When planning projects, companies sometimes forget to include all the resources relevant to operations. The team members might have been assigned tasks and the software solutions are already in place, but if other assets like money and time (scheduling) haven’t been noted, it could cause a lot of delays. As such, resource management can spell the difference between project completion and failure. This is why planning resources is a common practice for project managers and an essential subject of on-ground and online project management master’s degrees.
The practice applies to all types of project management as well as related activities such as task management and operations management. This article will define what a resource is and clearly show what is resource management for the professional project manager or the layperson.
Moreover, it will illustrate why “resources” are the seeds of every completed project and why effective resource management is the bedrock of project success. Project managers in the IT field will find the discussion on a case study particularly informative.
A conference paper published by a leading association of project managers (Discenza & Forman, 2007) identifies the top seven causes of project failure. Three of these are related to resource management shortcomings in the following critical areas:
To cite a global faux-pas (to put it lightly) of a marketing giant, McDonald’s launched the Arch Deluxe Burger in 1996. It poured more than $150 million into advertising the product—its biggest ad spend ever. It flopped. And when it did a post-mortem, it learned that it should have spent more money on customer preference research. People didn’t want a more ‘grown-up’ menu.
The heavy weight of success or failure rests on the project manager’s shoulders more than on anyone else. And in the world of project management, they would fall under to categories: Champions and Under-performers. Their performance hinges, to a very large extent, on how they manage their resources (time, budget, other resources) all the way to project completion.
More and more companies are realizing the value of having project and resource management expertise at the entire organization’s disposal. And for this reason, 90% of large companies, 88% of midsize, and 61% of small companies have their own Project Management Office (PMO) – dedicated to managing all components and stages of a project, including resources. Furthermore, some schools have embedded the practice in their management programs like online supply chain management bachelor’s degrees, business management programs, and construction management degrees. Could this be what your teams need to get over that resource management dilemma that keeps slowing down your project implementation?
PMI Pulse of the Profession (2017)
For researchers in the academe or in the various fields of technology, funding is an indispensable resource for a project to even start. But it isn’t the only resource that must be sustained all the way to the finish. Human resource specialists would say that productivity and the well-being of labor is a key factor that must be managed if one wants a project to succeed. Computer programmers, on the other hand, would insist that it’s the choice of the right project management software that makes the difference. Project managers, for their part, would say ‘time’ is the golden resource. Information managers would have a different say. And all these professionals would be correct.
A ‘resource’ is something that’s needed to get a project done. The basic assumption as to the nature of these resources is that they are finite or, in economic terms, “scarce.” And it is for this reason that they need to be managed.
Various industries would classify various company resources or assets differently, based on how these are actually used in a specific type of project. But generally, there are four factors that determine how resources can be classified.
The practice of resource management is based on a solid knowledge of the nature of these resources.
A short “resource management” definition would be: “acquiring, allocating and managing resources: individuals and their skills, finances, technology, materials, machinery and other resources—that are required for a project.” Resource management ensures that internal and external resources are used effectively on time and according to the allocated budget.
In most companies, this is the joint responsibility of several departments represented in a project management team. Still, in others, a full-time resource manager is designated to fulfill this function.
Wrike.com, MS Project, and other top work management platforms, built their applications around making every aspect of every resource ‘visible’ to project managers so they can make timely decisions based on what’s happening on the ground.
Transparency and visibility are indispensable to the success of resource management, as well as project management. It’s a best practice that can’t be built into any project management software, unfortunately. In fact, any such software, no matter how advanced, will be limited by the accuracy and truthfulness of the data inputted into it. Both are human traits that are dependent on the character and diligence of managers and staff alike.
Good resource management is not just about completing a project. The goal is to help implement it (in partnership with project managers) in the most efficient way, on time, with zero-waste of resources.
But isn’t project management and having a Work Breakdown Schedule (WBS) enough to get the job done?
Well, the thing about deadlines is that, in the real world, they are given by higher-ups to project managers even before the latter could start planning and estimating how much time is actually required to complete a project. These are the facts of life.
Many times, a fall-back position is needed, and tweaks need to be made from the resource allocation end. Without good resource management capabilities, a team will most likely end up overallocating its resources – both human and machine. Overwork of personnel lowers morale and leads to on-the-job errors and even accidents. Overworked machines, meanwhile, can cost millions to replace.
