Mastering Project Resource Management

The most common challenges I hear about project resource management are capacity planning and resource allocation. These challenges are encouraging as  capacity planning is often an indicator of growing maturity in PMOs. Greater maturity of PMOs often correlates to great success for an organization. Other common challenges that I hear include resource utilization, tracking resource skills and managing contractors. 

Most of the common problems with project resource management are the following:

• Scarcity of resources: availability of resources can be limited and competition among projects for these resources can lead to allocation difficulties.
• Lack of visibility: it can be difficult to track and manage the allocation of resources across multiple projects, leading to inefficiencies and potential over-allocation
• Skills shortages: the right mix of skills and expertise can be difficult to find and retain, leading to delays and increased costs.
• Changing requirements: As project requirements evolve, it can be difficult to adjust resource allocation in a timely and efficient manner.
• Budget constraints: Limited budget constraints can make it challenging to allocate  the resources necessary to complete a project on time and within scope.
• Resource conflicts: allocating resources among multiple projects can result in conflicts, particularly when projects have conflicting priorities.

There are multiple factors at play.  Firstly, discretionary investments – project and similar work vehicles, are becoming more common, consuming a greater percentage of an organization’s total expenditure.  In some organizations discretionary spend is surpassing operating expenditure.  With more money on projects so there are more people on projects and greater potential for bottlenecks, delays, etc.

At the same time, projects are changing more than ever.  Organizational operating environments are evolving due to competitor actions, customer expectations, emerging technologies, and so on.  Projects have to adapt and adjust in response to (and in anticipation of) these evolutions or they will deliver outdated solutions.  All of those changes have potential resource impacts and must be managed effectively, considering not only the immediate changes but also downstream resourcing dependencies.

Effective and efficient project resource management is an enabler of organizational agility.  Unless organizations have the ability to quickly move people and skills to where they are needed, even as those needs evolve, the ability of the organization to respond to shifting opportunities and threats will be reduced.  That in turn will hurt the success of projects.

The ability to move people to where they are needed is the single biggest factor in the success or failure of organizational agility.  Organizations are beginning to recognize that and as a result, effective project resource management is increasing in importance.  Without it, performance will suffer.

The biggest roadblock you see with teams trying to get better at project resource management comes from leaderships lack of importance on this topic. You will have leaders that want to know what resources are working on and trying to get pet projects started and worked on, but those same leaders won’t enforce time tracking. So, we need to get leaders to value the data they are going to get, but also enforce the teams provide the data.

The other roadblock you face with this resource management process is managers not wanting to expose they resource data and what their particular resources are working on. Many managers feel like the resources work for them personally and report to them and therefore they will direct what their resources will do, and don’t always have that global view.

Once you get over these two hurdles you will go a long way in moving your organization forward from a resource management perspective.

Everyone already does a form of project resource management.  But not many organizations know how well, or how badly, they do it.  For most it’s nothing more than allocating people to work, and in many cases, that’s based on nothing more than the whim of resource owners as to who they want to assign.

To develop a more structured approach that manages resources across all projects, requires firstly an understanding of the resources that are available.  Organizations like to talk in terms of a project resource pool, but that’s a false concept.  There is only one resource pool – the employees of the organization.  If you add more people to projects then you have to take them away from operations and / or support work.

Finding that optimal balance is important, as is knowing what skills are available – too many organizations think that all people in a certain function have the same skills, or at best that they are simply junior / intermediate / senior.  You can’t manage project resources effectively unless you have a more accurate and complete understanding of who’s available and what they can do.

The biggest benefit to project resource management is around visibility and ensuring that your company’s resources are working on the highest priority projects. We see a lot of companies that are struggling to catch-up from COVID and therefore what their resources are working on is extremely important to focus people on what matters the most. Another extremely valuable benefit of resource management is around utilization metrics and how we are using our resources from a utilization perspective. So not only is it about what they are working on but how hard and long are they working on each effort. And/or how many efforts are they working on at one time. Understanding these kinds of data points on our resources are extremely beneficial to any PMO.

When organizations are managing their project resources effectively, they are not only able to deliver more projects with fewer delays, they are also better able to move those resources around in response to problems, delays or changes in organizational needs.  Part of the reason for that is the way that resources are utilized, the ability to retain some spare capacity, and the mix of skills within the organization.

