Organizations and their project management offices (PMOs) follow different strategies to manage resources across multiple projects. When the project resource plan is developed based on the project scope, complexity, and project financials, it becomes a challenge when managers have multiple projects to execute at the same time.
Having the right resources for the right projects at every stage is crucial for the overall efficiency and success of the company.
There is a constant struggle to bring in the best solution that will align with each project goal and balancing resources between the projects. Often managers have to run from pillar to post for competent resources to get their projects delivered on budget and within time.
With a strategic resource management approach, managers can improve the outcomes, productivity, and profitability of each project. In this article, we have discussed some of the best resource management practices that can help you to manage your resources across multiple projects seamlessly.
How Does Managing Resources Benefit Projects?
Formulating an intelligent project plan requires accurate information of every resource attribute from skills, core competencies to their utilization and availability of resources . Based on these insights, managers can develop a working plan within the allocated project budget.
It will also help them enhance productivity and ensure the project’s success by facilitating the appropriate allocation of the right resource to the right project in the right capacities.
- Timely Project Delivery
- Increased Profitability
- Improve Client Satisfaction
Proactive resource planning allows managers to assess the capacity vs demand gap in advance and bridge it with appropriate resourcing measures. The effective distribution of competent resources in project management ensures that no under or over-skilled resources are allocated to projects.
Over-skilled resources can spike project cost and under-skilled resources can cause severe project delays. Therefore, proper resource allocation helps to maintain the project quality and consistent delivery of services on time and within budget.
Resource demand forecasting facilitates planned hiring which helps to reduce last-minute hiring/firing costs. Managers can implement the right resourcing measures to identify and allocate competent and cost-effective global resources across matrix boundaries. It will enhance profitability by reducing project resource costs significantly.
The satisfaction of clients depends on how effectively their expectations are met by the organization. When projects are delivered with quality services, on time, and within budget, it is considered a success.
Effective resource scheduling allows you to maintain the quality of deliverables and increase the company’s image.
How are Projects and Resources Classified?
To maximize productivity, resources and projects are regularly reviewed and the right type of workforce is deployed at every project.
The below section describes a classification of the different types of workforce deployed on projects:
2.1 Types of Human Resources:
Depending on the project requirements, the manager decides to hire different types of resources such as permanent employees, contractors, or freelancers.
- Permanent Employees (Full-time & Part-time)
- Contractual or Contingent Workforce
Permanent employees can be both full-time and part-time resources and are often perceived as a cost-effective solution for any business. Their productivity and contribution to meet business objectives are higher due to their participation in any or all of the internal and strategic works.
On-demand or contingent workforce is beneficial for businesses facing workload volatility due to change in market conditions. For short-term assignments, a contingent or contractual workforce is considered beneficial as they have less overhead compared to full-time resources. Often the project managers utilize contractual resources at a higher price but have no liability to maintain them once the task is accomplished.
Freelancers are hired for a specific work and time period with more flexibility of work schedule. They are often hired for specific expertise or niche skills on a project at hourly or daily rates. Hiring freelancers is a cost-cutting strategy used by many businesses as they cost less to the company in terms of training and other overhead costs.
2.2 Workforce in a Matrix Organization:
- Local Resources
- Global Resources
- Nearshore Model:
- Offshore Model:
A local resource is limited to a certain location within the local infrastructure of the project. Local resources have the advantage of being in the proximity of the business and they can build a better relationship with the key personnel of the client organization.
A global resource is known to exceed the system of the project location as it can be accessed from multiple locations through a global resource management model. It aims to have a centralized repository of a global resource pool having diverse skill sets. Companies can utilize skilled resources from cost-effective locations.
The Nearshore and Offshore outsourcing model is used by project managers to program the expertise needed for any project.
This outsourcing model refers to the resources located in neighboring countries with similar time zones. As an example, the nearshore location for the US would be Mexico.
The offshoring model refers to outsourcing to resources located far-away with considerable time zone differences. An example of an offshore location for the US would be India.
2.3 Different Types of Project:
- Small Scale Project
- Large Scale Project
Small scale project is characterized by factors such as short duration, a small team, and the budget size of the project. A single project manager can manage one or more such projects at the same time. Here resources are assigned for several small tasks and aim to deliver outputs over shorter time scales.
Large scale projects on the other end are characterized by the complex nature of the project, such as longer duration, larger teams, and a bigger budget. Multiple project managers are seen managing large-scale projects and are headed by the Delivery Project Executive (DPE). The DPE demonstrates a complete understanding of multiple client requirements and supports various project teams to meet their expectations.
Challenges of Managing Resources Across Multiple Projects
Below we take you through the challenges that add complexity to managing resources across multiple projects and how the right resource management tool can help.
- Poor Visibility due to Siloed Data
- A Traditional Resource Requisition Protocol
- Shortage of resources within a multi-project environment
The use of legacy tools and silos of spreadsheets across enterprises results in poor visibility and a lack of real-time updates. In this case, managers often end up allocating resources without complete knowledge of their competencies and existing bookings. This improper resource allocation leads to double-bookings and over-utilization of resources.
