Wondering where to start with resource management targets? Discover the six key metrics to monitor and master.
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Measuring resource management is essential for effective performance. As with everything, you need to know how you’re doing in order to know whether you’re doing well.
Targets let you quantify and prove the value you bring to the business, as well as giving you insight into what's working and what's not.
But equally, for targets to be meaningful, they need to be valid as performance indicators. There's no point trying to measure and influence everything. You need to measure what matters.
In this article, we'll be getting into what targets you should set for resource management performance, and how to measure them.
Targets matter in resource management because they inspire high performance and prove the value of the discipline.
Imagine you set yourself a target of a sub-30-minute 5K. That inspires you to try harder and allows you to measure your progress towards your goal.
It’s the same in resource management. Knowing what strong resource management looks like gives you something to aim for and helps you raise your standards.
Resource management metrics help align resource management objectives with corporate strategy and ensure your resource management plan is adding value to your organization.
By quantifying what you bring to the business, resource management KPIs can unlock credibility – with senior leaders, project managers, and the rest of the team – and secure buy-in towards further success.
Plus, monitoring your progress towards these KPIs can show how well your organizational resource management is maturing, bringing you ever closer to peak performance and efficiency.
It's really important to call out your key performance indicators and communicate these. When my team launched at the company that I'm at, people really didn't know what resource management was. So really defining how, for instance, utilization is one of our key metrics – and this is what we mean by that, and giving examples of what good looks like and what not so good looks like." – Martha Arias-Webster, MBA, RMCP, PMP.
Resource management performance can be judged on three fronts: financial, operational, and reputational – all of which impact your organization’s bottom line.
Combined, these three dimensions are the foundation of effective resource management. Financial targets protect your profits, operational metrics support timely project completion, and reputational factors secure long-term resilience.
Neglecting any one can undermine your organization’s present and future success, which is why setting targets and monitoring progress towards them is essential.
Resource utilization is a measure of how effectively you use available resources (people, in this case). It’s about optimizing the amount of work people perform – to ensure maximum productivity and return on investment – while protecting their wellbeing and workload.
Resource utilization rates deliver:
The formula for resource utilization is (Productive hours/Total hours available) x 100.
However, if you use resource management software, this should automatically calculate resource utilization for you. Happy days!
An 80% utilization rate is optimum. It’s high enough to make sure you’re scheduling staff time effectively – they’re not bench-warming while waiting for work. This keeps your projects on track and gives people enough of a buffer to work without unnecessary stress.
Outcome: you’re not scheduling enough work and your resource is underutilized.
Outcome: you’re scheduling too much work and your team is likely to be less productive and more error-prone
Billable utilization is also about using project resources effectively. However, this metric focuses specifically on the proportion of time spent on billable client work – activities that directly generate revenue for the business.
Billable utilization is a direct revenue driver. It’s a strategic resource management target because it lets you assess the balance of billable to unbillable work.
While unbillable work still contributes to business success – things like internal meetings and training – it doesn’t directly create revenue. If resource utilization sways too far in favor of unbillable team assignments, your profit margins suffer.
The Resource Management Institute calculates that a 1-point increase in utilization can be worth over $1m in a 300-person professional service organization. So if you track one thing, track this!
Billable utilization is a driver of the business. If people have lower billable rates, then the overhead costs get absorbed by your organization. So there's a cost-saving mechanism there for the business." – Martha Arias-Webster, MBA, RMCP, PMP
Learn more: How a 3% Utilization Increase Can Translate to Millions in Margin ➡️
The formula for billable utilization is (Billable hours/total available hours) x 100
Again, if you use a resource management tool, this data should be readily available and helpfully visualized for you, making it easy to spot trends and areas for improvement.
Within your resources’ 80% overall utilization rate, aim for 80% of that to be billable. That equates to about 64% of your resources’ total available time being billable. Something to remember when scheduling and recruiting. (Here’s why a 100% utilization rate is definitely not something to aim for!)
