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Project Portfolio Management

Resource Management Q&A

Published By Nils Davis
Resource Management Q&A

In our recent webinar, Getting the Most Value of Your Project Resources, we had the chance to really dive deep into Q&A, and get some good insight from our audience about resource planning and management.

What is the advantage of managing projects in a tool over a spreadsheet?

Of course, if you are a one-person show or a small team, often you can get away with a spreadsheet for a while. But I’ve worked on products that essentially were replacing spreadsheets for many, many years. And so I have a good sense of the shortcomings of spreadsheets and also their benefits. Certainly, spreadsheets are really easy to use, there’s no question about it. But there are a couple fundamental shortfalls you can’t avoid with spreadsheets.

  • The biggest issue with managing projects in a spreadsheet is that they are not effective in a multi-user situation. You can use a Google Spreadsheet to share, although then you give up some of the functionality and ease of use.
  • Spreadsheets quickly become out of date. Especially if you have multiple users interacting with same spreadsheet, they get out of sync with each other.
  • They are not very good at representing complex data and relationships. So, for example, in product there are multiple customers that are interested in different features, and we need to track each one in a many to many relationship. The ability to do queries related to which customers want what features, that’s actually pretty hard with the spreadsheet. Anything with a hierarchical relationship or a one-to-many relationship or even a many-to-many relationship in your data, it is really difficult to manage within a spreadsheet.
  • It’s difficult to create calculations in spreadsheets across multi-dimensional relationships like strategy, which has more than one dimension, and programs which of course have multiple projects.

What are some of the KPIs that you recommend organizations to track when it comes to resource usage?

The most important thing to track is individual resource utilization. In order to be able to track that, you need to track:

  • Capacity of the resource – whether they are available for 100% of the time or 80% of the time or half time or whatever it might be, taking into account things like vacations and holidays.
  • Allocation – be able to track capacity against how they are actually allocated against projects or whatever work it might be. Ideally you want that to be around 85%. If you have your resources 100% booked on projects, that means that things are likely to start falling off their plate. Obviously, if they are only 50% booked on projects and you expect them to be 85%, that’s a red flag that you could be getting more done with your resources.
  • Planning for resource usage – in relation to roles. So, being able to roll up resource usage and resource demand by role is going to help you with your hiring plans, which help with skill building plans and things like that.

How complex or large does your portfolio or organization need to be before you start to see value in a centralized solution or centralized software tool?

There’s no exact number, but even at five or six project competing for resources it gets difficult to manage in a spreadsheet or task tool, and you will start to see high value from a system that is designed to manage this. And of course organizations typically have dozens of projects – large organizations have thousands. Once you get into that range, you’re definitely going to need to start managing the portfolio.

One of the things that you mentioned is managing the inputs into your planning process as an important element. Any tips for how to ensure that you have accurate data going into the planning process?

There are two aspects of the data that are important. One is the benefit that the idea will have if it’s implemented. The other one is the cost that will take to implement the idea. And that’s also true if the idea is an enhancement or a new project or a new program. The first thing is to put the right amount of due diligence into validating those numbers and expectations relative to the size of the item. You’re going to put a lot more effort into validating both the benefit and cost claims of a program versus an enhancement.

One important thing to keep in mind in terms of the strategic alignment is to not simply depend on a simple financial metric like ROI. It’s pretty easy to overstate or even understate the ROI in advance. I think it’s much better to use a scorecard approach, where you list out the business objectives for the organization and you score inputs against that. Particularly if you are talking about substantial-size projects, that’s really an effective way to do it. By measuring what I call “strategic alignment,” you can get a more accurate picture of the value for your business.

In terms of the cost side, what we have in Innotas, for example, is you can have a project idea and you can do a role-based staffing on it where you’re not actually allocating people to the project, but you are indicating what the general level of effort for each individual role – developer, project manager, business analyst and so on. That gives you a cost value that’s more concrete than “Oh, this will cost $1 million.”

How does resource planning affect Agile teams especially since we designed to embrace change as an agile organization?

It is true that structurally Agile teams are more able to handle change, because of the way agile project management works. But that doesn’t mean we don’t have to do planning. There still is a need for the organization to say, “We need this set of capabilities in our business, and they have to be created via projects.” The benefits of Agile really are that you explicitly say we’re going to look at that capability and we’re going to break it down into a set of pieces and we’re going to prioritize those pieces and deliver the most important ones first. And you’re going to do that in little chunks of time as well. You’re going to reduce the little time frames for delivery to two weeks or a month.

