Today, the business landscape is dynamic due to cost pressure and market volatility. So, organizations find it challenging to foresee future skill demands and keep their workforce ready to fulfil them. Nevertheless, capacity planning helps bridge these skill gaps effectively and make the right resources available for the right projects at the right time.
But it’s easier said than done, and as a result, managers often face certain bottlenecks. Insufficient capacity can cause timeline delays, client dissatisfaction, or work overallocation resulting in burnout. On the contrary, excess capacity can cause billable losses, lowered productivity, reduced profitability, etc. Therefore, the managers must address such bottlenecks and ensure successful project delivery.
This article elaborates on the best practices to manage capacity planning bottlenecks and how an advanced resource management solution can help with that. Let’s get started:
1. Why is resource capacity planning essential for an organization?
Resource capacity planning helps evaluate the gap between resource capacity vs. demand and helps formulate a plan to bridge it. It is essential for every firm as it helps avoid over/under allocation of resources, last-minute firefighting, and high-cost hiring. Further, it also helps forecast billable and strategic utilization and enables managers to mobilize resources from non-billable to high-priority work to maximize it.
Further, efficient capacity planning plays a pivotal role in filling the skill gaps proactively. For example, it helps adjust project timelines, initiate retraining/upskilling measures, hire contingent workforce, facilitate cross-department collaboration, etc., to bridge skill gaps.
Now that it is clear how resource planning is essential, let’s understand the best practices to manage capacity planning bottlenecks.
2. Best practices to manage capacity planning bottlenecks
Capacity planning bottlenecks are the issues that make it challenging to fulfill various projects’ demands jeopardizing their timely completion within the stipulated budget. Skills mismatch, excess/shortfall of resources, lack of niche-skilled resources, increased employee attrition/absence, rise in hiring/firing cycle, etc., are indicators of capacity planning bottlenecks.
Following are a few strategies to manage them effectively.
2.1 Proactively identify key roles for pipeline projects preferably from internal channels
Organizations often find it hard to fulfill demands for critical and niche-skilled resources for multiple projects at the same time. Therefore, the resource manager should keep track of pipeline projects and identify the key resource requirements for them.
Accordingly, they can forward-plan and arrange resources for these key roles, preferably through internal channels, including bench or critical resources getting released from the other projects. This way, proper foresight into pipeline project opportunities can help the resource manager eliminate the bottleneck of filling niche-skilled roles at the last minute.
2.2 Forecast and bridge skill gaps proactively
The ever-evolving technological trends have increased the need to maintain an adequately skilled workforce. It will help an organization take up advanced projects and avoid a loss of viable market opportunities. Therefore, managers must create a robust strategy to fill the skill gaps proactively.
Based on the nature of skill requirements and project duration, the manager can formulate appropriate retraining/upskilling programs or hire a permanent/contingent workforce. It helps minimize the firefighting of resources at the eleventh hour, enhances the firm’s sustainability, and gives a competitive edge.
2.3 Ensure competent resource allocation
The availability of competent resources at the right cost is crucial for every project’s successful completion. After the project manager raises resource requests, the resource manager analyzes them and identifies the competent resources to fulfill the demand.
For that, they can filter and narrow down resources by various attributes like skills, locations, availability, utilization, cost rate, etc. It helps eliminate bottlenecks like incompetent allocation or mismatched skills, etc., and achieve timely completion of a project within budget.
2.4 Build the right mix of permanent and on-demand workforce
A hybrid workforce is the new norm today and is widely accepted across various organizations. Therefore, the managers should balance the resource pool with the right mix of permanent and on-demand workers. It helps fulfill short-term demands effectively and minimizes high resourcing costs. It also helps cater to evolving client expectations and prevents last-minute firefighting for resources.
First, managers can assess the nature of skill requirements for a project. Then they can compare it with other pipeline projects to determine if the skill demand is one-off in nature or repetitive. Based on that, they can hire a permanent worker for recurring needs and contingent resources for a one-off skill demand. This will also eliminate the challenge of finding suitable projects to redeploy on-demand employees and reduce unwanted firing cycles.
2.5 Implement out rotation/backfill strategy for niche resources
Most enterprises fall short of niche resources when their demands arise from multiple projects simultaneously. The out rotation/backfill strategy can help eliminate the bottleneck of shortage of critical resources in a multi-project scenario. In this strategy, the resource manager first identifies the running projects with niche-skilled resources.
They then assess the requirement for the new project and out-rotate an appropriate internal niche resource from an ongoing project to fulfill the same. Such a resource is generally picked from the projects that have passed the initial phase and reached a steady stage where critical roles are no longer required. To ensure that the current project is not hampered, a similar skilled resource is deployed for it.
Given the best practices to deal with capacity planning bottlenecks, let’s understand how advanced resource management software can help manage them.
3. How does advanced resource management software help combat capacity planning bottlenecks?
Saviom’s robust resource management solution is the key to managing and eliminating capacity planning bottlenecks. It provides enterprise-wide visibility of all resource-related data, including their profiles, competencies, skills, availability, cost rates, among other attributes. The managers can leverage it to find the best-fit resources for their projects and ensure competent allocation. Further, the 360-degree visibility helps break down silos between departments and fosters cross-department collaboration. That way, managers can coordinate and share resources for projects, reducing instances of shortfall/excess of resources.
Moreover, the tool’s robust forecasting capabilities and capacity-vs-demand report help foresee the skill gaps and fill them proactively through appropriate internal and external channels. Project vacancy reports give details of the vacancies across various projects, while the bench report shows resources on the bench or are about to be benched soon. Accordingly, the managers can identify the best-fit resources from the bench and book them to the matching vacancies. It, thus, reduces the last-minute resourcing hassle.
Effective resource capacity management is essential for an organization’s sustainability and profitability. It plays a crucial role in keeping the firm future-ready and competitive in volatile and uncertain market conditions. The practices mentioned above, combined with a robust resource management solution, can help identify and mitigate bottlenecks. This will also help leverage the maximum resource potential for higher productivity and business efficiency.