How to do resource management – the essential guide

How to do resource management

Resource management offers a multitude of benefits that pave the way for project success. By optimizing resource allocation and utilization, it enhances productivity, reduces costs and ensures timely project delivery. 

But how do you kickstart building a rock-solid resource management process? It’s no secret that resource management can sometimes feel overwhelming and people can struggle getting started building a resource management process.

We hear you and we have this covered. Read on to discover the pieces of the jigsaw you need to assemble to get started with effective resource management.

And the truth is, it is not as hard as you think.

Table of contents

Overview of the resource management process

The resource management process consists of five main components.

  • Capacity planning: which involves resource forecasting to assess if your organization has the necessary level of people and skills on board.
  • Resource planning: also known as resource allocation, where resources are strategically assigned to specific projects and timelines.
  • Resource scheduling: a detailed activity that plans resources onto activities and tasks.
  • Utilization tracking: a crucial tool for identifying underutilized or overutilized resources and achieving a balanced workload.
  • Reporting: valuable data and insights into resource utilization, workload and capacity, empowering better-informed decisions.

Keep reading to discover the step-by-step breakdown of each component, presented in simple actionable steps. These guidelines will answer all your questions about how to get started with resource management and show you the steps to build a resource management workflow that leads to success.

resource management process overview

Resource supply - get to know your resources

The first step in building a resource management process is to understand the resources you have available and their skills. This is called your resource pool.

For each resource in the pool, you need to calculate how much labor time they provide you. This is sometimes called resource supply or resource capacity.

The overall labor capacity of your resource pool is the number of people you have multiplied by the amount of labor time they provide. This is normally expressed in terms of FTE (full time equivalent) but you can also record it in days. Confused about FTE? Check out our handy guide to what is an FTE and how to calculate it.

Getting this step right is absolutely crucial because most organizations overstate the resource capacity they have available for work.

Once you have figured out the capacity of your resources, summarize this by role or team. Roles are the skills each person provides your organization for example project manager, engineer etc.

Here is how the resource pool looks in Kelloo.

Resource pool

Resource demand - calculate the resource requirements of your projects

Now it’s time to determine the types of resources required for your projects and when they are needed. This is referred to as resource demand.

Start by compiling a list of all the work you are being asked to do. This could be projects, programs or even business as usual activities. 

Then record the type of resource needed and how much time is required for the work. You can record this in either days or FTE.

Try to avoid listing specific resources against your projects at this stage. You are just trying to work out if you have enough resources in total, so trying to match actual resources to projects is too much detail at this stage.

It is more flexible to just record the type of resource needed. As you can see below, in Kelloo you just need to enter the project, role and work estimate to record the demand. Figuring out which resource actually gets allocated to the project comes as part of resource planning.

resource management estimate

Kelloo's resource management tools

Resource planning, forecasting and reporting in one place. We help you get the most from your projects and people.

Capacity planning and forecasting

Moving on to the next step, it’s time to assess whether you have adequate resources with the required skills to successfully complete your projects.

Chances are, you won’t have enough resources to handle all the projects you want to do and that’s where capacity planning becomes invaluable. Capacity planning allows you to plan effectively and prioritize projects based on available resources.

Capacity planning and forecasting help you answer high level resource management questions such as:

  • Do we have enough resources with the right skills?
  • Can we adjust the timing of projects to solve resource constraints?
  • How many projects can we do and when can we fit them in?
  • Do we have enough resources available to approve new projects?

Focus on the capacity of roles and teams

When capacity planning, you are not concerned with individual resources. You are comparing the labor demand vs. the labor capacity of roles and teams.

Capacity planning is about understanding your organization’s overall capacity to take on work, if you have any resource shortfalls and if you have the limit the number of projects you are doing.

Capacity planning helps you make tough decisions

Capacity planning identifies gaps between your resource capability and your demands. This is important so that you can demonstrate to your leadership team the number projects you can take on given the resources you have.

If you have a shortfall of resources, capacity planning helps you understand how to resolve problems:

  • Should you hire more resources?
  • If so what type of resource and when?
  • Can you re-deploy resources from lower priority work to higher priority work?
  • Would it help to delay working on some projects?

