Looking to get more value out of your resources and drive greater success for your business? Aim at effective resource management.
Effective resource management is critical for any professional services business that wants to achieve long-term success. By carefully managing and allocating its resources, a business can reduce costs, increase efficiency, improve the quality of its products or services, and become more agile and competitive.
In this article, we will delve into the key principles of effective resource management and explore some practical strategies that businesses can use to manage their resources more effectively. For this article, we have also spoken to Christine Robinson, a former Director of Resource Management now turned consultant. Continue reading her experts advice below.
Effective resource management, simply put, is all about positioning people to meet leadership goals and deliver the best ROI outcomes for the business. After all, your resources are the ultimate generator of income for the company, but they can also be the biggest expense, especially if you don't manage them right. Approaching your resources intelligently is, therefore, about striking the optimal balance between what resources cost and how much revenue they generate.
It's like playing chess, in a way. An effective resource manager will have taken into account all possible ramifications of any given move before making it, so that they can make smart decisions off the bat and avoid headaches later on.
Effective resource management can help a business achieve a number of goals, including:
Overall, resource management can help a business improve its bottom line and become more successful in the long term.
Whether with one employee or a hundred, an effective resource manager will make sure that no resource is wasted and every aspect of their operation can be maximized.
According to a recent report by Professional Services Maturity Benchmark, the bigger the firm, the more they focus on effective resource management to increase their billable utilization and make sure employees don't waste time working on non-billable tasks.
Before we jump to the elements that can make or break effective resource management, there's one important industry-agnostic best practice to remember. According to Christine Robinson, a former Director of Resource Management now turned consultant, successful resource management starts with meeting leadership goals.
If you get down to the core, successful resource management is not about resource management - it is about the organization and getting the organization positioned and strengthened to meet leadership's vision. So the very first thing that resource managers should be asking themselves in those moments is, what is the most important initiative right now from a leadership perspective? Maybe it's retention of talent, maybe it's productivity. Maybe it's retention of clients?
There's so many different factors that are influenced externally that the resource managers cannot control. So stop trying to control something that you can't control, right? Think about what is important to the organization. And don't just guess - ask leadership, show them that you are genuinely interested in and want to have an understanding of what is important to them.
And then, draw a clear line between what they're trying to achieve and how resource management will help them to achieve it. Because I promise you, there is a correlation, you just need to articulate it. If you don't articulate it, they're not going to do it for you.
So perhaps they tell you that retention of talent is the most important goal right now. What parts of the resource management process are you going to double down on to ensure that top talent can be retained? Maybe that's by assigning them to projects that are in line with their career aspirations? Or if the most important goal is productivity, great. How are your current methods working right now in terms of being able to predict the future, so to speak, in terms of pipeline and utilization and productivity? If they're not good, lay out a plan for how you're going to improve them paints a picture for leadership of what this could look like.
There are a lot of resource management principles that can help you improve the way you handle resources. When considering how to manage resources in the most effective way, it's easy to get bogged down in details and lose sight of the big picture. But in order to keep things as simple and as organized as possible, try to keep these key elements in mind, as they make the building blocks of good resource management.
Making sure you have a value proposition for resource management to secure leadership buy-in is extremely important. In our recent webinar Resourcing for Success, Christine made a great point:
In terms of securing leadership buy-in, I would say that the first step would be to establish trust and really work on cultivating the relationship. But that only takes you so far, right? You need to be able to articulate the value proposition of what resource management is. It's not staffing, it's not scheduling, quite frankly; those are the least strategic parts. They are pieces of the components that make up what resource management is. But really, it's that strategic opportunity to understand how the organization plans to evolve and what your organizational goals are.
Related: The Four Currencies of Resource Management
To successfully manage resources, you need to make sure that there's always a clear understanding of what comes first and what comes second. In project resource management, you need to set clear priorities on what projects are more important or have shorter deadlines, what resources are in high demand, what experts need to be hired, etc.
Having a plan B, which largely relies on prioritization, is the best way you can avoid scope creep and protect your projects from running over budget or getting finished late.
A research by McKinsey found that companies focusing on and investing in strategic prioritization tend to deliver 40% more value. Knowing where your priorities lie is, therefore, the recipe for effective resource management tactics.
