Whether you’re developing software or improving a process, project success relies on appropriate resource allocation. A lot of project management is ensuring all the right pieces slide into place at the right time, which requires a strong resource allocation plan.
Unfortunately, only around a third of companies always use resource management best practices for estimating and allocating resources to projects. Learn more about this critical PM step below and get some tips for doing it well.
What Is Resource Allocation?
It’s the act of resource management, which is ensuring you have the right resources in position to meet overall business objectives. When it comes to managing projects, resource utilization refers to how you use budgets, tools, and human capital to impact project results.
How To Master Resource Allocation
Ultimately, you typically get better at allocating resources well when you can practice resource scheduling in real-world environments. So, the more projects you work on, the more you learn and the better you can allocate resources in the future.
If you want to truly master these skills—and demonstrate your mastery to executive leadership or future employers—you might earn a Resource Management Certified Professional credential.
We have plenty of resources for project management professionals who want to increase their resource management skills:
- Our resource allocation spreadsheet template helps you go from basic Excel formats to a tool that makes managing resources easier.
- You can read our step-by-step resource allocation example to see how these principles work in actual project settings.
- Learn more about resource allocation methods so you can choose one that matches your preferences and needs.
5 Tips For Effective Resource Allocation
When you’re ready to put your new knowledge into action by creating a winning resource allocation strategy, follow the five tips below to enhance your chances of success.
1. Use the Right Resource Management Software
When possible, choose project management software that includes resource management functionality. If you don’t have this option, look into resource allocation software solutions that can help automate the process of handling resources. It’s also worth checking out resource management software.
When you’re running multiple projects or working within an organization that is supporting efforts on various fronts, something as seemingly simple as understanding resource availability can be difficult. The right software program can help you easily see which resources are available and when, cutting down on the manual work and communication required to correctly supply a project.
Software solutions can also drastically reduce common challenges such as over-allocation or under-allocation. For example, it might remind you that you already have the developer lined up during the weeks you need them, keeping you from lining up another developer and possibly depriving another project of that necessary resource.
2. Start With a Clear Project Scope
If you don’t know the scope of your project, you can’t forecast what team members or other resources you might need.
For example, if you think the scope of the project is to improve an existing app, you create a project team with that work in mind. If you later learn that your stakeholders meant you to create a completely new app, you may not have the development resources required for that work, and it could be too late to marshal them in time to meet the project deadline.
Keeping an eye on scope creep is another way you can protect and manage your resources. This is especially true in organizations that run multiple projects at a time. If the scope of your project creeps up, so does its time frame. That can cause your project efforts to overlap with other projects that need the same resources.
3. Identify Task Dependencies
Once everyone agrees to the scope of the project, move on to create a project plan. Your project schedule should detail deliverables and milestones, and most project leaders start with a critical path so they know how long the overall effort should take.
Break your project schedule down even further with a Gantt chart or your favorite visualization method for understanding task dependencies. Those details are essential to accurately prioritizing resources.
For example, imagine a construction project that requires the use of an expensive and specialty piece of machinery. You know you’ll have to rent the machinery—which creates a daily cost—and have the appropriately certified professional on hand to run it.
If the part of your project that requires this machine can’t occur until a dozen other project tasks happen, you’d waste resources if you allocate the machine and the certified professional to your project from the very beginning.
By working to identify task dependencies within your project schedule, you can enjoy the benefits of just-in-time allocation.
4. Create a Resource Plan Ahead of Time
Don’t stop at understanding those dependencies and the resource needs associated with your project plan. Create a plan for resources alongside your schedule.
Consider whether the project timeline lines up with available resources. If not, you may need to make adjustments to your schedule or connect proactively with human resources or other decision makers to adequately supply your project.
For example, your planning might lead you to understand that you need $100,000 for the project and not $50,000. That’s a pretty big leap, and getting the go-ahead to increase the project budget by double may take some time.
Or if you need to hire a temporary contractor to fulfill a specialty talent need for your project, your HR team may need a few weeks or more to list the job and sort through candidates to hire the right person.
5. Use Time Tracking to Gather Data About Resources Used
Your resource allocation responsibilities don’t stop once you have all the project resources you need. You should track the time spent by various people on your project as well as all the money and other resources used. These data points are important to:
- Support billables. You may be tasked with recovering expenses put into the project by passing them on appropriately to clients. You can only do this well if you know how much time went into various aspects of the project.
- Determine profitability. Stakeholders will want answers about whether there was a return on investment in the project. Time tracking and other resource-use data are critical to arriving at those answers.
- Enhance planning for new projects. When you know how much work people can do on various projects, you can engage in better capacity planning and avoid burnout for your internal teams.
Manage Resources More Effectively
Did you find this article helpful? Don’t forget to sign up for our newsletter to get project management news and expert tips right in your inbox.