Resource management is a lot like Clark Kent and Superman. Behind his desk at the Daily Planet, Clark is practical and dependable. He keeps things running day-to-day, meeting deadlines, and delivering the goods. That’s operational resource management.
Then he steps into a phone booth, takes to the sky, and sees things from a bird’s eye view – spotting risks, averting dangers, and generally saving the day. That’s strategic resource management.
Same guy, same discipline, but very different faces (well, exactly the same face except that one wears glasses and the other doesn’t 🦸♂️ 👨🏫).
If you’re relatively new to resource management – or work in an organization with a lower level of resource management maturity – you probably only see the day-to-day face of operational resource management.
And while that gets the job done, there’s a whole other side you might not even know about. So let us introduce you to its super impactful alter ego – so you can understand what strategic resource management can do for you and your business.
TL;DR: operational vs strategic resource management
In a hurry? Here’s the difference:
- Operational resource management: Allocates current resources to ensure in-flight projects deliver on time, on budget, and to client satisfaction.
- Strategic resource management: Aligns resources with your organization’s long-term strategic goals and future opportunities.
What does that mean in practice? You’re going to have to keep reading ⬇️
What is operational resource management?
Operational resource management is the process of allocating resources to projects and tasks, particularly in project-based businesses like software development or consulting. It’s concerned with the day-to-day deployment of human time and talent, to make sure neither goes to waste.
On the ground, that looks like:
- Maintaining up-to-date information on resources, skills, availability, and capacity.
- Assessing available resources and allocating the most appropriate people to projects.
- Balancing workloads to maintain productivity while reducing benchtime and burnout.
- Monitoring project progress and adjusting resource allocations to keep things moving.
- Tracking and reporting on resource utilization and other key performance indicators.
Done well, operational resource management looks like:
- Defined processes that deliver strong efficiency, reliability, and agility.
- Projects running on schedule and budget, with minimal delays caused by resourcing.
- Quality deliverables and happy clients, thanks to skill-based allocations.
- Increased ROI from investment in human capital through optimized utilization.
- Protected profit margins through closer monitoring of resource costs.
What is strategic resource management?
Strategic resource management is concerned with aligning resourcing decisions to critical business objectives. It takes a bird’s eye view of business needs and works out how to manage human capital and capacity to achieve them.
Strategic resource management isn’t concerned with day-to-day allocations and individual projects. It looks at overall business capacity, capability building, demand forecasting, risk management, and more.
For example:
- Demand forecasting – predicting demand based on future projects, market trends, and growth objectives.
- Scenario planning – modeling resource needs under different business scenarios.
- Strategic capacity planning – identifying and addressing capacity and capability gaps.
- Workforce development – determining optimum methods to increase capacity and capability.
- Financial control – ensuring processes are cost-controlled and profits are protected.
- Revenue generation – facilitating alignment between sales and capacity.
- Risk mitigation – reducing high-level resource risk, such as short-term recruitment planning.
Done well, strategic resource management delivers:
- Better alignment between people and business priorities, ensuring resource management supports organizational objectives effectively.
- Standardized, centralized resource management practices that deliver consistent results across every business function.
- The ability to seize new opportunities because of capacity and capability confidence.
- More strategic recruitment decisions that avoid unnecessary costs and disruption.
- Higher employee engagement, motivation, satisfaction, and retention.
Operational vs strategic resource management: in practice
1. Overutilization of key resources
It can be hard to appreciate the differences with an abstract list of differences, so let’s take a look at operational and strategic responses to some common challenges faced by resource managers.
|
Operational response: Reduce disruption to current projects and improve staff workload
|
Strategic response: Prevent recurrence and safeguard long-term growth
|
- Look at current utilization rates to determine over- and under-utilization
- Review in-flight project timelines and how they’re being affected
- Reassign work from overworked engineers to those with spare capacity
- Alert Human Resources to the potential need to recruit more engineers
|
- Look at long-term utilization rates to identify relevant trends
- Determine whether future demand will increase or decrease
- Consider opportunities to increase capacity through recruitment, upskilling, or crosstraining
- Assess employer brand and pipeline building to attract new graduates
|
2. Low project quality and high failure rates
People don’t have the right skills for the projects they’re working on. Quality and client satisfaction are falling, and rework is undermining profitability.