Recommended reading: How to Prioritize Projects (When You’re Understaffed)
It is important that everyone within your organization understands the value of resource management, exactly how resources are limited, and why decisions are made regarding their use. Transparency builds trust and confidence among team members allowing them to work together more efficiently. Christine points out:
I believe that many organizations have missed the boat to effectively communicate the value proposition of resource management. It's great if you have leaders who understand where resource management fits in, but failing to explain to the individuals who will interact with resource managers is a significant oversight. For instance, let's consider the importance of comprehending the complete person and their life circumstances in your organization. If it's vital to support individuals in achieving their developmental goals, it makes sense for resource managers to be informed and engaged.
Also, transparency creates an opportunity for those working with or for your company to provide valuable input about the allocation of resources which will improve the effectiveness of resource use overall.
Resource management tools generally aim to give you more visibility into your resources and take guesswork out of the picture. And above anything else, resource management is a lot easier to do when you use good tools.
It's possible to get by without resource management software, but then you risk forgetting about a project and leaving someone hanging, or you might grow frustrated with how much time it takes to track everything.
Christine Robinson, a Resource Management Leader with years of experience recommends to get a tool.
It's really difficult - and somewhat unreasonable - to expect resource management to flourish when not provided with the right tools in their arsenal. If you want resource management to be truly, truly strategic, your resource managers can't spend all of their time, you know, entering data and doing tasks that are simply administrative when a tool could do it.
You need something that's going to be able to position resource managers to get information efficiently, accurately. Ideally, something that can speak to other systems within your organization, so you're not having to work off of out of date data. Ideally, it’ll be something that captures the information that's important to your business - maybe that's skill sets, maybe that's certifications, maybe that's proficiency level. Certainly, has to cover schedules, and all of the different dynamic pieces that relate to people’s working hours: if you have some people on a flexible work arrangement, or only working 80% of the time, well, you need a system that is going to be able to capture that information for you.
Get a tool that can meet you where you are - not only in terms of the capability that you need from it from an organizational standpoint, but also where your organization is in its maturity path, and in terms of what data is even available in your organization. I've seen leaders and resource managers alike fall in love with the idea of a shiny new tool that is going to solve the world and all the problems.
Now, there are some really nice tools out there that do some pretty cool things. And I am a huge supporter of investing in your own toolbox. But what I would say is a word of caution. You can't just get a tool and you know, kind of go off to the races and expect everything to work. You need continuous iteration. The tool is just a base. You need leadership buy-in, continuous improvement, constant check-ins. You need to understand your people, and understand the direction of the business. That's what's needed to drive a really successful resource management function.
Hint: Why Resource Planning in Excel Isn't Sustainable
Now that you know the key elements that hold the foundation of effective resource management, here are some of the most effective rules resource managers employ.
Resource management success will eventually depend on how well you understand your workforce, their interests, passions, motivations, and career goals.
You should find out what your team members enjoy doing, what kind of projects they are interested in, and their skill levels. By seeing the holistic person, you can match team members with the right projects and tasks and bring the excitement back to their work.
The most integral and basic best practice is having a keen and acute understanding of what the pulse of the organization is, what is driving people right now, what they are looking for, in terms of diversity of experience or the evolution of where they are in their career. Resource management is so much less difficult when you've established that groundwork of genuinely connecting with someone, having their perspective be heard. - Christine Robinson
Rewarding people for a job well done is also important; it lets them know that their efforts are valuable to the project. So don't forget to credit where it's due!
Resource management is not 100% predictable. In fact, it is a dynamic process.
The ability to be comfortable with the unknown is paramount for a resource manager. If you're the type of individual who really enjoys having a mapped out layout of exactly how your day is going to go, and you become very flustered if one piece is out of place, this is probably not the field for you! Successful Resource Managers need to be able to roll with the punches. It's not to say that we don't get stressed out or challenged. But being able to pivot as the business needs, that's key to success.
This rule has already taken many shapes. But in resource management speak, it means that 80% of resource constraints come from 20% of your overall resource pool. This usually happens because those 20% are in high demand, their skill sets are most relevant to your projects, and their availability can disqualify your resource management process in a matter of a few days.
