How many times have you, as a manager, said to an employee “This needs to be done by tomorrow?” and in response, they have wondered if they even have the time or capabilities to complete the task? It’s not the best scenario for any manager or employee, for that matter.
To avoid such occurrences from happening frequently and reduce the stress related to finding the right person for a job, use a resource planning program. Resource management software will ensure that you always find the right person for the task at the right time so you can achieve your overall business goals.
Resource planning programs are technological tools that aid in the allocation and management process of your employees. In simpler terms, it makes tracking, managing, and ensuring productivity from your resources (employees in this case) easier and more efficient. Resource planning programs also give your business more control over resources and budgets.
One thing to highlight is that resource planning programs are not end-to-end project management systems. While there is some overlap, a resource planning tool is more for allocating the right resource for each project task and understanding its utility. You can say that resource planning software will further support your project management tools and goals.
A quick search will show you that there are multiple resource planning software available in the market. However, not all are the same. Some might advertise themselves as a resource planning tool, but be more of an HR tracking or resource management software. What will help you identify the right for you? It’s about the features.
It’s true that there are many features in resource management tools and the choice is quite vast. New technologies are also changing the landscape. Below are the “must-have” factors that any resource allocation app should possess:
The most important feature of a resource planning tool is its ability to provide real-time visibility into all your company’s resources, regardless of where they are physically based. The tool should also highlight their availability, billing rate, skill set, and current workload (so you can assess their capacity to take on more work).
When we say time tracking features, we don’t just mean documenting the clock-in and clock-out times of employees. Time tracking is actually about understanding how much actual time was spent on a job. When time tracking is done well, it gives a wealth of knowledge on how resources are being utilized.
Data and real-time reporting on resource management metrics will help your organization understand its current performance and give informed insights on what changes need to be made. Some of the key metrics to look out for include utilization rates, actual time taken vs. estimated time taken, estimated costs vs. actual costs, and variation. Better data leads to better decisions.
Drag-and-drop makes planning and scheduling a breeze. It’s an easy-to-use, fast, and efficient way of allocating resources to jobs. With drag-and-drop scheduling, changes to plans can also be handled instantaneously and in real time. A resource is no longer available? Simply, search the database for the next available and appropriate resource and drag their name into the scheduling sheet.
Your organization probably has its own technology stack that might compromise HR software, financial and operating systems, and/or a project management app. The resource planning application you are looking for needs to be able to easily integrate with these systems. Otherwise, it will end up being “another” system that is disjointed and probably not used. When resource management software can be customized and seamlessly integrated with the existing framework, it will be able to provide cohesive insight into how the business is doing and whether the resources are being utilized effectively to meet those targets.
With the rise of remote and hybrid teams, it’s vital to use a resource planning tool that is accessible on the go. You don’t want software that is tied to a certain computer or can only be used while at the office — it will limit your ability to plan and track resources efficiently. Therefore, it’s best to use software that is cloud-based, accessible via all devices, and that all stakeholders can access no matter where they are.
How does one know a process isn’t working and needs change? The most common way to do this is by looking at data. Resource planning software provides significant and valuable data metrics that you can use to track performance, identify areas for improvement, and guide your decisions.
To track resource performance, the key metrics to pay attention to in your resource planning software are resource utilization, optimal utilization, and cost variance. These three key performance indicators will show you if all your employees are being used to their highest potential.
The formula to calculate resource utilization is: given work time/resource capacity (how many hours they can work). This figure can be tracked as a percentage. Do remember that a higher resource utilization rate doesn’t always correlate with increased productivity.
Optimal utilization is calculated by: (Resource costs + overhead + profit margin) / (Total hours available x optimal billing rate). In most scenarios, the accepted optimal utilization rate is between 85-100%
Cost Variance calculates the difference between the allocated cost against the actual cost of a task or job.
By tracking these three metrics, you can improve your planning and identification of resources. For example, if your utilization rate is coming to 60%, then you know that there are several resources that are being underutilized. You can take proactive measures to improve this figure.
With real-time utilization and cost-variation rates, you can also get a betting return on investment (ROI). For instance, you can move resources to take on more billable tasks that will generate revenue and contribute to the bottom line. The resource planning software also tracks the costs of the resources against their billables. This metric ensures that the majority of resources are working on strategic and revenue-generating assignments.
Cost variance aids in evaluating how each of the resources fits into a project and if some are more cost-effective than others. Will a resource put you over budget? Is the resource worth going into the red? If not, it’s important to reevaluate the allocation of resources.
Tracking these KPIs lends itself to better forecasting future needs. If the utilization rates are above 100%, it could be a sign that resources are being overworked or that they don’t have the skills to complete the tasks in the given time frame. With this knowledge, the company can make a decision on whether they need to hire new resources or train their current staff.
|Benefits of Tracking Resource Performance
There are a lot of resource management platforms available, but all might not be suitable for your business. Before purchasing any, here are a few guidelines to keep in mind:
A resource management tool optimizes resource usage and offers a clear overview of available resources. You can see who is there, available, and/or booked.
The features of the software will make tracking and managing resources a breeze, reduce booking errors, and give you a more productive workforce.
eResource Scheduler is a powerful, cloud-based, and data-centric resource planning tool that has everything you need to improve your resource management. Start our free trial today and see how it works for you.