What are the most common challenges you’re hearing about resource capacity planning?
There are many challenges being experienced by organizations around resource capacity planning. Perhaps most significantly is the difficulty in forecasting resource demand more than one or two quarters out. With the pace of change of business today, and the historic lack of strategic resource management approaches, organizations find themselves unable to confidently predict how many people they will need and when they will be needed.
This problem is exacerbated by the lack of planning around operational resource impacts of projects – the change to resource demand that comes about as a result of the solutions delivered by the organizational projects. That affects both immediate resource capacity needs when the solution launches, and longer-term evolutions in the number of people and skills needed to perform various organizational functions.
Next is the reluctance of organizations to acknowledge that 100% allocation isn’t feasible for resources. Time will be consumed by non-work activities, and by general work items not directly aligned with an assignment. And there needs to be resource flexibility to support the ability to adapt and adjust when circumstances change. This can drop availability down to 60% or less, driving up the need for more capacity – and it’s frequently ignored.
What is the next big thing that resource capacity planning will offer organizations?
Flexibility. The way work gets done is changing, and that means that resourcing models are changing. There will be a reduction in stable employment bases and an increase in the use of contract resourcing. There will also be a greater willingness to embrace alternative contracting models – things like piecemeal work or micro-engagements.
To be able to leverage these models effectively, organizations need to understand what their resourcing needs are going to be, when they will occur, and how long they will last for. That’s what a more strategic view of resource capacity planning provides. It also provides that perspective further into the future, allowing time for organizations to find, onboard and prepare those resources that are core to success and need to be part of a permanent employee model going forward.
How would you recommend getting started with resource capacity planning?
It starts simply by understanding the resources that need to be planned for. Recognizing that resource capacity planning is not just about project resources, but also impacts operational and support staffing needs is essential if all the variables are going to be managed correctly.
It requires an accurate baseline of current resourcing levels – how much work can be delivered given the need to retain capacity for adjustments where needed, to avoid over allocating staff, etc. And it requires an appreciation for the amount of lead time necessary for critical roles – software developers may be able to be secured within 24 hours, specialist functions may take months.
Then it requires the engagement of all stakeholders – resource owners and project delivery teams / PMOs, but also HR, learning and development and procurement – the functions that help secure and prepare resources. Finally, it requires accurate resource planning further out so that resource needs are understood, at least at a high level, beyond the current quarter.
What does it look like for organizations that are seeing success with resource capacity planning?
It’s obvious that they’re good at resource capacity planning because the evidence is everywhere. Most importantly, resources are more engaged, motivated and productive because they are operating in an environment where they have reasonable expectations on them and where there aren’t excessive peaks or troughs in their workloads.
Project managers and stakeholders are more content because their initiatives are able to start when planned because resources are available and there aren’t any holdups while people finish up other work. And downstream stakeholders like internal customer groups are more effective and efficient because they are better prepared for the resourcing impacts of the solutions they are receiving.
Executives see a greater return on investments both because their resources – the biggest investment, are more productive, and because the initiatives that are being delivered are more successful because they aren’t subjected to direct resourcing issues or indirect motivational issues caused by those resourcing challenges.
What tools/processes can organizations implement to solve for resource capacity planning?
Resource and capacity planning really needs to be underpinned by a framework that focuses on the value outcomes you need. Ensuring you are capturing data in a consistent, clear way will allow you to build the desired picture. KeyedIn allows you that insight on who is currently doing what and where... and then layers in the what's coming next. Consistent data capture, via forecasting, allows you to identify pinch points, gaps and key demand to be able to act upon. This also feeds into prioritization and planning so you can easily pivot as strategic decisions are confirmed. The key is gaining that transparency that is desired, at the level you need to drill into.
How does the right approach to resource capacity planning impact the business?
It improves performance – simple as that. When the right number of people are in place at any given time work flows more smoothly. There are fewer delays which means faster time to value and greater overall ROI. When there are too many resources costs go up and productivity goes down because of frustrated resources. When there are too few resources that same productivity issue occurs, this time due to overwork, and the ability to deliver is reduced because there is too much work and too few people.
When organizations get it right, performance is optimized and it becomes easier to maintain the model. There’s more confidence in estimates, a better ability to predict resource need changes and, with more engaged staff, lower turnover – reducing the need for hiring, onboarding, etc.
How does KeyedIn solve for resource capacity planning?
KeyedIn helps organizations solve for resource capacity planning by providing real-time visibility into the capacity (both overall and productive), demand and supply of all resources in the system, with the ability to filter by a large number of factors and to act on the data from a single screen.
What is the role of the PMO in resource capacity planning improvement?
PMOs have a broader perspective of project work than most other stakeholders. As such they can identify resourcing trends better than most other functions. They are often the first groups to see that a particular job function is being allocated more often, or that a role is not needed as much.
This allows them to inform the organization on the need to retrain or reallocate existing resources and to change hiring and procurement practices to better align with emerging needs. PMOs, especially strategic PMOs that concentrate on portfolio management, are also able to monitor actual resource utilization and compare it with forecast and capacity. It’s not unusual for estimated resource requirements for new or specialist functions to be inaccurate by a greater degree than more common or familiar roles. PMOs can help improve the quality of forecasts by monitoring and communicating actual performance data.
How to get internal buy-in for proper resource capacity planning?
I’ve never found it difficult to get buy in for investments in improved resource capacity planning – it just needs executives to understand the cost of not being good at it! As soon as decision makers appreciate the connection between ineffective resource planning and delayed product launches, bad product defects, reduced profit margins, etc. the willingness to commit comes quickly.
The bigger challenge is convincing those executives to embrace emerging resourcing approaches – like piecemeal work; to outsource critical project elements to external specialists; and to spend enough money to make a difference. It’s therefore critical to ensure that success criteria are defined and measured for any changes in how resource capacity is planned for , and that those metrics are freely available to all stakeholders.