I’ve been writing, speaking, and advising for some time now about the importance of resource management and capacity planning, but I realize it is time to step back and define what this truly means in layman’s terms… First, some foundation. What is resource management and capacity planning?
When we refer to resources in this context of resource management and capacity planning, we’re talking primarily about people resources, not the broader use of the term that encompasses equipment, technology, and other assets. When we refer to capacity it is in reference to the amount of work that your pool of resources can reasonably take on, given their workload and work hours. The other crucial piece of the puzzle—the flip side of capacity—is demand—the incoming and active work they need to tackle.
With the terms resources and capacity defined, the titular processes are easier to explain. First, resource management is the ongoing assignment and maintenance of your organizational resources as part of project operations and execution. In other words, it’s a tactical activity—assigning people to work and maintaining their master data, such as their roles, skills, cost center, rate, and so on.
In contrast, capacity planning is simply the act of assessing available capacity during the demand prioritization and selection process. In other words, it’s the act of checking whether the roles and skills needed are indeed available to do the incoming work, before actually scheduling the work to be done. Now isn’t that a novel idea? Would you write a personal check to buy a car without first making sure you have enough money in your bank account to cover it? I didn’t think so.
Resource management and capacity planning go hand in hand. The former involves managing the resource data at a named resource level and assigning the people to work, while the latter involves planning at a high level (generally by role and department) whether the capacity is there to take on new work to begin with. Thus, capacity planning is used to either schedule the work for when there is availability, make tradeoffs to free up resources, or stimulate a discussion about possibly staffing the work in some alternate way.
Why Should You Care about Resource Management and Capacity Planning?
To those in the know, the need is self-evident. All one needs to do is look around. There are too many projects and not enough people. Fire drills have gotten out of control. New initiatives keep coming in without regard for other activities or whether there are enough people to do the work, let alone the right people. As a result, everything gets behind, market windows are missed, and employee frustration is high. And you can forget about having the capacity to innovate; you’re lucky just to stay afloat.
Now that you’re among the ones in the know, why not look into implementing or improving these vital processes? By doing so, you’ll help your organization gain business agility, a greater capacity to innovate, and a more productive, focused workforce. And who can argue with that?
To learn more about resource management and capacity planning, I invite you to take a look at the 2016 State of Resource Management and Capacity Planning Benchmark Study and website. It provides good information for both IT and Product Leaders and enables you to assess your maturity on the subject.
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Written by Jerry ManasJerry Manas is an internationally best-selling author, speaker, and consultant. He is frequently cited by leading voices in the world of business, including legendary management guru Tom Peters (“In Search of Excellence”), who often references Manas’s bestselling book Napoleon on Project Management for its insights on simplicity and character, and Pat Williams, Senior VP of the Orlando Magic, who called Manas’s book Managing the Gray Areas “a new path for leaders.” Jerry’s latest book is The Resource Management and Capacity Planning Handbook (McGraw-Hill), which Judith E. Glaser, noted author of Conversational Intelligence, touted as “the first book dedicated to what is essentially the drivetrain of organizations—the effective use of its people toward its most important activities.” Through his consulting company, The Marengo Group, Jerry helps clients maximize their organizational people resources, leading to a grater capacity to innovate, a more value-focused workforce, and an increased ability to adapt to change. He is a popular speaker at events around the world, speaking on lessons from history, resource planning, organizational change, and other topics. Jerry’s work has been highlighted in a variety of publications, including the Houston Chronicle, Chicago Sun Times, National Post, Globe and Mail, Huffington Post, and others.