Selecting the Best Resource Management Software
Resource management software provides simple scheduling, budgeting, and time-tracking features.
However, keeping teams on time and within budget may not be enough to move the needle when an organization operates in turbulent, fast-moving environments. Executive teams are under constant pressure to adapt quickly to changing industry demands and customer preferences.
What’s the best approach so resource management is in lockstep with perpetual change to business priorities? The right resource management solution. Resource management software enables portfolio managers to facilitate quick pivots while continuously supporting strategy execution. This helps them track multiple projects with clear visibility into resource capacity.
And when plans shift and projects need to morph, this information contributes to smart, informed decision-making and execution.
In this guide, you’ll learn how to select the best resource management software for your organization. Learn how to manage resources while supporting how every organization and team in the enterprise prefers to execute and deliver work.
Then there are the changing dynamics of the future of work and work delivery to consider – while different work methodologies have their benefits, resource management challenges can arise when a variety of methodologies are used across an organization.
It’s easy to prefer a single work methodology to bring consistency; however, the characteristics of the work vary as much as the people who execute that work.
Companies are adopting a range of work methodologies, such as traditional waterfall, agile, or a hybrid approach. While each work methodology has its benefits, the variety running concurrently in an enterprise adds to resource management challenges.
Why Resource Management Software Is Important
One of the most critical and ongoing decisions all companies make is how to allocate constrained resources.
PMOs and portfolio managers are responsible for putting the right resources on the right work at the right time – and reallocating as needed. Resource management software enables the complex decision-making and data needed to plan, monitor, and optimize resources for one project or an entire portfolio.
Data transparency is a major reason why resource management software is so important. It gives project and portfolio managers quick, up-to-date insight into data surrounding:
- Resource utilization
- Project schedules
- Status of ongoing work
Access to this information is instrumental for the success of your projects. It helps with planning and allocating resources between projects in your portfolio. Use this information to identify resource gaps, address interdependencies, and keep projects within your portfolio on track.
Portfolio-level insights enable PMOs to make decisions in context with company initiatives, priorities, and strategies. For instance, visibility into portfolio performance and resource capacity lets the PMO determine how to sequence multiple investments to achieve desired outcomes. In addition, resources can continuously be assigned to the highest priority projects that deliver business value.
McKinsey research found top companies frequently reallocate high performers to the most critical strategic priorities. These organizations are 2.2 times more likely to outperform their competitors on total returns to shareholders (TRS) than slower ones.
Advanced resource management software makes it possible to enact changes like these with speed and agility. Project leaders can quickly rebalance roles, people, and team assignments across all strategic work as needed.
For example, moving a team to newly prioritized work could impact other teams, funding, and strategic initiatives across the organization. PMOs can analyze the dependencies and trade-offs of shifting the team, make recommendations, and quickly put the revised resource plan into action.
Without this transparency, project and portfolio managers cannot easily keep tabs on who is available to work on which projects, and when. Resources are more likely to be over- or under-utilized. The risks are employee burnout, project delays, lost productivity, conflicts over resources, and more.
Overall, the use of software can improve the ability to schedule, plan, and manage your resources. Deadlines, budgeting commitments, and project outcomes are more likely to be realized. PMOs become better advisors to executives, providing more accurate status updates as well as modeling and forecasting.
Balancing capacity with demand
Why is resource management software so important?
The most common constraint on work is resource capacity. Work can come from anywhere, and even when moving towards fixed teams, shared resources are a reality.
This challenge is only increasing as the lines between enterprise organizations are becoming blurred. Companies are breaking down silos in favor of cross-organizational collaboration.
While seen as beneficial for innovation and speeding products to market, the enterprise-wide focus uncovers the many disparate tools being used throughout the organization – including those for project management and resource management. Data becomes fragmented, fails to provide a big picture view, and requires data management over a number of tools that may not integrate with tools used in other departments.
Resource managers and executives, therefore, have no real way to balance overall (and limited) capacity with increasing demand, nor prioritize the highest-impact work coming in from multiple requestors.
In fact, they have a hard time understanding if they have enough of the right resources to deliver on strategies and often have little evidence to justify additional headcount.
