Allocating and Managing Constrained Resources
This chapter provides a variety of techniques for monitoring the resources used within your project. The emphasis is on human resources, but the principles can be applied to any project resource.
Managing Resources in Living Order
Seeing the Big Picture
Resource allocation occurs within a broader organizational context, subject to pressures that go beyond an individual project. That means that getting and using the resources you need, when you need them, is rarely as simple as it might seem when spelled out in a project schedule. As discussed in Lesson 2, in a well-run organization, project selection is guided by the organization's overall strategy. The same is true of resource allocation; decisions about what resources will be available to which projects are, ideally, made in alignment with the organizational strategy. For project managers, it's important to keep this in mind. It might be better for you and your project to have access to a certain resource on a certain day, but that might not necessarily be the best option for the organization as a whole.
Other realities can affect your ability to gain access to and pay for a resource. In the case of a scarce piece of equipment, you might try to reserve it for more time than is strictly necessary, so you can use it when you need it. This allows you to purchase flexibility, but that flexibility might be more expensive than you can afford. However, if you let a critical resource go, you might not get it back when you need it, or you might need to pay a charge for reactivating the resource. In other situations, you may be forced to pay for more than you need. For example, in projects involving union labor, you might have to pay for a half-day of labor for someone to operate equipment that you actually only need for two hours. All of these factors affect the reality of getting a resource, how much it costs, and when it is available.
Another important factor affecting the allocation of resources is the often intense competition for resources within an organization. In an article describing how the pharmaceutical company SmithKline Beecham (SB) improved its resource-allocation process, Paul Sharpe and Tom Keelin acknowledge the realities of intra-organizational competitiveness:
How do you make good decisions in a high-risk, technically complex business when the information you need to make those decisions comes largely from the project champions who are competing against one another for resources? A critical company process can become politicized when strong-willed, charismatic project leaders beat out their less competitive colleagues for resources. That in turn leads to the cynical view that your project is as good as the performance you can put on at funding time…. One of the major weaknesses of most resource-allocation processes is that project advocates tend to take an all-or-nothing approach to budget requests. At SB, that meant that project leaders would develop a single plan of action and present it as the only viable approach. Project teams rarely took the time to consider meaningful alternatives – especially if they suspected that doing so might mean a cutback in funding.
The improved resource allocation process that Sharpe and Keelin developed was systematic and value-driven, but the key to their approach came down to one thing: better communication among project managers and other stakeholders. This, in turn, allowed them to trust each other, so they could turn their attention to the company's overall strategic goals rather than skirmishing over available resources. Sharpe and Keelin found that "by tackling the soft issues around resource allocation, such as information quality, credibility, and trust, we had also addressed the hard ones: How much should we invest and where should we invest it?"
In other words, resource allocation is yet another area of project management in which good communication can help smooth the way to project success.