuit to forecast
Estimated NET Revenue is the projected Net Service Revenue recorded for an opportunity before award. After award, actual project performance determines the Net Service Revenue the firm earns. Multiplied by win probability, Estimated NET Revenue produces the weighted opportunity value used in planning.
This project carried an Estimated NET Revenue of $205,000 and a win probability of 40 percent, a weighted opportunity value of $82,000. Added to signed backlog, weighted opportunity value forms a planning view of future work, not committed revenue.
Week 2 applies this model. The Go/No-Go process produces the Estimated NET Revenue and win probability used in the planning view.
Formula reference
| Formula |
|---|
| Gross Revenue − Direct Expenses − Reimbursable Expenses = Net Service Revenue |
| Direct Labor Cost × Direct Labor Multiplier = Billing Rate |
| Direct Labor Multiplier = Net Service Revenue ÷ Direct Labor |
| Overhead Factor = Overhead ÷ Direct Labor |
| Estimated NET Revenue × Win Probability = Weighted Opportunity Value |
Financial figures current as of July 2026. Confirm current values before pricing or planning.