Resource Utilization Best Practices in Project Management

Resource Utilization Best Practices in Project Management

Resource Utilization is one of the key performance indicators in project management. And project managers have a tough time finding their resource utilization metrics right.

Resource Utilization is one of 3 key components of resource management. The other 2 being resource availability and allocation.

As we review some of the best practices for resource utilization within our project management practices, let us understand resource utilization and its impact first.

What is Resource Utilization?

Resource Utilization is the productive or billable time as a percentage of the total working time of a resource.

Gartner suggests anything between 70-80% is a great utilization. However, organizations are hard-pressed between their costs and project profitability and keep pushing for more.

90%-95% is kind of the desired utilization rate by PMOs the world over.

The most critical problem with pushing for higher resource utilization is – employee burnout!

Note: A higher utilization rate does not necessarily indicate higher productivity or efficiency. Instead it has proven to be counter-productive.

The question then becomes, how do we maintain optimum utilization without draining our resources and still deriving maximum efficiency?

Create a detailed Task to Resource Mapping

Task to resource mapping is the first step towards getting your resource planning right.

This includes a robust yet realistic task breakdown that covers:

  • Resource to skill requirements to get the tasks done
  • Well defined task duration and estimated hours
  • Task to resource assignments for the entire project
  • Task schedule that accommodates holidays & leave planning( add contingency slack as well)
  • Training & skill requirements

Task planning will give you a clear indication of what type of resource requirements you have for the project, how many total resources will be required, what is available in-house and how to meet the skills gap if any.

Armed with these insights, you can then analyse your overall resource pool to see which other resources might need to be pulled in, shared between projects or be contracted.

And lastly, negotiate or adjust the overall project schedule to strike balance between the project goals and resource capabilities of your organization.

Managing all of these activities in an excel sheet or paper is surely not the wisest thing to do.

A cloud based project management tool with resource management capabilities will make it a lot easier and provide real time view of your overall resource plan.

Practice Time Tracking

This may sound like a cliché. But organizations and teams have still not got this right.

Time tracking has great many benefits than tracking what the resources are up to. It provides you deep insights about your task and resources:

  • How many tasks are being completed within the estimated hours?
  • Which type of tasks almost always end up breaching the defined hours?
  • Which resources end up spending more time on their tasks?
  • How many billable hours are being spent on your projects?
  • What is your team’s billable vs non-billable hour ratio?

When you have answers to the above questions, it becomes easier to focus on the right things instead of just banging against resources or pouring in tasks into your team’s queue.

Identifying bottlenecks be it in your processes or resources is important.

An active task board tells you how your project is progressing and if your resources are able to move the tasks forward. And you have a good head-start to step-in, in case things do not look so good.

Have a clear view of the overall resource pool

Resource availability is a crucial input towards healthy resource utilization rates.

Having a proper visibility of all your resources are stacked gives you the much needed vantage point for better resource planning.

You may not get all your resources at the beginning of the project. Hence, knowing who will be available when and for how long can help you manage the project schedule efficiently.

Maintaining low wait times on your task queue is important to ensure resources are not being overloaded.

Else, you end up piling more tasks with the tasks sitting idle and skewing your project schedule adversely.

At the same time when you know reinforcements are due soon, task prioritization and assignments can be managed better to ensure a healthy execution rate.

Hire, Up-skill and Contract

Being a 100% dependent on in-house resources all the time is not a good resource management practice. Unless you have deep pockets to maintain a bench strength!

You can never have all required skills for a project in-house. Hence, making a formal and thorough upskill plan for your resources is a must.

This will provide you the much needed competitive boost, expedite task execution in future and increase the team’s overall capabilities to deliver within tighter deadlines.

Periodic assessment of the organization’s project pipeline w.r.t the resource utilization and availability, the hiring plans must be set into motion.

Doing more with less is a classic bad example of resource management! It has always been counter-productive, led to more delays, quality of deliverables becomes questionable and employees surely are burnt-out.

Monitor Resource Utilization Constantly

Knowing your team’s current resource utilization rate is a must before setting out for new projects.

This gives you a good inkling on how many and what level of resources you will need to deliver the project at hand.

And at a more tactical level, constant monitoring will tell you if your team is getting sloppy or just has too much to handle.

As a savvy project manager, reviewing the utilization rates will help you re-plan and reassign tasks as needed.

You surely do not want to overload your top performing resources. It’s the most common practice and the worst one too. You are sending out very wrong signals to the under-performers here.

Any imbalance in your resource utilization is a ticking time bomb waiting to explode.

Because suddenly resources may start calling in sick, stay away from work or resources may be pulled out of your project due to low utilization.

Either ways, your project is at risk!

Conclusion

An effective resource management strategy is what at times makes all the difference between a project’s success and failure.

As a project leader you must have a greater handle on all 3 aspects of resource management

  • Resource Availability
  • Resource Allocation
  • Resource Utilization

Keeping a tight tab on these aspects not only augur well for your project but also for your most important assets – your resources!

Orangescrum project management tool has been a proven choice of project managers for all their task, time and resource management needs.

When was the last time you checked on your resources’ health and hit he ideal utilization rate?

If not, start today with Orangescrum!

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