Source: PMI Pulse of the Profession (2018)
This does not benefit anyone and will cause a breakdown in other resources, that could only result in further delay. It goes without saying that such breakdowns also have a price tag.
In fact, resource management, or the lack of it can have life-and-death consequences.
In a seminal work on resource-constrained project scheduling in a hazardous environment, Shuai Li et. al. (2018) adopted a PSO algorithm to ensure that workers in a nuclear power plant overhauling project would not be exposed to hazardous or fatal levels of radiation. On top of the usual human resource constraint being the number of workers and work hours, this unique context gives project managers additional constraints to consider:
These additional constraints greatly increase the complexity of the resource management puzzle. In fact, Resource-constrained project scheduling (RCPSP) is a hotspot for research work because of the challenge it presents to project and resource managers.
And unlike in ordinary work conditions, an error, miscalculation, or neglect in the management of resources will result not only in inoptimal use of human resources, but to mental damage and even death.
There have been 3 conventional approaches to solving similar problems in the past:
But the emphases and priorities of previous studies have focused on minimizing the number of work hours with the purpose of minimizing labor costs – since these do not take into consideration the safety issues of the work environment.
In the paper of Shuai Li et. al. (2018), a RCPSP model in a hazardous environment was established, with the objective of minimizing the project duration and keeping the hurt suffered by each worker under the controllable limit. To solve the problem, a novel discrete particle swarm algorithm was developed.
A key component of the solution was to determine the best “staffing strategy” (i.e. the criteria for determining which resource should be assigned for a particular time and a certain duration of time).
In the study, three basic strategies are considered:
Strategy 1: Use resources as much as possible. In this strategy, we allocate resources to an activity in the order of its index. Only when the resources are unavailable, we allocate the next resource to the activity in the order.
Strategy 2: Use resources randomly. In this strategy, we assign a resource randomly. If the resource is not available, we randomly select another resource.
Strategy 3: Use a resource firstly when its accumulated dangerous quantity is smallest. In this strategy, we first allocate resources that have the least cumulative dangerous quantity to activities. (Shuai Li, Zhicong Zhang, Xiaohui Yan, Kaishun Hu & Shaoyong Zhao, 2018)
Triggering 100 instances of the problem, with the duration of each work activity being randomly generated, the findings clearly show that resource allocation is always superior when a well-planned resource schedule seeks to optimize each human resource – rather than when a randomly generated schedule is followed.
We can imagine a similar situation being in place now at the COVID wards of hospitals around the world – how to manage the scheduling of overworked, over-exposed (to the COVID virus), and dwindling medical staff.
The Centers for Disease Control and Prevention recognizes the crucial role of proper healthcare staffing guidelines in mitigating the risks to their lives. In the end, saving the lives of a subsector of society (i.e. workers) can be all-important to saving the lives of the rest of the population.
Another real-world revelation is that—surprise, Project Managers often overshoot or undershoot the deadline. No kidding. When that happens, resource allocation needs to be immediately adjusted. To prevent the emergence of additional lags in the project timeline, resource managers should be on top of their game, on their toes, and be able to immediately adjust the deployment of resources in accordance with the situation on the ground. Note to all aspiring project managers: resource management can never be fixed but have to be dynamic. A ‘plan’ does not set things in stone.
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What can go wrong when you have your eye set on the project completion date but fail to keep an eye on your resources? Well, as earlier mentioned, the project budget could be easily impacted. An unforeseen overallocation of human resources, say, in a construction project, might require the hiring of additional temporary or contractual personnel. Without a contingency resource sourcing plan, a company could be forced to acquire the needed professionals from the most convenient source but at great cost.
Finally, since resources are, as we mentioned, “finite” and “scarce,” it may take some effort to replenish on the spur-of-the-moment. If one is really out of luck, in bad times such as now when theCOVID-19 pandemic has slowed down suppliers’ delivery of goods not directly related to the crisis, the needed resource/supply/financing may never come. And this is just one of the many resource-related causes of project failure. You won’t believe the number of unfinished bridges there are the world over.
