How To Set Up an Optimal Resource Allocation?

Often perceived as a constraint, the allocation of resources is actually a real performance lever in project management. Time, skills, employees, budget or equipment, resources and their careful planning are essential to achieve the company's strategic objectives.

However, setting up an efficient allocation of resources is not always a simple process! That's why we've put together a comprehensive guide to help you understand the challenges of optimal resource allocation, but also to help you implement it in your organization with the right tools.

What is Resource Allocation in Project Management?

Resource allocation: definition

Resource allocation, sometimes referred to as resource allocation, is the process of determining how resources are distributed within a project.

A resource is defined as both tangible and intangible, such as equipment or budget, as well as intangible skills or available time.

This crucial step, carried out during project planning, involves listing the different resources and distributing them to maximize productivity. It is considered strategic: it would be difficult for the company to achieve its objectives without an optimal and thoughtful allocation of resources. 

Differences between resource allocation, smoothing, and leveling 

Resource allocation can easily be confused with resource smoothing or leveling. Here's a recap to help you clarify each concept.

• Resource allocation plans who does what, when, and how; it allocates resources to each specific task.
• Resource Smoothing distributes resources evenly to meet the schedule. It avoids one-off overloads, maintaining the duration of the project. 
• Resource leveling tolerates a schedule adjustment. This technique also avoids overloading resources, but allows for a postponement of the deadline. This can be relevant when resources are limited or shared across multiple projects.

Why Optimize Resource Allocation?

A strategic lever on several levels

The allocation of resources is strategic in many aspects, which we will review. Its challenges differ from one structure to another because they depend on the company's objectives, its sector, its culture or human and financial constraints.

Performance and growth

An optimal allocation of resources supports the growth of the company by boosting its performance. This involves two aspects: 

• Optimizing the utilization rate, which avoids over- or under-stressing resources.
• Maximizing the occupancy rate, which helps to distribute the different talents on high value-added missions.

Skills management

The more the mission requires non-interchangeable resources (specific expertise, for example), the more the allocation of resources must make it possible to select the right profile. This is made possible through an audit of available skills or the anticipation of training or recruitment needs.

Financial optimization
Optimized resource allocation improves project profitability.

By strategically assigning different profiles to projects, at appropriate timings, it is possible to maximize margins and therefore revenues.

Profiles and experience levels

The allocation of resources also makes it possible to think about the seniority of the profiles during assignments. Thus, the levels of experience must be taken into account: IT Services or agency, senior profiles must be less solicited on pure operational work, unlike more junior profiles. Indeed, seniors devote part of their time to internal activities such as mentoring, training or strategy.

Team engagement and employer branding

The distribution of resources has a strong impact on employee engagement and can also be used as a lever to improve the quality of life at work. Indeed, it contributes to:

• avoid overloads, limiting burnout and turnover,

• optimize the workload in a balanced way,
• consider the appetites, thus strengthening the motivation and commitment of employees.

HR Management

Resource planning is also essential to recruitment because it highlights missing skills. Thus, it guides research and makes it possible to propose training plans adapted to the missions.

Operational challenges of resource allocation

Efficiency and performance 

Resource allocation should be done in a way that aligns teams, schedule, and budgets with business goals. Available at the right time, resources help save time by being available in a timely manner, maximizing business potential.

Unparalleled Visibility 

By providing a clear view of availability, skills, and assignments, resource allocation limits the frustration caused by inappropriate load distribution.

Profitability 

When optimized, resource allocation improves profitability because it helps minimize costs. This involves limiting delays, idle time, or the strategic placement of the most profitable profiles.

Responsiveness and flexibility 

Resource allocation must be flexible: it must allow resources to be adapted in the event of unforeseen events. In addition to risk management, the allocation of resources must be reviewed in the event of a change in scope or external factors (economic, environmental, political, etc.).

Tools

Theuse of resource planning facilitates resource allocation. This usually allows you to dynamically manage resources to coordinate all projects within the portfolio.

Gentle on the teams 

Optimal resource allocation helps keep the workload balanced. Neither over-used nor under-used, the teams remain motivated and committed. 

This helps to increase employee satisfaction.

Different challenges depending on the profile

Resource allocation has a different impact depending on the company's profiles. 

• For the project manager, it allows them to have the right resource, at the right time.
• For the CEO and the COO, it helps to optimize the use of resources by maximizing the performance of the teams.
• For Human Resources, it helps to plan for resource planning and managing skills development.
• For the CFO and CFO, it helps to make projects profitable.
• For consultants, it allows them to offer assignments adapted to their profile and career.
• For the PMO and the responsible resource planning, the allocation of resources makes it possible to objectively arbitrate one's choices, based on reliable data.

How To Efficiently Allocate Resources on Projects?

Plan for capacity management 

Capacity planning in resource allocation involves four steps.

• Take inventory of available resources

This requires a list of the resources available : skills, employees, time, tools, budget or equipment.

• Identify resource needs

It is a question of mapping needs in order to organize resources. Ultimately, the allocation of resources must make it possible to meet the company's strategic objectives. This is because project resource forecasting helps to determine whether the necessary skills are available internally or whether there is a need to outsource or recruit.