Here is an example of capacity reporting Kelloo showing periods when resource demands exceed resource capacity.


The importance of prioritization when capacity planning

To perform effective capacity planning, first prioritize your projects and work. You will always be asked to do more work than you have the capacity to do. So prioritization allows you to ensure your resources working on the right projects.

The output of the capacity planning process should be an agreed list of the projects you are going to do and approximate dates when you think you can fit them in.

Resource planning - allocate resources to projects

Moving on to the next step in the resource management process, we arrive at project resource planning, a crucial phase where individual resources are assigned to specific projects. This process is also referred to as resource allocation.

Using the list of projects from the capacity planning step, you can now strategically focus your resources on the most critical and essential projects. As you assign people to projects and adjust timings you need to monitor resource utilization to ensure no teams or people are overloaded.

To complete this step you need a place where all managers can centrally view resource availability and allocate resources. Some organizations try to use a spreadsheet for resource planning but quickly hit problems.

The best tools for resource management are visual and provide:

  • A view of available resources and over-allocated resources. A heatmap format is normally the easiest to use.
  • A view of current schedules and who is allocated to what and when. Ideally with simple drag and drop scheduling.
  • The ability to see the impact of changes as you make them.

Here is the resource planner in Kelloo. As schedules are adjusted in the top, the resource heatmap at the bottom shows the current availability of resources.


Often resources will be allocated to more than one project at the same time. This poses a particular challenge when resource planning as a change to one project can have a ripple effect across other projects. Here are some hints and tips to help you resource plan effectively in a multi project environment. And if you run an agile process, our guide to agile resource planning explores how resource planning and agile work together.

The relationship between capacity planning and resource planning

Whereas capacity planning is a strategic high level technique used to help you work out what projects you can do and the resources you need, resource planning is used to work out who will be working on which projects. Confused? then take a look at our article difference between resource planning and capacity planning.

Capacity planning operates at the role or team level and compares the supply of resource to the resource requirements of your different projects.

Whereas resource planning is the process of working out which resources will be allocated to projects and when.

Scenario planning

There will always be different options in terms of what projects to run, the timing of the projects and the appropriate level of resources. You need to weigh up the pros and cons of each and see which works out best for your organization. This is called scenario planning or what-if analysis.

Scenario planning also lets you model the likely impact of changes. This can include answering questions such as:

  • If we approve a new project, how many more resources will we need?
  • Will delaying a low-priority project free up resources to take on a new project?
  • How many more resources do we need to hire?

Take a look at this article if you want to take a deeper dive into scenario planning projects.

select a scenario for what if scenario analysis

Track and manage resource utilization

Resource management is an ongoing process and you need to keep a constant eye on resource utilization. Projects slip and things change so the resource plan needs to be kept current with up to date resource estimates. Inevitably resource utilization issues will happen.

It is essential that you can view your resource plan both in terms of skill, team and individual resource utilization. This helps you spot opportunities for re-allocating work to different resources with the same skill.

A visual representation of utilization levels is the easiest way to identify and resolve resource utilization issues. 

Utilization heatmap

Resource management reporting

Resource management reporting offers critical insights into metrics and kpi’s such as resource utilization, workload, capacity and skills gaps. By analyzing the data provided in these reports, you can make informed decisions, optimize resource allocation and identify areas of improvement.

It enables data-driven decision-making, ensuring that resources are efficiently utilized, projects stay on track and objectives are met. Moreover, reporting enhances transparency and accountability, fostering a culture of continuous improvement and empowering organizations to achieve their goals effectively.

Resource management reporting presents a unique challenge as data is frequently scattered across spreadsheets, making the process of generating comprehensive reports laborious and complex. The answer to this is to use a resource management platform that includes a reporting and analysis tools.


Our latest articles and tips straight to your inbox

If you liked it then share it

Other things you may like

What if scenario analysis

What if scenario analysis in project management

The new what if planning features in Kelloo give you a crystal ball at your fingertips so you can see the future. What if planning shows what will happen if you change project timings, delay projects, hire or fire resources or cancel or commit to new projects.