How to Manage Resources in Agile Project Management?

- By Mahendra Gupta | January 23, 2024
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PMI’s report reveals that around 71 percent of organizations use agile project management approaches.

As projects are becoming more complex, the agile approach has transformed the project management landscape. While the traditional project management method tries to complete the delivery within a stipulated time and budget, it does not allow frequent changes to the business requirements in the middle of the project.

Agile project management, on the contrary, allows organizations to adapt to changing client requirements and ensure the delivery the high-quality projects.

Managing resources is an essential component of project management. They are scarce, expensive, and must be utilized efficiently and effectively. But does resource management play a significant role in the agile development framework? It certainly does, as it is the only way to control project resource costs and complete the delivery satisfactorily.

This article discusses several bottlenecks and their solutions in agile resource planning and management.

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What is agile methodology?

Agile project management is an iterative and incremental approach to managing projects that emphasizes flexibility, collaboration, and continuous improvement. It focuses on delivering smaller, functional pieces of a project in short incremental cycles known as sprints.

During the sprint, cross-functional teams work together to accomplish sprint goals and regularly hold review meetings to gather feedback from stakeholders and clients. This continuous feedback cycle allows them to adapt to changing requirements even at later stages of the project lifecycle.

There are many different agile methods, some of which are Scrum, Kanban, Lean, RAD, and Extreme Programming. Scrum is a robust framework for implementing agile software development processes and other projects. It utilizes short iterations of work, called sprints, and daily meetings, called scrums, to tackle discrete portions of a project until it is completed. Scrum has three key roles: The Scrum Master, Product Owner, and Team members.

The sprint planning meeting is held on the first day of every sprint. After a delivery commitment is made in a sprint planning meeting, the team begins the work and tracks its progress. At the end of each sprint, the stakeholders are invited for a sprint review. The features completed during the sprint are discussed, and feedback is requested.

The product owner keeps track of the feedback and maintains a product backlog with the changes.

In the release-planning meeting, the product owner presents the features they want to be completed in the quarter. Then, the team provides gross-level estimates, which decide the specific features that can be completed in a given sprint. The team also jointly determines how many such features can be completed by the quarter-end.

Release planning can be feature-driven (how many sprints will be required to deliver all the features?), time-driven (how many features can be completed by a specific deadline?), or cost-driven (Important features that must be created within the budget?).

The Scrum methodology requires product backlog (work to be done), sprint backlog, release burndown, and sprint burndown. In addition, the team defines all other forms of documentation as per the specific situation.

The project manager often becomes the scrum master, but this may not always be true. For example, in traditional estimating, all requirements are fully defined, with tasks created and estimated based on their fixed scope. Conversely, agile resource planning and estimation use a top-down method to forecast each sprint.

Enhance agile-hybrid waterfall model with real-time resource optimisation

Now, let’s understand how an agile project management framework differs from a waterfall approach.

Agile project management vs. waterfall project management: What is the difference?

The following section compares two distinct project management approaches, commonly known as waterfall and agile approaches. Understanding these fundamentals will help you evaluate a project and apply the right approach for its completion. Read on:

In a waterfall project management approach, the project manager plays an active role in delegating tasks to the resources and measuring the task progress at every stage. The project goals and deliverables are well established, the project lifecycle follows a linear path, and the decision-making process is centralized.

The project manager communicates progress with every milestone or key indicator to the stakeholders to ensure the project is on track. Moreover, the budget is clearly defined, and costs are kept under control with careful evaluation of the direct costs, contingency expenses, profits, etc.

However, in the agile methodology, the agile manager or the scrum master acts as a facilitator who proactively addresses the project team’s concerns and removes barriers impeding their work. The agile team is cross-functional and self-organizing, and every member actively participates in decision-making. The project planning takes place in shorter iterations, and the focus is on delivering value quickly.

Furthermore, the schedule is divided into sprints, each with a specific duration and defined set of deliverables. The team continually interacts with clients, and changes are made based on the feedback received; the associated costs also change.

Read More: What are the Different Project Management Methodologies?

Let’s now dive deep into the various features of agile resource planning.

