pmo365 optimises your Resource Management

Resource management is a process that allows organisations to assign the appropriate resource in the most effective way to successfully execute the projects in the portfolio. It helps ensure resources allocation are made accurately to account for present and future organizational needs.

Resource management differs from capacity management. Where the former looks at the capacity of business in a very high-level and broad perspective, resource management handles resource on a smaller and more direct scale - from projects, programs to portfolio.

As a result of the organisation wide activity happening at all different scales, using the right software and systems becomes critical as without them, organisations lose the capacity to pull important and relevant information from the mass of data.

Most organisations, roughly 43% of organisations, have recognised the need for a resource management process but have not established any practices or standards. However, research from the Project Management Institute reveals just how much of an impact a higher maturity level resource management process can make ( as seen in the chart below)

We can see there is a direct correlation between the level of resource management maturity and the performance of organisations. But by no means should all organisations always strive for the highest level of resource management. Depending on the context and circumstances of an organisation, it is important to select the most optimal level of resource management so resources and effort is not wasted on layers of complexity that are not effectively utilized. Whatever level of resource management maturity you find yourself within, pmo365 will be there to help make it the best it can be for our unique context.

When done right, resource management can improve your organisation’s ability to plan capacity and manage resources in many ways. The key benefits include:

When your organisation’s resource management system and software gives you full visibility and control, you gain a more accurate and realistic understanding of what can be accomplished with the available resources. This allows you to do a myriad of things such as:

PMI divides the three most pressing challenges to resource management into three categories: 1) resource planning and estimating challenges, 2) resource prioritization, allocation and scheduling challenges, and 3) resource execution, monitoring and controlling challenges.

Though there are significant challenges in all these categories, their research shows resource planning and estimating is the most pressing issue for organisation leaders. Planning and estimation challenges include issues with poor resource capacity planning, inaccurate effort estimation, frequent project scope creep, unassessed resource risk and projects being given arbitrary end dates.

We believe that if you set yourself up well from the beginning, you set yourself up for a win. At pmo365, we help you from the very foundations of your resource management journey when you are making your resource plans. We make sure you have complete visibility and accessibility to all relevant information, even in other organisation functions, to make sure your estimations and planning process are as accurate and efficient as possible.

Before getting into the nitty-gritty of resource management, it’s first crucial to identify what type of project management organisation you are as this will inform the resource management approach you apply.

There are three types of project management organisational structure: Function-based, Project-based and Matrix.

The most common type of organisational structure, these type of organisations are organised around the functions the organisation needs to perform. The common functions include Human Resources, Sales, Marketing, Administration and so on.

The benefit of this organisational structure is that it enables greater flexibility in the use of personnel with typical cases where technical personnel can be shared across multiple projects. However, it is for this very reason that function-based organisation’s need effective resource management the most. The sharing of resources and personnel often lead to inter-departmental cooperation and communication challenges.

These organisations are organised around projects rather than function. In these organisations, projects are the central focus so project managers have more authority and resource control. This often results in very tight-knit, focused teams where resources are not as commonly shared between different teams, projects or functions.

In these organisations, interactive methodologies such as Agile are more often used and thus teams are kept within focused cycles rather than a linear collaboration across the entire organisation. Resource management still plays a large part in these types of organisations, however, they may not require the same level of resource management depth and maturity compared to large function-based organisations.

Matrix organisations blend the characteristics of function-based and project-based organisations. Though there are no specific categorisations, matrix organisations can often be placed on a spectrum between a more function-based matrix or project-based matrix. You can often identify which side they are more inclined to by looking at who has more power - project managers or functional managers.

In these cases, resource management approaches are dependent on the organisation's context and their level of balance between the two positions. Resource management is still critical here, particularly data visibility and accessibility, as often there are constant negotiations between functional managers and project managers over resource allocation.

Though there are many additional parts to resource management, everything is based on two critical components: measuring demand and capacity.

Accurately estimating and measuring the resources an activity, project or programme needs is important so resource demand does not overshoot too far leading to a waste of resources or underestimated resulting in project delays. This demand is often measured in terms of hours, FTE, person days, etc. Resource demand is often calculated by aggregating project related work, admin support activities and operational activities.

Measuring capacity or supply simply means aggregating all the current resources available in the organisation and calculating which resources are occupied by other projects. For effective capacity measurement, understanding the level of importance each resource is to projects is critical as it allows for resources to be shared if they do not need to devote all their time to a single project. pmo365 helps you gain that extra level of visibility so resources can be allocated and optimised in the most efficient manner. For this, a deep integration of timesheet reporting is very useful as it allows you to have insight into employee or resource productivity. Supply is also measured in the same terms as demand so they can be easily matched.

In the end, resource management comes down to a battle between resource demand and capacity. In situations where demand is higher than capacity, organisations may need to consider outsourcing or hiring extra hands to complete the task. In situations where capacity is higher than demand, resources can then be funneled to other existing or new projects to ensure no resource is wasted.

For resource management to be truly effective, it needs to be integrated across all project activities and functions. From cost management to risk management, your resource management will be lopsided and will not be able to make the most informed decisions. All the more reason why you need pmo365 to help integrate all your systems and activities in your organisation and give you a single source of truth for all your project portfolio activities.

If you want to learn more about how we can optimise your organisation’s resource management, book a free 30 minute PPM audit and speak directly with our PPM experts.