The traditional way of resource requesting method brings in a lot of complexity and challenges in the form of double booking, internal conflicts, discrepancies, etc. The manual resource requisition process involves manually sorting out resources and taking call/email requests from multiple project managers, which is time-consuming and cumbersome
It is particularly challenging if there is a demand for a niche skill set between multiple projects. The organization may only have a limited number of resources to satisfy all the requirements. Allocating all available critical resources to a single high-priority project can create a resource crunch and other projects are adversely affected.
- Rise of Internal Conflicts between Multiple Projects
- Unable to forecast demand vs capacity
- Lack of Productive Utilization
Often multiple projects require the same competencies at the same time. This gives rise to competition for resources creating disagreement between project managers that may lead to conflicts. Some other causes of internal conflicts are differences in needs, resource schedules, project priorities, etc.
Inappropriate resource allocation and improper use of bench resources lead to unplanned hiring of high-cost resources in place of low-cost similar skilled resources. The lack of foresight into the capacity vs demand gap elevates unplanned hiring at the eleventh hour and as a result, expensive local resources get recruited. It escalates the project budget and impacts project profitability.
Scheduling competent resources into non-billable activities reduces productivity. Without the right tools, project managers fail to track real-time utilization resulting in suboptimal utilization of resources. This can further cause revenue loss, project delay, and a decline in employee satisfaction.
7 Strategies for Effectively Managing Resources Across Multiple Projects:
If you are struggling to distribute and manage different resources across multiple projects, one needs to be effective in juggling multiple activities.
Here are some 7 strategies that will help to keep everything on track without disappointing any stakeholder within your business.
- Gain 360-Degree Visibility of all Resource Profiles
- Prioritize Projects
- Distribute Key Resources Uniformly Across Projects
- Enable Out Rotation and Backfill Strategy
Multidimensional resource scheduler facilitates identifying and allocating suitable resources to the right project at the right time. With a unified Gantt chart view of the enterprise, it offers 360-degree visibility of all resource profiles and schedules that can help deploy them to the project based on the skills and availability. The comprehensive view of all resources allows managers to optimize utilization levels and increase revenue and employee satisfaction.
Resource management in a shared-services model becomes complex when it is supervised by two or more managers. Therefore, it is appropriate to categorize projects based on priorities and keep an updated list of tasks that needs to be done by shared resources. This will also help shared resources to be more effective and get involved with more billable and strategic initiatives.
An efficient resource allocation will ensure that no resource is under or over-utilized against their available capacity. In this case, the resource managers can create a revised schedule to distribute them uniformly across projects. Resource Leveling and Resource Smoothing are the two strategic techniques that can be used to maintain uniformity.
Strategic resource planning helps managers to out rotate an internal niche skilled resource from an existing project to kick-start a new critical project. To ensure that the previous project’s quality is not compromised, they can imply a backfill strategy i.e. fill a resource with similar skill. A resource is short-listed for out rotation if the concerned person is not involved with any important activities.
- Encourage Multi Skill Building
- Leverage Cost-effective Global Resources
- Determine Proper Guidelines for Matrix Organizations
Implementing skill-building programs that promote sharing and application of one’s knowledge is critical to the success of any organization. Managers should therefore invest in training and development activities to encourage multi-skill building among resources. When employees are encouraged to have two or more skills, it improves billability. So, if a resource’s primary skills are not matching any suitable vacancy, they can be made billable using their secondary skill sets.
Individual Development Plans or IDP help employees to learn new skills and enhance their work performance as per their interest. It helps managers to align employee training with the goals and objectives of an organization.
Developing a proper resource planning strategy that brings in cost-effective global resources and facilitates global resource management helps to control the project budgets. Using a multi-location policy, managers can identify and allocate cost-effective global resources from low-cost locations, and control project costs.
Given the complexity of a matrix organizational structure, where every single resource has dual or multiple reporting and accountability the onus is on the managers to make sure resources are utilized optimally against their capacity. The shared-service model of highly skilled resources between functional units and projects lets managers check one single pool of resources to fill the demand of the project.
A proper resource management tool provides data-driven insights into resource availability, utilization, and resource capacity that let managers forecast the demand in advance.
Managing resources and projects are the two sides of the same coin. Some call it an art, and some categorize it as science to manage resources across multiple projects! One needs to consider the project scope, financials, and every other essential aspect before creating a project resource plan.
But in order to effectively manage resources and maintain business profitability, it helps to use a powerful resource management tool customized for one’s requirement.
It provides a unified view among resources and ensures that everyone has a broad view of multiple projects. It also significantly helps managers to make informed decisions that enhance all the operations of the business and boost resource utilization and productivity.
What challenges do you face while managing multiple projects simultaneously?
The Saviom Solution
SAVIOM is the market leader in providing the most powerful and configurable solutions for effective management of resources. Having more than 20 years of experience, this Australian-based MNC has a global presence in over 50 countries. It is also popular with more than 100 customers and helping them to achieve their business goals. SAVIOM also has products for project portfolio management, professional service automation, and workforce planning software which can be easily customized as per business requirements.
The Ultimate Guide to an Efficient Resource ManagementDownload
Somya Yesodharan & Aakash Gupta