Resource Allocation Definition and Tips for Projects

What is Resource Allocation?

The method of allocating the most suitable resources for projects and tasks is known as resource allocation. The workload is managed by resource allocation to avoid under or overutilization of resources. This allows people to be reassigned as needed based on the project timelines and current resource availability. Resource allocation is done along with capacity planning.

How to Allocate Resources on a Project

A crucial resource planning activity is resource allocation, a strategy you create intending to get the most out of the available resources in a project. This is primarily a short-term plan put in place to accomplish future goals.

The following are some broad guidelines to assist you with allocating resources when overseeing a project.

1. Know Your Scope

First, establish the scope of the project, objectives, and tasks that must be executed. Once you have established the scope, you can estimate what resources you will require and how many are needed to finish the project. The clearer the project scope, the easier it will be to determine how to allocate resources.

2. Identify Resources

Now, you must gather your resources. Determine who is available, which equipment is needed, and where the project's tasks will be performed. Also, check if the area is available. 

First, obtain the resources before allocating them. Prepare a list based on the criteria above, and ensure it falls within the allotted budget.

3. Don't Procrastinate

Resources will inevitably need reallocating. Thus, during the planning phase, spend some time researching if and when there might be a blocked teammate or task dependencies.

Set up a resource plan and take note of these warning signs. Figure out how you'll respond to them ahead of time, so you are ready to deal with them when they occur.

4. Think Holistically

Remember to keep track of the project's progress, but more importantly, be updated on the status of your resources. For example, what is the team's schedule, would any of them go on vacation, how long is the lease for the equipment or the project site, and so on? These are crucial issues to consider while allocating resources.

5. Know Your Resource Dependencies

Preplanning helps to eliminate bottlenecks that may trap your resources when they are most needed during project execution. It also keeps your resources from running out. Have a backup plan ready to keep your plans from becoming overly dependent on a single resource to avoid problems later.

6. Track Time

Keep an eye on the schedule, how your team is performing, and how efficient they are. As a project manager, you must maintain track of your team's workload to avoid delays. That requires using the appropriate tools to provide real-time information recorded on a single page that you can view and schedule ahead of time as needed.

7. Use Tools

Use project management software to manage your resources more effectively. You can get project data instantly updated with an online tool. You can see how your resources are distributed throughout a calendar that can indicate if they are on-task, off-task, sick, or on vacation. Rescheduling to assist overburdened teammates can become extremely simple.

8. Don't Over-Allocate

Managers often over-allocate, which instead of completing projects on time and under budget, over-allocation risks team burnout. It's unjust to put so much pressure on your resources that they break down. Reexamine the resource plan, then use it to distribute your project resources appropriately.

9. Be Realistic

Although it is good to be prepared for problems that may arise in the future, avoid skewing the project estimate by adding too many resources or days to the project schedule. It may compromise the effectiveness of long-term planning. Remember to compare the estimated to the actual usage. It comes in handy to keep you appropriately allocated. Using a tool is essential for accurately assessing the project's progress.

10. Have a Routine

Set up regular check-ins to review your resources, verify the project management tools, and ensure no one is overburdened for the upcoming week's work. Speak with your teammates to get a feel of what's happening on the project's front lines, and ask if they have any concerns. 

11. Know Your Resources

You should be aware of the experience, skills, and personality of every resource you have tasked or assigned to assist with the project. Familiarity with the resources will help you arrange them in future projects and allot tasks they can perform best.

12. Use Resource Reports

Resource reports provide a complete picture of the project's progress, helping you balance resources. Task reports keep you updated, and variance reports assist you in determining whether the project is progressing as intended. The latter provides critical information, such as whether you are behind schedule and must redistribute tasks to get back on track.

Benefits of Resource Allocation

Resource allocation helps keep project progress on track, avoid resource burnout and maintain quality. Here are the main benefits of resource allocation.

Collaboration

Resource allocation promotes communication and collaboration across teams. A resource allocation plan facilitates communication with stakeholders to keep them updated on progress toward strategic goals.