In 2019, US construction industry revenues reached $2 trillion. But this industry also has an average annual expenditure of $1,231 billion. Consider how closed-loop material cycle construction and project management can promote recovery of materials from building projects, cut costs, and facilitate better project management by lessening constant resource drain and dependency.
Given this half-hearted compliance to effective project management practices, it’s no wonder that a PwC study of 10,640 projects found that a dismal 2.5% of companies complete 100% of their projects successfully. Everybody else either goes beyond the original budget or misses the deadline. Failed IT projects alone costs the US economy between $50 and $150 billion in lost time and revenues.
Resource Management, as one of the essential project management practices, not only gets the job done on time but also saves the company money, reduces equipment depreciation, prevents unplanned expenses, but most of all – can save lives.
Pulse of the Profession, PMI (2019)
It’s added work and will entail filling up additional spreadsheets, generating more Gantt charts, and keeping all data updated. But will the resource management advantages outweigh the extra administrative work?
In their paper, “Research Focuses, Trends, and Major Findings on Project Complexity: A Bibliometric Network Analysis of 50 Years of Project Complexity Research,” L. De Rezende, et. al. found that with regard to how project managers’ approach complex projects, “the focus is changing from project control to project adaptability when dealing with complex projects, and it is necessary to develop capabilities to manage complex projects, not only in the organization or at the team level, but also through the project’s supply chain.”
The authors’ findings, published in the Project Management Journal, identified three “waves” of discussions surrounding project management, which eventually evolved into the focus on “project complexity.”
“The first [wave], prior to 1985, focused on organizational structure and dynamics, innovation, major projects, system thinking, complexity theory, scheduling, and resource allocation.
The second wave, from 1990 to 2004, was characterized by numerous interconnected articles focusing on topics such as scheduling, resource allocation, and programming, and rapidly converged toward a central discussion regarding classifications of complex projects, organizational adaptability and learning, innovation, system dynamics, uncertainty, and ambiguity.
The third and current wave began in 2005 and discussed topics such as project complexity, knowledge integration, project size, multiproject scheduling, resource constraints, complex engineering projects, and collaborative new product development teams. (De Rezende, Blackwell & Goncalves, 2018)”
And it’s very significant to note that in all of these waves, “resource” has come out as a common pivotal discussion point (as “resource allocation” in the first two waves then as “resource constraints” in the third wave) on what complicates or makes a project “complex.”
And when dealing with complex projects, project managers are faced with the choice of dealing with these using traditional methods, or newer, more flexible approaches. It is even more interesting that one of the emerging approaches is to deal with these through the project’s supply chain – also a resource handle.
Discussions on resource management are also taking on broader meanings in an age when nature is a fast-depleting resource.
In “Evaluating Approaches to Resource Management in Consumer Product Sectors – an Overview of Global Practices,” J. Singh et. al. assert: “Addressing global sustainability challenges associated with natural resource security and climate change requires new perspective on waste and resource management. Sustainability-driven business model innovations have a crucial role in transforming current, unsustainable, production and consumption patterns by slowing product replacement and closing material cycles. This study identifies best practice across a range of consumer product sectors.” (Journal of Cleaner Production, 24 2019).
The study reports their findings on 145 best practices by companies involved in the production of 519 different products – from shoes to appliances and cars. These best practices could result in more durable consumer products, less consumption of natural resources, less recycling, and less solid waste disposal expenses for companies and economies in general.
So, yes, experts believe that resource management turns a project around.
Organizations that manage their resources are able to:
After careful consideration of the competencies and strengths of each of your team members, you give them their assignments. After consulting with your human resources on what they would need to get their job done, and in what quantities, you provide them with these resources.
You keep an eye on how much work is being done by your human, technical, mechanical and other resources, while also keeping an eye on the hours they put in. You will be especially concerned with resources that are “under-utilized” or “over-utilized” (overallocation).
Knowing the utilization level of your resources, you adjust assignments so as to get the most productivity from each while protecting these from overwork and damage.
A resource manager who does his job well and who knows his numbers will be able to predict, with reasonable confidence, how much work his team can do over a period of time. This enables the team and the company to accurately prepare and plan for upcoming commitments.