What are the characteristic traits of agile resource planning?

Agile resource planning is an approach to managing and allocating resources in a flexible and adaptive manner, primarily used in project management and software development contexts. The traits of agile resource planning include:

  • Flexibility

Agile resource planning emphasizes the ability to quickly respond and adapt to changing project requirements, priorities, and resource needs instead of following a rigid plan. It allows for adjustments and reallocation of resources based on evolving circumstances without any operational halts. This enables firms to review the project periodically, reduce time wastage, and enhance customer satisfaction.

  • Iterative approach

Agile planning is often done in short iterations or sprints, with frequent reassessment and adjustment of resource allocation based on feedback and progress. Each agile project is divided into sprints, which typically span 1-4 weeks, and adapts changes in iterations. This allows for continuous improvement and optimization of resource utilization.

  • Collaboration

Agile resource planning encourages collaboration among team members, stakeholders, and resource owners. It involves open communication and close cooperation to ensure the right resources are available at the right time. Apart from technical and domain knowledge, the following additional skills are also required in an agile resourcing environment. In addition, the following agile characteristics help in delivering high-quality projects.

Read More: 11 Ways to Improve Cross-Departmental Collaboration

  • Prioritization

Due to budget and time constraints, agile teams prioritize tasks and resource allocation based on the perceived value, associated cost, potential risks, and impact. This helps firms determine the project’s scope and focus on delivering high-value features or outcomes early on. Further, it enables stakeholders to provide timely feedback and make informed adjustments swiftly.

  • Continuous monitoring and adaptation

Agile resource planning requires ongoing monitoring of resource usage, progress, and performance. It emphasizes the need to gather data, analyze it, and make necessary adjustments to optimize resource allocation and ensure project success. This continuous assessment and alterations help agile teams improve their processes to deliver optimum value to the end-user.

These critical traits of agile resource planning help effectively manage resources in dynamic environments. But first, let’s understand the challenges of resource planning in an agile environment.

Challenges of managing resources in agile environment

For projects to succeed, having the right resources is vital. While agile methodologies offer flexibility and adaptability, managing resources effectively within this can be complex. Here are some common challenges of managing resources in an agile environment:

Difficulty in managing changing project requirements and scope

Agile projects are characterized by their adaptability and responsiveness to change. However, this flexibility can pose challenges when it comes to resource management. As project requirements evolve, new tasks can emerge, existing tasks can be reprioritized or modified, and additional resources can be added to the project.

If project managers are unable to anticipate the changes and manage them accordingly, it can lead to last-minute firefighting for resources and overloading of existing employees. This impacts on the project quality and causes delays in delivery.

Inability to manage competing project priorities

Agile projects often operate in dynamic environments where priorities can shift rapidly. Stakeholder requirements, market conditions, or internal organizational changes can lead to changes in project priorities.

Constantly juggling competing priorities and conflicting resource demands can cause significant stress and burnout among team members. It can lead to a decrease in morale and productivity. This, in turn, can further hinder the progress of agile projects.

Conflicting resource demands

In an agile environment, resources typically work on multiple projects concurrently. However, each project has its own set of deadlines, deliverables, and resource requirements, which can result in conflicting resource demands and contention among different projects or teams.

This can cause delays, conflicts, and compromises in resource allocation decisions, impacting project progress and overall efficiency. If tasks or projects with high priority are not given the necessary resources, it can result in missed deadlines and compromised project schedules.

Poor communication and collaboration between teams

Effective communication and coordination are crucial for resource management in agile projects. However, lack of proper communication channels, poor resource visibility, and dispersed teams can affect the collaboration between team members, stakeholders, and project managers.

This can result in misinterpretations and misalignment of expectations, leading to inefficiencies, duplicated efforts, and rework. As a result, team members may spend more time seeking clarification, impacting the overall productivity and project progress.

Skill gaps and resource shortages

Agile projects often require a diverse range of skills and expertise. However, poor visibility into resources and skills, lack of proper training and development opportunities, skill obsolescence, etc. This can lead to skill gaps, as team members may not have the necessary competencies to contribute to agile projects effectively.