Efficiency

The availability of resources assists teams in completing projects on time and using only the resources required to achieve every goal. A good strategy assists project teams in avoiding errors caused by conflicting dependencies.

Team Morale

Employee participation and team morale rise as a result of resource allocation. It allows for a more balanced division of responsibilities, ensuring that teammates are not overworked. It can increase productivity because when team members' well-being improves, they have more capacity and authority to undertake additional work.

Cost Reduction

Since it promotes efficiency, minimizes waste, and avoids costly blunders, setbacks, and delays, efficient resource allocation can lead to significant cost savings.

Challenges of Resource Allocation

Resource allocation can come with its own set of challenges, such as the following.

Resource Scarcity

More resources are often required to complete the tasks outlined in the project plan. Throughout the project, some resources may be only partially available. In some situations, project resources could be available initially but not as the project advances.

Skill Shortages

If certain skills are in scarce supply, the project may suffer as a result. Additional hiring or training could be required, which may not have been incorporated into the project's schedule.

Resource Overallocation

Over-allocation can also reduce productivity and efficiency. Employees may become overwhelmed if more resources are assigned to a task than are required.

Visibility

 Poor visibility into the project's progress can lead to project managers failing to allocate the appropriate resources where they are required. It could also impair a company's capacity to foresee future project requirements, resulting in future resource misallocation. 

Miscommunication

Poor communication between teammates or different teams can lead to various issues. Miscommunication between the sales and delivery teams, for example, could result in the customer not being aware of all project needs, resulting in deliverables not meeting client expectations.

Outdated Technology

Traditional methods, such as a spreadsheet program, may not give enough real-time data for monitoring. As project requirements change, this might result in the overallocation of resources or missed opportunities.

Scope Creep

Scope creep is a deviation or fluctuation from a project's original tasks or goals that can lead to constant adjustments in the project's scope. If requirements are constantly imposed, resources may be depleted, and team members may suffer.

How to Handle Resource Allocation Problems?

Here are some common challenges project managers face and how to overcome them. 

The Project Scope Changes

The best resource allocation strategy still has a possibility of scope creep. To avoid it, you can make sure project scopes and objectives are defined clearly. Ensure a mechanism that allows employees to approve modifications. Keep an eye on team performance to track progress. Use all of the resources at your disposal to accelerate progress. Have a scope change mechanism to adapt quickly and get back on track.

Resources Become Unavailable

Unforeseen circumstances could prevent resources from being accessible. Find a replacement as soon as possible from your resource pool. If no one with the necessary abilities is available, hiring a freelancer or contractor may be the best solution. Investigate task dependencies and prepare a backup plan to avoid such an issue.

Resources Need to Be Shared

In small companies, it is typical for projects to employ the same resources, which can lead to bottlenecks. Use resource allocation software to identify gaps ahead of time. Monitor the workloads of teammates who move between departments. It's the most effective technique to avoid over-allocating resources and fatigue.

Unexpected Delays

The best way to deal with unexpected delays is to prevent them. To do so, you can assign tasks based on expertise. Refrain from overloading team members with numerous other priorities. Provide flexible working hours. Plan project deadlines, divide them into phases, and keep track of progress. Prepare a systematic and transparent resource distribution strategy.

Manage Your Team’s Availability on Autopilot With Resource Allocation Software

After the resource allocation procedure is completed, changes in project requirements may arise that necessitate a quick response. Modern resource management solutions with real-time business update reports and dashboards contribute to an improved organization health index.

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Conclusion

Project managers sometimes ignore the necessity of resource allocation. Whether you have a team of two or 200, efficiently distributing your resources depends on the manager's ability to recognize and utilize their distinct skill sets and manage their availability. It's easier to keep the team efficient and deliver successful projects through resource management and the right tools. Learn all the essential skills required to become a Project Manager with our UMass Project Management Certification. Attend live online interactive classes, masterclasses from UMass Amherst, Harvard Business Publishing case studies, and capstone projects. Enroll today!