Bringing all of this together to ensure there is enough capacity to deliver, and that the highest-priority work is aligned to strategy, is a huge challenge.
These challenges don’t just live in IT. They have a ripple effect that impacts the entire organization’s ability to innovate and remain competitive. There is a high cost of doing nothing to improve the situation, such as:
- Unsatisfactory department performance
- Frequent, unexpected setbacks
- Minor issues that grow into major financial problems
- Lower morale and higher turnover from over-utilization of resources
Discover the reasons why projects fail and how resource management is providing stability. Read The Cost of Poor Resource Management guide to learn more.
Resource Management Software Brings Order to the Chaos
Functional and well-aligned resource management software gives organizations the boost they need to deliver effectively, despite the changing world of work and the challenges it brings.
The best practice is to choose a solution that combines resource management with adaptive project management or collaborative work management tools, so work and resources can be managed simultaneously.
Remember: Resource management software is only a tool
Resource management software is not the end-all. It must come with process changes for its implementation and adoption to be successful.
Providing your organization with such technology, however, will help drive those changes for improved work prioritization, better visibility, and effective management of resource utilization.
The primary goal for resource management software is to create visibility that reveals whether the existing capacity can meet prioritized demand, determines the cost of resource time, and illustrates whether it can be capitalized.
Integrating work and resources to manage capacity will ensure your high-value work is prioritized. Finally, the organization must support a full range of work methodologies to deliver on strategy.
Selecting the Right Resource Management Software
The right resource management software depends on your organization’s unique needs and challenges, as well as the sophistication of your resource management capabilities. Project leaders may need help prioritizing incoming demands so they don’t say yes to everything. Ideally, selecting a solution that can grow with your organization’s needs and maturity is best for the sustainability of your resource management practice.
Another issue may be obtaining visibility into team capacity, or centralizing all projects, work, and resources to facilitate enterprise-wide management.
If the decision to invest in a solution has not yet been made, consider the following: resource management software provides capabilities and benefits those spreadsheets and other manual methods cannot.
PMOs and portfolio managers gain more insights into projects and delivery. That’s because effective resource management software provides greater visibility into resource utilization rates, project status, availability, budgets, and more. This translates into companies significantly reducing project resource costs and improving efficiencies, as well as mitigating risks to quickly deliver projects and value to customers.
In addition, resource management software helps optimize resources during periods of volatility or rapid change. When new demand comes in or executives shift strategy, the right software can help the company make better decisions and adapt more quickly – without wasting resources.
Forecasting capabilities are equally valuable. Data from completed projects can inform accurate predictions about future capacity, timelines, and budgeting. Executives may also want scenario planning and modeling capabilities. That will help them choose the right investments in line with resource capacity and priorities.
Regardless of what your goals are, a quality solution will have some common features and capabilities. Here are some tips to help you choose the right resource management software solution for your organization.
Begin with best practices
When choosing any software solution, start with best practices and then drill into specific features. To do this, the PMO must first understand the organization’s objectives and align them with software capabilities.
In some cases, it is beneficial to allow the vendor to provide guidance based on their experience as they demonstrate how the software can be optimized. Much can be learned from the vendor and how they have built functionality out of the box, giving the PMO a jumpstart as they avoid a future restart from too much complexity and/or customization.
Evaluate key features
No matter the resource management software you select, there are three core features it must provide:
1. Visibility and utilization
The most important aspect of any resource management software solution is the visibility it provides. It must offer insight into capacity and demand, particularly the resources and skills in short supply. If the right mix of skills is not available or even present within the team, project delays will ensue.
Resource managers must also be able to see resource availability across a timeline based on a flexible set of attributes, such as:
- Cost center
- Resource type
These details, plus any configurable attributes to allow for unique requirements, will ensure managers can plan, forecast, and assign the right resources to the right projects at the right time.
Managers also need dynamic views of resource utilization based on current work and assignments. Only then will they be able to determine over- and under-utilization, and whether their team members are being fully optimized. A “just right” amount of work goes a long way to keeping your people engaged and high performing.
