5 tips to divest your project resourcing costs wisely
A project runs like a well-oiled machine when none of its constraints are excessively violated. Considering the dynamics of a rapidly evolving project landscape, though, global project managers know that nothing could be further from the truth when it comes to cost and time overruns.
When project issues multiply, the onus is on the project manager to identify, mitigate and prevent unfavorable incidents. And one of the first steps in a contingency plan is to assess the damage sustained by the project monetarily. In other words, how much it’ll cost you to resolve these issues and invest on measures that prevent recurrences.
While risks are inevitable 90% of the time, costing your project’s resources brings this percentage down significantly. Besides eliminating unworthy projects with a higher cost-to-benefit ratio, measures that divest project resourcing costs let you size up your resources in terms of the activities and duration they’re required for. It then lets you plan and distribute funds, thus extracting the project’s billing worth. Let’s begin outlining the 5-step process to doing so with the question;
Does project resource costing fall under project cost management?
To understand the difference is to first know what a resource is. Resources are a combination of Project cost management is a comprehensive project knowledge-area that predicts the costs to take up and complete a project. It generates cost estimates per project task, enabling you to contain any excesses. Project resource costing is that element that assigns costs to task-specific resources. It then generates skill-matches to ensure that the optimal number of relevant resources are available for deployment to time-sensitive, complex and mission-critical work. And this is how you get started on divesting your project resourcing costs -
1. A Strategic Resource Plan
As the word implies, a resource plan identifies and strategizes the usage of your workforce and finalizes allocations to future work. It detects resource insufficiencies and/or excesses and reshuffles your employees such that starving projects are restarted with optimal bandwidth. Having a resource plan module within a resource management software strategizes the usage of your workforce such that a sufficient balance is achieved between resource assignments and technical capabilities they’re equipped with.
A resource plan lets you gauge your workforce’s long term fit with your organization, both culturally and strategically. Simply put, it retrieves resource-centric information from the inbuilt staff repository to weed out irrelevant and outdated skills, thus shaping the resource pool around an evolved capacity. This measure ensures your resourcing spend is invested in the right competencies before work commences, rather than hustle for secondary resources in the nth hour. Better still,a strategic resource plan prevents you from over-hiring the wrong resource types and instead, redistribute that spend into upskilling measures for your existing resources.
Strategic resource planning profiles resources by skills, location, experiential prowess, knowledge upgrades, availability,certifications/reskilling undertaken and location. It then looks into previous and inflight work to assess the primary skills that prevailed. By adding resource effort estimates to project data, not only are you in a position to allot future available hours but also ensure resource schedules stay the course.
Costs can consequently be assigned by your employees’ billability or the time spent on a particular service and skill. Resource plans that factor in the cost of resources per task or project activity lets you calculate the exact quantity and quality of resources in terms of skill-matches, availability and utilization of the existing resource capacity, all at once.
2. Invest in Resourcing Data Analytics
Of the five degrees of project freedom, quality and effort remain non-negotiable entities, over and above the triple constraints of time,costs and scope. Which is why it makes sense to invest in a resource-centric reporting suite.
Besides monitoring effort levels and quality standards, the more granular your analytical components are, the better unified are enterprise-wide project and resource workflows. Resourcing data analytics center insights around your resources’ mobilization on multiple inflight projects. It stores resource profiles and segregates them by their skills, site (or location), period of availability, effort hours and full-time equivalents. By recording this information, it prevents you from over- or under assigning the existing capacity while gauging workforce relevance. In other words, it divests project resourcing costs by weeding out undesirable traits and promotes reskilled resources.
A measurable by-product of this endeavor is your team’s overall productivity. For instance, incentivizing high performers not only uplifts team morale but also fosters a collaborative work culture comprising of project teams who play to their strengths.
Reporting analytics also measure hourly rates differentiated by the type of resourcing contracts in question. This way, temporary hires aren’t working past their shortened hours but are able to deliver quality work alongside their full-time counterparts. With an accurate overview of availability against project vacancies, concerned teams are instantly notified of upcoming assignments in the project pipeline, so that they can self-check their schedules and in turn, raise and resolve scheduling conflicts ahead of the curve.
3. Diversify Resourcing Contracts
Given the gradual shift from conventional permanent roles to more temporary options such as freelancing and part-timing, embracing a gig workforce comprising of several types of resourcing contracts not only lets you retain true potential but ensures the quality of deliverables checks all the right boxes.
Not only do contractual hires space work evenly amongst your resources but also ensures timely delivery of the work requested for. When several projects are on the boil, retaining contractors and freelancers speeds up time-sensitive tasks with their prior orientation around your project’s particulars. Incidentally, when you receive several bids for the same work, you can ascertain the most cost-effective resource and allocated hours onto a project without overloading any one. This way, labor overheads are prevented while ensuring time to master newer requirements is minimized.
4. Scope out the project realistically
When time is money, clarifying the project’s scope right from the start is key to bringing stakeholders, clients and project teams onto the same page.
Keeping the project scope realistic not only covers all important aspects of the project such as its risk, costs, resources and but also manages the clients, teams and stakeholders’ expectations uniformly. It repurposes the project such that costs remain low without your team investing too much time and effort into gold plating the work done. Besides additional billable hours going into the project, modifications risk the product’s functional behavior unnecessarily.
In other words, when a product is overbuilt there is the distinct possibility of going over the proposed budget. Scoping the project lets you re-examine business requirements and eliminate features that do not contribute directly to the business case and/or value of the end product.
5. Revisit project timelines and effort estimates
Considering the exclusivity or interdependencies between two tasks, revisiting project timelines verifies the time-sensitivity and criticality of sequenced tasks.
The benefit of a resource management suite here is that it lets you detect benched potential who are between projects. It then aggregates the effort bandwidth of both active and passive resources to generate enterprise-wide resource effort estimates with greater precision. This way, an exactness between resource availability and the existing skills capacity occurs, ensuring that competent staff can take up complex tasks without being overloaded.
So how does repurposing resources around their core competencies and available hours shorten the project duration considerably?
For one, not all tasks require all working hours in a day. If a task ended earlier than scheduled, the latest start of the next task in line has to be appropriately advanced to prevent lags in the project delivery route. Conversely, if a task is taking longer than expected, succeeding work has to be extended by finishing routine BAU work in the quickest possible time. In order to allow a seamless transition from one activity to the next, instant alerts concerning which skills were used, percentage of available effort hours and number of resources possessing this know-how needs to be relayed to team members.
While resource schedules would have to be renegotiated with project managers and their teams alike, minimized effort hours also saves time while reducing project costs.
Sensible effort estimation is a core component of a successful resource management strategy. And with these 5 points in mind, you’ll not only divest your project resourcing costs but will budget your work with resource efficiency at the center!
Author Bio :
As the Business Sales Consultant at Saviom, Aakash Gupta is an established authority on workforce management, resource planning and project portfolio optimization. With several leading pieces on the subject to his credit, Aakash spends his time expanding his learning on the best project management practices. Follow him here.