Resource planning is a discipline within project management software that ensures the most effective use of an organization’s team members and resources across the portfolio. This involves gathering the proper mix and quantity of resources required to complete a project and coordinating timelines between different departments using the same resources. For the purposes of this article, a resource can be people, equipment, materials, IT assets, or funding.
An analogy may help: If a project is a recipe, resource planning is the process of coordinating the requisite ingredients, kitchen utensils, and cooks to deliver dishes to customers in the most efficient and quality way possible.
What is the challenge of resource management?
In truth, a good recipe is only the beginning. The next step is planning which and how many resources are required during specific time frames. A project manager must then continuously monitor those resources for availability, utilization, and cost. The dilemma of resource management is this: projects have demanding requirements and deadlines, but the resources used to fulfill those requirements are finite. In today’s climate, project teams are expected to do more with less.
Sadly, many companies fail at this challenge. In the IT industry—where companies often manage hundreds of projects at a time—failure rates are particularly high. Gartner predicts that 80 percent of IT organizations will reach “resource breaking points” due to time constraints and other pressures1. Across all industries, the speed of innovation demands efficient resource management. Without the right tools for managing resources across your portfolio of projects and identifying bottlenecks and risk early on, managers are likely to fail to deliver.
The right project management software provides a visualization of resource availability, helps you distribute work across finite resources, and minimizes duration of projects by maximizing use of resources. Effective project management software increases efficiency both in the planning phase and in continued optimization during the project. Many project management (PM) systems, especially those designed for project and portfolio management (PPM), provide built-in tools for planning, allocating, and managing project resources. Common features in a resource management module include:
- Visual resource planning
- Capacity planning
- Demand planning
- Real-time analytics and forecasting
- “What-if” simulations
- Skill matching and skill repositories
Some resource planning tools are available as standalone products, while others are integrated with larger PM or PPM suites. Depending on your needs and what software you may already have, either of these could be a good fit.
There are several ways PM software can help you better allocate and manage resources at different points during the project lifecycle. Here are three:
1. Better time management
A project management system with resource management gives you complete, up-to-the-minute visibility into the division of your workforce on macro and micro levels. For example, visual resource planning shows what your resources are working on and when. Most project management tools also give you the ability to drill down to the granular level, where you can assess schedule availability. This helps you avoid creating a bottleneck on one individual resource constraint which would inevitably delay the project delivery timeline.
2. Intelligence-driven decisions
Some of a project manager’s most challenging decisions are about how to prioritize all the moving pieces in a project or portfolio of projects. Prioritization, of course, is directly tied to resource allocation. Allocation mistakes can be extremely costly to a company if they happen on a large scale. The best project management software takes the guesswork out of resource allocation by helping you plan and prioritize based on data updated in real-time. Capacity and demand planning reconcile the volume of work that needs to be done with your resources actual capacity (usually in hours). You can also run tests or “what-if” scenarios by plugging in variables and letting the system predict their impact (such as a material shortage, or changing priorities). Once you’ve seen the data, you can decide how to best allocate resources to yield the optimal results. Check out how LiquidPlanner’s resource management software has helped Victualic create a competitive advantage.
3. Real-time resource optimization
We all know that priorities and market pressures cause teams to change their project timelines constantly. Almost as soon as you define your resource allocation schedule, you can expect it to change. This means your distribution of materials and equipment will also need to change . Keeping up with today’s pace of change and making end-to-end adjustments manually is painstaking, if not impossible. Good software, on the other hand, automates this process for you, enabling capacity and flexibility to meet ever evolving project timelines. Some sophisticated project management solutions can drag and drop resource assignments with a few clicks. And if you’re using a cloud-based solution like LiquidPlanner, all relevant stakeholders will have access to the updated timeline immediately. This automated information flow is critical to effective collaboration and to ensure each member of the team knows what to work on and when.
These are only a few ways project management software can improve your resource management strategy. You can also expect to see more accurate job costing, the ability to give your teams more autonomy, and a better understanding of the interdependencies between projects and resources. With today’s reality of hybrid work for many teams, software that delivers this is increasingly important.
A well-balanced resource planning portfolio is only made possible by an optimized resource schedule. Project management software happens to be the most useful tool in the industry for accomplishing this.
Did this article inspire you to learn more about how to manage project resources like a pro? Share with us how project management software has helped your team plan and use resources more efficiently.