Before you engage with a new project, there are certain things you have to know. Is the cost worth the return? Can you get it done properly by the deadline? Do you have the resources? Resource forecasting is how you can answer that last question.
Resources are anything you need to execute the project plan. From your team to the tools they need, materials, equipment, software, office space and so on. Want to know why resource forecasting is so important? Keep reading.
What Is Resource Forecasting in Project Management?
Resource forecasting is a way to estimate the number of necessary resources to deliver your project successfully. It’s a tool used by project managers and their teams to see if they have the resources they need to complete the assigned tasks in a project.
As noted, resources can mean many things. The most valuable resource in any project, however, is the people who make that project happen. When talking about resource forecasting, most project managers are looking at how to allocate their team by looking at their capacity, workload and utilization levels.
That means having the ability to see who is tasked with what assignments and whether the team is sharing that workload fairly. If you have only a few resources carrying the weight for the team, these people will likely get burned out and their morale will erode. This isn’t the way to retain your workforce or get your project done on time.
There are project management software solutions that address resource forecasting. ProjectManager is online project management software that captures capacity in real time to help you make better decisions on how to allocate your resources. Our workload chart is color-coded so you can see at a glance who is overallocated and then balance the workload from that view to keep teams productive. Get started with ProjectManager today for free.
Resource Forecasting vs. Resource Planning
Resource forecasting is used in resource planning. You can’t plan your resources if you don’t know what resources you have. These two aspects of project planning are connected and inform one another.
Resource planning is how one organizes the resources that a project needs to reach completion. As we’ve mentioned, resources are broad and cover many categories. The resource forecast identifies these resources and whether they can fulfill the needs of the project over a specific timeframe.
The resource plan outlines exactly what you need in terms of resources. It does this first by splitting resources into storable resources, as in cash to non-storable resources, which include your team, equipment, etc. The project schedule and its budget will greatly influence resource forecasting.
Resource Forecasting vs. Resource Management
Resource management is where resource forecasting and resource planning reside. Resource management is the larger practice of planning, scheduling and allocating resources for a project, program or portfolio. The purpose of resource management is to get the most value out of your resources by having the right resource available at the right time for the right job.
Resource forecasting is an important aspect of resource management as it factors in resource planning. One way to look at these integrated practices is as a Russian doll where one is inside the other. Resource management needs resource forecasting to understand what resources are available and if they’re going to be enough to fulfill the project activities.
Without resource forecasting (and resource planning), resource management wouldn’t be able to meet its mandate of optimizing and allocating resources to the right initiatives. This holds true whether applied to one project or a program or a portfolio of projects. Resource management works to reduce waste and duplication to streamline and automate processes to add efficiency.
Benefits of Resource Forecasting
Now that you know how resource management is made up of resource planning and resource forecasting, let’s look at how resource forecasting benefits the project. The most obvious is that it allows project managers to know what they’re working with and how to use those resources effectively to get the project done on time and within budget.
When it comes to your team, resource forecasting allows you to see who you need to complete the project successfully and shows any holes you might have to fill. Resource forecasting tells you what skills you need and makes it easier to zero in on the needed talent to accomplish your goals.
Using resource forecasting helps you balance your supply and demand by making sure you have the resources matching the workload you require. It tells you who you need on your team for upcoming projects. Without resource forecasting, you could overspend or end up going over schedule because you miscalculated the resources necessary to complete the tasks at hand.
In other words, resource forecasting provides greater efficiency, leading to greater profits. That’s because you produce more revenue by knowing what skillsets you require to adapt to future market trends. It also makes resource planning more flexible so you can pivot as demand changes.
Resource Forecasting Tips
We understand what resource forecasting is, how it fits into resource planning and larger resource management, and why it’s beneficial to projects. Let’s explore how to do resource forecasting to take advantage of these benefits.
Start with a complete understanding of what skills will be necessary for the project. This means knowing the project plan and the deliverables. From this, you can create team member profiles you need to fulfill the project’s objectives. This informs you of job listings or, in the case of a program or portfolio, the skills inventory developed by the project management office (PMO).
Related: Free Project Plan Template for Word
Next, go past the skills to understand the strengths and weaknesses of your team. Review their performances on past projects and create a chart that maps their skill level, the quality of their work and how fast they complete tasks. You might have to invest in training to bring them up to the level you need for the project or seek recruits outside your organization. Be sure to reach out to their managers and other project managers for perspective on these potential team members.
Historical data is also helpful when resource forecasting. Old projects should be archived and available for review so you can see how those resources were used and whether they were under or over-utilized. Reviewing lessons from past resource forecasting is a great way to avoid old mistakes.
Keep in mind that you need to match the right resource to the right task. This takes place after you’ve assembled your team and are looking at the whole project. Remember, don’t make assumptions based on job titles and be careful not to underestimate time or resource needs.
Don’t forget about attrition rates. Your company’s performance and hiring trends will impact the resources you attract. Knowing the market gives you an edge when it comes to recruiting talent. Looking at past trends can help you forecast where resources are going in the future.
ProjectManager Helps with Resource Management
ProjectManager is online project management software that plans, manages and tracks resources in real time. Our resource management features allow you to create profiles of your team members, track their progress and performance and balance their workload to keep them productive.
Plan, Manage and Track Resources in Real Time
Gantt charts are great for project planning and organizing tasks, resources and costs on a timeline. Once you set a baseline, that plan is captured and can be used to compare your actual resource use in the project. This information is shared across our tool as projects evolve. Use the real-time dashboard for a high-level view of the project’s progress and performance, including workload and percent complete. There’s no setup required as with inferior products, and it’s ready to go when you are.
Track Time Spent on Tasks With Secure Timesheets
From the team page, you can get an overview of your task distribution across your projects and zoom in on a specific team member’s profile. To see how each time member is performing, you can make a customized report on their timesheet and view the time they’ve logged on their tasks. Now you know if you need to reallocate resources to keep to your schedule. Our secure timesheets also streamline payroll and are locked once submitted.
There are other reports that are fully customizable to give you a full view of the project, allowing you to focus on the details you want to see. Reports can also be easily shared to keep stakeholders updated. You can see the availability for your team, including global holidays, to make it easier to allocate resources for tasks. You can’t predict the future but we help make resource forecasting and management more accurate.
ProjectManager is award-winning software that empowers teams to plan, manage and track their resources in real time. Beyond robust resource management features, there are task and risk management tools that help keep projects productive. Join the teams at Siemens, Nestle and Avis who use our software to deliver success. Get started with ProjectManager today for free.