Chapter 10: Resource Planning
Learning Objectives
- Use effective methods in estimating, allocating and assigning resources.
- Examine challenges of allocating scare resources and juggling limited resources among multiple projects.
- Discuss five tools and techniques for creating the most accurate estimates.
In the previous wedding case study, it is clear that Steve and Susan have resource problems. Getting a handle on all of the tasks that have to be done is a great start, but it’s not enough to know the tasks and the order they come in. Before you can put the final schedule together, you need to know who is going to do each job, and the things they need so they can do it.
“We’ve got so much to do! Invitations, catering, music… and I’ve got no idea who’s going to do it all. I’m totally overwhelmed.” From this statement it is clear that Susan is worried about human resources. In comparison, Steve realizes that not all resources are people: “And it’s not just people. We need food, flowers, a cake, a sound system, and a venue. How do we get a handle on this?”
Resources are people, equipment, place, money, or anything else that you need in order to do all of the activities that you planned for. Every activity in your activity list needs to have resources assigned to it. Before you can assign resources to your project, you need to know their availability. Resource availability includes information about what resources you can use on your project, when they’re available to you, and the conditions of their availability. Don’t forget that some resources, like consultants or training rooms, have to be scheduled in advance, and they might only be available at certain times. You’ll need to know this before you can finish planning your project. If you are starting to plan in January, a June wedding is harder to plan than one in December, because the wedding halls are all booked up in advance. That is clearly a resource constraint. You’ll also need the activity list that you created earlier, and you’ll need to know how your organization typically handles resources. Once you’ve got a handle on these things, you’re set for resource estimation.
Estimating the Resources
The goal of activity resource estimating is to assign resources to each activity in the activity list. There are five tools and techniques for estimating activity resources.
- Expert judgment means bringing in experts who have done this sort of work before and getting their opinions on what resources are needed.
- Alternative analysis means considering several different options for how you assign resources. This includes varying the number of resources as well as the kind of resources you use. Many times, there’s more than one way to accomplish an activity and alternative analysis helps decide among the possibilities.
- Published estimating data is something that project managers in a lot of industries use to help them figure out how many resources they need. They rely on articles, books, journals, and periodicals that collect, analyze, and publish data from other people’s projects.
- Project management software such as Microsoft Project will often have features designed to help project managers estimate resource needs and constraints and find the best combination of assignments for the project.
- Bottom-up estimating means breaking down complex activities into pieces and working out the resource assignments for each piece. It is a process of estimating individual activity resource need or cost and then adding these up together to come up with a total estimate. Bottom-up estimating is a very accurate means of estimating, provided the estimates at the schedule activity level are accurate. However, it takes a considerable amount of time to perform bottom-up estimating because every activity must be assessed and estimated accurately to be included in the bottom-up calculation. The smaller and more detailed the activity, the greater the accuracy and cost of this technique.
Estimating Activity Duration
Once you’re done with activity resource estimating, you’ve got everything you need to figure out how long each activity will take. That’s done in a process called activity duration estimating. This is where you look at each activity in the activity list, consider its scope and resources, and estimate how long it will take to perform.
Estimating the duration of an activity means starting with the information you have about that activity and the resources that are assigned to it, and then working with the project team to come up with an estimate. Most of the time you’ll start with a rough estimate and then refine it to make it more accurate. You’ll use these five tools and techniques to create the most accurate estimates:
- Expert judgment will come from your project team members who are familiar with the work that has to be done. If you don’t get their opinion, there’s a huge risk that your estimates will be wrong.
- Analogous estimating is when you look at similar activities from previous projects and how long they took. This only works if the activities and resources are similar.
- Parametric estimating means plugging data about your project into a formula, spreadsheet, database, or computer program that comes up with an estimate. The software or formula that you use for parametric estimating is based on a database of actual duration from past projects.
- Three-point estimating is when you come up with three numbers: a realistic estimate that’s most likely to occur, an optimistic one that represents the best-case scenario, and a pessimistic one that represents the worst-case scenario. The final estimate is the weighted average of the three.
- Reserve analysis means adding extra time to the schedule (called a contingency reserve or a buffer) to account for extra risk.
Exercises
In each of the following scenarios of planning Steve and Susan’s wedding, determine which of the five activity resource estimation tools and techniques is being used.
Exercise 10.1 Sally has to figure out what to do for the music at Steve and Susan’s wedding. She considers using a DJ, a rock band, or a string quartet.
Exercise 10.2 The latest issue of Wedding Planner’s Journal has an article on working with caterers. It includes a table that shows how many waiters work with various guest-list sizes.
Exercise 10.3 There’s a national wedding consultant who specializes in Caribbean-themed weddings. Sally gets in touch with her to ask about menu options.
Exercise 10.4 Sally downloads and fills out a specialized spreadsheet that a project manager developed to help with wedding planning.
Exercise 10.5 There’s so much work that has to be done to set up the reception hall that Sally has to break it down into five different activities in order to assign jobs.
Exercise 10.6 Sally asks Steve and Susan to visit several different caterers and sample various potential items for the menu.
