Team capacity is the number of hours your team can actually spend on planned work in a period. Start with working hours, subtract leave and holidays, then multiply by the share of time that really goes to planned work once meetings, support and admin are taken out. That share is always lower than managers assume, which is why you should measure it from tracked time instead of guessing.
Key takeaways
- Capacity = available hours × the share that goes to planned work.
- Measure that share from your own data. Do not borrow a rule of thumb.
- Plan to about 85% of capacity. A plan with no slack fails on the first surprise.
- Recalculate every sprint or month. Leave and team changes move it.
What is the capacity formula?
Capacity = (people × working days × hours per day − leave hours) × focus factor
Example: (5 people × 10 days × 8 hours − 24 hours of leave) × 0.70 = 376 × 0.70 = 263 hours
The focus factor is the share of working time that goes to planned work. The rest goes to meetings, email, support, admin and everything else that fills a real week.
How do you work it out for a team?
Take one two-week sprint for a team of five.
| Person | Working days | Leave | Available hours | Focus factor | Capacity |
|---|---|---|---|---|---|
| Megan R. | 10 | 0 | 80 | 0.75 | 60 |
| Daniel K. | 10 | 2 days | 64 | 0.75 | 48 |
| Paige S. | 10 | 0 | 80 | 0.70 | 56 |
| Tom B., team lead | 10 | 0 | 80 | 0.50 | 40 |
| Lauren W. | 10 | 1 day | 72 | 0.75 | 54 |
| Team | 3 days | 376 | 258 |
Working person by person gives a better answer than one factor for the team. A lead who spends half the week in meetings has half the capacity of an individual contributor.
How do you measure the focus factor?
From history. Do not pick a number that feels right.
Focus factor = hours on planned project work ÷ total hours worked
Example: 1,120 hours on projects out of 1,560 hours worked last quarter = 0.72
Take the last quarter
Three months smooths out holidays and one-off crises.
Total the hours worked
For each person, from time tracking.
Total the hours on planned work
Time logged to projects and tasks in the plan.
Divide
Planned hours ÷ total hours, per person and per role.
Use the result as next quarter's factor
And measure again next time.
If you have no tracked time yet, run a two-week time audit first.
Where does the rest of the time go?
An illustration with a focus factor of 0.70. Measure your own.
As an outside reference, professional services firms billed an average of 66.4% of available hours in 2025, according to SPI Research's 2026 benchmark as reported by Deltek. Billable share and focus factor are not the same measure, and both point the same way: a third or more of paid time does not go to planned client work. See employee utilization rate.
How do you compare capacity with demand?
- Requested work331 hours
- Team capacity258 hours
- Safe to plan, at 85% of capacity219 hours
In this example the team is being asked for 112 hours more than it can safely plan.
When demand is above capacity there are only four moves: cut scope, move the date, add people or accept overtime. Capacity planning exists to make that choice early and out loud. Hidden overtime is the default when nobody chooses, and it has a cost. See signs of overwork.
How does sprint capacity work?
The same formula, over the length of a sprint.
- In hours. Use the table above. Compare capacity with the sum of task estimates.
- In story points. Use velocity: the average points completed in recent sprints. Scale it down for leave. A team that averages 40 points with everyone present can plan about 32 when one of five people is away.
Many teams plan in points and check in hours. The difference between the two is covered in story points vs hours.
A capacity planning template
Period,[Sprint 14 or March 2027],,,,, Person,Working days,Leave days,Hours per day,Available hours,Focus factor,Capacity hours Megan R.,10,0,8,=(B3-C3)*D3,0.75,=E3*F3 Daniel K.,10,2,8,=(B4-C4)*D4,0.75,=E4*F4 Paige S.,10,0,8,=(B5-C5)*D5,0.70,=E5*F5 Team total,,,,=SUM(E3:E5),,=SUM(G3:G5) Planned at 85%,,,,,,=G6*0.85
What mistakes ruin a capacity plan?
Do
- Measure the focus factor from real data
- Plan each person separately
- Leave 15% unplanned for surprises
- Recalculate when leave or the team changes
Do not
- Assume eight productive hours a day
- Plan at 100%
- Treat the lead as a full-time contributor
- Use the plan to squeeze more hours out of people
How does BirdsEye support capacity planning?
BirdsEye supplies the two numbers that are usually guessed: hours worked and hours on planned work.
- Tracked time. Working time is recorded automatically inside working hours, for every person.
- Time by project. Hours against each project and task, with hour budgets on the Team plan.
- Leave and holidays. Approved leave and company holidays are on the same calendar as attendance.
- Team overview. Teams side by side, with tracked time.
- Period comparison. Each figure against the previous period, on the Team plan and above.
Divide project hours by tracked hours and you have a focus factor you can defend. See projects and budgets and reports.
Frequently asked questions
How do you calculate team capacity?
Multiply people by working days and hours per day, subtract leave, then multiply by the focus factor, which is the share of time that goes to planned work.
What is a focus factor?
The fraction of working time available for planned work after meetings, communication, support and admin. Measure it from your own tracked time.
How much of capacity should you plan?
About 85%. The rest absorbs sickness, urgent requests and estimates that turn out low.
What is the difference between capacity and utilization?
Capacity looks forward: how many hours you can plan. Utilization looks back: what share of available hours was billable or productive.