What Exactly Is Resource Management? The Basics for Novices and for Pros.

“What exactly is resource management?” – know that you’re not the only one asking this question. We hear it from team leaders weighing employee burnout against successful delivery. From company management whose top priority is delivering reliable customer solutions. And from newly-minted project managers looking for a concise definition of resource management.

Whether you belong to one of these groups or are simply curious, you’ve come to the right place. This article will help you answer the following questions:

What are resources?
What is resource management?
What are the benefits of resource management?
What is the difference between resource management and resource planning?
How does one manage resources?
How do other companies approach resource management?
How can you best get started with resource management?

What Are Resources?

The term “resources” refers to capital, assets, or tools needed for a specific purpose. This can include money for purchases, materials for production, information for decision-making, or even people’s skills and capacities for executing projects.

Delays in production, decision-making, or projects inevitably arise when just one resource is missing from the puzzle. Individuals and their knowledge are resources of critical importance for company success and preventing such bottlenecks. While money, information, and materials can be stored and saved for later, poorly- or unutilized time is lost forever. Resource management is gaining importance for so many companies to make sure their time is used to the fullest.

But What Is Resource Management?

Resource management is generally understood to be the component of project management that seeks to deploy the right people to the right projects at the right time. Delivering quality results on time usually requires that employees with project-relevant skills should, with their limited capacity in mind, always be working on the highest-priority projects at any given time.

To do this, the first step is to identify priorities and their necessary deadlines. The exact form these might take vary from company to company or project to project depending on, for example, what contributes most to internal goals or best fulfills clients’ needs.

It doesn’t end there. Once priorities have been established, project managers have to:

• know which employees with which skills are available at any time, in case gaps arise,
• staff projects with specialists according to their priority,
• ensure that gaps are filled or that new priorities are set in case of absences,
• identify recurring bottlenecks and initiate recruitment of new personnel,
• ensure the well-being of employees,
• and exchange insights with project managers, employees, and management to decide on next steps.

By now, you’ve probably realized how intertwined resource and project management are, both with each other and with timely, high-quality delivery. But how critical is this next step, really?

Why Bother with Resource Management?

The positive effects of efficient resource management can be wide-ranging and lead to unexpected benefits elsewhere. Knowing who is doing what when means you can shift employees to projects where their skills and/or capacity are needed once they’re available. If you can (and this can be achieved more easily than you might think) schedule more flexibly, pivot spontaneously when circumstances require, and achieve coordination across teams, tools, and working styles, the sky is the limit.

The advantages of resource management include:

• Assigning colleagues in a way that not only maximizes their skills but fosters their personal development.
• Being unconstrained by other departments when planning .
• Relief for colleagues, increasing their satisfaction and improving morale.
• Transparency for everyone, helping management to make well-informed decisions.
• The ability to retrace your steps and explain your decisions.
• Composure and calm, due to predictable and realistic planning.
• Customer satisfaction, thanks to projects finished on time.
• Additional capacity for the projects you’ve been meaning to get to.
• Decisiveness in all circumstances, thanks to a comprehensive overview and clear head.

It’s plain to see: resource management is worth the effort. Now that we’re on the same page, let’s see what resource management looks like in the real world.

What Does It Mean to Manage Resources?

In “But what is resource management?”, we outlined some of the responsibilities and benefits that come with resource management. Here, we’d like to explore how to incorporate it into one’s medium-, short-, and long-term planning by way of a few examples. The company in our example is pursuing two objectives:

Objective 1: To complete as many projects as possible, with maximum quality, and on time.
Objective 2: To prioritize the well-being of your employees and retain their talent over the long-term.

Effective Medium-Term Planning

Let’s start with the medium-term perspective in resource management. The availability of data for the medium-term and its influence on the upcoming weeks and months likely means it forms the central pillar of your planning.

Get a Lay of the Land

For a realistic plan, it is crucial that you, as resource manager, regularly communicate with all stakeholders. Only by receiving up-to-date information from employees, project management, and company management can you answer questions like:

• Which personnel with which skills are available to me?
• Which projects and day-to-day tasks are they currently working on, and how much capacity will be available taking into account planned vacation or other absences?
• Which projects are scheduled for implementation in the immediate future, and which of these projects have the highest priority?

Smaller companies tend to have an easier time gathering and storing this information centrally in tabular form. As a company grows larger and more complex, though, simple Excel tables can become overly complicated, making other software solutions that centralize and update this information on a daily basis a time-saver of the essence.

