Resource Planning – The New Critical Path

Why efficient resource planning determines the feasibility of entire project portfolios today and why agile transformation only works in a “purely” agile project environment

Budget constraint “Resources”

Effective resource planning is the biggest challenge PPM leaders are facing in many companies. So far, we have moved along the common guidelines of time, scope and budget in order to fulfill our entrepreneurial activities:

  • Keep-the-light’s on
  • Run-the-business
  • Change-the-business
  • Transform-the-business
  • Innovate-the-business.

So far so good. But as well as the financial budget, there is another limitation that determines the feasibility of all our activities in today´s economy:

Resources, their capacities and individual skills.

This is understandable, as almost every initiative touches on the topic of employees at some point in the process, and almost every company has more initiatives than it has available capacities to fulfill them. In such an overloaded system, even a small shift leads to a chain of further shifts, resource shortages and inevitable conflict. The limited availability of capacities and skills in a company has now become that company’s most important factor and can cause entire project portfolios to succeed or fail. We need methods and knowledge to manage this critical, narrow path of resource planning more efficiently and to remain responsive.

“There are two types of budgets for organizations: money and resources. But the second type is by far the more complex, usually more limited and not transparent at all.”

“Resources and capacities are by most companies perceived as scarce, critical for the company’s success and extremely opaque.”

(Valkeen Market & Research)

Agile frameworks do not solve the “resource problem”

Many companies – if not most – will never be able to operate in a fully agile way because the heterogeneous requirements of their organizational landscapes and projects do not allow it. This is mainly because of issues such as shared services, cross-functional teams and employees who have to work on dual activities (keep the lights on and run the business) simultaneously. This means that the majority of organizations will continue to address a hybrid project portfolio. That wouldn’t be critical if companies didn’t always hope that agile scaling would automatically solve the resource problem. Despite the employee-based idea of teams and the desired responsiveness of agile frameworks, the company’s basic problem remains: there is no overall view of all available resources and their availability and skills, regardless of methodology, function and location, and there is no common process to plan and steer them.

In the end we often find ourselves in new silos – agile silos, but silos nonetheless.

From our experience we know that it is important to consider the concepts of agile scaling and resource management independently and not to confuse the respective strengths of systems with each other. If each discipline is mastered individually, there are possibilities for synergies, as resource management will make teams and the general use of resources in a hybrid project portfolio even more dynamic and effective. Common goals can also be more easily achieved – efficiency, improved time-to-market, responsiveness (business agility), employee satisfaction and increased throughput – all in a transformative environment.

Meet resource planning with real resource management

The solution is simple: Eliminate the silos and target a transparent pool of resources. and above all use real resource management, with the aim of deploying your employees precisely and at the same time remaining able to react. This will include resource planning at a higher technological level than just using Excel or MS Project and establishing high data quality for strategic decision-making.

In order to allow strategies and innovations to determine the activities of companies once again, resources must no longer be critical inhibitors but should instead be the enablers of these tasks. After all, it’s the people in the company who bring about transformation. Resource management creates exactly this balance, delivering efficiency for the company while navigating employees out of overloaded situations and playing to their strengths.

All resource management methods and best practices are designed to address conflicts in capacity and skills in the short term and long term, and by planning against them while preventing imbalances caused by resource conflicts from arising in the first place. These new critical path resources are therefore solvable:

  • Resource transparency (single source of truth / resource pool)

  • Cross-dimensional utilization of resources: across methodology, function & location

  • Short-term and long-term bottleneck and conflict resolution

  • Resource Capacity Planning: Qualitative resource deployment planning on project, line & portfolio

  • Strategic HR planning: anticipate skill deficits and take countermeasures

  • Portfolio simulation on resources

Summary

In reality, most companies will operate hybrid project portfolios. For this we need firm and reliable data about time, scope and two equally important types of budgets, namely money and capacities. Resources and their skills and capacities are the most limited factors in today´s economy and therefore represent the actual critical path of the project portfolio. No matter what the future brings in terms of change – be it reorganizations, pandemics, recessions, “New Work Order”, GEN-Z, Cloud computing technologies or AI – an integrated and resilient resource database is the foundation of any business activity that ties up resources. A dominant shortage of capacity and skills will lead to a critical path that can be managed in the long term and planned for with the help of real resource management.

Valkeen – Expertise and Guidance

We are passionate about the discipline of resource management and are your resource management consultancy in Switzerland, Germany and Austria.