Thus, this task requires the involvement of all the different departments. 

• Prioritizing needs

Prioritizing tasks and needs is essential. Take the time to prioritize them based on their priority level. There are several options:

• Prioritise projects that achieve strategic objectives, 
• Favor those that prove to be the most profitable. 

• Anticipate resource requirements 

The distribution of capacity must be anticipated. Considered from the pre-sales phase, anticipation makes it possible to ensure that the load and available capacities are aligned.

In addition, using a resource planning how Stafiz can facilitate this planning. Indeed, the capacity planning view helps you, for example, to identify when capacity becomes insufficient, thanks to a forecasting vision. This visibility gives you all the keys to react accordingly, by planning recruitment, training or outsourcing. 

Forward-looking view of the resource planning compared to the real world

Estimating time and skills needs 

The estimate is decisive because it allows you to carry out simulations that will help you establish a budget. This exercise consists of determining the amount of resources needed for each task, optimising the margin as much as possible.

Once the estimate has been established, you can set up your resource allocation plan. The latter must remain flexible to deal with perimeter drifts that may affect your estimate.

Select the right profiles

• Choosing the right profile thanks to an internal search engine

The selection of profiles is strategic, it is a question of finding the balance between skills management and employee commitment.

Finding the right profiles for the right projects can be complex, which is why Stafiz offers a search engine, taking into account the skills, appetites and availability of resources.

• Generate scenarios with the scenario builder

Another feature, the scenario builder, also makes it possible to automate capacity management. This allows you to generate optimal resource allocation scenarios by selecting criteria such as skills, appetites or availability. You can then match them to your goals like the utilization rate or income.

Stafiz's scenario-based simulation tool 

• View all available skills

The selection of profiles implies a strategic distribution between the projects. Sometimes, it makes more sense to keep a profile for an upcoming project. This visibility over the entire project portfolio is then possible thanks to the centralization of needs. 

Knowing your talents is therefore essential: an audit, a monitoring of skills and appetites are valuable tools. To do this, you can create a skills database, either in Excel format or using the Resource Breakdown Structure, or through a resource management tool like Stafiz.

Your employees' CVs serve as a reference for your allocation searches.

Manage and optimize the load

Load management is an essential step for optimal resource allocation. The goal is to balance workloads in a way that avoids over- or under-stretching of resources, while optimizing the utilization rate.

Thus, comparing the current capacity with the estimated demand allows you to calculate a load plan.

This tool avoids inter-contracts, which can generate a loss of income or even a disengagement of the teams. The identification of risks then makes it possible to adopt preventive measures.

Thus, it is essential to gain real-time visibility on the workload of the teams and to monitor the utilization rate and occupation.

The dashboard offered by Stafiz allows you to obtain this vision while facilitating the replacement or reallocation of resources, accessible in a few clicks.

Stafiz, for example, takes into account pre-positioning, established on the basis of opportunities, in order to take into account the overall and future activity.

Stafiz simplifies the allocation of your resources

Spend less time planning your projects and earn profit!

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Track and adjust allocation

Monitoring the use of resources must allow flexibility and responsiveness. Thus, using work management software like Stafiz helps you to carry out accurate monitoring. This tool is a reliable and scalable reference source. 

Resource allocation should be adjusted when the parameters change. Thus, it is essential to regularly analyze workloads and propose alternatives to avoid overflows. 

• Align resource allocation with project profitability

The allocation of resources on the basis of profitability is made possible by a Predictive visibility into the resource planning. This allows you to anticipate budget overruns and in some cases, a feature can even help you identify the causes of deviations.

In addition, some tools such as Stafiz offer customizable alerts to notify you in advance, without you having to consult the forecast report. You can thus rectify the trajectory, as with Stafiz thanks to the time tracking feature.  

Time tracking in Stafiz

• Align resource allocation with a change in project scope 

In the event of a change in scope, a common hazard in project planning, the reallocation of resources is necessary. Some features help you in this process, such as the automatic assignment offered by Stafiz. 

Stafiz offers features that make it easy to reorganize with flexibility

Use Case: How a Consulting Firm Optimized its Resource Allocation with a Software

Present in many countries, Colliers is a real estate consulting company with 230 employees. Already equipped with a CRM and an HRIS, the firm was however faced with problems of resource planning. And for good reason: management scattered over several Excel files.

Stafiz was able to meet Colliers' needs in terms of long-term capacity planning, but also thanks to better financial management.

The Stafiz x Colliers Success Story

Optimal resource allocation helps to achieve performance and profitability. However, it also plays a role in the well-being and engagement of employees by facilitating collaboration. Indeed, anticipating needs helps to distribute resources accurately, thus limiting the tensions related to the distribution of burdens.

For effective resource allocation, communication between different teams is essential. To guarantee transparency, the use of dedicated tools such as Stafiz is therefore invaluable. Indeed, they make it possible to anticipate loads, but also offer a global view to monitor assignments in real time, thus facilitating adjustments in the event of unforeseen events. Flexibility is essential for optimal resource allocation.