So how do you work around this?
By accurately pinpointing those 20%, you can identify the most appropriate resources to hire and expand your options there. That way you will ease their workload and avoid many project lifecycle risks.
Resource planning and scheduling can be a tricky job, especially when you're working with a team to get things done. And the bigger the team, the harder the job.
Frequent changes will be made to the schedule, which has an impact on all the stakeholders involved — the people in charge of making sure the schedule is running smoothly, and the people who are waiting for updates to stay on schedule. Unfortunately, the only way to make sure that the schedule runs as smoothly as possible is to just keep updating it until it does.
A good resource management system can really cut down on the need for frequent updates, however. The idea is simple here: you have everything you need whenever you need it.
Too many businesses focus on just filling holes with whoever is around or whatever is at hand— they don’t have time to plan out what resources they need and when they need them, which leaves gaps open. This often leads to overworked teams because people are still being asked for things even when it looks like they can’t get it together.
Having visibility over all the resources at your disposal is a tremendous tool for project and resource management. Using this power properly allows you to see when you might be missing people; For example, if a deadline is looming and you know there’s going to be a crunch time where you don’t have enough engineers or designers available to meet the demand, or if a certain product is lagging behind because there aren’t enough salespeople to reach out and make connections.
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A key element of effective resource management is monitoring resource utilization, which is one of the top resource management KPIs.
What does that mean? Simply put, it’s taking note of how much time and effort your team members are spending on your projects. Whether they are working on billable or non-billable time, and identifying planned vs actual utilization.
Going into a project without knowing your team’s capacity is like trying to drive a car without knowing how many gallons of fuel you have in the gas tank — you might be able to get started, but you won’t know when you run out.
Related: 5 Resource Management Reports for Better Decision-Making
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When it comes to managing projects, there’s no such thing as an “extra” minute. Your team members will always be doing relevant tasks, but not all of those tasks are going to be billable.
Non-billable time is any time spent on project work that does not result in an invoice. Effective resource management requires an understanding of where your resources are spending their time, especially those that aren't being billed.
To optimize resource allocation and utilization, it's important to make sure your people are delivering maximum value through billable work. Don't let them waste time on admin duties or become overworked because of a heavy workload.
Effective resource management needs a bottom-up prioritization plan.
To ensure that tasks are addressed in a timely manner and that you are able to meet deadlines, it's important to prioritize various requests, special needs, organizational goals, and final deliverables.
When you are developing this plan, it's important to think about how much effort any particular request or task will take and whether it is urgent or important enough to be addressed immediately.
Many people think that a certain project will take only a few minutes to complete, but these requests end up eating into your schedule and becoming obstacles for effective resource management. By prioritizing your tasks and scheduling in an organized manner, you can allocate resources more effectively.
When it comes to resource management, it’s key to have an accurate and reliable resource forecast available. Otherwise, you might find yourself in a position where your resources aren’t being used as effectively as they could be. For example, if one of your employees is in high demand, but this isn’t reflected in their diary, you might find that you're using them less than efficiently.
According to Christine,
You never want to be in a situation where there's an iceberg in the distance and you didn't see it coming. So again, certain things are unavoidable. But if you have information, even if it's the most basic information around, say, scheduling, as far as you know, into the future, maybe it's three months, maybe it's three weeks, having that insight and making decisions based on that information is going to help not only the organization be successful, but I firmly believe that it really does help the team member experience to be a lot more robust and successful. You begin to position yourself to have the ability to have real meaningful conversations with people around: 'Look, here's what the next three months are going to look like. You've got an opening in your schedule, which essentially is an opening in your career path, what do you want to do? Express your aspiration so that we can help align you appropriately.'
It's also important to remember that all people are not created equal. There may be certain people whose skills and talents are so valuable that you need to go out of your way to ensure that they're properly utilized.
Resource management is essential for survival.
In fact, the success of your organization depends on it. We are surrounded by a world full of resources that we need to manage effectively in order to survive. When we look at the business environment, resources are the lifeblood of organizations and if you don’t have enough or control them effectively you won’t succeed.
It's important to learn effective resource management because the resources are often limited, and what you do with them matters.
Ready to see what you could do to lead the game? Book a demo with Runn today!
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