As planners its a daily fact of life. You will always find yourself in a situation where the demand for projects exceeds the resources available.
So, what’s the secret sauce to conquer this challenge? The answer is resource capacity planning. Resource capacity planning is all about optimizing your resources, focusing on the right projects and making those critical decisions like a seasoned pro.
Now, I know what you’re thinking – where do you start? Don’t worry, I’ve got you covered. In this article, we’re focusing on a range of easy-to-implement resource capacity planning best practices and techniques with a proven track record of success. You’ll be the master of resource capacity planning in no time.
And we’re not stopping there. We’ll also explore how capacity planning software can be your trusty partner, making your resource management journey smoother than ever.
So, if you’re ready to up your game and take charge of your resource capacity planning this is where it all begins. Read on to explore our easy to implement resource capacity planning best practices and tips.
Table of contents
Record all of your work and overheads
A common mistake organizations make is to fail to account for all of their work and overheads.
It is essential that your resource plans include all the work your resources are expected to work on. This means both currently approved and in-flight work and work in your pipeline.
Don’t get too detailed
The purpose of a capacity plan is to give the organization a heads-up about its capability to deliver on existing work and take on new work.
It is not concerned with which individual resource is working on what project or task on which day.
And this is a common mistake.
For most organizations, the capacity plan should be working at the resource role (skill) level and for each project record the resource roles needed by month.
Account for holidays, vacations and absence
When calculating the capacity of your resources don’t forget about absence time.
As it is impossible to predict months in advance what absence people will have, the easiest way to model this is using trends.
Data driven decisions
Base your resource capacity planning decisions on up-to-date information and insights. While resource capacity planning spreadsheets may seem a great option, the fact is they are often out of date and problematic.
Consider using resource capacity planning tools that provide visual insight into metrics and data using tools like capacity charts and heatmaps to help you track availability and utilization levels.
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Understand your resource costs
In some organizations, there may be multiple resources with the same role and capabilities, but what sets them apart is their cost to the organization.
To make informed decisions, it’s essential to have a clear visualization of your resource plan in terms of monetary values. This way, you can better understand and compare different options based on their financial implications.
Prioritize your projects
Wherever possible, resources should always be allocated to mandatory (i.e. regulatory / compliance) projects first.
Then in turn to the highest priority projects in the portfolio (continuing until you run out of projects or resources).
So it is essential that a project prioritization technique is used alongside capacity planning.
Use what if scenario planning
There will never be one solution to your capacity planning puzzle, instead, there will be different options and tradeoffs.
To help you make sense of this use what if scenario planning and analysis to compare how different resource levels, allocation plans and project timings stack up.
Incorporate capacity planning into the portfolio management process
Even if your organization doesn’t have a full-fledged portfolio management process, don’t worry! You can still make a big difference by adopting some basic principles.
Simple things like having a project approval process, using basic prioritization criteria, and regularly monitoring the portfolio’s health can go a long way in improving project management.
Capacity planning timeframe
Setting a realistic time frame for resource capacity planning is crucial. The work environment in most organizations is ever-changing and unpredictable, making long-term forecasting impossible. So, we need a balanced approach – a planning time frame that offers enough detail without being too time-consuming or expensive.
A recommended approach is to focus your capacity planning on the next 3-12 month period. By striking this balance, organizations can stay agile and adaptive while effectively managing their resources within a practical planning horizon. It’s all about finding that sweet spot to plan smartly and stay ahead of the game
Let resource capacity planning software do the heavy lifting
Resource capacity planning software is designed to help organizations effectively manage and optimize their resources across multiple projects. It provides a platform to plan, track, and allocate resources efficiently, ensuring that projects are adequately staffed and resource demands are met without overloading the workforce.
Key features of resource capacity planning software include:
- Workload visualization: A visual representation of resource availability, allocation, and capacity. This allows project managers to quickly assess the resource situation and identify potential bottlenecks or gaps.
- Resource forecasting: Resource forecasting capabilities to predict future resource demands based on historical data and project trends.
- Resource load balancing: Features to help in balancing workloads across team members, avoiding resource overloads and optimizing resource utilization.
- Scenario planning: Resource capacity planning software often includes what-if scenario analysis, allowing project managers to simulate different resource allocation scenarios and understand their impact on project timelines and outcomes.
While creating a resource planning spreadsheet may seem simple, the drawbacks can outweigh the benefits.
- Resource planning requires collaboration and sharing of reports and analysis, which spreadsheets may not handle well.
- In larger organizations, multiple people manage resource planning, leading to separate spreadsheets for each team or location, creating information silos.
- Additionally, using spreadsheets means repeating formulas for each project and resource type, which can be time-consuming and prone to errors.
It is too easy to make mistakes that are impossible to spot. It is far easier, safer and more cost-effective to use a dedicated resource capacity planning software solution.
