The Future of Resource Management: Predictability, Possibility & Permeability

‍We spoke to Runn's CEO Tim Copeland to discuss the future of resource management, from decreasing business predictability, to the possibilities represented by the gig economy. Here’s what he had to share about resource management trends - and how to navigate its growing complexity in this dynamic environment.‍

Tim, thank you for joining us to talk about the future of resource management. There’s a lot of change in the world at the moment - both in broader economic terms and in terms of how we work - and that’s exciting but challenging for businesses. We want to give organizations an insight into future trends they can plan for now. What’s your take on the future of resource management over the medium term?

It’s an interesting question because resource management and resource allocation has been the same problem forever. All businesses have the exact same constraints. 

They've got a limited amount of people who can do the work. Those people have a finite number of skills to apply to their work. And they work for a limited number of hours. 

So if you're thinking about a business that requires people, those people are the most fundamental unit that constrains the business. It’s a well-understood problem. But it isn’t a well-SOLVED problem yet.

Trying to solve that problem elegantly - understanding what the capacity of your business is, understanding what the career progression of staff looks like… hasn’t been achieved by industry at large yet. 

And that’s a growing issue for organizations because things aren’t going to get easier. Future of work trends point to an increasingly complex resource management environment. And businesses need to address that.   

Why is resource management getting more challenging now? What are the factors driving it?

What is making that problem harder is that things are changing faster than they used to. If you think back to the olden days - before the post-pandemic revolution in how we work - everyone would be present in a physical office and they'd work from nine to five. And it was easier to manage those resources because they were very predictable. 

Nowadays, understanding the capacity of your workforce is harder. Employees expect accessibility around hours. They expect to be able to take time off, work flexibly, have part-time hours, define the hours they want to work… That's an absolute baseline expectation that didn’t exist before.. 

Expectations are changing and that degree of flexibility is critical for today's workforce. But building systems that can elegantly scale with that level of flexibility - and still give the right answers around capacity - that's a challenge.  

It isn’t just changing expectations of work increasing the pressure, is it? Project-based businesses are used to navigating uncertainty around their future pipeline. But the current global economic climate must be impacting that too…?

Absolutely. The inherent volatility of project work is a perennial challenge. 

In the current economic climate, there's a lot of uncertainty about what work is gonna go ahead, when, what the scope of work will be. There are a lot of things in flux for project planning. Understanding and balancing capacity and demand is making life harder for people in those roles. Not just on a project basis but generally in terms of your workforce and work. Getting predictability in your business is more difficult. 

I think one of the challenges for business in the future is deciding what you want to be. Do you want to be a business that’s very good at reacting to things that happen to you? Or really good at planning and making things happen for you?

To be really good at planning, which is definitely the better state to be in, you need to have a reliable long-term forecast. And the ability to deal with inherent volatility along the way. You need to be able to see it all. And that's been very, difficult for most companies in the past. 

That isn’t going to get any easier in the global economic climate unless businesses prioritize solving their resource management challenges.  

Is cost efficiency the key rationale for organizations to improve their resource management right now?

It’s one of them. The world's going into recession and you see all the headlines about just how aggressively a lot of companies are cutting their headcount. The need for efficiency and effectiveness has been elevated.

For a long time, companies were able to get away with less stringent controls because money was so cheap. But that's no longer the case. It's the exact opposite. Money is very expensive, so people are a lot more expensive now than they used to be.

Businesses need to be very careful about how they're spending their money and how they're asking employees to focus their time and energy. Resource management is the key to this. 

Resource management ensures you’re utilizing your resources effectively, to deliver the highest return on investment for your business, but without burning people out. The focus is much more on balancing the interests of the business with the interests of the people who work there now. Industry is realizing the two are inseparable if you want to achieve long-term success.

You said cost efficiency isn’t the be-all-and-end-all. What else do organizations need to be mindful of?

One of the big trends is how resource management supports skills and capability management - and that’s key in an increasingly volatile business landscape. 

A metric that organizations have historically focused on is resource utilization - how much time is spent doing billable work or productive work. And while that's still an incredibly useful metric, it's not necessarily the leading indicator of success. 

Utilization is very much a metric of this week. You know you're very productive right now. But it isn’t forward-looking. It doesn’t help your business prepare to be successful in the future. 

Something companies need to think about is how well-suited is their current workforce to the needs of their clients in the future - particularly if those needs are changing. 

One of the major benefits of effective resource management is understanding what sort of skills are required to deliver work that's coming down the pipeline. Being able to foresee that requirement for future skills and then training your people so that you're able to meet that need. 

In the past, when money was cheap, people would just have recruited people with the skills they need, when that need becomes apparent. But that’s reactive. It can be costly and disruptive. 

