Learn about the role of resource allocators in managing and distributing resources within an organization. Find out how they ensure efficient resource use.
Resource allocation is critically important for project management. Resources are limited, and wrong decisions can lead to higher costs and slow delivery, which may result in client frustration. Unfortunately, making a wrong move is easier than you can imagine.
As resource allocators, managers have a lot to think about. There are people with their skills and seniority. There is a budget. There is time. Taken separately, each of the resources seems easy to handle – but only in theory. In real life, these resources create dependencies, get influenced by unexpected factors, and tend to get exhausted.
In this article, we’ll discuss the challenges resource allocators face in project management and give advice on how to deal with them.
Managers of organizations have many different duties and responsibilities. They organize their employees’ work, create strategies, communicate with various stakeholders, and do many other managerial things on the daily basis. Each of these duties requires a manager to play a specific role, which, in turn, requires a specific set of skills.
Henry Mintzberg, a Professor of Management Studies at McGill University in Canada, analyzed managers’ responsibilities, identifying ten roles managers perform in an organization and classifying them in three categories. These categories are as follows:
In Mintzberg’s classification, a resource allocator falls into the category of decisional roles.
The main function of a resource allocator is to ensure that resources are used efficiently and effectively, and that they are allocated in a way that maximizes the overall productivity and profitability of the organization. This can involve making decisions about which projects or tasks to prioritize, determining the allocation of resources to different departments or teams, and ensuring that resources are being used in the most cost-effective manner.
There are many different approaches to resource allocation, and the specific approach that is used will depend on the nature of the organization and the resources being managed. For example, in a manufacturing company, the resource allocator might be responsible for determining the most efficient use of raw materials and equipment, while in a service organization, the focus might be on maximizing the use of labor and financial resources.
One key aspect of resource allocation is the need to balance the allocation of resources with the needs and priorities of different stakeholders within the organization. This can include balancing the needs of different departments or teams, as well as the needs of customers, shareholders, and other stakeholders.
Effective resource allocation is critical to the success of any organization, as it can help to ensure that resources are used in the most efficient and effective manner possible, and that the organization is able to achieve its goals and objectives in a timely and cost-effective manner.
Typically, resources are planned and distributed by a project manager, especially in small and medium-sized companies. In larger organizations though, there could be entire departments in charge of resource allocation.
In addition to that, some companies can hire a resource manager. Unlike project managers, who are responsible for the projects they’re directly working on, resource managers handle resources across several projects simultaneously.
It’s also worth mentioning that there are two ways in which a manager can allocate resources – to projects and to tasks:
In this case, you allocate your team members to a project. This will work if you don’t know what tasks you will have to deal with.
Recommended reading: How to Allocate Resources to Projects
This type of resource allocation takes place when you’ve got tasks that can be already assigned to your team – for example, if you have a list of requirements from a client, these requirements can be transformed into tasks.
The resource allocator role involves a variety of tasks that are done with one aim – to optimize business activities. A manager as a resource allocator is supposed to distribute resources in a way that maximizes the efficiency and resourcefulness of an organization. This means he needs to identify project requirements and assign resources within the company’s timeline and budget.
A manager in the resource allocator role is supposed to handle the resource allocation process, which includes the following steps (these steps can also be used as a guide):
To allocate resources properly, a manager has to know what tasks the project will include. Break down the project into tasks, set goals, and create milestones.
Collect information, answering these questions:
Determine what resources will be required to complete each task.
Of course, the most obvious resource to allocate is funding. However, a term “resources” covers much more than just money. Basically, it refers to anything that is needed to complete a project.
To make things easier, we can roughly divide all resources into two main types:
Resources are not only limited – they’re often unavailable. This is especially tricky when it comes to time and people. So allocating resources, make sure they're available.
Is anyone going to take time off? Does anyone work part-time? Also, remember that someone may need a sick leave, which is hard to predict but still can happen.
If a person with the necessary skill in unavailable, be ready to replace him. You could hire a freelancer or a contractor, if no one with the skill is available.
It may also happen that you may have a limited number of team members with the necessary skill. Again, you could hire a contractor – or just put a project on hold, if it’s not first-priority.
There are many reasons why a person may not be available. After all, the company’s priorities can change. In any case, the best thing you can do is to analyze the availability in advance, to avoid surprises.
Make sure you allocate team members with the right skills. If you are a senior manager, you may not always know who has the appropriate skills, and what is your workers’ workload. In this case, consult with team leaders.
Besides, it’s important for project managers to be professional and objective while assigning tasks. If you’re friends with some novice and inexperienced people, do not assign them with difficult tasks. It will backfire.
Also, take into account the fact that some of your people may be working on more than one project. This means they won’t be able to fully dedicate to your project, so you may need additional people.
A resource allocation tool, or resource management tool, is software that helps project managers plan, allocate, and schedule resources, as well as track progress and generate reports. Unlike note-taking and whiteboards, software tools create transparency, enabling managers to automatically track their team members’ calendars in real-time.
