Automated Cost and Penalty Calculations

What Happens Automatically?

Why Automation Matters for Service Economics

Manual cross-referencing between capacity data, rate cards, and finance sheets is a primary source of errors in service organisations. Automation eliminates this by linking data entry directly to financial outcomes.

Two Key Automations

DigitalCore has two automated cross-domain calculations that trigger as you enter check-in data:

1. Hours → Labour Costs (Capacity domain feeds Finance domain)
2. KPI Breaches → SLA Penalties (Performance domain feeds Finance domain)

Hours Become Labour Costs

When You Log Capacity Hours, DigitalCore Calculates the Cost

Enter actual hours for a role on an engagement. DigitalCore immediately multiplies those hours by the applicable hourly rate and creates a cost entry in the finance domain.

How It Picks the Right Rate

The system uses a priority hierarchy to find the most specific rate:

1. Contract rate with engagement match — Rate specific to this engagement’s contract
2. Contract rate — General rate defined in the linked contract
3. Rate card default — Organisation-level default rate for this role
4. Any matching rate card — Fallback if no default is specifically flagged

The most specific rate always wins.

Where the Cost Appears in Your Finance View

The labour cost appears as an entry in the finance grid, in the line item that matches the role’s catalog link (typically a COGS Labour line). It’s clearly marked as system-generated so you can distinguish it from manual entries.

SLA Breaches Become Financial Penalties

When a KPI Falls Below the Agreed Threshold

If you enter a KPI actual that breaches the SLA threshold defined in the engagement’s linked contract, DigitalCore detects the breach automatically.

How DigitalCore Determines If It’s a Breach

The breach check uses the SLA operator defined in the contract terms:

• “Greater than” — Actual exceeds the threshold (e.g., response time > 4 hours)
• “Less than” — Actual falls below the threshold (e.g., availability < 99.5%)

Penalty Calculation: Fixed Amount, Percentage, or Tiered

The contract defines how the penalty is calculated:

• Fixed amount — A flat penalty per breach (e.g., €5,000)
• Percentage — A percentage of contract value (e.g., 2% of monthly contract value)
• Tiered — Different penalty amounts depending on the severity of the breach

Where the Penalty Appears in Your Finance View

The penalty creates a cost entry in the finance domain, in the line item linked to the SLA term. It’s marked as system-generated with a reference to the specific penalty event.

Traceability

Every Auto-Generated Cost is Clearly Labelled

Automated entries are tagged with their source: “Generated from capacity hours” or “Generated from SLA breach.” You can trace any automated cost back to the original data that triggered it.

Manual Entries vs. Automated Entries — Easy to Tell Apart

The finance grid distinguishes manual entries (entered by a user during check-in) from automated entries (generated by triggers). Both contribute to totals and margins equally.