2. Allocation, planning, and prioritization
Any resource management software worth the investment must offer detailed planning and prioritization across shared resources. The software should allow them to evaluate and score potential resources to fulfill resource requests. The scoring system makes it quick and easy to see which resources are most suited for a particular project.
The software must be flexible, accommodating whatever view a particular stakeholder wants to see most. For instance, it should allow for hard and soft booking, as well as handling team versus individual assignments.
The system should be flexible enough to provide both high-level planning, as well as detailed, bottom-up planning. It must allow options to plan at various ranges of granularity over short and long-term timeframes.
3. Actuals and financials
Modern resource management software can help the organization better understand planned versus actuals. Executives and finance care about capturing actuals and costs. Yet traditionally, these metrics have been little more than best guesses and estimates.
With the right resource management software, however, the PMO can speak the same language as finance and give them the data they want. That data could be:
- How much time was planned?
- What actually happened?
- What was the time cost and how it was split between capital and operational expenses?
In one instance, a company reported more than $2 million in capital savings and $2.6 million in expense savings due to improved processes and planning.
To ensure accurate costing of resources, it’s important to know the associated resource rate functionality, which is often complex. Typically, costing requires time delimited rates based on a flexible set of resource attributes, such as role or location, as well as individual resource rates. Depending on the work, there is probably the need for the ability to override the standard rates with project or activity-level rates.
Time tracking provides the granular detail necessary to cost resources.
What’s more, time tracking has evolved considerably. It’s highly effective at helping organizations know how long specific work takes – so they can estimate future capacity and schedule appropriately.
This data facilitates proper resource allocation for projects and justifies requesting additional headcount when needed. When people see how tracking their time can potentially reduce their workloads, they are more apt to comply.
Time tracking can be used for traditional projects or lighter-weight, iterative Lean-Agile practices. As companies are making agile transformations, some vendors are starting to pair high-level planning with team-level agile and Kanban that automatically calculate time based on the natural flow of work on a Kanban board. This allows finance to get their actuals and resources without needing to reference a timesheet.
Dive deeper by accessing The Challenges of Agile Software Development Capitalization eBook. Learn how time tracking and agile costing are important to capitalization, and how capitalization impacts agile team funding and headcount.
Vendor support to partner on the journey
Finally, vendor support is critical. Resource management software offers a range of functionality that can be daunting without the right vendor support. Assess which vendor will best meet the needs of the organization, has the experience and knowledge from supporting other customers in their own journeys, and will help the PMO best meet its strategic goals to deliver value with speed.
PMOs at any level can enhance resource capacity planning and management to accelerate business growth. Get The Savvy PMO’s Guide to Resource Planning eBook to learn how.
Summary of Next Steps and Benefits
Once the PMO knows the organization’s goals and objectives, the next step is to understand how well resources are being managed today. Identify known risks when those resources aren’t being properly assigned to projects that align with the company’s strategic initiatives. This will be a powerful exercise that inevitably reveals gaps and opportunities for improvement.
When the right resource management software is implemented in partnership with the vendor, a wealth of benefits soon follows:
- A realistic view of demand and capacity to deliver, with the ability to spot problems early in the process
- A dramatically improved ability to execute on strategy by focusing resources on high-value work
- An enhanced ability to respond to the dynamic nature of business as scope and priorities change, driving the organization towards agility
- Fully-integrated work and resource management, providing detailed cost information to help inform key stakeholders’ decisions
- Happier teams and lead to greater retainment, efficiencies, and capacity to deliver real value to the business
The PMO must transform itself to meet the challenges of a new world of work. Integrating work and modernizing resource management is key to enabling the PMO to do more than dictate processes and enforce governance. With robust, integrated resource management software, your PMO can facilitate growth through innovation and efficiency.
Discover how to create flexibility in your resource planning and avoid common pitfalls with resource capacity planning. Download the Top 5 Challenges of Modernizing Resource Capacity Planning eBook and get started today.
Top 5 Challenges of Modernizing Resource Capacity Planning
Get the answers to how you can modernize and improve your organization’s approach to resource capacity planning.View the eBook • Top 5 Challenges of Modernizing Resource Capacity Planning