Exercise 10.7 Sally calls up her friend who knows specifics of the various venues in their area for advice on which one would work best.
Exercise 10.8 There are two different catering companies at the wedding. Sally asks the head chef at each of them to give her an estimate of how long it will take each of them to do the job.
Exercise 10.9 There’s a spreadsheet Sally always uses to figure out how long it takes guest to RSVP. She enters the number of guests and their zip codes, and it calculates estimates for her.
Exercise 10.10 Sally’s done four weddings that are very similar to Steve and Susan’s, and in all four of them, it took exactly the same amount of time for the caterers to set up the reception hall.
The activity duration estimates are an estimate of how long each activity in the activity list will take. This is a quantitative measure usually expressed in hours, weeks, days, or months. Any work period is fine, and you’ll use different work periods for different jobs. A small job (like booking a DJ) may take just a few hours; a bigger job (like catering, including deciding on a menu, ordering ingredients, cooking food, and serving guests on the big day) could take days.
Another thing to keep in mind when estimating the duration of activities is determining the effort involved. Duration is the amount of the time that an activity takes, while effort is the total number of person-hours that are expended. If it takes two people six hours to carve the ice sculpture for the centerpiece of a wedding, the duration is six hours. But if two people worked on it for the whole time, it took 12 person-hours of effort to create.
You’ll also learn more about the specific activities while you’re estimating them. That’s something that always happens. You have to really think through all of the aspects of a task in order to estimate it. As you learn more about the specific activities remember to update the activity attributes.
If we go back to our case study of the wedding, we can see that while Sally has a handle on how long things are going to take, she still has some work to do before she has the whole project under control. Steve and Susan know where they want to get married, and they have the place booked now. But, what about the caterer? They have no idea who’s going to be providing food. And what about the band they want? Will the timing with their schedule work out? “If the caterers come too early, the food will sit around under heat lamps. But if they come too late, the band won’t have time to play. I just don’t see how we’ll ever work this out.”
It’s not easy to plan for a lot of resources when they have tight time restrictions and overlapping constraints. How do you figure out a schedule that makes everything fit together? You’re never going to have the complete resource picture until you have finished building the schedule. And the same goes for your activity list and duration estimates! It’s only when you lay out the schedule that you’ll figure out that some of your activities and durations didn’t quite work.
Project Schedule and Critical Path
The project schedule should be approved and signed off by stakeholders and functional managers. This ensures they have read the schedule, understand the dates and resource commitments, and will cooperate. You’ll also need to obtain confirmation that resources will be available as outlined in the schedule. The schedule cannot be finalized until you receive approval and commitment for the resource assignments outlined in it. Once the schedule is approved, it will become your baseline for the remainder of the project. Project progress and task completion will be monitored and tracked against the project schedule to determine if the project is on course as planned.
The schedule can be displayed in a variety of ways, some of which are variations of what you have already seen. Project schedule network diagrams will work as schedule diagrams when you add the start and finish dates to each activity. These diagrams usually show the activity dependencies and critical path.
The critical path method is an important tool for keeping your projects on track. Every network diagram has something that is called the critical path. It’s the string of activities that, if you add up all of the durations, is longer than any other path through the network. It usually starts with the first activity in the network and usually ends with the last one.
The reason that the critical path is critical is that every single activity on the path must finish on time in order for the project to come in on time. A delay in any one of the critical path activities will cause the entire project to be delayed (Figure 10.1[1]).
Knowing where your critical path is can give you a lot of freedom. If you know an activity is not on the critical path, then you know a delay in that activity may not necessarily delay the project. This can really help you handle emergency situations. Even better, it means that if you need to bring your project in earlier than was originally planned, you know that adding resources to the critical path will be much more effective than adding them elsewhere.
It’s easy to find the critical path in any project. Of course, on a large project with dozens or hundreds of tasks, you’ll probably use software like Microsoft Project to find the critical path for you. But when it does, it’s following the same exact steps that are followed here
Resource Management
Resource management is the efficient and effective deployment of an organization’s resources when they are needed. Such resources may include financial resources, inventory, human skills, production resources, or information technology (IT). In the realm of project management, processes, techniques, and philosophies for the best approach for allocating resources have been developed. These include discussions on functional versus cross-functional resource allocation as well as processes espoused by organizations like the Project Management Institute (PMI) through the methodology of project management outlined in their publication A Guide to the Project Management Body of Knowledge (PMBOK). Resource management is a key element to activity resource estimating and project human resource management. As is the case with the larger discipline of project management, there are resource management software tools available that automate and assist the process of resource allocation to projects.
HR Planning
The most important resource to a project is its people—the project team. Projects require specific expertise at specific moments in the schedule, depending on the milestones being delivered or the given phase of the project. An organization can host several strategic projects concurrently over the course of a budget year, which means that its employees can be working on more than one project at a time. Alternatively, an employee may be seconded away from his or her role within an organization to become part of a project team because of a particular expertise. Moreover, projects often require talent and resources that can only be acquired via contract work and third party vendors. Procuring and coordinating these human resources, in tandem with managing the time aspect of the project, is critical to overall success.
