What Is An Effective Resource Management System?

Estimated reading time: 4 minutes

How a PPM tool can help you to manage project resources effectively

Key Takeaways:

  • Effective and efficient project resource management requires matching in-bound work demand with available resource supply at the project portfolio level.
  • With the right resource management tool, PMOs can streamline execution, maximize resource utilization, and increase project profitability.
  • A resource-management-oriented Project Portfolio Management tool will help significantly by providing you the required visibility on resource capabilities and capacity, as well as on project schedules and requirements.
  • A good tool should offer a wide range of resource management options and support various processes and techniques in order to fit the resource management model of your organization.

The optimization of capacity planning and resource management is a key prerequisite for effective project portfolio management. However, Project Management Offices and portfolio management professionals often find it hard to make sure that their organization’s human, technical, and financial resources are utilized in the best possible way. Excellence in the management of project resources requires not only a top-notch resource allocation process to ensure that the right capabilities are mobilized to complete the right tasks, but also mechanisms to maximize the utilization rate of all resources across the organization.

What is at stake is no less than the success of your business. Effective resource management based on accurate project costing and scheduling will boost productivity, improve customer relationships and satisfaction by making the deliverables more predictable, increase employee engagement, and facilitate hiring decisions.

While manual determination of resource management optima can prove to be a real headache, project organizations can leverage purpose-made software tools and systems to help facilitate, accelerate, and improve the quality of the process.

US - 1 - Prerequisites for effective resource management

When it comes to managing project resources, success can be defined as the enterprise’s ability to staff the right resources on the right activities and projects while maximizing the overall utilization rate. This definition carries a number of implications:

  • A firm’s productive resources are not equal: while some can be defined as “critical” to the business — either because they are rare and cannot be replaced easily, because they are costly, or because they have the unique skills or capabilities that help the firm stand out on the market — others are objectively less important to the survival and success of the organization. You need to take that difference into account when allocating resources: those projects with the highest potential return and strategic value should take priority when it comes to access to the top critical resources.
  • Finding and maintaining the perfect resource utilization rate is essential in order to maximize the return on resource investment, including labor expenses: On the one hand, paying high-skill workers full-time to have them work only part-time is obviously a waste of money. On the other hand, overworking your staff is hardly the way to go in order to attract and retain top talent. But finding the sweet spot requires the ability to forecast work demand and resource capacity.
  • Both the availability of resources and the schedules and requirements of projects may evolve over time. This means that organizations and PMOs need the ability to track shifts in work demand and resource supply and to course-correct proactively when needed in order to maintain a healthy balance between work demand and resource supply.

US - 2 - The importance of visibility for effective resource allocation

Poor performance of resource allocation and utilization often stems from one key problem: a lack of visibility and clarity over the pool of resources and the projects in the pipeline. If you are to make sure that supply matches demand over time, you need to be able to understand and track both supply and demand. Here’s how a resource-management-oriented PPM tool can help.

A Project Portfolio Management system provides a centralized repository offering an up-to-date overview of all project-related data. You get instant, anytime, anywhere access to a high-level view of your resource pool, with the ability to check availability at a glance to instantly identify what other activities a resource might be working on.

PPM systems also provide an array of solution capabilities to filter, sort, and categorize human resources by role, by skill, by location, and by other attributes. This overview or resource qualifications and bandwidth can be matched and compared with a similar big picture view of the requirements of active and upcoming projects, with automatic features to balance supply and demand and to detect anomalies and discrepancies. Visual-led screens and calendars are making the information easy to understand, to digest, and to report.

The best-in-class tools offer the option to view, track, and manage the costs associated with resource allocation in order to help businesses achieve greater performance against deadlines and financial goals.

Why your resource management system should be flexible and comprehensive

The process used to allocate and manage resources may vary considerably from one organization to the next, depending on a number of market and organizational factors, such as the level of detail and granularity required for resource assignment, or the respective responsibilities of the various stakeholders involved in resource management (Project Managers and Resource Managers, the PMO, Project Owners, and so forth) and the way they interact. What more, the process embraced by a given organization may evolve over time in response to shifts in the business environment. This is why it is essential to opt for a resource management tool that supports every option and opportunity.

  • For example, many businesses and PMOs will find it very useful to be able to perform soft allocations (i.e. allocating a generic role before deciding on a named resource) for tentative projects.
  • According to your company’s geographical location and line of business, you may prefer assigning resources by the hour, by the day, or go for a mix of both. Your resource management platform should ideally offer either option.
  • A proper Project Portfolio Management tool should enable you to assign resources at the level of an activity, of a project, or even of a program or a portfolio. Most organizations have to distribute a fixed pool of shared resources across multiple initiatives. Your PPM and resource management system should therefore support dependency analysis to help prevent and resolve resource assignment conflicts across projects.
  • Finally, PMOs need the ability to assess future work requirements and capacity in order to achieve realistic projections. Tool functionality such as pre-set project models suggesting standard resource requirements for a project, real-time views and reports for resources, and scenario simulation capabilities will help to anticipate — and therefore to better prioritize projects and/or to make the capacity adjustments ahead of time.

 

Looking for further information on resource management? Check out the following:

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Benoît Boitard

Benoît has been a proud member of Sciforma’s marketing team since 2020. A number of former work experiences as a Digital Strategy Consultant, both in up-and-coming start-up companies and large corporations, imbued him with a big-picture understanding of Project Management in traditional and agile work environments alike.