Table of contents

Resource management is the practice of planning, scheduling, and allocating people, skills, money, and technology to a project or program. In essence, it’s the process of allocating limited resources to achieve the greatest organizational value.

Planview’s Portfolio Resource Management Solution

See Planview’s project portfolio management solution for PMO teams.

Watch the product demo: Planview’s Portfolio Resource Management Solution
Resource management allows you to plan at any level – across the enterprise, portfolios, departments, and teams.
Resource management allows you to plan at any level – across the enterprise, portfolios, departments, and teams.

Resource management is critical for organizations to ensure their resources are optimized and allocated to the right initiatives – the initiatives that are aligned to corporate strategy and bring the most value. By minimizing waste and duplication, streamlining and automating processes, and maximizing and speeding throughput, the enterprise is in a better position to respond quickly to customer demands and be nimble to change. Program and project delivery demands better resource management.

The onus of responsibility continues to include resource managers but increasingly involves self-managed teams. Regardless of methodology, it is critical to carefully balance demand with capacity while also understanding the needs of the business to prioritize, plan, and schedule work with the right teams, people, and skillsets. Gartner says that “regardless of the type of initiative – waterfall, agile, something else or a mix – resource management is a challenge for most organizations.”

With increasing demand, continuously delivering value with resources isn’t easy, even for the most mature organizations. It’s a common and constant challenge for the enterprise: Making sure there are enough resources and funding on hand to complete work well and on time. And that’s where evolved resource management can help.

Resource management within the context of project portfolio management (PPM) enables organizations and managers to gain a level of control that wouldn’t otherwise be possible. If there’s no or poor resource management, projects and initiatives are more likely to fail because of a lack of money or people, or because resources are focused on the wrong areas. It’s one of the primary reasons work goes astray.

There is collateral damage to these failures as well. When resources are misallocated, other initiatives suffer from inattention or having the wrong resources assigned to them. Poor resource management quickly spirals out of control, handicapping execution at every level.

Research firm Gartner Inc., in a report, “Supercharge Your Resource Management to Support Advanced PPM Maturity,” notes:

“It wouldn’t be so bad if resource management mediocrity resulted only in frustration, extra planning work, and meetings to find out what’s really happening. At least that’s survivable, as many low-PPM-maturity organizations have found. However, what’s not survivable is repeated failure to meet commitments, to provide promised new products and services, and to sustain a competitive edge. It is the pervasive impact of poor resource management, across a number of organizational functions and capabilities that prevents being a highly effective organization.”

Reaching advanced maturity in PPM requires new resource management techniques. Program and portfolio managers need to enhance their resource management practices so that they can deliver improved performance.

Often, portfolio and resource managers claim to have resource management. But they can’t escape the cycle of facing too much work with too few resources, which leads to being constantly in short supply of resources and seeing projects fall further behind schedule.

For CIOs, program managers, project management officers, and others, poor resource management can mean missing out on opportunities. And it’s not just a matter of falling short of needed resources. Poor resource management can also lead to an overallocation of people and funding, and people in these roles will be held accountable by finance leadership and the C-suite when that happens.

While there’s much to talk about the need for new skills in a variety of technology areas, much of resource management has to do with making sure existing resources are being used best. The right titles and roles need to be aligned with the work that will deliver the most value.

Why Is Resource Management Important?

Resource management is all about transparency so managers can schedule, plan, and properly manage their people, aligning them with the right projects at the right time. It’s easy to see the importance of resource management by understanding the disadvantage of not having it. Without the right data, resource managers have no way of understanding:

  • Planning and scheduling – Understanding what resources are available and when
  • Available and required skills – Assessing the skills of each person and whether additional skills (or people) need to be added
  • Resource utilization – Knowing where people are already committed and if those allocations are appropriate
  • Resource capacity – Understanding true capacity to do work, recognizing that not all time can be utilized
  • Resource prioritization and allocation – Identifying those prioritized initiatives that the most attention and possibly specialized skills

Resource management ensures resource managers have on-demand, real-time visibility into people and other resources so they can have greater control over delivery. When organizations execute resource management properly, they reduce costs, improve efficiencies, and boost productivity. In this fast-evolving, high-demand world, these benefits are exactly what the enterprise is looking for and one that the Project Management Office (PMO) and/or resource managers can deliver if given the right tools and process to follow.

Keep in mind that resources aren’t only the people; resources are also the:

  • technology needed to enable people to execute their tasks
  • budget required to fund the project

Resource management also demands a close inspection of schedules and timelines. It is important to bring all of these elements together with the goals of the business, making resource managers one of the most critical contributors to corporate success.