A Challenge to Consider:

The following situation may be familiar: some teams are quick to adopt their own project management solutions, working in a highly agile manner, while others are not. These differing approaches to organization mean teams and project leaders plan in different ways, scattered across documents and software. Despite this, management still wants to know what is going on at the press of a button and be able to give their two cents.

Therefore, when getting your feet wet in the world of resource management, choose a solution that accommodates the needs of these teams yet centralizes the needed information right from the beginning. This will simplify your life significantly and facilitate success.

Let’s Get Started

Now that you have an overview of the needs of project management as well as the capacity and skills that are available to you, we can start organizing and planning resources.

Once your projects and priorities have been established, resource planning becomes second nature. After all relevant teams’ projects have been centrally stored and ranked in terms of priority, you simply need to assign resources from top to bottom until capacity has been reached. This process is called allocation.

Tip: Tools are a serious time-saver when it comes to resource capacity planning. With the right tools, you can see the current and future workload of your employees and how new projects or schedule changes might have an effect. In our opinion, a histogram is the easiest way to track resource capacity.

One of the chief benefits of resource planning is the early recognition of what is possible and what is not. After allocation, a histogram like the one above depicts long-term constraints or imminent bottlenecks that you can address right away with project or company management to find a solution. Resource managers and team leaders are thus empowered to actively monitor the workload of their employees while ensuring that sufficient capacity is available for the most important projects.

Short-Term Planning: The Power of Pivoting

No matter how far in advance you plan, something always comes up in day-to-day operations. Whether it be a sudden bottleneck, an employee absence, new management directives, or a new regulatory environment.

The Brunt of It: Managing Bottlenecks

In such cases, it’s the job of resource management to keep things running in the short-term. You have all the cards on the table (or in the tool of your choice) with which you can, just like in the mid-term planning, answer some important questions off the bat:

• Do other employees have available capacity to compensate for the absence/bottleneck/etc.?
• Do some of the less urgent projects need to be postponed?
• Are there employees who are waiting on deliveries from other departments and could be deployed elsewhere in the meantime?

As a resource manager with the right information, you can determine what is feasible and what is not. Though the final decision is usually made in collaboration with project managers, executives, and others, your knowledge is the linchpin holding everything together. Having this info readily available allows you to communicate transparently and (if needed) explain your decisions to the rest of the company.

Long-Term Planning

Long-term planning takes a different focus. The challenges of assigning employees and overcoming bottlenecks remain, but the focus lies now in gleaning insights from these repeated occurrences in short- and mid-term planning phases and taking strategic measures to reduce their frequency in the future.

To this end, key performance indicators (KPIs) such as resource utilization, resource availability, employee satisfaction, customer satisfaction, project completion times, and so on are typically monitored. These can then be displayed in a BI tool to help make decisions, like:

• KPIs point to capacity issues, so your company focuses on recruiting key resources that have caused bottlenecks in the past.
• KPIs point to an unmanageable volume of projects with the current resources, resulting in a reduction in the scope of project portfolios.
• KPIs indicate that a handful of teams have persistent, untapped capacity that can be utilized in the future to relieve bottlenecks or to help chip away on the next innovation project.

How are things on your end? Could you answer our example questions for mid-term, short-term, and long-term planning? Or did you relate to some of the problem areas while reading? Could your company also benefit from resource management?

How Do Other Companies Manage Their Resources?

Like we said: You are not alone. Resource management is not exactly a walk in the park, but most find a way to make it work. The company below has graciously given insight into their resource management processes after working with us at Meisterplan to optimize them. “Learning by doing” is good, but learning from others can help save time.

Learn how Hays allocates over 300 resources to all sorts of IT projects without sacrificing flexibility or timeliness.

Download the case study

What’s the Best Way to Get Started?

Resources, resource management, its benefits and various measures—it’s a lot to digest, and it can be hard to know how to get started. There are numerous ways to test the waters of resource management when starting out, so we won’t provide you with a step-by-step guide. Still, we can offer you some tips that have helped us in the past to help you through the early phases:

1. Get your colleagues on board: Present them with some of your ideas for implementing resource management and try to generate interest within the company. Resource management is all about teamwork after all!
2. Find a good tool: resist the urge to start too hastily with spreadsheets. Instead, choose a software solution that can accommodate the needs of your company from the beginning. This could be a more “static” software that has preset, role-based views depending on whether the user is a project or portfolio manager, or a more flexible package that accommodates agile, shifting teams.
3. Start small: begin by testing new tools and processes in just one department. This will make your efforts more manageable and give you time to experiment. If you are successful just once, others will naturally want to try it themselves.

We wish you all the best on your resource management journey. Let us know about your experience with resource management or what aspects of project portfolio management you have struggled with recently—we’re always happy to discuss!