Resource allocation is a crucial step in project management. This is so important because, as is easy to realize, resources are limited by nature.
- What is resource allocation in project management?
- The 7 steps for successful resource allocation in project management
- Resource allocation: Creating a Project Plan
- Resource allocation: Understanding resource requirements for activities
- Resource allocation: Find available resources with a matching skill set
- Resource allocation: Closing the gap between demand and capacity using multiple channels
- Resource allocation: Allocating resources according to demand
- Resource allocation: Reallocating resources between projects as necessary
- Resource allocation: Tracking and monitoring resource usage
Therefore, it is easy to see how the success of a project is directly proportional to the appropriate allocation of resources, regardless of the industry.
Easier said than done, especially if you lack the tools for resource management. In this article we will discuss what this is all about in detail.
What is resource allocation in project management?
Resource allocation is about determining and planning your manpower, equipment, and facilities on the different tasks of a project in order to achieve your goals.
Resources in a project pertain to everything you need to accomplish it. Here are some examples:
- Human Resources: The team members, the eventual consultants, and freelancers who bring the various skills needed to carry out the project.
- Equipment/tools: from project management software to computer hardware, from the equipment for an industrial processes to specialist’s tools.
- Facilities: the environment necessary to carry out a project, such as an office or warehouse.
- Materials: these are the consumables needed to generate output. For example, office stationery or raw materials to build a house.
- Budget: the funds necessary to purchase any of the aforementioned resources.
The 7 steps for successful resource allocation in project management
Project resources may be fully, partially available, or unavailable.
Therefore, the project manager, or resource manager, must take this into account to make decisions that ensure the best use.
Resource allocation: Creating a Project Plan
For starters, you need to split each project into multiple tasks and create their dependencies.
This process is known as the Work Break Down Structure, or WBS, and is the absolute minimum requirement for creating a project plan.
It is possible to have two activities run sequentially or in parallel based on their relationship.
The critical path within a project plan dictates the minimum amount of time required to complete the project.
Resource allocation: Understanding resource requirements for activities
Once the project has been broken down into the smaller activities, you will be able to identify the requirements needed for each resource.
Activities may require both human and non-human resources, depending on the nature of the work.
For human resources, you need to determine and assess skills and competencies.
Conversely, in case of non-human resources, you need to determine the specifications of the different equipment before assigning it to a task.
Resource allocation: Find available resources with a matching skill set
In this step, you need to determine the availability of a resource with the corresponding skills.
Resource allocation: Closing the gap between demand and capacity using multiple channels
If there is no human resource with matching requirements, emergency resources can be hired or used.
Likewise, if some equipment is unavailable, it can be rented or purchased as per the respective strategy and budget.
Resource allocation: Allocating resources according to demand
Once resources have been determined, they are assigned to specific tasks.
Unforeseen events are always around the corner, and it may happen that the resource assigned to a particular task, at the very last moment, is no longer available – for example, when a team member falls ill.
Especially, in the case of the most critical positions, the solution is to have a backup plan.
Resource allocation: Reallocating resources between projects as necessary
Resource reallocation may be necessary during a project lifecycle for a number of reasons.
A resource may present performance issues or, again, a resource with a niche skill may be required in another project with a higher priority.
Resource allocation: Tracking and monitoring resource usage
You should monitor the performance of each resource to make sure you are following an effective resource allocation process.
The ideal situation is that no resource should be over/under-allocated or over/under-utilized.
Small companies could probably just monitor this using a shared calendar.
Larger companies, however, need a dedicated resource allocation tool.
Of course, the project manager’s experience plays an important role, but the use of good project management software can provide key support.
Ultimately, resource allocation is an essential part of any project.
Without it, project managers can define a project timeline of activities and milestones, but they cannot know whether or not those timelines will be achievable using the resources at hand.
Moreover, getting understaffed during a project can cause unnecessary anxiety and inefficiency.
Worst case scenario, poor resource allocation can even lead to project failure.
Conversely, having a sound resource allocation strategy can provide confidence, create a positive work environment, and head the project toward success.
Make use of the tips offered in this article and supplement them with good project management software. They will help you to efficiently allocate project resources and thus achieve your goals.