Benefits of Resource Management

For many organizations, resource management seems like an elusive goal where success is just out of reach. It’s a common misconception that resource management requires a large investment and a radical shift in process and culture.

While change is part of the solution, it doesn’t have to happen overnight. Some of the most successful companies take a multi-phased approach to advance their resource management capabilities to keep up with the increased demand. Whether the journey towards a more mature resource management strategy consists of baby steps or one huge leap, the benefits of prioritizing the initiative are well-documented.

Organizations that focus on establishing or improving their resource management capability reap benefits nearly immediately. While these benefits may vary depending on the organization and the steps taken, it is common to discover that projects are more frequently delivered on time and on budget.

When resource managers have the data they need to plan and schedule, they can properly allocate people based on their skills and availability. Managers can set the right expectations with their customers when they understand current workloads, timelines, priorities, and budgets.

Instead of saying yes to everything with no regard to capacity, resource managers can more accurately schedule projects based on realistic, real-time data. Resource managers can make smarter decisions about how to staff their teams, both in terms of headcount and required skills to execute current and upcoming projects.

There is another key benefit derived from having the right resources working on the right projects at the right time: happy people. The most common challenge companies face is having too few people to work on too many initiatives. Over-utilized employees quickly become frustrated and disheartened. They feel overwhelmed with their workloads, which frequently results in disengagement, decreased productivity, and poor performance.

With more predictability and consistency, attainable workloads, and properly-utilized skill sets, employees are more apt to feel valued and satisfied. Resource management helps organizations leverage people, providing insight into their workloads, availability, project time requirements, skills, and more. They are armed with what they need to appropriately and fairly allocate projects to the right resources.

For the majority of companies, the biggest project cost is people. If the wrong people are working on the wrong projects, costs escalate, even while delivery declines.

Resource management brings control to the chaos, ensuring managers are equipped to optimize resources and reduce unnecessary costs. Managers understand project and personnel costs for more accurate budgeting and planning. They are also able to maintain an ideal team of people – optimizing resources across projects and initiatives based on skills and capacity.

Ultimately, the greatest benefit of resource management is the effective and efficient delivery of projects and outcomes to the end customer. Customer satisfaction improves when teams are able to fulfill project requests on time and as expected. For companies who value growth and innovation, having confidence in their ability to execute projects builds momentum, becoming a differentiator and providing a strategic advantage.

Software Tools

Resource management software helps enterprises address a number of pain points related to managing their money and people resources. These challenges might include such issues as work overload, scope creep, and project failures due to time constraints.

Key challenges associated with resource management that an organization might face, and that software can address, include:

  • Managing and prioritizing project work requests and setting appropriate expectations with key stakeholders
  • Managing resource capacity vs. demand for that capacity and understanding who is available to take on new work and when
  • Understanding what roles and / or skill sets are needed, either internally or through new hires, in order to fulfill stakeholder commitments
  • Ensuring that available resources are working on the highest priority projects that are best aligned with the strategic goals of the organization
  • Optimizing scheduling for when the appropriate resources are available to work on projects

When evaluating resource management solutions, companies should look for particular features and capabilities. At a basic level, solutions should enable:

  • The capture and planning of work with resource assignments so managers can prioritize, avoid over-utilization, and forecast resource costs
  • The ability to monitor the execution of work and quickly respond to changing priorities
  • The tracking and measurement of progress and costs to ensure the proper balance of work aligned to your strategies
Plan and balance your capacity to focus on the right work.
Plan and balance your capacity to focus on the right work.

More specifically, resource management software should have:

  • The ability to recommend how companies use resource capacity to deliver the highest business value
  • What-if scenario planning to help determine whether the organization can absorb and adjust to changes in the plan
  • A centralized resource view to review, approve, modify, and schedule resources
  • A standardized resource request workflow for project managers and resource managers to communicate and collaborate

Address the Pain Points

Organizations in a variety of industries leverage resource management tools to address challenges and more effectively allocate their project resources. Here are some real-world examples:

Growing pains

A building materials company that designs and manufactures insulation products was quickly growing through acquisitions and global expansion. One of the challenges the company faced was the need to establish governance for new product development.

The faster the business grew, the more difficult it was to control processes and scale. As a result, the development of the product portfolio was slower than it should have been, and costs were running too high. Much of this was due to a lack of visibility into reliable data and resource capacity.