|
Operational response: Improve skills-matching within allocations
|
Strategic response: Prevent future skill-related failures
|
- Ensure skills and skill levels are considered in future resource allocations
- Review current projects for skills-based problems and reallocate resources accordingly
- Conduct a skills inventory to uncover gaps that need addressing
|
- Implement a skills management strategy to identify and reduce gaps
- Create workforce development plans to address long-term skills gaps and build capabilities
- Invest in systems to centralize, maintain, and enrich skills information for better allocations
|
3. Capacity awareness and alignment issues
The sales team is onboarding projects that you don’t have capacity for, putting some delivery teams under pressure, while others are warming the bench with nothing to do.
|
Operational response: Firefighting current capacity issues
|
Strategic response: Proactively address the cause of the issue
|
- Use resource levelling techniques to relieve immediate project pressures
- Reassign work between over- and under-utilized staff to keep promised schedules on track
- Identify where temporary contractors are required to fulfil client promises
|
- Implement a capacity-aware sales process to ensure you only commit to projects you can deliver
- Establish interlock meetings and reporting between sales and delivery to prevent recurring misalignment
- Regularly review utilization rates to surface spare capacity that can be sold (or resources to retrain)
|
What are the benefits of moving from operational to strategic resource management?
Moving from operational to strategic resource management will deliver significant benefits to your business. You might also hear this referred to as raising your resource management maturity. Whatever you choose to call it, here’s what you can expect.
- Better alignment with business goals – Resources are allocated not just to complete tasks, but to support the organization’s long-term objectives and growth priorities.
- Increased efficiency and productivity – Proper planning prevents over- or under-utilization, reduces bottlenecks, and ensures teams are deployed where they add the most value.
- Right-sizing the workforce – Strategic resource management helps ensure the organization has the right number and mix of people and skills to fulfil its future goals.
- Enhanced employee satisfaction and retention – Balanced workloads and career development through upskilling can improve satisfaction and reduce the cost of involuntary turnover.
- Stronger financial performance – Strategic resource allocation optimizes ROI on human capital, reduces costs associated with overstaffing or underperformance, and improves project profitability.
- Future-proofing the organization – Scenario planning, capacity forecasting, and skills development ensure the organization can seize opportunities and adapt to changing market conditions.
- Elevated status within the organization – It’s not about you. But there’s nothing wrong with enjoying a bit of credit where it’s due. Increasing your resource management maturity increases your impact and position within the business.
How can you move from operational to strategic resource management? Five steps to strategic success
Moving from operational to strategic resource management needs leadership buy-in for the concept of strategic resource management, and a roadmap and resources to make it happen. Don’t worry, we’ve got plenty of resources to help you.
1. Assess current maturity
Assess your current resource management maturity to identify gaps in processes, tools, data, and skill management. Work out whether you engage in reactive or proactive resource management.
If you discover there’s room to improve, plan your next steps using our guide to resource management maturity and check out our webinar, mastering resource management maturity ➡️
2. Secure leadership buy-in
Executives need to understand the value of strategic resource management and support the necessary investment of time, tools, and people. Listen to leadership problems and understand strategy, so you can establish an undeniable value proposition for resource management in your firm.
Further reading: How to get buy-in for resource management and How to get stakeholders on your side ➡️
3. Centralize and standardize
To operate at a higher level of maturity, your resource management practices and data sources need to be centralized and standardized. This could mean anything from implementing organization-wide RM processes to creating a dedicated Resource Management Office.
Further reading: Centralized resource management: the what, why, and how ➡️
4. Improve data practices
Operational and strategic resource management decisions depend on accurate, up-to-date data. If your data sources are siloed, incomplete, or out-of-date, your shift to strategic RM is doomed – in fact it's one of the biggest resource management mistakes.
Further reading: Quality data and resource management ➡️
5. Get better visibility
Both types of resource management rely on visibility – into resource use, project progress, capacity, utilization, and more – to inform insights and action. The best way to achieve this is with a dedicated resource management platform, with live updates, data visualizations, dashboards, and customisable reports.
Further reading: Our buyer’s guide to resource management software ➡️
Final thoughts
Strategic resource management is the next stage in the evolution of your professional service organization – and your personal role within it.
It takes the benefits that operational resource management brings to projects – accuracy, efficiency, profitability – and applies that at an organizational level.
If you’re ready to shake off those glasses, fasten that cape, and Superman this thing, you’re going to need a trusty sidekick. That’s where Runn comes in.
Think of us as the JARVIS to your Iron Man. Just A Rather Very Intelligent System that can help you elevate the maturity, impact, and position of resource management within the business through tools for:
- Effective skills management for strategic planning
- Accurate resource allocation and scheduling
- Future-focused capacity and scenario planning
- Dashboards for at-a-glance operational insights
- In-depth reporting to guide strategic decision-making