Managing the Team
In order to successfully meet the needs of a project, it is important to have a high-performing project team made up of individuals who are both technically skilled and motivated to contribute to the project’s outcome. One of the many responsibilities of a project manager is to enhance the ability of each project team member to contribute to the project, while also fostering individual growth and accomplishment. At the same time, each individual must be encouraged to share ideas and work with others toward a common goal.
Through performance evaluation, the manager will get the information needed to ensure that the team has adequate knowledge, to establish a positive team environment and a healthy communication climate, to work properly, and to ensure accountability.
Managing the project team includes appraisal of employee performance and project performance. The performance reports provide the basis for managerial decisions on how to manage the project team.
Employee performance includes the employee’s work results such as:
- Quality and quantity of outputs
- Work behavior (such as punctuality)
- Job-related attributes (such as cooperation and initiative)
After conducting employee performance reviews, project managers should:
- Provide feedback to employees about how well they have performed on established goals.
- Provide feedback to employees about areas in which they are weak or could do better.
- Take corrective action to address problems with employees performing at or below minimum expectations.
- Reward superior performers to encourage their continued excellence.
Techniques for Managing Resources
One resource management technique is resource leveling. It aims at smoothing the stock of resources on hand, reducing both excess inventories and shortages.
The required data are the demands for various resources, forecast by time period into the future as far as is reasonable; the resources’ configurations required in those demands; and the supply of the resources, again forecast by time period into the future as far as is reasonable.
The goal is to achieve 100% utilization. However that is very unlikely, when weighted by important metrics and subject to constraints; for example: meeting a minimum quality level, but otherwise minimizing cost.
Resource Leveling
Resource leveling is used to examine unbalanced use of resources (usually people or equipment) over time and for resolving over-allocations or conflicts.
When performing project planning activities, the manager will attempt to schedule certain tasks simultaneously. When more resources such as machines or people are needed than are available, or perhaps a specific person is needed in both tasks, the tasks will have to be rescheduled sequentially to manage the constraint. Resource leveling during project planning is the process of resolving these conflicts. It can also be used to balance the workload of primary resources over the course of the project, usually at the expense of one of the traditional triple constraints (time, cost, scope).
When using specially designed project software, leveling typically means resolving conflicts or over-allocations in the project plan by allowing the software to calculate delays and update tasks automatically. Project management software leveling requires delaying tasks until resources are available. In more complex environments, resources could be allocated across multiple, concurrent projects thus requiring the process of resource leveling to be performed at company level.
In either definition, leveling could result in a later project finish date if the tasks affected are in the critical path.
Solutions
Solution to Exercise 10.1 – Alternative analysis
Solution to Exercise 10.2 – Published estimating data
Solution to Exercise 10.3 – Expert judgment
Solution to Exercise 10.4 – Project management software
Solution to Exercise 10.5 – Bottom-up estimating
Solution to Exercise 10.6 – Alternative analysis
Solution to Exercise 10.7 – Expert judgment
Solution to Exercise 10.8 – Expert judgment
Solution to Exercise 10.9 – Parametric estimating
Solution to Exercise 10.10 – Analogous estimating
Key Takeaways
- Resource management is the efficient and effective deployment of an organization’s resources when they are needed. Such resources may include financial resources, inventory, human skills, production resources, equipment or information technology (IT).
- If the project cannot produce the deliverables specified by the sponsor or meet the sponsor’s deadline, deal with the problem immediately through discussions with him or her. Don’t ignore the problem.
- Reexamine key assumptions about deliverables, deadline requirements, and project resources. It may be possible to satisfy the sponsor and stakeholders by making adjustments to those elements.
- Reexamine the WBS and your initial assignment of tasks to identify unnecessary steps and opportunities to get the job done faster and better.
- Resource leveling is used to examine unbalanced use of resources (usually people or equipment) over time and for resolving over-allocations or conflicts.
- Five tools and techniques for estimating activity resources are:
- Expert judgment
- Analogous estimating
- Parametric estimating
- Three point estimates.
- Reserve analysis
Attribution
This chapter is based on chapter 11 in Project Management by Adrienne Watt.
Chapter 11 in Project Management by Adrienne Watt CC BY 4.0 is a derivative the following texts:
- Project Management by Merrie Barron and Andrew Barron. © CC BY (Attribution).
- Project Management/PMBOK/Human Resources Management and Development Cooperation Handbook/How do we manage the human resources of programmes and projects?/Manage the Project Team by Wikibooks. © CC BY-SA (Attribution-ShareAlike).
- Resource Management, Edgar Schein, and Resource Leveling by Wikipedia. © CC BY-SA (Attribution-ShareAlike).
- Project Management for Instructional Designers by Amado, M., et. al. © Creative Commons Attribution 3.0 Licence.
- Figure 10.1: Illustration from Barron & Barron Project Management for Scientists and Engineers, http://cnx.org/content/col11120/1.4/ ↵