Capacity planning and resource planning are not the same thing. The terms are often used interchangeably but they are different processes with different outcomes. Continue reading this article to understand the differences between capacity planning and resource planning.
First let’s clarify what we mean by resources. In the context of this article we are primarily talking about human resources and not things like machines, rooms, equipment etc.
What is capacity planning?
Alternative names for this include resource forecasting and demand planning. Capacity planning determines if your organization has sufficient resources with the right skills to execute the projects you want to do.
It compares the demands made on your resources (the work required on the projects) to the supply of your resources (how many resources you have). Capacity planning does not concern itself with individual resources – it looks at the availability of resources at the skill set / team level.
The output of the capacity planning process will be decisions to hire more resource, defer projects, approve projects or cancel projects. The aim being to balance the resource supply with the resource demand and ensure you have sufficient resources for the projects you wish to work on (both current and work seeking approval).
What is resource planning?
Resource planning is the process of coordinating and allocating actual resources to projects so the project managers know who they are working with.
An alternative name for this is resource allocation. So for each approved project, resources will be allocated to the project based on the skills and resource requirements of the project.
The output of this process should be named resources allocated to projects with minimal over or under utilization of the resources. The resource plan informs the project managers which resources they can plan onto their projects and when.
Resource planning is normally an activity between the line managers / resource owners and the project managers.
Capacity planning vs. resource planning comparison
Planning time-frame and level of detail
Resource capacity planning is a high level longer range view of your resources. A typical capacity plan will cover the period from around 3 to 6 months to 12 months from current date.
Things that will influence the duration of the capacity plans will be your budget periods, hiring time-frames etc.
Resource planning is a detailed view of your resources. It will typically cover the period from current date to around 3 to 6 months out.
The resource planning duration will be closely linked to how far in advance your project managers need to understand which resources are working on their projects to allow them to plan effectively.
However these duration’s are not set in stone and will vary from organization to organization. It is also quite common for the capacity planning and resource planning periods to overlap.Using Kelloo for resource planning and capacity planning
What projects are being worked on and which are the priority projects.
Who is allocated to what projects in the near term and when.
For current projects and prospective projects is there sufficient resource.
If there are any skills gaps and hiring needs.
If any resources have slack time.
Overworked groups of resources allowing work to be moved to other resources.