Without the necessary expertise, teams may make mistakes or overlook critical aspects of the project, leading to failures or low-quality deliverables. In addition, it also affects employee productivity because resources struggle to perform tasks efficiently due to a lack of expertise or resources, resulting in delays in project delivery.

Read More: How to Mitigate Resource Risk in Project Management?

Overutilization and employee burnout

High-performing agile teams sometimes seamlessly transition from one sprint cycle to another, consistently meeting task milestones and producing quality outcomes without break or slack. Additionally, they regularly coordinate with the relevant stakeholders to gain timely feedback and incorporate suggestions in iterations.

However, if this trend persists uninterrupted, it can lead to prolonged stress, impacting the agile team’s mental and physical well-being. This can eventually lead to the workforce feeling emotionally overwhelmed and mentally drained, resulting in employee overutilization and burnout.

Read More: How Workforce Planning Prevents Employee Burnout Down the Line

Unable to identify cost-effective global resources

In a matrix organization, employees are distributed across teams, departments, locations, etc. This leads to information silos, as agile managers may not have enterprise-wide visibility into resource attributes and real-time metrics like skillsets, competencies, experience, time zones, capacity, availability, utilization, etc.

This lack of comprehensive insights hinders managers from promptly identifying and deploying cost-effective global resources to form a competent cross-functional agile team. Additionally, it may translate to the firm’s inability to attract or cater to global clients around the clock. Consequently, this can increase resourcing costs, negatively impacting productivity and ROI.

Knowing the challenges of resource planning in agile project management, let’s understand how advanced resource management software can help manage resources effectively.

5 best practices for agile resource management

Effective agile resource management helps identify and allocate resources to ensure that teams have the skills and capacity to deliver high-quality results. Here are some best practices for agile resource management:

Leverage cross-functional teams and their skills

Cross-functional teams consist of individuals with various expertise and abilities, allowing them to contribute to different aspects of a project. By harnessing this collective knowledge, organizations can optimize resource allocation and utilization for agile projects.

In addition, it promotes flexibility, as team members can adapt to changing project needs and fill gaps in skills or knowledge as required. By leveraging the strengths and capabilities of cross-functional teams, organizations can enhance productivity, deliver high-quality results, and foster a culture of collaboration and knowledge sharing.

Prioritize project tasks based on business value and dependencies

Agile projects typically involve a backlog of tasks, and it is important to prioritize them strategically to maximize the overall project value. By focusing on delivering high-value features or outcomes early in the project, organizations can ensure that the most critical objectives are addressed first.

Additionally, managers need to understand task dependencies to determine the sequence and order in which tasks should be executed. By consistently reassessing and reprioritizing tasks based on their value and dependencies, organizations can allocate resources efficiently, resulting in better project outcomes and increased customer satisfaction.

Forecast resource requirements for projects

For the seamless progression of agile projects, managers must gain insight into the opportunity pipeline and determine resource requirements for each sprint in advance. This proactive planning will allow managers to ensure they have enough capacity to initiate agile projects and produce set deliverables on time. If not, they will have enough lead time to implement resourcing measures to bridge the capacity vs. demand gap.

For instance, in case of resource excess, managers can either bring forward project tasks or sell additional capacity at a discounted rate. However, in case of resource shortage, managers can either upskill/train the existing workforce or initiate planned hiring for competent resources. This will help eliminate last-minute firefighting for competent resources and minimize high-resourcing costs, ensuring value-driven project outcomes.

Read More: What is Resource Capacity Planning? An Ultimate Guide for Every Project Manager

Monitor and track resource utilization

Agile resource management emphasizes continuously monitoring resource utilization levels throughout the project lifecycle. It involves regularly tracking resource usage, progress, and performance to identify deviations or issues. By monitoring resource utilization, organizations can identify potential bottlenecks, underutilized resources, or overburdened team members.

This allows project managers to make timely adjustments and reallocate resources as needed. In addition, it helps be responsive to changes in project requirements, priorities, or constraints. It ensures that resources are aligned with the project’s evolving needs, optimizing their utilization and enabling timely delivery of project milestones.

Read More: How to Track Resource Utilization?

