A Comprehensive Guide to Resource Management
Brought to you by Polaris, the world’s first self-driving Professional Services Automation.
What is Resource Management?
‘To win the marketplace, first you must win the workplace’– Douglas Conant
When you start a business, you try everything to make it successful – hire, invest, and bring in the right people, technology, products, and many other resources necessary to run the business. But this still does not assure you of growth and continuous success. But even after putting in all these efforts, you may not witness steady growth or continued success.
You cannot expect to gain that until you don’t figure out ways to get maximum output from all of your resources, and this is where resource management comes into the picture.
In layman’s terms, managing any resource – from employees, projects, products, processes, technology to machines through proper planning, acquiring, and allocating is called resource management. It aims to utilize a resource efficiently and maximize efficiency as nobody likes to waste, notably in business.
Why is Resource Management important?
In recent years, resource management has become an essential part of any business’ profitability, sustainability, growth, and success as it:
- provides you with a bird’s eye view
- maximizes resources utilization and efficiency
- prevents mishaps by adequately planning and giving more transparency
- helps you find out problems before they start
- gives you complete control
Resource management is not only vital to establish and enhance the project opportunities, but it is also essential to achieve efficiency in every area. How correctly you place your resources can impact the timeline and profitability of the project significantly.
Without proper project resource management, you are considerably less likely to meet timelines and definitely not in as economical a manner as you would prefer. To do it well, you will need complete visibility into your resources—people, products, and the budget to put it all together—which you can only obtain from resource management.
Techniques of Resource Management
Resource management is essential for filling in the gaps between where you are now and where you want to go. By creating a roadmap for the project, project managers find that projects flow much more smoothly. Here are some techniques involved in resource management:
Resource allocation: This involves identifying and allocating resources to a project based on their skills and capacity. If you can get the most from your available pool of resources in the best and most efficient way, you can avoid schedule delays and stay within your budget. Resource allocation reports help managers get a clear view into resource status, bringing more transparency and efficiency in the hands.
Resource leveling: This technique helps discover the underused or inefficiently used resources in the company and utilize them in other projects. An example of resource leveling is a frontend developer who has experience in UI design as well. With the correct resource distribution, the UI design team can leverage his/her skills to fulfill any Adhoc design requests without spending time and resources in hiring someone new.
Resource forecasting: To forecast future resource requirements before a project begins and distribute people, materials, and budget accordingly, managers need to be familiar with the project goals and lifecycle. Resource management software provides this level of visibility and easy access to your projects and resources all in one place. It will help you forecast the project’s scope, resource availability, possible challenges/constraints, unexpected costs, and potential threats.
Resource Management Tools and Software
The limitations of spreadsheets and on-premise solutions are known – the management of resources is an ad-hoc work. Resources being the major cost in any business, managing them more effectively will directly affect profit margins. The advent of professional services resource management tools like PSA is changing the strategies companies use to allocate resources positively.
Polaris is such a system designed to support proactive and adequate resourcing within any type/size of business. Here is how Polaris is different from others and what it has to offer:
Resource Pool: View global resources, use the graphical calendar to determine their current and future allocation levels, and quickly identify underutilized or over-utilized resources. Get reports on utilization by various dimensions with dynamic charts and graphs, time off, holiday calendars, and schedules to determine resource availability.
Intelligent allocation with SmartMatch: Get intelligent resource recommendations with SmartMatch capability. Managers can create requests, mention benchmarks while requesting resource availability, skills, location, etc.
Capacity Planning: Generate resource forecast reports and get complete visibility into the future availability of resources, which can be assigned to pending projects to efficiently manage resource requirements and enable swift hiring/training if required.
Skills & Certification Management: Easily track and manage skill, expertise, and certification updates with attestation. Create a reference inventory of skills needed by each resource and analyze resource availability by skillset to proactively hire/upskill resources and meet future requirements.
Project Resource Management: Manage projects in real-time with SmartBeats. Get instant reports from project users about completed and remaining work, Estimate at Completion (EAC), and completion dates.
Managers can also approve/edit user beats and give feedback. Project Pulse helps managers evaluate problems based on user and task beats and take the required actions to ensure successful project delivery.
Advanced Analytics: MissionControl provides real-time visibility into all business metrics, viz, profits, margins, revenues, and more. Tailored views and custom reports cater to every role within a project-based organization, including project managers, resource managers, finance teams, practice managers, client managers, and more.
You can also view overall metrics using dynamic summary charts and dashboards and drill down data at a more granular level to analyze the underlying project, resource, and costs. Additionally, advanced API for BI and prebuilt PowerBI, Tableau, Google BigQuery connectors help fulfill different analytics needs.
Business Governance: Define projects with configurable stages to ensure business process adherence and standardize projects, resources, billing, revenue, etc., across your organization. Manage complete resource lifecycle from predicting resource requirements to managing allocations and utilization.