Sprints are really little projects, and you don’t do a change within the sprint.

If you start off a sprint intending to do a set of stories or deliver a feature that’s what you do in that sprint. And you don’t respond to any external changes in priority during the sprint. Then, at the end of the sprint, you then look and see, well what’s left to do or what’s on the backlog, is there anything new, do we need to re-prioritize? And then you again focus on what the most important thing is. So, really the way that Agile works is you essentially make a list of the most important things. You then spend a small amount of time doing the most important thing on that list. Maybe you do several of those. And then at the end of that sprint, you then re-prioritize again. From the standpoint of managing change it’s just a little version of the big picture; do strategic planning then do execution, and repeat.. You still drive it with strategic planning, you just may do that planning a little bit more often and with the idea that you can be more responsive.

Aside from scalability issues in spreadsheets, what analytics or the analysis tools are available in a centralized tool like Innotas?

In short, it varies widely. Innotas has a number of different components of the analytics that are available such as predictive portfolio analysis, which essentially takes all your projects and uses a metric for determining their alignment with the strategy and takes all your resources which are stored in Innotas and looks at their availability and their skills and combines those pieces of the information that come up with a recommended project plan that prioritizes the most important projects to get the best return.

Additionally, things like a what-if analysis where you can ask things like “what if I took this person of their project and put them on another project, how would that impact the delivery of these two projects?” Essentially, be able to show me where I am, and give me transparency to what’s going on. And then, help me do some decision making – what will happen if I change this, what projects should I be working on. Those are the two fundamental types of analytics you need to be able to do.

How do you keep morale at a good level or very high level at the beginning but more importantly, after a project has been completed? What are your thoughts on keeping motivation levels high?

It’s a great question, and in some ways it relates back to planning. One of the things that really bothers a lot of developers in terms of their morale is to not have anything to do. As a product manager, I have a similar relationship. We’re working in little agile sprints which are like little projects and once a feature is delivered at the end of a sprint or in the release, then if I don’t have the next thing for these folks to work on, they get bored and antsy.

Typically projects are technical, and most people are interested in learning new things and experimenting with new technologies. There’s often an opportunity at the end of project to give them a little time to learn a new skill or to maybe switch roles with somebody else to learn a new role or to go take a class. This is going to work depending on the organization. The alternative of course is to simply assign the next project. It should be really exciting, “It’s aligned with the organization strategy, I think you are the perfect person to do it.”

Getting back to some of the earlier points, if people are directly having an impact, that is very motivating.

Can Innotas centralize staffing as a model or is there a tool for having a centralized staffing model and methodology to help with understanding what work is coming, what works is being delegated out, etc.?

The fundamental business problem is that projects needs resources, of course, but usually the resources don’t work for the project managers – they work for some other organization. And particularly as the organizations get bigger, this is more often the case. The flipside of that is the resource managers have these resources, but they don’t necessarily know where they should be deployed because they don’t have their finger on the pulse of the project world.

You don’t want them to have to go into the project management tool to go search around for projects with resource demand. Centralized staffing addresses that business problem. If you don’t have centralized staffing and you have that situation, then the project managers have to do a lot of email exchanges or phone calls to the resource managers to negotiate, things like that. Centralized staffing essentially enables you to semi-automate that process where the project manager will need a developer, will send that request to a resource manager who has developers and the resource manager can then assign one for you or reject the request because they can’t do it, and need to send it to another resource manager.

So this eliminates a bunch of phone calls and emails. And it gives you the additional benefit of gaining governance. Those phone calls and emails aren’t trackable or manageable, so doing all the communication within the tool, enables insight into how the process is going. For example, what if there is a resource manager who is not responsive? Are there project managers who continually ask for the same person, one really they don’t require? Those are some of the reasons you would use, centralized staffing– it’s more efficient, it solves the real problem which is the disconnect between project managers and resource managers, and it gives you governance.


Nils Davis is currently Director of Product Manager at Innotas, responsible for mapping and executing changes on resource management features. Nils has over 20 years of experience in project and product management at companies such as Egress, Naehas, Accept, and NetIQ where he held various leadership roles. Nils is an avid blogger on strategy execution, planning, and innovation.

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Written by Nils Davis