Practice iterative and incremental development

Iterative and incremental development promotes the breaking down work into smaller units and delivering value incrementally. This enables better estimation, planning, and allocation of resources. By dividing the work into smaller increments, teams can optimize resource utilization, as these units are easier to estimate and allocate.

Additionally, iterative development facilitates prioritization based on feedback, ensuring that teams focus on the most valuable and high-priority items, thus helping in competent allocation. It also allows for adaptability and mitigates risks, as the team can adjust resource allocation in response to changing requirements or emerging opportunities.

Encourage a culture of continuous learning and improvement

To foster a culture of continuous improvement in resource management, it is essential to actively encourage team members to pursue learning and growth opportunities. This can be achieved through participation in training programs, workshops, or upskilling activities. By continuously expanding their knowledge and skills, team members can make valuable contributions to the projects.

In addition, embracing a culture of continuous improvement means viewing each iteration or sprint as an opportunity for learning and refining resource management practices. It is crucial to regularly review and adapt processes based on feedback received and the outcomes achieved. This iterative approach enables the team to enhance resource allocation, improve capacity planning, and optimize resource utilization effectively.

Empower teams to take accountability and responsibility

Agile teams exercise a higher degree of autonomy as opposed to the traditional waterfall approach. The scrum master entrusts the self-organized team to take accountability for managing their workload. Further, they encourage the team members to share their opinions and perspectives in the decision-making process, collaborate, and create solutions to deliver value.

Thus, empowering teams in this manner fosters a sense of ownership, instills responsibility for meeting deadlines, and motivates them to improve their performance continuously. Moreover, this approach builds trust, as team members rely on each other to fulfill their respective roles. This heightened employee engagement and involvement in their responsibilities improves their productivity and ensures they deliver successful outcomes.

Read More: 7 Effective Ways to Empower Employees and Prevent Micromanagement

These are some of the best practices for efficient resource management in an agile project environment. Now, let’s understand the key features of resource management software to help manage resources in agile projects.

Resource management software for agile framework

Resource quality plays a significant role in an agile project environment. One cannot optimally use critical resources by assigning work below or above a person’s capability.

One also needs visibility into all the resources – available or not – and their costs. Only then can one balance people, technology, knowledge, time, and budget to deliver on time and goal. This needs to be analyzed before creating WBS (Work Breakdown Structure).

Here are some of the salient features of resource management software to manage agile projects:

Resource or workforce scheduling

Resource scheduling involves identifying and allocating resources for a specific period to different project tasks. With a centralized Gantt chart view of the enterprise, resource scheduling eliminates silos of spreadsheets. It also facilitates deploying the “best-available-best-fit” rather than the “first-available-first-fit” resource. Most agile projects operate with small team sizes. The product backlog will be adversely impacted unless the right resource is deployed for the right task.

Resource utilization

A resource is effective if it works on billable or strategic projects and is fully utilized per its capacity. The efficiency of an organization can be determined by the cumulative utilization of all its employees. Resource managers can proactively mobilize resources from non-billable to billable/ strategic tasks and maximize their billable utilization. Furthermore, ensuring minimum time is spent on mundane tasks such as attending meetings for the scrum team members is crucial.

Read More: What is Resource Utilization? A Complete Guide to Improve Business Efficiency

Forecast shortfall or excesses of resources

Resource capacity is the total number of standard hours an individual is available to work per the employer’s arrangement. Resource demand is understanding the number of resources required to meet the demand for various types of work. Capacity vs. Demand is the process of forecasting shortages or excesses of resources by analyzing the gaps between resources’ capacity against the demand for resources.

It is a shortage of resources when the demand is higher than the capacity or supply of resources. Conversely, it is an excess of resources when the demand is lower than the capacity or supply of resources.

Effective bench management

Bench refers to employees not assigned to any project but on the company’s payroll. They are, in short, kept as reserves by companies on their payroll in anticipation of future projects. If the size of the bench is not controlled, this cost suddenly balloons and significantly affects the company’s bottom line. Therefore, Scrum Master needs to consider bench resource availability during sprint planning.

