The element of effective project management is proactive resource organization. A good resource strategy is a well-balanced blend of process, innovation, and automation. This allows professional service firms to work more efficiently by assigning the right people, time, and tools to a project and ensuring high-impact projects can succeed.
According to PMI’s Pulse of the Profession 2020, poor planning can exhaust up to 11.4% of an organization’s assets. So, to maximize firm resources and manage a reliable project schedule, project managers must consider employing effective resource management even before considering the project itself.
Understanding Resource Management
Project resource planning and management is the process of identifying and managing an organization’s resources to maximize its efficiency. Resource management is motivated by the desire for efficiency and optimization. In a nutshell, resource management is a subset of project management concerned with accomplishing more with less. Resource waste can be fatal in business; consequently, each project requires effective resource management.
Project managers are always looking for ways to increase a project’s return on investment. The resource planning process has a compounding impact throughout a project’s lifecycle, increasing overall profits. Management resources can increase ROI through cost reductions, product quality enhancements, or repeat business from a satisfied customer.
Reasons Why Resource Management is Significant in Professional Service Firms
Resource management is critical to increasing a professional service company’s profitability and sustainability. Check how resource requirements in project management can contribute to professional service firms’ top and bottom lines.
1. Significantly reduce project resource costs
According to Deloitte, cost decrease takes priority over other business programs.
Resource managers can use cost-effective world resources from low-cost sites with enterprise-wide visibility. Getting the proper mix of global and regional resources aids in project cost reduction. By allocating appropriate resources to the right project, they can complete the delivery on time and within budget. Resource managers can keep costs under control by distributing essential resources evenly across all projects rather than focusing on a single high-priority project.
2. Increase revenue and resource utilization
When employees are highly specialized, have multiple reporting lines, and are geographically dispersed, maximizing the use of these resources can be extremely difficult. Good resource management techniques can assist your company in overcoming these complexities, strategically deploying resources, and proactively identifying revenue opportunities.
3. Enhance productivity while decreasing waste
Controlling and allocating resources on purpose allows you to identify areas where you can better use them. It can also encourage you to identify areas to shift resources and increase their importance. Assume you’re a business owner or manager. If you notice a teammate has strong interpersonal skills, you may ask that they be moved from a back-office role to one where they communicate directly with customers. That way, you can put the team player’s interpersonal skills to better use and boost their value to the firm.
4. Assists in tracking resource availability and ensuring transparency
Allocating resources can aid in determining the supply and demand for resources. This gives you control over them, allowing you to deliver projects to customers effectively and efficiently. By learning how to calculate resource utilization and identifying all of a company’s resources, you can be more apparent and encourage team members to use resources more freely.
5. Boost engagement visibility and business responsiveness
Maintaining capacity visibility, monitoring and adapting to changing trends, and identifying resourcing concerns all need effective resource management. When faced with resource disputes or disruptions, resource management methods that promote transparency and visibility of available resources and utilization will provide your company with more control.
6. Deal with resource shortages in a fast-paced business environment
If a specific skill set is required to begin a new project, planning provides visibility to find a matching resource within the institution. Because these resources are typically actively distributed in projects, implementing the out-rotation strategy will aid in the start-up of a new project. Another resource with the minimum prerequisites can serve as a backfill to fill the vacancy.
7. Increase profits by employing forecasting techniques
Project resource management tools and techniques such as forecasting project financials, including the cost, overheads, revenue, and project margins, allows you to take preventive measures and control project costs ahead of time. These insights can help you save money and increase profits by putting together the right resource mix.
8. Team Improvement
The secret to employee retention for professional services has a strong team that communicates effectively and understands their specific tasks. In project management, planning reinforces teams by keeping employees informed about anything from manufacturing assets to the device to labor requirements. Team members who understand what is expected of them and their assets will also function best.
Efficiency and optimization
Developing, monitoring, and leveraging the appropriate metrics is critical to optimizing your resource management practices. Combining in-depth, data-driven ideas with a powerful project management software solution is the most efficient way to measure and optimize your firm’s resource management practices. Resource management software can significantly improve efficiency and free up time by streamlining decision-making processes and reducing manual steps.