A huge advantage of resource allocation tools is that they help you identify the best-suited resources for each task and make sure no one is sitting on the bench. This way, projects can be completed within the budget and on time. However, even though resource allocation software is very useful, many companies still track it manually using a spreadsheet, often making decisions by virtue of situations.
The benefits of resource allocation tools are obvious:
As the project unfolds, a resource allocator may face different unexpected changes. You may find out that you overloaded your team, or that the resources are running out because of bottlenecks, or that the project’s scope has changed. In any case, you should stay flexible and be ready to make changes. Reallocation of resources is not necessarily a bad thing – it can open opportunities.
Make sure to do the following:
Evaluation gives you a great chance to learn from your mistakes. Analyze the project: did you have any delays? How did the team handle the tasks? Were team members overloaded? What can be improved in the future? Obviously, it’s easier to do evaluations, using the data pulled out of resource allocation software.
Let’s take a look at some examples from project management to see how exactly a manager works in a resource allocator position:
Of course, there isn’t one right answer to all these questions. The decision on resource allocation in project management will highly depend on the current situation and priorities. The business environment is dynamic, and it means resources may need to be rotated depending on the business priority.
There are many blind spots to resource allocation. Very often these are obvious yet trivial things companies forget to take care of on time.
Resource allocation may seem easy to plan but it’s definitely not easy to execute. To succeed, a manager needs to consider many things which will determine how smoothly a project will go smoothly.
We’ve prepared some tips which should help managers to allocate resources effectively:
Plans are very important, but they are never set in stone. The possibility that you will need to reallocate your resources is very high.
For example, your client may suddenly decide to add more features and functionality. This will mean you’ll need to allocate more developers to the project – and if you lack people with a particular skill, you will have to think where to find them.
However, know when to say no. A change in demand, which typically concerns time and budget, can often lead to such a phenomenon as scope creep. Any additional requirement means that the project scope changes, and that involces additional resources. So if resources are scarce, do not overpromise.
Many things just have to happen in sequence, so you need to be aware of that and get prepared. For example, before booking resources on your project, make sure they will be able to start working on their part straight off – otherwise, if they have to wait till other people finish their tasks first, it will be a waste of time and money.
Whenever possible, try to not be overdependent on a certain resource, and always have a contingency plan.
Allocating resources, don’t focus on any single part of the project. Think of the project as a whole. A sick leave a team member takes is as important.
Time must be used efficiently. Without time tracking, your employees may spend a week doing a task that can be done in one day. So keep track of your team’s workload. Again, use the tools that provide real-time data.
Trying to figure out how much time each task on the project will take, don’t forget that people are living creatures who take coffee breaks and chat with colleagues. They get paid for this time, not directly contributing to the company’s progress. For your business, it’s non-billable time.
Take into account your human resource utilization. This will help you make accurate estimations while deciding how much time will be needed for each task.
Pick up a specific time when you’ll check your resources. See if anyone isn’t overtasked. Talk to your people to figure out if they’ve got any issues, and what is actually going on. Again, resource allocation software would be very useful.
Regular resource allocation reviews will ensure continuous improvement of your work process.
Learn about the skills and experience of your people to improve resource allocation. Create a profile for each of your human resources. The more you know, the easier it would be to assign the right people to the right task.
It’s very helpful to have a centralized resource pool that contains data about employees’ skills and skill levels. For example, in Runn the skill feature gives you an opportunity to search for resources by skill and then filter them by level, cost, and availability.
Overallocation means allocating too much work. It’s especially true with human resources because human capacities are harder to calculate than money or any other resource. Too many tasks or projects, assigned to the same person, will cause stress, lead to lower quality, and in some cases, even to attrition.
In addition to that, keep in mind that it’s impossible to work at 100% capacity all the time. Remember that besides directly working on the project, your people will have to check emails and do administrative stuff, which also takes time. The sweet spot is assigning 80% of the time for project work, and leaving 20% of the time for other work-related things.
Also, find out if there are any other upcoming projects. When they get confirmed, your people will have to balance their workload. Take that into account to not assign too many tasks to one person. This would inevitably lead to burnout.
Allocate MVPs (your most valuable players) to the projects of highest priority - like those which can bring high revenues or are necessary for strategic development. MVP refers to people on your team who have the most valuable experience and skills. It may be costly to hire them, but it usually pays off, since these people often save money for the company, working better than average employees.
At the same time, be careful allocating senior employees to projects that can be done without their special skills. This will increase costs while not necessarily improving the project.
Finally, when you allocate resources, do not appoint junior resources who lack the skills required to complete a certain task. You can cut costs, but their work may not meet the required standards. Besides, they will probably have issues fitting the timeline.
Once you notice areas where resources will bring more results if you reallocate them, don’t hesitate.
To allocate resources effectively, a project manager needs to do a lot of work. To not get lost, thoroughly research the current situation, plan ahead of time, and make sure to use resource allocation tools. This will help you success as a resource allocator, and give you more time to work in other managerial roles.
Having a resource calendar will help you better understand the availability of your resources, plan ahead for upcoming projects, and prevent overloads.
Capacity management is a delicate balancing act that has a very real impact on a businesses bottom line. Learn how to do it right in our ultimate guide.