8 Tips for Estimating Resources in Project Management
Calculating resources in project management is one of the primary skills for a project manager. It depends on not only understanding project scope and needs, but also having detailed knowledge of how each team member performs, how the team performs together, and the typical feedback loop between team and client. Making an accurate prediction can be complicated but is important not only to bid the project accurately, but also to effectively plan for and execute a project.
Tips for Calculating Resources in Project Management
The actual resources needed to complete a project will depend on the productivity of your individual team members, the amount of project switching (passing project tasks between team members), as well as the feedback loop from clients and stakeholders.
1. Understand the Scope of the Project
Before a company can accurately bid on a project, the project manager should have a clear and detailed understanding of the project scope. There are several methods for using project scope to help estimate deliverables, including a top-down or bottom-up approach.
A bottom-up approach (using the team’s collective knowledge to predict each small step from inception to completion) is the most accurate method of predicting resource needs, but can also be time-consuming and impractical during the project planning phase. A top-down approach (breaking the project down into high-level needs and letting the team handle the details within a given timeframe) can be faster, but is often significantly less accurate. Usually somewhere in-between is the most practical and effective for a project manager.
2. Know Your Team
The project management industry has a standard of never expecting an individual to be 100% utilized. In fact, the running average is to assume 80% utilization for any given resource. However, some resources may be more—or less—productive on average than others, some may have upcoming vacations or expected leave, some may have more average sick days than another, and most can anticipate decreased productivity when there’s lots of project switching (or passing tasks between different team members). This is where you can, and should, have intimate knowledge of how your team operates individually and together. Find the right formula for your resource calculations, then take into consideration any expected decreased productivity (such as during the summer and holidays when vacations are likely to disrupt the productivity process).
3. Get to Know the Industry Climate
Understanding the industry climate can help you get a feel for how clients may impact a project timeline. For instance, an industry with government or health services clients can expect increased bureaucracy and downtime during reviews, approvals, etc. It can also help you measure whether your team is performing competitively in the industry, or if you tend to be faster—or slower—than your competitors in presenting deliverables. A good place to start with this analysis is by talking with other project managers in your industry, project managers in the industries you’re offering services in, or even other vendors within the industry.
4. Analyze Published Estimating Data
It might be a comfort for you to know that you’re not the only person in a project management role for the specific type of project you’re undertaking. There are others who have—most likely—helped execute similar projects before. The project management community helps support each other in their PM endeavors by periodically publishing journals, articles, and books that collect data about projects, including the resources used for the project. Perusing these publications can help you get a better feel for calculating the resources that may be used in your project.
5. Reuse Project Resource Plans
If you’ve had a successful project that might be repeated in whole or in part in the future, save the project resource template. With project management tools such as Mavenlink, you can save the template with the actual resources, or use a role-based template that dictates the time you’ll need a particular role—such as a graphic designer or programmer—so you can more easily allocate resources for the next project using role matching.
6. Analyze Previous Project Data
Hopefully you already have a meticulous resource tracking system in place so you can see how previous projects performed. If so, you will be able to look through this data to see which resources were used in previous projects or tasks within a project. This can be incredibly helpful in calculating resource needs as it’s using real, in-action data from your team. If you don’t have a tracking system in place, implement one! The information you gain through these systems can be invaluable to your project management process.
7. Consider Current Commitments
Besides calculating project resources, you’ll also have to know whether the project resources needed for a project are available—and when. Your project management software should have a detailed view for seeing team availability as a whole, as well as seeing a breakdown of availability by team member. This helps you to predict timelines and see if there’s any period within the project where resources may fall short of project needs.
8. Compare Different Scenarios
Unless your team is made up of drones who produce exactly the same output at identical associated costs, you can expect a lot of variability in the time resources need to complete certain tasks, as well as a difference in resource cost. For this reason, it can be a huge benefit to the company to build out multiple project scenarios to analyze the difference in timeline and profit when calculating resources. Tools such as Mavenlink can help build out these scenarios to help you find the best resource allocation for your project.
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