Forecasted vs. actual use of resource

Resource forecasting predicts various workforce metrics such as demand, supply, vacancies on the bench, resource cost, etc. A resource may be booked for multiple projects where they are expected to spend a certain percentage of the time. Therefore, a timesheet helps record the time an employee spends on each job. This is essential in agile project management to control project costs.

The PMO office verifies if the person concerned has spent the same hours on different activities as per the allocation or if there is a variance.

Managing pipeline projects

The two pipeline management goals are to build a healthy pipeline and win more deals. However, the pipeline or future projects also must be delivered on time and within budget, and one needs advanced resource planning to complete them. Many scheduling software allow the creation of a project plan using ghost resources, which can be replaced with the existing resources. Since frequent requirement changes are expected within a project that follows agile methodology, timely resource capacity planning is essential.

Read more: What is Resource Planning, and Why is it Important in Project Management?

Supporting matrix structure

In a matrix organizational structure, some individuals report to multiple supervisors or leaders. This relationship can be described as a solid or dotted line of reporting. Managing a shared resource becomes complex when two managers have different project priorities.

It is necessary to ensure that the resource is not overloaded, leading to burnout or unplanned attrition.

Matrix organization can complement the agile project management process when the Scrum Master can access surplus resources in other departments.

Visibility of resource information for decision making

Relevant information about a resource can be viewed using an advanced filter to help decision-making. It can also be made role-specific, e.g., a project manager will only see information about the projects he manages. On the other hand, a location manager can see resource-related data for the location. These fields could include skillset/competency, cost rate, charge-out rate, etc.

A resource management software with an advanced filtering option can quickly identify appropriate resources for a scrum master.

Forecasting financials

Forecasting is the process of making predictions of the future based on past and present data. To calculate the gross margin for a project, we need to know the charge-out rate and cost to the company of each resource. Most of the projects operate either on a fixed cost or on a time and material basis.

For a fixed-cost project, the revenue amount is already known, and we only need to calculate the resource cost for the project duration.

Read More: What is Resource Forecasting? An Ultimate Guide for Project Managers

Scenarios – modelling and simulation

The simulation technique determines how projected performance is affected by changes in the assumptions that those projections are based upon. What-if analysis often compares scenarios and their potential outcomes based on changing conditions. The changes can be simulated in a sandbox environment, and the best possible scenario can be applied to the schedule.

When there is a resource crunch, agile project management can decide on project and resource priorities using simulation.

Business intelligence and reports

Business intelligence provides actionable insights by performing extensive data analysis. Resource management metrics are generated using real-time data, individualized reports, and dashboards. The reports allow managers to make informed decisions and monitor the overall resource health index.

Scrum masters can immensely benefit from the digital dashboards created using real-time business intelligence with changing requirements.

Workforce planning and optimization

Strategic Workforce planning looks at system-wide issues and strategies to:

  • Support the organization’s strategic plan (e.g., reorganization and redeployment).
  • Address external workforce factors that affect the entire business (e.g., succession planning for retirement bubbles or staff reduction planning for budget cuts).
  • Maintain organizational capacity (e.g., in-service training).
  • Mitigate risk exposure (e.g., safety planning and Equal Employment Opportunity training).

Read More: What is Workforce Planning, and How to Master it for Business Efficiency?

What is next?

Resources must be utilized efficiently as they are the most high-priced investments of any business. This must be considered while implementing effective resource management in an agile project. In addition, organizations spend a lot of time and cost creating the right talent pool.

Depending on the nature of the project, an appropriate methodology, such as a waterfall or agile, can be adopted. Accordingly, it is necessary to tap the skills and competencies of resources for overall efficiency and profitability.

The Glossary

Read More: Glossary of Resource Workforce Planning, Scheduling and Management

The SAVIOM Solution

SAVIOM is the market leader in providing Enterprise Resource Management Software. With more than 20 years of experience, SAVIOM’s solution is being used by many Fortune 500 companies across the globe. It also provides tools for project portfolio management, professional service automation, and workforce planning software. 

Whether it is Agile, Waterfall, or any other methodology, SAVIOM can provide a comprehensive solution for managing resources.


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