Resource capacity planning is an essential aspect of managing business projects effectively. It entails balancing the available resources with the demands of various projects and tasks, ensuring that the right people are in the right place at the right time.

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On paper, the approach is fairly straightforward—it involves comparing resource estimates against their available time to work and allocating them appropriately; however, effective resource capacity planning can be fairly challenging. Ineffective planning can lead to delayed business growth, decreased return on investments, lower staff morale, and more.

Effective resource capacity planning can result in accelerated business growth, increased employee satisfaction, and more.

To successfully navigate this process, organizations must steer clear of common pitfalls that can lead to inefficiencies and mismanagement. In this article, you’ll learn:

  • Resource capacity planning,
  • Why it’s important to today’s businesses,
  • The benefits of establishing and implementing a strong capacity planning process, and
  • How to avoid common mistakes and pitfalls.
  • What to look for when selecting resource capacity planning software.
  • How real companies have successfully planned and allocated resources using resource capacity planning software like Planview.

Challenges vs Pitfalls of Resource Capacity Planning

There’s no shortage of challenges surrounding resource capacity planning in project management—from lack of visibility to lack of integration. To ensure projects are completed on schedule and on budget, organizations should know how to avoid common pitfalls in the resource capacity planning process. These include:

Getting a handle on organizational demand

Project managers or team leaders should know what projects or initiatives are requesting resources and to what capacity. With this in mind, project managers can ensure they have the right resources to meet them.

Typically, project managers don’t have this type of visibility—roughly 68% of organizations find demand management to be a significant challenge—which creates the need for a cross-functional, business-led team to drive prioritization.

Integrating CRM and PSA Systems

For Professional Services organizations, their sales funnel represents their demand – therefore, a CRM system is put in place to manage the sales pipeline, connected to a professional services automation (PSA) system to automate and streamline professional services delivery and operations.

By integrating these two systems, project managers gain visibility into incoming demand and existing capacity assignments. This enables them to effectively identify resource capacity gaps and effectively allocate resources.

For IT PMOs or business PMOs not focused on services engagement, demand for projects can come from forms, ideation systems, and other sources, which are then connected to a project portfolio management (PPM) system to prioritize, budget for, identify resource capacity gaps, and effectively allocate resources.

Planning at a role level early in project management cycle

Instead of planning with a focus on individual resources, it’s helpful to plan at a role level. Doing so enables project managers to understand incoming demand by role so they can determine where organizations need to hire or partner to fulfill resource needs.

What Is Resource Capacity Planning?

Simply put, resource capacity planning is the process of balancing the supply and demand of organizational resources to identify and avoid either a shortfall or excess of resources. Essentially, organizations can bridge resource gaps and increase the chances of successful project delivery.

In regards to project management, resource capacity planning helps to align sales and delivery by forecasting and planning for current and future pipeline opportunities. As a project progresses, project managers can estimate the resources needed and allocate them appropriately.

The approach requires organizations to centralize information from various business systems, including human resources, current projects, employee skills, future pipeline projects, and non-project activities.

To increase the success of resource planning, early visibility into project demand is key.

The visibility will help project managers identify gaps in resource supply and take proactive steps to address them. This can also help project managers effectively prioritize internal projects.

The Benefits of Successful Resource Capacity Planning

As noted above, resource capacity planning involves balancing supply and demand. This is critical to an organization in the sense that it increases value in the internal organization as well as customers and ensures work is focused on the right things. Essentially, the approach drives time to value for customers which leads to higher satisfaction, retention, and expansion.

Additionally, effective resource capacity planning offers several key benefits. These include:

Optimized resource allocation

Resource capacity planning ensures that organizations make the most of their available talent and assets. When resources are allocated efficiently, organizations can reduce downtime and idle time, resulting in increased productivity; minimize the risk of overallocation; and allocate resources based on individual skills and availability.

Risk mitigation

Effective planning aids in identifying and mitigating potential risks and bottlenecks. In fact, organizations that actively manage their resource capacity are 68% more likely to complete projects on time.

