When it comes to resource management and capacity planning, the more experienced you are, and the better the automation tools at your disposal, the more likely you’ll meet delivery targets. But is this enough in the current and post-COVID-19 environment? If not, how will resource managers need to adjust in 2020 and beyond?As a result of the recent pandemic, businesses have been severely damaged, and we have been forced to become more adaptable, in new ways and at new speeds. The way we manage resources has changed quickly, and those changes are likely to stick; while projects still require humans to complete work and drive business outcomes, they now need to be managed differently. Offices have largely been left empty without immediate plans for reopening. This has resources scattered around the world, without proper processes and compliance requirements in place to handle such a transition. Within each company, everyone now has a different opinion of what resource management is — or what has changed and how to adjust.
Resource management is defined by demand and capacity
Resource management is based on how you define demand and capacity. Capacity planning depends on having accurate and timely data — and the only way you're going to have access to real data is if everyone in your company can agree on the meaning of resource management. Regardless of the source of demand or which demand item is driving the need, the same resource management business systems and processes need to be used if the resources are dedicated or shared.
Despite sounding fairly simple on the surface, capacity planning and resource management are extraordinarily complex. Most people may agree on a relatively straightforward formula – Resource Management = Right People + Right Time + Right Project + Right Cost. However, how this is implemented often depends on the goals of your organization. I’ve had the most experience in my career across three areas – IT, engineering services, and professional services. For this article, I will contain my observations to those areas, though we have many other experts that would love to hear about your challenges if these areas don’t relate to you directly.
- IT services: Often consist of a range of small to large projects, with resources operating as close to full capacity as possible at all times. A significant challenge in managing these resources is shifting regulations, requirements, and skillsets.
- Engineering services: Clients’ needs determine what specific resources are needed to get the work done. This generally means resource managers are focused on ensuring all projects and programs have the necessary skill sets, at the right times, to complete a job.
- Professional services: Often used by companies to scale out resources for a particular workload, this area sees a lot of turnover and moving resources. This has led companies to become over-reliant on a few people to keep the ship moving, which takes away from their ability to develop junior talent sustainably.
Effective resource management relies on a lot of start-to-finish and finish-to-start accuracy — which is easy if you have the white space — but not that easy if you have limited useful resources and time pressures.
This year, however, all bets are off. The way we used to do things, if not productive in our new environment, have quickly given way to how we do things now. To say it’s a moving target would be an understatement.
The effects of COVID-19 on resource management
In 2020, we find a world operating in unprecedented ways. Upheaval and resulting uncertainty following COVID-19 means managing resources are starting to look very different — with a rising focus on adaptable resource management practices. How has resource management been impacted due to the pandemic?
- Confidence around projects and sustainability has been diminished.
- Many projects were halted across IT, engineering services, and professional services, leaving people out of work or temporarily sidelined. Some people started working remotely — and harder than usual. Organizations had to quickly create new capabilities within their organization and manage existing skillsets alongside newly required and urgently evolving ones.
- Even large services companies experienced large gaps in their revenue pipeline. The number of invoices has been decreased by as much as 60% as all employee time was no longer billable.
- Professional and engineering services companies that typically plan in days are now at immense risk if they are unable to forecast in hours — and those forecasting in FTEs face increased challenges.
- Without a system that can translate back and forward between forecasting methods, companies are operating under a false sense of security and heading towards chaos — which is a significant issue.
- Nearly all project delivery is now remote. While much of it was remote already, it wasn’t this broad and universal as it is today. This “new normal” has changed the way many people think about remote resources, and it’s likely to be a trend that sticks well beyond COVID.
The biggest challenges for resource managers post-COVID-19
Resourcing has always been a challenge — and in a post-COVID era, this has now become amplified. I recognize the world, our economies, and people, are still actively dealing with the effects of the COVID-19 pandemic and will for the foreseeable future. This post-COVID era will take many shapes over the next year and beyond. Right now, many companies struggle to determine how long it will take to complete projects and what the resources will cost to deliver quality outcomes. Specifically, many services-focused organizations are facing concerns around:
Time-based allocation – most resource managers were used to assigning work to accurate time parameters because they had a set of previous trends to rely on, they knew how long things generally take. More and more they will need to assign and reassign work as delivery plans and working conditions change due to this new COVID-era we are living in.
