{"id":3486,"date":"2022-07-14T00:00:24","date_gmt":"2022-07-14T00:00:24","guid":{"rendered":"https:\/\/www.saviom.com\/resources\/?p=3486"},"modified":"2026-05-14T06:14:51","modified_gmt":"2026-05-14T06:14:51","slug":"ways-to-increase-operational-efficiency","status":"publish","type":"blog","link":"https:\/\/www.saviom.com\/blog\/ways-to-increase-operational-efficiency\/","title":{"rendered":"Understaffed? 11 Ways to Increase Operational Efficiency"},"content":{"rendered":"

According to the U.S. Bureau of labor statistics, a record-breaking 4.5 million employees quit their jobs, and another 1.4 million were discharged or relieved as of March 2022.<\/em><\/p>\n

This exponential increase in planned and unplanned attrition is attributed to the global COVID-19 outbreak. Due to the economic upheaval, several organizations had to cut costs, relieve non-critical employees, and operate on limited resources. Moreover, the increased global competition for niche talent and growing skills shortage has also left many organizations understaffed<\/strong>. Understaffing can have severe repercussions on businesses<\/strong>. From employees being stressed and burnt out to compromised work quality and revenue loss due to lost opportunities, it negatively impacts a company\u2019s overall efficiency.<\/span> However, if appropriately managed, business leaders can enhance operational efficiency even when understaffed. This article explains the impact of understaffing and how one can combat it with a definite strategy. Let\u2019s delve into the basics, \"Ways

What is Operational Efficiency, and How Does Understaffing Impact it?<\/h2>\n

Operational efficiency is the ability of an organization to deliver high-quality projects<\/strong> and services\/products with limited resources. It can be measured by comparing an organization’s revenue generated against expenses incurred for every project.<\/p>\n

Operational efficiency factors in several metrics like production capacity, labor productivity, turnaround time, and profitability. If an organization is understaffed, it may witness a decline in these metrics. Organizations might overutilize their existing resources to keep that occurrence at bay by allocating extra work to meet the project requirements.<\/p>\n

However, the downside is that employees feel stressed<\/strong> and burned out when given an unmanageable workload<\/strong> or allocated beyond their capacity. This can result in unplanned absenteeism<\/a> and even high employee turnover. In addition, they may miss deadlines, and work quality inevitably suffers. When businesses cannot deliver high-quality projects within the stipulated time and budget, customer dissatisfaction jeopardizes the brand’s reputation. All of this may further lead to lost growth opportunities<\/strong> and question the firm’s sustainability.<\/p>\n

The pertinent question is, can organizations function efficiently and negate this impact, even when they don\u2019t have enough workforce? The answer is a resounding yes. Let\u2019s see how.<\/p>\n

\"Experience

11 Ways to Manage Understaffing and Boost Operational Efficiency<\/h2>\n

Since understaffing is a consistent issue in organizations today, managers can adopt ways to make the best use of their existing resources and enhance operational efficiency. The following ways will help you in the process.<\/p>\n

Prioritize Projects Based on Business Value and Strategic Goals<\/h3>\n

When organizations are functioning with fewer resources, it\u2019s imperative to ensure that only profitable and value-adding projects<\/strong> are undertaken. Otherwise, they will end up utilizing the workforce without any substantial ROI. Therefore, managers can coordinate with the PMO<\/strong> to help identify profitable and strategically aligned projects. This way, they can deploy their talent pool on the right projects, contributing to the organization\u2019s growth. In addition, working on such projects ensures that the financial and long-term goals<\/strong> are met<\/strong> even with a limited workforce, thereby increasing operational efficiency<\/strong>.<\/p>\n

Ensure Effective Time and Task Management<\/h3>\n

Adequate time and task management are key to boosting operational efficiency, especially when you are understaffed. Thus, the onus lies with managers to ensure every project task is defined clearly and given a realistic timeline. Because you are facing resource constraints<\/a>, giving unrealistic deadlines will cause more harm than good. Moreover, employees can plan ahead of the curve and avoid any potential delays when working with a well-defined schedule. So, managers can implement the work breakdown structure<\/strong><\/a> that helps divide the projects into smaller, manageable tasks and estimate the deadline for each. Once the required skillset is defined, they can allocate competent resources for the job and clarify the roles and responsibilities. This will ensure timely delivery<\/strong> and ensure no task is overlooked or missed.<\/p>\n

Read More: What is Time Management? 9 Effective Strategies to Master It<\/a><\/strong><\/p>\n

Track Project Financials Regularly to Avoid Loss of Revenue<\/h3>\n

Profitability is one of the very important metrics to assess operational efficiency. Naturally, higher profitability implies better efficiency. Thus, managers must track project financials regularly. If not, it can lead to cost overruns<\/a>, billable loss, and more. The pertinent question is, how can they procure accurate data? Implementing a project and resource management tool<\/strong> will provide real-time insights<\/strong> into project costs forecast vs. actuals where managers can evaluate variances between planned and actual costs, etc. This helps them take corrective actions<\/strong> well ahead of the curve and avoid any loss of revenue. Moreover, while estimating the budget during the planning stage, managers should leverage lesson-learned reports<\/strong> to improve accuracy.<\/p>\n