Strategic, proactive businesses will train the resources they have. It’s more cost-effective, and there’s less of a learning curve. 

A few months back, I engaged in a conversation with the CFO of a considerably large company. During our discussion, he recounted an experience where the company had shifted its focus from staff utilization. This change came after two decades of operating as a well-established organization. For about 20 years, utilization was their North Star, getting the most out of their staff's time. It was all about making sure everyone's busy and that supposedly drove their success.

However, they’ve come to realize that the skill set possessed by their workforce wasn't necessarily the most sought-after in the market. Consequently, they chose to temporarily step back from focusing on utilization and redirect their efforts towards comprehensive staff training and development, with a particular focus on their sales team. The company even sought projects aligned with the evolving skill set they were cultivating.

This strategic shift wasn't without its challenges. It involved a six-month period of significant adjustments, entailing substantial costs for the transformative process. The result, upon reevaluation, was a scenario in which their staff's utilization was lower than before, yet the work they were undertaking held greater value for their clients.

This transition yielded an intriguing synergy: the company's profitability increased while the workforce experienced reduced stress levels. 

Operating under the premise that allocating 100% of staff time solely to work tasks left little room for creativity, and even practical considerations like sick leave, they recalibrated their approach. By targeting, for instance, 80% of planned work, they allowed space for spontaneity and creativity to flourish. Instead of aiming for that elusive 100% utilization, they dialed it down to 80%.

Ultimately, this balance facilitated a more productive and innovative work environment. Entrusting employees to manage their time effectively eliminated the need for micromanagement on an hourly basis.

So in the future of work, people are going to care more about making better use of the small number of staff that they've got. Making sure they’re highly effective and have the right skills and training. And to do that they need a long-term forecast into their pipeline, capacity, and capabilities.

One of the key trends you’ve talked to me about is companies sharing resources in the future. What does that look like? 

One of the beliefs that we've got for the future is that enterprise companies can be as nimble and vibrant as startups and smaller companies can be. Typically what’s holding them back is the inherent bureaucracy and lack of transparency and visibility in these sorts of organizations. 

One of the ways of solving that is if you look at each team within a larger enterprise as a standalone company in its own right. One that makes its own decisions and has a higher degree of autonomy. Things that will change how they interact with other departments and other companies and the organization.

So instead of just being this big monolithic structure, you can think of a large company as being lots of small companies. Instead of being constrained by legacy structures and factionalism that builds artificial barriers, each of these smaller companies is lean and dynamic, free to focus on providing exceptional services to the other companies within the organization. 

I see that increasing the fluidity of team composition and how people join and leave teams. The walls within the organization will become more permeable and there will be more internal movement. 

I think that's going to increase over time as enterprises seek to emulate the agility of startups. But to achieve those benefits, organizations will need increased transparency into their resources, and to what area they’re working in.  

In our recent Key Trends in the Future of Work article, we discussed the growth of the gig economy and how that benefits businesses in terms of agility and costs. But it presents challenges in terms of resource management too. Can you talk about that a little?

Yes, another of our predictions for the future of work is that there will be freelance contractors working for lots of different, totally independent companies. That speaks to the autonomy and flexibility people are seeking by being part of the gig economy, and also the increased agility and access to talent that businesses need.

So these contractors will work with a business on - perhaps - a long-term basis. But they won’t actually be PART of that company. And they might have this relationship with several other organizations too.

We used to hear about ‘jobs for life’. And then we’d maybe expect people to have 5 or more jobs in their lifetime. Now, we can expect people to have much more frequent engagements with lots of other companies in their career. 

The marketplace dynamics are still evolving and playing out. But I think the concept of a company as a whole is going to come under scrutiny in the next ten years, as both businesses and individuals look for more flexibility, and remote work and digital technology make that increasingly viable. 

Sounds complicated!

Yes. It opens up a whole bunch of exciting possibilities. But also introduces a lot of complexity. How the heck do you manage that? 

How do you manage people who might be working for multiple organizations? Or work fluidly between different internal companies within your business? How do employees and contractors keep on top of what they’re working on? 

It certainly isn’t with spreadsheets. That’s the sort of challenge Runn is designed to solve.

Which leads us nicely to my last question, which is how can organizations prepare for the future of work and manage their resources in a potentially dynamic and disruptive environment?

Well, obviously, I’m going to say that it's about using the right tools for the job. Organizations need a centralized system to manage their resources strategically and effectively. 

If you've got individual managers with their own spreadsheets trying to figure this stuff out - or worse, if you’ve just got everything in your head - there's no possible way you're going be able to do it when the complexity and competition ramp up in the future. 

We've gone past that now. The future of work is accelerating change, increasing complexity, and organizations need to address that head-on. We’ve designed Runn to help enterprises with lots of internal project do just that.