Outcome: This is a little high and doesn’t leave enough time for essential non-billable work or unexpected work. Despite being profitable, there’s a risk of stress and slippage.
Outcome: this is about right. They’re bringing in revenue but have sufficient time for training, meetings, and everything else their job requires to run smoothly and productively.
Time to staff is the amount of time it takes to fill a resource need once it has been identified. It ensures you have the right resources for timely project delivery, incurring no delays due to resource availability.
Time to staff tells you a lot about the efficiency and accuracy of your resource allocation process, which are both key to assembling high-performing teams in a reasonable timeframe. The metric evidences your resource management:
Delays in assigning resources also flag potential resource constraints and capacity risks, particularly if specific roles consistently take longer to fill.
I look at time to staff as being an input driver to projects starting and ending on time. Where we have a date of intake, a target start date, and a target end, then we can look and say, 'Did we meet our time to staff? How long did it take us to get the team fully staffed, and did this change our end date?' In that way, you can look at time to staff as being a driver for client satisfaction as well.’ – Martha Arias-Webster, MBA, RMCP, PMP.
The formula for Time to Staff is: Date of resource allocation - date of resource request = No of days
Targets will vary according to industry and role complexity, but a lower number is generally better. A consistently high time-to-staff rate can indicate problems with strategic workforce planning, as there aren’t enough qualified resources available when needed. Or it may indicate inefficiencies in your internal resource management processes.
Forecast accuracy measures how closely your resource demand forecast matches reality. Did your projections match actual resource requirements?
More accurate project estimates lead to less variance – ie, your teams are more likely to meet project timelines, and your capacity planning to deliver the perfect balance of people and skills.
There are a few ways to assess forecasting accuracy.
These metrics can be used individually or aggregated across multiple projects – see examples below.
Remember, resource planning software can crunch these complex numbers automatically for you.
Under 20% error / over 80% accuracy is a great target for MAPE.
Use these metrics to look for patterns in forecasting accuracy. For example, whether certain teams or types of work are consistently under- or over-forecast.
Staff satisfaction is how happy your employees are with their experience. There are a lot of factors that impact this – both within and outside your control. So you should be focusing on the impact of resourcing decisions on their overall satisfaction.
Staff dissatisfaction translates into various problems for your business – problems you could and should avoid if possible.
‘We wanted to make a connection for how well we were doing for our clients internally – if we were giving them the type of project resources they needed.
So, we run a survey to our internal clients on satisfaction, asking things like 'Did we give you the person who can deliver, who has the skills that you needed? How are they performing?' So we can get feedback on how we're doing. And the people who we are staffing, we ask them how well we did in matching them to work that matches their skills so that they can deliver work.’ – Martha Arias-Webster, MBA, RMCP, PMP.
Many organizations target 70% staff satisfaction or above. If your organization is below this, aim for steady improvement.
This one doesn’t need any introduction. It’s a measure of whether your clients were happy with the project you delivered.
Happy clients are more likely to pay their invoices on time, to recommend you to other businesses, and to give you repeat custom. It delivers a significant competitive advantage.
There’s no one-size-fits-all. But some common approaches include:
Aim for over 8 out of 10 in satisfaction scores or above 50 for NPS. Appropriate retention rates will be specific to your industry and service. For example, a design agency might reasonably expect multiple projects from the same client, whereas a construction firm may have more one-off engagements.
Using resource management software makes it significantly easier to monitor resource management KPIs and improve the performance of your resource management strategy.
Last year, when we surveyed over 100 resource managers, we discovered that 40% of them were spending over six hours each week on reporting alone – some, significantly more than six hours.
Now, as we have argued in this article, tracking metrics and measuring performance are important factors in ensuring successful, strategic resource management. But a lot of the data collection and number crunching that goes into your reports can (and should) be automated.
With Runn, for instance, you can see resource management metrics at a glance through intuitive heatmaps and charts, customizable dashboards, and in-depth reports.
Why not start a free trial and take a look at our extensive but user-friendly reporting features?
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