Implement Resourcing Treatments to Optimize the Workforce<\/h3>\n

Project managers<\/a> are in a predicament when they have to deliver projects with less resources as multiple risks are involved. For instance,<\/strong> the absence of a critical resource can hamper other dependent tasks, derailing the whole project. In this case, implementing the right resourcing strategy such as out-rotation<\/strong> and backfill<\/strong> can help save both the ongoing and the new project. Moreover, when you are understaffed, optimizing and building a future-ready workforce<\/strong> is of utmost importance. This ascertains that each employee is equipped with appropriate competencies to manage evolving demands. So, organizations can conduct upskilling and training<\/strong><\/a> programs to achieve this. These practices enable managers to deliver quality projects with limited availability of resources.<\/p>\n

Read More: What is Workforce Optimization? Definition, Benefits & Best Practices<\/a><\/strong><\/p>\n

Hire Contingent Workforce to Fulfill Short-Term Niche Requirements<\/h3>\n

Often projects demand niche-skilled resources that are not available within the organization\u2019s talent pool. If this is a one-time requirement, they can hire contingent workers<\/a> such as freelancers or contractors from empaneled vendors to get the job done. This way, organizations can avoid unnecessary overheads of hiring permanent employees or losing the opportunity altogether. To gauge if the demand is one-time or recurring, managers can deploy a resource management tool that provides a bird\u2019s eye view<\/strong> of current and pipeline project demand. This will also reduce training time<\/strong>, minimize unnecessary hiring\/firing cycles<\/a>, help form the right mix of permanent and contingent staff, and elevate overall efficiency<\/strong>.<\/p>\n

Ensure Profitable Resource Utilization for Better Productivity<\/h3>\n

Resources are the most significant investment and success drivers of any organization. Thus, managers are responsible for tapping into the maximum potential<\/strong> of every employee and ensuring optimal resource utilization<\/a>. For instance, if a resource is underutilized or spending more time on BAU or admin tasks, they are not generating substantial revenue, which declines profitability. Thus, managers must correct and mobilize or reallocate them to billable or strategic projects. This will boost productivity<\/strong> and ascertain revenue generation, eventually enhancing efficiency<\/strong>.<\/p>\n

Read More: How to Optimize Resource Utilization in 7 Effective Steps?<\/a><\/strong><\/p>\n

Encourage Cross-Departmental Collaboration<\/h3>\n

Organizations must ensure that they have an adequate talent pool<\/strong> to avoid missing out on opportunities or new projects. The first question that surfaces is, how can one achieve this when there is a resource crunch? Cross-departmental collaboration<\/a> is the solution to combat this. It allows employees to work on projects that do not fall under their respective departments but demand their skills. This will facilitate sharing of resources<\/strong> and also let employees diversify their portfolios<\/strong>. This way, businesses can intelligently utilize their existing workforce, deliver projects successfully, and improve efficiency<\/strong>.<\/p>\n

Automate and Streamline Administrative Work<\/h3>\n

As discussed earlier, when employees spend more time on BAU work, it affects their productivity and the organization\u2019s profitability. To prevent this, businesses should implement the right tool inventory that can automate mundane tasks<\/strong>. For instance, they can streamline repetitive tasks<\/strong> like generating reports, invoicing, and billing using automation tools and software. Thus, employees can utilize their time on human-critical activities such as strategic work, tasks, etc. In a nutshell, automation will help you make the most of your limited resource pool and improve operational efficiency<\/a>.<\/p>\n

Invest in Multi-Skill Building Programs and IDPs<\/h3>\n

One of the many most effective ways to improve efficiency while understaffed is conducting multi-skill building <\/strong>programs and IDPs<\/strong>. Many employees are generalists, meaning they are proficient in performing different tasks that demand varied competencies. Organizations can leverage these resources and hone their skills to allocate them to diverse projects. Thus, even if you have a smaller resource pool, you will not miss out on new opportunities and can deploy the employees on multi-faceted projects and upkeep efficiency. Furthermore, it ensures\u00a0optimal utilization<\/strong> and increased productivity, boosting operational efficiency.<\/p>\n

Read More: How Can Retraining\/Upskilling Future-Proof Your Workforce?<\/a><\/strong><\/p>\n

Conduct Regular Rewards and Recognition Programs<\/h3>\n

When there is a resource shortage, the existing workforce puts in their maximum effort and goes the extra mile to ensure quality project delivery. Thus, they expect to get rewarded and compensated for their hard work. Without that, employees may feel disengaged and demotivated at work. Hence, organizations can formulate employee recognition programs<\/a> that acknowledge the contribution and high performance. They can leverage their company\u2019s social media handle and give shout-outs to their employees or offer physical fitness programs or mental well-being sessions. This will foster a sense of belonging<\/strong> and make employees feel valued and appreciated<\/strong> at their workplace. Eventually, it increases their drive for work resulting in higher efficiency<\/strong>.<\/p>\n

Build Assets Within the Project and Reuse them as Appropriate<\/h3>\n

Organizational assets include tech inventory, machinery, human resources, lesson learned reports, knowledge base, etc. These assets demand high investment and hold high value. Thus, to get the maximum output of their investment, one can reuse such assets for similar projects or endeavors. For instance,<\/strong> a project requires a code to automate some tasks. Once the employee develops this code, organizations can preserve it in their repository and make it available for others to use as and when there is a need. This will save time and money spent on doing the same task, allow employees to complete other tasks at the same time, and ensure efficiency. Coupled with the above-mentioned strategic tips, organizations can implement modern resource management software<\/a> to mitigate the challenges of understaffing. The following section explains ways this software helps in elevating operational efficiency,<\/p>\n

How can Resource Management Help Manage Understaffing and Enhance Operational Efficiency?<\/h2>\n

Advanced resource management software<\/strong> can help in dealing with understaffing and maximize operational efficiency in the following ways:<\/p>\n