In a Project-based work environment, organizations are under tremendous pressure to deliver innovative and refined products with slim budgets. In fact, resources being one of the biggest sources of expense for an organization, ensuring their optimum utilization is the key to drive profitability.
If the resources are utilized poorly, it can affect their productivity, increase project costs, compromise the quality of deliverables of projects, and even reduce employee engagement. The key to overcome these shortcomings is to ensure every resource and their skills are utilized to the maximum possible extent. It’s easier said than done with resources being spread across boundaries and different departments.
Tracking each one’s performance, keeping the course on their utilization rates, ensuring uniform workload across the enterprise, and staying informed of their schedules manually is not feasible. In this case, leveraging a refined resource management software will facilitate you to supervise your workforce without a hitch.
Let’s understand how software-aided resource planning is vital for a project’s success:
1. Importance of resource planning
1. Meet project demands
Resource managers help project managers meet their project requirements with precision. When provided detailed project requirements, it’s easy for workforce managers to recognize these demands and allocate resources with the right skill set accordingly.
2. Prevent burnout
A resource management tool provides a comprehensive heatmap that helps you track the utilization rates of your resources. According to a Deloitte survey, unrealistic deadlines and consistent long working hours account for 30% and 29% employee burnout respectively.
If a resource is over-utilized, you can re-allocate his/her tasks to other employees and reduce his workload to prevent burnout.
3. Avoid benching resources
The heat map also informs you of under-utilized employees. This information can be used to avoid benching of resources either by taking up new projects where their skills can be utilized or by re-skilling them to accommodate the vacant spots.
4. Deploy the right resource
One of the significant benefits of resource planning is a structured listing of resources and their competencies. Hence based on this data, resource managers are able to deploy the right resources to the right job and increase project regulation.
5. Build transparency
Resource management software maintains a single source of truth by providing enterprise-wide visibility of employees and their schedules. This builds transparency as resource managers can get a fix on the assigned tasks and their available bandwidth.
6. Take corrective actions in advance
A tool equipped with advanced forecasting forewarns you about the project demands. You can then bridge the capacity vs demand gap and take corrective actions ahead of the curve. In case your resource pool lacks certain competencies, you can hire or retrain the existing employees to fulfill the project’s requirements.
7. Maximize billable utilization
A resource manager can view overall schedules and allocations of every employee. If a highly skilled resource is booked for BAU or admin tasks, the manager can mobilize him/her to billable or high priority projects. That will enable him to channelize his expertise into the right tasks. This increases billability and improves the profitability of an organization.
8. Reduce hiring/firing costs
With efficient capacity planning, an organization can reduce resourcing costs by avoiding last-minute hiring. Uniform allocation of tasks and upskilling measures reduce layoffs thus saving your company’s valued talent and reducing firing costsResource management provides accurate forecasting of demands and productive utilization of global resources. Also, to meet the volatile market demands, you can hire a contingent or on-demand workforcefor a stipulated period of time and deliver the results.
All these detailed benefits make effective resource planning incumbent for an enterprise. It’s certainly not easy to track each and every resources’ utilization rates manually. And of course, to err is human! A tech-based tool with varied functionalities that caters to every attribute is the solution. This will eliminate errors and improve the accuracy of the results. And what’s more? A data-driven solution strengthens your decision-making and improves efficiency.
Now that it’s significance is clear, let’s understand the ways to effectively plan your workforce using a resource management tool.
1. 360 degree view of employees’ activities
When the workforce is dispersed across offices globally, it’s difficult for managers to keep a tab on everyone’s schedules and their assigned tasks. Leveraging a resource management tool to get a 360-degree view of the enterprise’s workforce is the ideal solution to organize and utilize the resource pool. You get a bird’s eye view of every employee’s schedule and their allocated activities be it BAU, billable projects, or admin tasks.
In addition, when managers have complete visibility of both projects and resources, they can get a grip on the skills actively utilized. In addition, using the advanced filter options, they can identify the right resource for the right job at the right cost based on their experience, competencies, location, availability, and more.
What could be better than being able to redistribute the workforce to billable tasks with simple drag and drop functionality? Supervisors can reassign the workforce hooked to admin tasks to billable projects and tap into their potential and maximize profitability.
2. Resource requesting
Needing a resource immediately and the long trails of emails and texts to request that resource halt your project’s progress. Dreary, isn’t it? Especially when you have multiple projects on the boil. It slows down your resource planning and creates further project bottlenecks. To avoid this nightmare, a systemized and fluid resource requesting process is needed to streamline your workforce planning.
To avoid missing out on deadlines, a tool integrated with a formalized resource request process to allocate resources with required skill sets enhances efficiency. It enables you to assign resources with the appropriate approvals and notifications on time. You can then accomplish the projects within their budgeted time and cost. What are the benefits here? One, you eliminate the chaos of fragmented requesting and two, you fill the resource vacancy in advance to avoid last-minute hindrances!
3. Track utilization rates
An essential step of the resource planning process is to ensure that your employees aren’t overworked or are benched because they haven’t been allocated enough work. Don’t worry! This task is a breeze when you are equipped with smart tools that can track and curate smart reports using business intelligence. You can get insights into all your resources’ utilization rates and ensure they are used to their optimal capacity.
For example, an employee is 50% utilized and one is 130% utilized. These are instances of under and overutilization. Optimum utilization aims for them to work between 90-110% of their capacity. In fact, according to Gartner Analyst Robert Handler, an actual tipping point of productivity- that sweet spot, is between 70% and 80% utilization.
How to mitigate this situation? When an employee is under-utilized, you can take up new projects pertaining to his or her skills or assign them more billable tasks. Whereas when they are over-utilized, you can re-assign the tasks to other resources with the same competencies. This will enhance their productivity, avoid burnouts, and reduce benching resources in the future.
4. Stay proactive with resource forecasting
A nuanced approach to staff future projects is necessary to prevent roadblocks in the project’s progress. One needs to plan for future hiring in case of projected vacancies and also manage the workload of the existing workforce to prevent discrepancies.
Resource forecasting is one of the most advanced and beneficial resource management strategies to deal with future project resource planning. With an accurate prediction of resource requirements well in advance, you can eliminate the risk of resource bottlenecks at the eleventh hour. Resource planning becomes more efficient and structured when your future project demands are already taken care of.
Besides, you can bridge the capacity vs demand gap by taking certain corrective measures ahead of the curve. If the required skills are absent or the employees are unavailable during that particular period, you can hire new talent or reskill the existing employees to keep your progress steady. You can also tap into the on-demand workforce to avoid permanent overhead costs. Furthermore, if the forecasted reports show skill excesses, you can plan to take up new projects or market the available capacity. This ensures the effective utilization of resources and their skills in management.
2. The takeaway
Your organization’s success depends on your employees’ performance and productivity. Optimized utilization of these resources will lead to the project’s success and will eventually help you meet the strategic goals of your firm. When you take care of your employees, they work harder to add more value to the organization. The increased employee engagement and satisfaction will in turn improve your firm’s reputation. If you haven’t already, consider implementing the best tools to optimize your workforce and give your business a sustainable competitive edge.