Enhanced decision-making

Accurate resource capacity planning empowers organizations to make informed decisions about project prioritization and resource allocation. According to PwC, companies that utilize data-driven decision-making processes are 5% more productive and 6% more profitable.

Increased competitiveness

Organizations that excel in resource capacity planning tend to outperform their competitors. Resource capacity planning enables organizations to respond more quickly to market changes and evolving customer demands as well as enhance customer satisfaction by delivering projects on time.

Employee engagement and retention

Engaged and satisfied employees are vital to an organization’s success. Resource capacity planning increases employee engagement and retention by assigning resources to projects that align with their skills and career aspirations and avoids resource overallocation.

Additionally, it provides a clear roadmap for career development and progression, resulting in higher job satisfaction.

Common Pitfalls of Resource Capacity Planning and How to Avoid Them

While resource capacity planning is a valuable process, it’s not without its challenges. Organizations often stumble into common pitfalls that can hinder their success. By identifying and addressing these pitfalls, businesses can navigate resource capacity planning more efficiently and effectively.

Some of the top pitfalls include siloed teams planning in spreadsheets, treating agile teams as standard resources, and delaying planning.

We’ll discuss each of these in more detail below. However, before we delve into the common pitfalls, it’s important to understand the difference between PPM and PSA.

What is PPM?

Project portfolio management refers to the process of analyzing the potential return on undertaking a project. The process involves looking at every piece of data regarding proposed and current projects to see the bigger picture.

Information in PPM comes from strategic planning and a funnel of ideas. The ideas are then prioritized and planned against resources like money and people. Important KPIs in PPM revolve around project status and success rates.

For example, ANZCO Foods, one of New Zealand’s largest exporters, used Planview’s PPM software to gain comprehensive visibility into project risks, costs, and resource loads. The team has also used to automate repetitive, time-consuming tasks, saving project managers valuable time.

What is PSA?

Professional services automation is the process of automating and supporting the service delivery lifecycle from opportunity creation through to revenue realization. Resource capacity planning is a critical part of the process to increase financial and customer success.

Demand intake is based on sales opportunities and is then planned against available people resources (with most of the funding for resource justified by what comes from the customer). The supply of resources is then adjusted as needed to meet demand.

Primary KPIs for PSA revolve around utilization and profitability; however, project status and success rates are also important.

For example, Extension Healthcare, a provider that improves clinical communication, collaboration, care coordination, and workflows, used Planview’s PSA solution to improve visibility into customer requests and project resources. With the solution, Extension Healthcare can access a complete picture of the entire project portfolio, enabling them to make smarter, more informed decisions.

Siloed teams planning in spreadsheets and not communicating

Often, teams are managing their own capacity but are not effectively communicating with other teams that may be able to utilize resources that are under capacity to drive value for either the company or its customers. This is particularly true when teams are working in isolation and relying on spreadsheets for resource capacity planning as this ultimately results in miscommunications, errors, and inefficiencies.

To avoid this pitfall, it’s crucial for organizations to foster cross-functional collaboration and invest in resource management tools that facilitate real-time data sharing and communication.

Treating agile teams as standard resources

In an agile world, capacity is considered at the team level rather than a role or resource level. To ensure successful resource allocation, agile teams should be composed of cross functional resources that can complete the work end to end. Essentially, this ensures demand is brought to the team rather than the resource being assigned to the work.

Additionally, agile teams have unique requirements and operate under different principles compared to traditional project teams. It’s essential to adapt planning processes to accommodate their needs.

Planning early at the resource level

Delaying resource capacity planning until late in the project cycle can lead to rushed decisions and ineffective resource allocation. Early planning is crucial for optimizing resource utilization and avoiding bottlenecks.

By categorizing resources by roles and planning at the role level, organizations can understand where supply constraints are. Roles might include project managers, solution architects, developers, quality assurance, and DevOps.

Put simply, understanding the big picture at the role level helps organizations identify how to either prioritize or balance work based on the most requested roles. This can also help organizations drive strategies to invest and either hire or partner with outside businesses to increase capacity for those roles.

