Resource Planning – Art vs. Science

May 21, 2019

Resource Planning – Art vs. Science

There is an age-old debate within the professional services community about the best way to optimize resource utilization. Specifically, how do you maximize utilization of your existing resources, identify a shortage of specific skills and people, as well as the need to bring on additional people, and smooth out demand when you have peaks and valleys across client projects?

In short, how do you best match supply and demand?

The debate is centered on whether or not this process can be fully automated (science), or does good old intuition (art) still play a big part?


In order to have a good grasp on techniques to address the supply side of resource management, you will need to understand the predictability of your business. This will mostly be driven by the type of work you do. A few questions to consider:

  • How much of your work is seasonal or tied to external business drivers, for example tax or audit services?
  • Do you run an embedded services team within a software company, and have the increased demand that comes along with closing a number of deals close to a fiscal quarter or year end? For example – if 50% of your annual business closes in December, you know that January and February will be critical times for project staffing.
  • Do you sell and staff projects based on a top-down, FTE model, or as a bottom-up, work effort-driven estimate model? Maybe it’s a mix of both?
  • How accurate is your sales forecasting, and how long are your sales cycles? Do you run a high-velocity sales model, or mostly large mega-projects?
  • How much variation is there between projects? Do you have a project template that is duplicated with 80-90% consistency from one client to the next, or is every project unique?
  • If you work for a software company, what is the mix of products? Do you implement projects across multiple lines of business at a time?

Once you’ve started to think along these lines of analysis, you need to capture the data to support it. The transactional data – clients, projects, time entries, resources, billing, and cost rates – should be captured and stored in your Operational System of Record (OSR). However, you’ll need to supplement this with a number of additional dimensions in order to give you the correct level of insight and identify areas for planning through deeper analysis. These dimensions could include but certainly aren’t limited to:

  • Client location/vertical/size
  • Internal product mix/line of business
  • Skills required on the project
  • Role/resource mix (program management, business, technical, creative, QA, etc.)

The general rule here is that the more granularity you can bring in, the better, and you should be able to capture all of these dimensions in the core systems of record associated with each, such as your Customer Relationship Management, General Ledger, or Human Capital Management system. You’ll want to supplement the OSR data with these dimensions to give you a full picture.

The Overallocated Expert

This is where one of the first potential pitfalls comes into play. We’ll call it the myth of the overallocated expert. Every team has their superstar performers – you know, the consultant that everyone wants on their project, who can solve any problem that a customer throws at them and do it in a perfectly communicated, succinct manner.

The problem is this, and I’ve been guilty of it myself – the assumption is made that this person will be busy 100% of the time and never be available for new projects. While this may sometimes not be far from the truth, it becomes a self-fulfilling prophecy unless you check it against the hard data. Without checking, you will keep the supply-side of the equation in your head and introduce bias into the process, not to mention create inefficiency.

For example, we have two resource managers, Bob and Jill. Bob is responsible for the technical consulting team, while Jill’s team is the business analysts. They each have a superstar performer – Tom Technical and Alice Analyst, and a new client project, which matches perfectly to their skills, needs to be staffed.

The requests are put in, and Bob, who prefers to run his business by gut feeling, just knows that Tom is busy and doesn’t even consider him for the project. Jill, on the other hand, is data-driven and doesn’t want to make any assumptions. As it turns out, both Tom and Alice are only putting in 25 hours of billable work a week on their current projects, and they both have the bandwidth to support a new project in a part-time capacity.

So what happens? Bob assigns someone else who isn’t as good of a match, and Jill assigns Alice along with another resource so that she can bring her expertise to the project. Both Bob and Jill have done their jobs. They’ve fulfilled a resource request, and quickly everybody moves on. However, it’s only in retrospect, when looking at utilization in the rear-view mirror, does Bob wonder why he isn’t able to maximize the efficiency of his team the same way Jill is.

Not Looking at the Bigger Picture

Let’s look at resource management again through a different lens. This time, Bob and Jill want to consider their other resourcing needs over the coming months as a total picture and optimize staffing across all projects. There are other projects in the pipeline with varying degrees of certainty to close, and the project managers have put in requested allocations accordingly.

Because Jill has an understanding of the overall trends of her business, she can apply a mix of art and science to predicting the future. She can view a report to see that Alice’s current project is slated to ramp down in four to five weeks. She also has historical data to back it up, knowing that the project manager is fairly accurate in this reporting and the dates likely won’t change. She also knows that a new project which hasn’t yet closed but is in the “sweet spot” of the organization is slated to start shortly after, which will require 100% of Alice’s time.

This is where the judgement call comes into play. Is it better to sacrifice some amount of short-term billable time in order to maximize over the long term? Jill thinks so, and finds a different resource to support the immediate project instead.

Bob takes the same approach as he did before. He also looks at the business holistically, but with a much broader brush. He applies his gut feeling to both the state of current projects, as well as how he wants to plan for the future and what deals will close and when. It’s still a judgement call, but as you would expect, it isn’t going to be quite as accurate and efficient as the way Jill does it.

The Inflated Demand Problem

One final pitfall to address here is what I will call the “Inflated Demand” problem.

While the total effort assigned to a project should match what is sold (most of the time!), the allocation of that effort to a timeline falls to your project managers, and this is where another art vs. science debate comes into play. In my own experience, there is a human tendency to be more optimistic about how quickly a project will run – and, by extension, how many resources will be needed in the short term – than the data actually supports.

To make this more tangible, let’s say we’ve sold a project that requires 100 hours of a technical consultant’s time over the course of a 20-week project. This can be allocated in a number of ways:

  • They can be allocated five hours per week across the whole project from start to finish. While this probably isn’t accurate, it’s certainly the easiest.
  • Maybe the resource doesn’t start until midway through the project – the build phase – and are then assigned 10 hours/week for 10 weeks.
  • If the detailed Gantt chart is built out for the project, they could be assigned at the task level for 100 hours spread across individual tasks, which roll up to the total.
  • As a worst case scenario, this might not even happen at all, you just know they’re on this project and that’s it. It doesn’t get any more granular.

Where the balance comes into play is in how quantitative you want to be. Past data will certainly help shape and inform these decisions, and it’s incumbent on your team to have some checks and balances in place. Resource Managers should question Project Managers if things don’t seem right based on how projects have run in the past. It’s good to have some healthy tension here and if the right balance can be found, and everyone agrees on the methodology, you should be able to minimize the impact of “winging it.”

Finding Balance in Resource Planning

Decisions about resourcing are made every day. It’s critical that the role of the resource manager involves deciding when to utilize hard facts and quantitative decision methods, and when to interpret based on intuition. However, the reality is that their accuracy in maximizing their team’s utilization depends on the tools they use to create insights and make informed decisions.

Learn more ways to strengthen your resources with our ebook, “Agile Resource Management.”

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