Compliance – many organizations are multifaceted from a tooling perspective, which usually means requirements are inconsistent between departments. Organizations need to ensure they are regulatory compliant, as more and more resources utilize different types of equipment and services to get their work done.
Risk management – many PMOs have shared with me that they don't feel they have mature enough resources to drive governance around risk management as it relates specifically to resource allocation. Up-leveling risk management skills and learning how to allocate resources in a risk-infused environment will be essential going forward.
Lastly, at a higher level, I’ve observed two typical challenges that most companies continually face, and will need attention going forward:
- Visibility into how resources are being consumed.
- Visibility on availability with a forecasted horizon of resources becoming available for new assignments.
Tips for managing resources in the post-COVID world
- Recognize quickly when the status quo no longer works: When something is broken, the odds are everyone else already knows. Resource managers must evolve to keep up with changes.
- Do more than reporting: Reporting just measures where you are — executives need interactive dashboards to build better insights. Reporting quality also needs to increase. In many cases, teams are still trying to do the same things they did before COVID, yet things are not the same and are still changing rapidly. Executives can’t wait for reports to be delivered; business moves too fast. Interactive dashboards enable leaders to have instant visibility on opportunities and progress, to make informed and contextual decisions.
- Re-tooling and training are necessary: Resource managers and project teams need to acquire the right systems and receive adequate training. Companies will need to identify and retain top resource management talent or invest in developing junior talent.
- Revisit your processes: For example, less than 30% of companies have a formal resource allocation process for requesting resources. Resource allocation has many dependencies, which makes a formal process important to ensure all that have a role in allocating resources have everything they need when they need it. Chaos ensues without at least some formality.
- Use technology to fill in the gaps: Less than 25% of teams have adequate or effective systems in place – most use email and a mixture of word documents and spreadsheets for resource management and allocation. Systems are designed to ensure resources can be formally requested, effectively allocated, used, and tracked.
Leadership guidance: How executive leaders can guide how resources are managed
Often there’s at least a partial disconnect between the leadership team and project or resource managers. At the end of the day, a large portion of resourcing falls back to the executives. If things aren’t going right, it's ultimately the executives’ responsibility. The employees or consultants underneath them on the org-chart can only work with the resources that are approved and in place. There are things that the leadership team can focus on to help middle managers better plan their resources.
- Define outcomes: executives are in the best position to define what success looks like. By defining intended outcomes, it can provide resource and project managers with clear objectives — and easily prioritize each one.
- Expectation setting: executives should be the first line of defense for their resources and always advocate on their behalf. It’s important that executives set clear expectations in terms of resource capacity and rigorously negotiate against over-utilization trends that plague services organizations.
- Protect the white space: many resources are finding themselves over-utilized at unprecedented levels, leaving them little room to reflect and strategize as they’re always in execution mode. Executives can protect this by assisting in certain tasks or helping to secure new resources, so the overall team doesn’t become strained.
I think many companies are trying to sort through what to do, when to make changes, and deciding if and where to scale back. They’re also wading through what’s changed, where their gaps lie, and how to adjust. Regardless, the lull of product releases over the next two years will be replaced with a plethora of releases in the following two, essentially making up for lost time — and that flood of sorts will impact all areas of business and how resources are managed.
The key to successful capacity planning, resource allocation, and utilization
Success in managing resources ultimately is dependent on accurate data and finding the right way to use it. While there is no one right approach to how each company should adjust and manage resources in the post-COVID world, it is clear that leaders, project, and resource managers must work together. Companies will then stand a much greater chance of increasing visibility into resource availability, identifying how resources are being consumed, and effectively forecasting which projects should be on the horizon. As we carry on, try to accept that companies are in uncharted territory due to the uncertainty that COVID-19 has created, and we’re all trying to figure this out together. It just might take some time – and a helping hand.