But a large part of it is down to the engagement and commitment of the resources themselves.  When project resource management is effective, the people doing the work – the resources, have a more balanced distribution of their work, they better understand what they are doing and why, they know how their work is contributing, they can better plan upcoming assignments, etc.  This leads to greater motivation, a better connection to their employer, and ultimately, better work.

I suggest a single tool with all resources and associated metadata. This includes the ability to:

• Forecast demand at a role level and allocate to an individual or team
• See where staff is currently allocated across a set of filtered data points
• Determine quickly if that allocation is tracking (budget vs. actuals)
• Easily change allocations on the fly

Even low maturity organizations and PMOs will have to do a form of project resource management – people are assigned to initiatives, bottlenecks or unavailability has to be addressed, etc.  Therefore, the key as a PMO matures is to recognize the need to improve – to overcome the perception that what already exists is good enough.

As PMOs mature they should be looking to manage resources more broadly – it’s not about finding a suitable resource for a given project’s need, it’s about ensuring that every resource is allocated to work that they are capable of doing and that is appropriate.  That can only happen with a broad view of all work.  Maturity should also bring more awareness of the need to maintain ‘spare’ capacity to provide flexibility for the inevitable changes that will occur.

But perhaps the biggest change as PMOs mature is that project resource management must shift to become something that is done with resources, not to them.  Engaging with the people doing the work, individually and collectively, will help build trust and understanding and result in a more capable and flexible resource pool for all work.

Effective project resource management is crucial for organizations. In my experience of being a project resource manager for a large company, first I defined roles and responsibilities very clear. Then you want to identify the resources you have for those projects. Resource allocation is very important because you need to put the right resources in the right place without thinking what is going to be their effectiveness in completing those tasks. You should be consistently monitoring how your resources are performing against your portfolio. For me, that was day to day monitoring of how they are progressing and checking on performance to look for optimizations. Communication is important for all key resources. Lastly, you need to ensure they are delivering the right outcomes. That’s what I would say is important for implementing proper project resource management. 

The PMO is generally the first function that becomes aware of a problem with project resource management.  Individual teams and project managers may identify a specific issue with a piece of work or an allocation, but it is the PMO that will be able to see whether that is a one-off or the start of something bigger.  Similarly, PMOs are likely the first function to see whether changes in resource management approaches are having the desired effect, or whether further adjustments are needed.

PMOs should also be driving improvements.  Their broader view allows them to identify opportunities to adjust resourcing approaches and models, address areas of the organization where there is excess capacity or where there are insufficient resources, and to feed resource capacity planning when trends emerge that will create permanent shifts in resourcing needs.

An effective PPM platform is essential to optimize project resource management.  It allows for all resources to be managed from a central tool, something that often doesn’t happen when work is being delivered using Agile, waterfall and hybrid.  Either through direct management of resources in the PPM solution, or through integration with other work tracking tools (and likely both), accurate information on actual work, variances between planned and actual assignments, etc. can be tracked.

Combined with powerful reporting and analysis functionality, and integrations with HRIS and similar tools, PPM solutions allow project resource management to become more proactive.  Instead of responding to problems, PMOs and other stakeholders can identify early warning signs and adjust allocations in order to prevent problems from occurring.  The earlier these indicators can be identified, the more flexibility organizations have to find a solution, and the less severe the impact will be.

To get buy-in for improving project resource management, there has to be an understanding that there is a problem in the first place.  That comes from data.  The primary sets of data will be things like resource utilization, employee turnover, etc.  But the problems with these is that they are just numbers, there’s no standard baseline to measure them against.  Instead of focusing on trying to find some generic baseline online (and let’s face it, you can find any number that support whatever argument you want to make), I prefer to focus on secondary sets of data.

That’s things like, average schedule delay – a metric which is most closely aligned with resources; time to adjust – the time between a decision being made to change resourcing on a project and the time that change has been completed; and wasted effort – the amount of time spent by resources on work items that never make it to the final solution.  When these are understood it’s easy to put a real dollar cost on the problem, and that’s going to make it much easier to get buy-in for improvements.

This depends on the organization, but for our organization, this includes direct managers and the team members involved in the resource management decisions. However, depending on the complexity, duration, etc. of the projects this can include a multitude of different departments and stakeholders.