Along with governance, resource management was a challenge. The company had the talent in place but did not always know what these resources were doing or what they were capable of doing. Some areas experienced bottlenecks while others had underutilized resources. And with facilities and resources in multiple locations around the world, communication and collaboration suffered.

Resources were being pulled in many directions at once, and without visibility into where funding was going, discerning margins and determining return on investment was difficult. The company had lost the ability to take on the innovative products it was known for quickly enough to keep its edge in the marketplace.

To address these challenges, the company created an Innovation Development System (IDS) department to concentrate solely on product ideation and development and deployed a PPM solution to manage data, process, and resources. The PPM tool quickly became a valuable diagnostic solution to identify risks, costs, conflicts, and resource issues.

By leveraging skills from under-utilized resources, the company can now develop products faster and at a reduced cost. The PPM system shows the company where the gaps and problems are in simple-to-read reports for ongoing analysis of scope, schedule, and budget estimates.

The technology has enabled the company to regain its competitive edge as it manages the next generation of product development. Among the key benefits are that the right products are developed by the right people on budget and on time.

Facing multiple challenges

A company that sells young children’s apparel worldwide through a multiple-channel business model made it a strategic and operational priority to revamp its IT project and resource management efforts to continue business growth.

IT had multiple project lists maintained separately by various business units, with no governance in how to select or create projects or tracking of project costs or resource requirements. This made regulatory compliance virtually impossible.

Managers and IT resources had no way to identify which projects were the most valuable for the company. IT staff was being expensed on software projects that depreciated over multiple years, there was a mismatch of project costs, and auditors were concerned about improper annual expenses.

Furthermore, each workgroup within the company had a different set of “run the business activities,” creating more than 100 different activity types. There was no way to determine how IT personnel were actually spending their time.

In addition, several groups were involved in almost every project, with minimal coordination between projects. It was impossible to forecast resource capacity issues, and this created constant resource conflict issues.

The company deployed a work and resource management solution to address its multiple challenges and support business growth. The solution provides a simple workflow and project structure that was missing, and the company can now define project tiers to establish priorities.

The use of comprehensive time tracking enforces standard rate roles for all project members, based on salary ranges. All IT project members are allocated to projects and tasks, all managers and users are trained on new activities, and new reports are created for managers and activities.

Due to improved processes and planning, the company has seen more than $2 million in capital savings and $2.6 million in expense savings.

It has also improved the prioritization of work and resources with a six- to 12-month view of resource planning activities.

Lacking visibility into resources

A health insurance provider lacked an integrated view of demand and capacity and found it difficult to prioritize and communicate pipeline demand without restraining resources. The company wanted to improve the management of work, resources, investment planning, and reporting.

Governance was important, as was being able to forecast demand and capacity for accurate investment planning. With a half dozen internal delivery partners, the firm needed to look at how to best broaden its view to understand supply, demand, capacity, and systems.

The company deployed a resource management solution to balance demand from multiple sources and assign work to resources to ensure that the most valuable projects are completed.

With the solution, the company can make the best use of its resources and focus on projects that align best with its strategic plan. The insurance firm is also focused on optimizing resource capacity, so the right mix of work is being tackled at the right time.

Previously, the company struggled with data in various spreadsheets. Managing resources was nearly impossible in static documentation that was always seemingly out-of-date or incorrect. Using integrated investment and capacity planning capabilities, it can now ensure staffing is done strategically to maximize value and productivity. Staffing and resources are now distributed based on project prioritization.

Granular reports give resource managers actual and forecast detail by portfolio and project and staffed / unstaffed work information so that they can identify resource gaps. Status detail at every level provides managers with the data they need to ensure capacity can meet demand now and 18 months in the future.

Using their configuration of resource management software, the firm can forecast demand 12 to 24 months ahead and use that information to allocate resources weekly. Roles are better defined, with more detail to provide greater insight into capacity and demand. Among the key benefits:

  • Resources are optimized by focusing staff on efficiency and value
  • Work is prioritized and aligned to strategic roadmaps for better visibility
  • Investment planning is used to maximize portfolio and staff productivity
  • Plans can be integrated to measure capacity and demand
  • Demand is prioritized by capacity and role

Summary

Effective resource management is not simply a “nice-to-have” feature of project portfolio management; it’s essential to success.

If organizations lack visibility and can’t keep track of resources, such as people and money, and direct these toward the most valuable work, they will likely fail to complete projects and deliver the products that bring competitive advantages, missing out on potential benefits. With the right resource management solution in place, organizations have the tools in place to ensure that the right people and funding are applied to those strategically aligned programs that will deliver value to the organization and its customers.