Also, model billing and revenue plans per your business need to enhance collaboration between project and finance/billing teams and get everyone on the same page. Oversee documentation requirements in projects, expenses, and timesheets to capture details required as part of the process.
Financial Modeling for Better Budgets and Bids: With SmartBudget, ensure that your proposals and bids are accurate from the beginning and meet all business metrics. Factor incomplete resource time, costs, and overheads while creating rate cards to maximize margins and profitability.
Predict business metrics based on rates under consideration to make better decisions about projects. Calculate margins and profits based on a 360° view of your business.
Managing Your Clients: Manage customers, vendors, fund sources, service partners, or internal departments using the client entity and leverage actionable insights with a consolidated view of all client-specific projects and engagements. Access real-time metrics like costs, billing, profitability, and more to better assess your client relationships.
Bring transparency into project delivery by providing visibility into what work is being done through configurable reports and views and streamline costing, billing, and consolidation processes for clients.
Project Time & Cost: Track project time, expense statistics, billable and non-billable hours anytime, anywhere. Get real-time notifications and access to consolidate time and expense details to understand the actual costs for making informed billing decisions.
Right Project Financials: Versatile bill plan modeling to adjust various client/project billing needs – fixed-bid, time and materials, flat, or any combination. You can track financial health, understand WIP and enhance visibility into cashflows. All of your client billing needs are taken care of by a configurable invoicing engine with multiple templates.
Seamless Integrations: Easily integrate Polaris with any CRM, ERP, PM, HRMS system that your company uses. You can also implement, deploy, and upgrade with turnkey and seamless cloud-based integrations.
Benefits of Resource Management
Project resource management involves knowing the availability and allocation of your resources and how productive they can be. With the right resource management strategy, you can not only improve company performance but also gain:
- Improved utilization: Maximizing productivity while making sure that the resources are not overworked is very important for the right balance. Insights on resource availability enable you to use the resources to their maximum potential, keep projects on time and within the estimated budget, and gain benefits by utilizing resources on a substantial project. A good project resource management solution can predict current resource utilization and improve it by taking corrective actions. You will also gain real-time information to enhance profit by planning the utilization of other (non-human) resources.
- On-Time delivery: Effective management of resources will help you deliver projects and services on time as you will have real-time insights into resource availability as well as project timelines. Data visibility across different levels allows managers to improve time projections and strategically plan resources for successful delivery.
- Cost optimization: Allocating the right resource at the right place enables you to complete projects on or before time and within budget. A proper resource management plan can reduce oversights, prevent double-bookings and avoid last-minute hiring costs. To this effect, project resource management helps managers forecast resource utilization in advance. Additional resources can be mobilized from non-billable to billable if a project is likely to go off the rails.
- Improved profitability: Attributing costs to actual projects is one of the biggest challenges to derive profitability. While the organization must strive to get the best out of its resources, overburdening employees to achieve poor planning goals is not the characteristic of successful management. Resource management streamlines this process using better forecasts and resource tracking, predicting accurate project estimates and profit margins.
- Better decision-making capability: In a growing company, the workload can often exceed the resources available. In such scenarios, hiring new resources or shuffling existing ones needs to be finalized after looking at the current resource pool and the future project requirements. The company may also decide to hire contingent workers or freelancers to handle any additional workload if the resources are required for a limited time. All these decisions can be taken much more smoothly by setting correct expectations and improving communication and visibility through proper resource management practices.
Challenges of Effective Resource Management
- Rise in project costs: Inefficient/poor/Incorrect allocation or double booking of resources will cause a rise in project budget as the resources will not be leveraged effectively.
- Degrading employee performance: Overburdening or bookings without considering employee skills can contribute to dissatisfied employees, which will, in turn, convert into productivity loss. It will badly affect the quality of the project and may lower down employee confidence. This can also lead to employee burnout. These circumstances can force your resource pool to look for outside opportunities.
- Delays in project delivery: Without the correct visibility of resources and their skill set, they may get assigned to projects that do not match their skill. This can result in project delivery delays as most of the time will be spent on learning before becoming productive. It will also knock up project costs.
- Dissatisfied Client/loss of business: Poor resource management will cause heavy workload and pressure thus increasing the chance of errors. Delayed delivery, poor quality, and high budget will not only jeopardize the project but will also impact the relationship with the client which may eventually cause business loss.
Therefore, decision-makers must have in place an efficient resource management process to avoid facing these challenges.
The decision is yours to make
It is now crystal clear that resource management is essential for the success of any business. We, at Polaris, understand that every organization is different as it operates differently. Therefore the requirement is tailored resource management that suits your needs.
Want to know more? Get in touch with our experts, who will help you formulate the right resource management for your business.
Maximize Resource Utilization!
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See how Readiness IT simplified resource planning and improved staffing across the business with Polaris PSA.