Rather than listing down generic steps that could apply to all industries, a case study might best illustrate the responsibilities involved in resource management. In this case, a software development project was selected because of the unique challenges related to it.
The Journal of International Technology and Information Management reports that most studies related to project management in the fields of information management and information systems focus on human resources issues. This is because the peculiar nature of its professional labor force makes it an interesting topic of study for researchers. IT professionals, particularly software developers, are highly valued and very well-compensated. In their paper, Project Management: IS/IT Research Challenges, D. Tesch, et. al. point out that because there is such a high competition among companies to retain or pirate such professionals, it has now become a major responsibility of IT resource managers to prevent the loss of key personnel — especially in the middle of project implementation.
In addition to this, “resource management” has multiple connotations for the IT practitioner. It can refer to the usual human, financial, and time resources that need to be juggled and allocated efficiently in a project. In this line of work, “resources” also refer to information, data, or computer “resources” (CPU speed, memory, etc). Programmers have even developed an entire class of application known as “Enterprise Resource Planning” or ERP software. In this highly technical profession, project management and resource management become all the more significant. And such roles are among the more promising career paths for a computer science graduate.
Because of the many-sided significance of “resources” in the field of Information Technology, the steps and examples in the following resource management process flow will be skewed towards its application in this environment: the implementation of a software development project.
When writing the project scoping document, determine the list of resources that will be needed for the project. These should be classified into a) dedicated resources and b) shared resources (as discussed earlier).
Project scoping/software estimation indicates the complexity and size of a software, the kind of development effort it will require, the cost of this project, and the schedule of implementation.
Based on this, a software development resource manager will:
Using the Work Breakdown Structure (WBS) drawn up by the project management team, allocate the requisite resources to each defined task or activity for the appropriate period.
Some helpful tips on resource allocation:
During project implementation, it is possible that there would be ‘overallocation’ of some resources. This is especially true for some stages of software development as deadlines approach. Some programmers, for instance, could be putting in more hours for their own good or for the good of the project outcome. In such cases, some degree of resource levelling would be necessary. This will require a splitting of some tasks or an extension of deadlines as necessary. Or when there is underutilization of resources, some tasks may have to be transferred from overloaded staff to less-loaded but equally capable resources. If your most skilled programmer, for instance, is also an expert graphics designer, it will be in the company’s better interest to assign the design task to a lesser skilled professional despite the cost savings of relying on the same person for both tasks.
At some point, the resources will be taken out of the resource manager’s hands and will be managed by the project manager or the concerned unit supervisor. But be ready to provide support, based on your resource management plan, when they come to you with resource-related problems that you should have anticipated and planned for.
Once a human resource has completed all the planned activities assigned to him or her, he or she could be released back to the Human Resources Department and made available to other projects or teams. Prior to this, a project manager or resource manager should complete a performance appraisal of the said resource. Following this, the resource’s skill database records should be updated. Finally, a two-way discussion between manager and resource would be highly beneficial. The manager might discuss opportunities for a resource to improve his or her performance. A resource might also want to provide his feedback on how a manager implemented a project, particularly in areas related to the resource’s responsibilities.
At project closure, monetary resources should also be released back to the Finance Department. An itemized reconciliation statement should show planned expenditures vs. actual expenditures, noting deviations and providing the justifications for these. This will help in the overall cost analysis, with the end-in-view of drawing out lessons and developing best practices for similar projects in the future.
Finally, all other resources should be turned over to concerned departments, i.e. computer hardware to the IT Inventory Management unit, etc.
Resource Management is a specialized field in the broader task of project management. It is challenging because it will require the resource manager to coordinate with the various departments in charge of the different kinds of resources. But it is also very rewarding because when things go wrong, you will find that your planning ahead is just what the project team needed to get over the resource-related humps and get back on track, all the way to project completion.
Besides taking up project management programs, learners can get acquainted with the practice’s central concepts if they enroll in other management programs like online bachelor’s degrees in business management, supply chain management, and hospitality management. They also need proficiency in enterprise resource planning tools, or if working in public service or in scientific establishments, skilled use of respective digital tools such as government procurement software and scientific data management software is vital. Investing in skills pertaining to the use of technology is vital in this age of digital transformation.