Top Resource Capacity Planning Software Features

If you’re wondering how to select resource capacity planning software, it’s helpful to start with a list of essential capabilities. The right software can streamline operations, improve data accuracy, and enhance collaboration across teams. When evaluating platforms, organizations should look for solutions that offer the following capabilities:


Choose software that seamlessly integrates with existing systems, including CRM, HCM, financial planning, PSA, project management tools or whatever your current landscape is. Integration capabilities provide organizations with real-time data sharing and eliminates manual data entry, reducing the risk of errors.

Resource forecasting tools

Look for solutions that provide robust resource forecasting capabilities that enable users to predict resource demand, perform “what-if” scenario modeling, and analyze historical data to make more accurate predictions.

Role-based planning

Opt for software that allows for role-based planning. This approach enables more flexible allocation of resources based on roles and skill sets rather than assigning individuals directly. This is also essential for accommodating changing project needs.

Reporting and analytics

The software should provide comprehensive reporting and analytics features. These tools empower organizations to monitor resource utilization, track project progress, and make data-driven decisions. Additionally, customizable dashboards and reporting templates are also beneficial.


Platforms should seamlessly grow with the organization. Ensure software can adapt to accommodate evolving requirements without significant overhaul.

User-friendly interface

Look for software that provides a user-friendly interface as this increases successful user adoption. A steep learning curve can impede the effectiveness of the tool and cause delays in implementation.

Support and training

Consider the level of vendor support and training offered. Adequate training resources and responsive customer support can significantly impact the successful adoption of the software.

Cost considerations

Evaluate the cost of the software and ensure it fits within budget. Organizations should also consider not just the initial purchase price but also ongoing licensing fees, maintenance costs, and any additional expenses.

Resource Capacity Planning Software: Use Cases

To understand just how beneficial resource capacity planning software is, let’s look at how real organizations have utilized solutions like Planview.

How a growing IT services organization enhanced governance

Bell Integration is an IT services organization that has helped companies establish, maintain, and grow their IT services since 1996. However, as the organization grew, it recognized the need for comprehensive visibility across the enterprise. This would give the organization an in-depth view of project health and resources.

With Planview’s Professional Services Automation solution, Bell created a single source of truth for all project data. This eliminated the disconnect between the spreadsheets, processes, and systems the company had previously relied on. As a result, project managers had more time to focus on value-adding tasks, and the company significantly increased efficiency.

Fresenius Medical Care increases project collaboration

Global Manufacturing Quality & Supply (GMQS) (the group that handles production and delivery of Fresenius’ products) was struggling with siloed departments and regionalized processes. Additionally, varying work methodologies, poor communication, and low transparency created a need for leadership to transform how the company works and operates.

To help with change management initiatives, GMQS turned to Planview solutions, specifically our project portfolio management and project-centric work delivery tools. With these tools in place, the company was able to streamline global processes, increase visibility and transparency, and provide data-driven insights to both leadership and project managers.

SITA Improves collaboration and communication

SITA is a world-leading air transport IT and communications provider. The company’s portfolio covers everything from managed global communications to eAircraft passenger management.

However, one of the company’s biggest challenges was that its communication and project management systems for a major customer were spread over multiple programs. This caused a lack of flexibility and visibility across the account and prevented SITA from effectively monitoring progress.

To overcome these challenges, SITA turned to Planview. The end-to-end, cloud-based platform enabled workers to access project tasks in real time and easily make alterations and updates. Additionally, the company increased productivity, improved task allocation, and increased visibility and communication across the enterprise.

Ready to Optimize Resource Planning?

Resource capacity planning isn’t just a concept—it’s a pathway to accelerated business growth, increased employee satisfaction, and more. By maximizing resource planning, organizations move beyond just planning and toward a future in which efficiency and competitiveness reign supreme.

It’s time to be at the forefront of resource management and project execution. To learn more on how to get started, check out the following resources from Planview:

If you want a closer look into Planview’s project portfolio management solutions, check out our eBook or request a free demo.