Resource Management Examples: Recommendations for Service Businesses

Running a service business means endlessly trading time for money. With poor resource management, this ongoing exchange can become fruitless — leaving your team spinning its wheels with no profitable outcome.

Even if you don’t have a dedicated resource manager, understanding resource management tools and principles can help your team take important steps to improve employee utilization, reasonably distribute workload and, ultimately, become more productive. 

Here, we’ll review:

• The definition of resource management 
• Why you might need to be more intentional about resource management
• Use cases in which a professional services business might apply forecasting, leveling and other strategies to get the most value out of its existing team

What Is Resource Management?

On a high level, resource management is the practice of scheduling, allocating and overseeing the full range of resources available to your business or department. It’s most often a point of focus for project managers. 

Keep in mind: It’s more complex than just tracking your employee capacity or reviewing timesheets! Effective resource management is not limited to human resource management but also encompasses non-human resources like capital, equipment, software and other tools that help businesses get work done.

When to Prioritize Resource Management in Professional Services

It’s common to have a general sense of what resource management is all about, yet avoid looking at resourcing issues as a potential source of project management issues. Knowing warning signs can help you identify if your current approach to resourcing is problematic.

Your business may be poised for a proactive approach to resource management if:

• Your project managers struggle to assess the health of in-progress projects
• Scheduling conflicts have caused confusion among various departments
• One or more teams are underperforming based on data-driven predictions
• Some employees express dissatisfaction with or confusion about their roles

The above are surefire signs that your team should begin using resource management strategies if they aren’t already, but it’s not wise to wait until these signs show up. Nearly every business — especially in a service industry — needs to prioritize resource management to optimize efficiency and profitability.

Defining Processes and Evaluating Project Resources

Before you can take any managerial or corrective action regarding resources, you should know what your team aims to achieve and what resources are at your disposal. Let’s think about when and how this assessment could take place within the context of a specific service business.

Scenario: A mid-sized team of engineers has recently invested in additional equipment and hired a few new employees. The firm’s managers are unsure of how to best spread these resources across upcoming projects without negatively impacting timelines or budgets.

Solution: The first step in solving a resource management challenge is to ensure your workflows are clearly defined. Trying to balance resources across any given engineering job will be unsuccessful if the team doesn’t see how all steps in the project fit together. A properly defined workflow will go beyond sequential steps and account for time estimates, accountable departments or teams and task dependencies. If workflows aren’t already documented or if this process is a struggle, they may find it helpful to bring on additional resources in the form of a workflow management tool.

Next, the management team needs to evaluate every resource they have available to inject into these workflows. This could include:

• Employee capacity (available hours after all other commitments)
• Employee skill sets
• Financial resources
• Supervisory services
• Modes of transportation and job equipment
• Technology and industry software

While they may not use the complete list of potential project resources for every job, the team will be better aligned after evaluating what they have. Awareness is a prerequisite for great resource management, especially if a team is facing limited resources.

Resource Leveling for Project Teams 

Resource leveling is the process of reallocating resources to ensure that no single non-human resource or employee is overextended. It could involve reworking the order of tasks in a project, prioritizing critical tasks or clients only or requesting additional resources. Leveling is often the responsibility of a project manager but can come about as a result of financial analysis or an external factor such as an economic downturn.

Scenario: A small MSP aims to transition from a team of local cybersecurity experts to a fully remote, nationwide business offering threat detection, backup and more. Much of the team’s time has been dedicated to boosting its technical infrastructure to support the change, but some are overwhelmed by existing client work. Leadership is unsure when they’ll be ready to serve a larger audience.

Solution: It’s common for small teams to struggle to balance client work with longer-term structural projects that help the business grow. In this scenario, the MSP would benefit from careful resource scheduling to ensure that its team can continue to serve current clients while getting ready to take on even more work. 

A Gantt-chart approach to scheduling could be helpful in achieving reasonable resource leveling. Having a live timeline in front of them about current and upcoming projects simultaneously can help project or resource managers see where overlaps occur and feel more confident about shifting efforts. A simple resource leveling attempt may make the team realize they need more people — or a more robust automation tool — to help make the desired expansion a reality.

Resource Utilization To Support Employee Efficiency

Sometimes, where your resources are placed turns out to be fine. The issue may instead be employee inefficiency. That’s when tracking resource utilization, especially billable time, can be advantageous.

Scenario: In analyzing recent projects, a marketing agency’s project managers are noticing signs of scope creep. Their large team of marketing specialists, designers, videographers and writers works cohesively and doesn’t report overwhelm — and there don’t seem to be any obvious bottlenecks.   

Solution: If collaboration and resource allocation are on point, workflow analysis and resource leveling may not help. Scope creep can often be linked to a pileup of inefficiencies. These may be small enough that they don’t show up as major bottlenecks. But just a few added minutes per task per person can make a big difference when you have a large team.

The key to better budget and timeline alignment for this agency is likely to be better resource utilization. While its talented team is probably great at collaborating and producing deliverables, they may be unaware of how much non-billable time they’re using and how that impacts the agency’s bottom line.

Time tracking is the basis for improved employee utilization. Accurate time logs create a clear picture of where team efforts are going. To solve the scope creep problem, project managers should be using a time-tracking tool that generates real-time reports displaying billable vs. non-billable and actual vs. estimated time.

See the tangible impact of improving resource utilization: Read Gamcorp’s story

Resource Forecasting as a Leadership Tool

Current data about scheduling and utilization is critical for those who are hands-on in the management of resources. But understanding where your business is headed is just as important as knowing where it stands today. Resource forecasting, or the practice of using employee utilization rate and a range of financial reports to predict the efficiency and profitability of future projects, is a leadership best practice.

Scenario: The decision-makers at a management consulting firm are considering taking on significant debt to rebrand the firm, change up its marketing approach and renew its menu of services. Managers are making small tweaks to processes to improve business efficiency, but the leadership team is nervous about tackling these shifts with existing resources.

Solution: Business intelligence has become a priority for many leaders in professional services, but which specific insights should this firm use to successfully forecast the impact of these plans? After all, there are many kinds of data points that can be useful to get a handle on a business’s future performance.

Since many consulting firms have a team comprised of contractors, they may neglect tracking key metrics like:

• Target and actual billable utilization rates
• Predicted and actual time estimates for past projects
• Profitability by client and project

Along with analyses of fixed and variable costs and expenses, reports reflecting the above factors will make accurate resource forecasting possible.

Why Use Resource Management Software?

There are countless benefits to having a resource management strategy in place, including: 

• The means to avoid layoffs and persist through hard times
• Bigger profit margins as a result of increased efficiency
• Better employee retention due to well-placed skills

But strategy must be paired with execution. All the best intentions on the part of your team can’t make up for a lack of appropriate tools to make solid resource management a reality.

As a supplement to your talented team, resource management software can be one of your best sources of strength. And it’s an even stronger partner when it’s a multifunctional, end-to-end client work management platform — because managing resources is simplest when you can see how they all connect in one place. 

Accelo can assist your team in successfully planning, allocating, measuring and forecasting for better resource utilization. See its powerful features in action via a free trial or a demo.

About the Author

Chelsea Williams is Senior Copywriter at Accelo, where she shares unique insights with service professionals and tells user stories via blogs, eBooks, industry reports and more. She has over 15 years of B2B and B2C writing experience — primarily in tech, sales, education and healthcare. Chelsea is an AWAI-certified Master Copywriter trained in brand storytelling and microcopy.