Four common resource management fails and how to avoid them

The Resource Management field is growing fast. According to The Resource Management Institute more than two-thirds of professional and consulting services teams, half of enterprise/IT organizations, and one-quarter of product development teams have a Resource Management function established.

In addition, there is a growing trend of freelancers as the fastest-growing workforce segment in the EU all the while companies safeguard cash flow by balancing fixed costs with rising demands for new capabilities and talent during COVID-19. This makes Resource Management even more critical for companies to harness.

As the Resource Management field evolves, like any other industry business transformation, some growing pains are common.

Here are 4 common fails when implementing a Resource Management function and how to address them.

1. Don´t disempower your Resource Management function and continue business as usual
Many companies think of Resource Management as a tactical function and only place a partial bet on it. This is a huge mistake! Resource Management matters because it increases business transparency, allows the business to hire/invest ahead of demand, improves forecasting of resource capacity and demand, improves delivery velocity, and nurtures your employees to greatness.

Considering a new Resource Management function and a scalable workforce, take time to reflect on how you price and deliver projects and whether to make changes to your pricing strategies and overall delivery model.

Certain projects e.g. with a compressed work package, low risk, no dependencies, and tight timelines might be better suited for a contract-based resource with a deep skillset than more operational projects with longer timelines and more generic skillsets. Try to identify the optimal mix of flexible resources on projects depending on the client, industry, project type, and pricing (T&M, fixed-price, retainer, no-cure-no-pay etc.).

In addition, you might need to adjust your pricing strategies to account for the administrative workload associated with managing the flexible part of your workforce by adding an admin fee to your contracts charging your flexible contract-based resources with a small fee for handling their contracts, equipment, pay-outs etc.

2. Don’t drag your feet – go digital from the get-go
Many companies hold back on procuring a resource planning tool clinging on for dear life to Excel spreadsheets. Surely, if you recognize resource planning as key in your company´s operational backbone, you should invest in the digital tool to support your resource management efforts appropriately and effectively.

So contemplate how your technical infrastructure can support your Resource Management efforts. Maybe you already have a good resource planning tool in place somewhere in the organization that can be implemented on a broader scale?

Having a proper planning tool from day 1 is crucial when working with resourcing management and a flexible scalable workforce. Especially when tying staffing and sourcing decisions with project pricing and margin calculations to effectively monitor project financials and evaluate pricing strategies for new projects.

Furthermore, you can also tie the resource planning tool with the talent management tool to make sure you consider career development aspects when making staffing decisions for your core workforce.

In addition, enabling transparency over which resources are allocated to which projects will be important to everyone who is being staffed by the new Resource Management function to always be able to see his/her current staffing and upcoming staffing.

Many companies do not properly invest in a good resource planning tool despite the many affordable cloud-based options such as Floator If you do, make sure you acquire a cloud-based tool with an open API to enable integration with your current system landscape.

Are you considering a new ERP system? If so, you can add resource planning to the list of requirements and kill two birds with one stone.

3. Don´t under- or over-design
When designing your Resource Management processes, governance, principles, and policies make sure you strike the right balance from the start.

Take time to assess your current Resource Management maturity and decide what to-be level you want to aspire to before setting out to implement Resource Management.

Key aspects to consider when assessing your maturity are: Skills inventory, resource planning, and allocation, training, policies and processes, demand forecasting, tools and data, culture, vision, and organization as well as sourcing, development and recruitment.

In addition, make sure you strike the right balance between a Resource Management design that can accommodate your current business needs as well as a design that is scalable for the future business. This is a challenging exercise but worth the time invested in the end!

4. Get past the stumbling blocks for a successful implementation: Chose the right implementation partner
Make sure you partner up with an experienced implementation partner who knows the pitfalls as well as the critical path to a successful implementation.

Be aware that it might not be the same partner who should help establish the Resource Management function as the person who should operationally run it post- implementation.

One thing is to set up staffing principles, governance, processes, secure buy-in, carry out change communication, and steer the implementation. Another thing is to operationally run staffing and sourcing efforts on a day-to-day basis post-implementation once key processes and a governance structure is in place.

About the author:

Naima Robenhagen Burgdorf
Managing Consultant
NorthHouse Partners
Phone +45 31 70 31 11

During the past 10+ years, Naima has helped digital agencies, consulting firms, AEC clients, pharma, healthcare, and public sector clients with business transformation, resource management, and workforce planning.

As a resource management specialist, Naima is well-versed in developing and operating resource management functions helping her clients achieve a greater level of transparency and optimal demand planning enabling better recruitment decisions, improved talent, and performance across the workforce resulting in higher fee rates and greater retention instantly impacting the bottom line.

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