Resource management is the practice of optimising the utilization of an organization’s resources, whilst ensuring that the commitments made will be met. Whilst human resources are a significant component, other resources to be managed include finance, machinery and IT systems. Where the main business is managing a portfolio of projects, resource management has two key objectives, which are not always compatible:
- Sufficient numbers of appropriate resources must be allocated to each projects, so that timescale, budget and quality commitments will consistently be met for every project.
- Ensure that utilization of the resource pool, when measured across the entire project workload, remains at a consistently high level.
Why is resource management important?
There can be rich financial rewards for maintaining the right balance. A recent (2011) member survey of the UK Association of Consulting Engineers, showed that a mere 2% improvement in utilization of their billable human resources, would deliver an increase of 25% in operating profits.
Why is resource management so difficult?
Resource management can be relatively straightforward across a small number of large projects, where each project has a dedicated full time team. But when managing a large number of small projects, where individuals are assigned to more than one project, maintaining high levels of utilization is challenging. No sooner do you have the skills demand nicely in balance with capacity than a project change arrives, one gets delayed or a key person goes sick; the more fragmented and volatile the mix of projects is, the greater are the difficulties in maintaining high levels of utilization.
What is the best type of organisation for resource management?
To give equal weight to the two objectives, project organisations need to be focused on both project and resourcing requirements. This demands a matrix organisation, where project managers are responsible for the performance and deliverables of individual projects, and resource managers supply requested resources whilst striving to maintain high levels of utilization of their team members.
What steps are needed for successful resource management?
There are two main phases in the resource management process:
- Demand management. Individual project plans show profiles of demand for different resource skills and competencies. Aggregating these for all confirmed projects shows the overall demand pattern. Comparing the demand with the skills capacities in the resource pool identifies any unacceptable bottlenecks – which will jeopardise project commitments, or spare capacity – which will erode utilization levels.
As potential projects get close to award or approval, they get layered on top of the committed project workload to see if any resource bottlenecks get exacerbated. What If…? analysis enables prospective projects to be moved in time to minimise these bottlenecks, where this is acceptable. Otherwise the forecast bottleneck information drives contractor hiring, recruitment, or re-training programmes.
- Resource allocation. With the demand for skills in balance with the capacity, project managers can request resources with confidence. They will want to specify required skills and competencies to ensure that only suitable resources get to work on their projects. Leaders of teams with the requested skills can then locate and propose suitable candidates.
This process relies on good co-operation between project managers and team leaders, with senior management intervening as necessary to resolve disputes. The process is enabled and supported by resource management tools that supply appropriate information to each role and a clear workflow through the key steps, often enforced with email alerts.