Picture your project team as traffic travelling on a motorway. When the traffic density is high, a minor crash has an instant impact on traffic flow — slowing it substantially or stopping it completely. You don’t need 100 per cent traffic density to see this effect either. Traffic jams occur when roads reach utilisation rates of 70 per cent or more.
The same principle applies to your IT project resources. Overloading employees more often than not backfires, resulting in outcomes no one wants — reduced performance and more mistakes. Gartner research shows that teams with lower utilisation can reduce the time it takes to deliver business value by 30 per cent or more.
Having adequate human resources continues to be a top barrier for programme and portfolio management (PPM) leaders, leaving them unable to help CIOs achieve their goals. While a shortage of resources can be due to a lack of specific skills or a true shortage of numbers, the problem is often inefficient use of existing resources.
Today’s IT staff tends to be overloaded with too much to do. This leaves them trying to do everything, but doing nothing particularly well.
Overloading project resources with too much work is simply bad practice, leaving teams without capacity to plan, reflect and innovate. To overcome this challenge PPM leaders can follow four basic steps to optimise project resource utilisation.
Step 1. Determine capacity of resources available to do projects
Resource management is a careful balancing act and is essential to completing projects successfully. The available project resources need to be balanced with demand for those resources. Careful prioritisation and flexibility on timing can help PPM leaders deliver greater value. Calculate the number of people available to do project work as full-time equivalents (FTEs), multiplied by their availability to work on projects.
Step 2. Determine hours of availability
When looking to optimise delivery, it helps to adopt a surgical approach. Convert FTEs into hours and derive a true representation of availability. For example, after factoring in holiday, sick leave, and training time, a person declared as 50 per cent available for project work is actually available only 37 per cent of a theoretical work year, or 760 hours.
Step 3. Set utilisation targets
PPM leaders must capture an accurate picture of availability for all project resources, factoring in all commitments. Calculate utilisation targets for all project resources below 80 per cent, and use that data to limit the number of active projects. Resources working below the target might appear inefficient, but resources working above that target are likely to introduce costly delays and errors into the project.
Step 4: Limit or modify the queue
Have you ever waited for a table at a restaurant, even though the restaurant is half empty? This was most likely a tactic the restaurant implemented to avoid overloading the waiters, which would ultimately result in you having a poor dining experience. The number of waiters was a limiter to providing a good service.
For the PPM office, the limiter must be when project resource utilisation approaches 80 per cent. Starting new projects when resources are at or above their targets may appease project stakeholders at the time, but downstream it’s sure to disappoint them, the project team, users and, potentially, a whole host of other people.
While it's tempting to increase their utilisation targets to 100 per cent, don't do it. These are bottleneck resources. In many ways, they define the throughput of the entire project delivery system. When they max out at 80 per cent, no more projects involving these roles can be started. However, other projects not calling upon these roles can be started, even if they are of lesser importance, until another bottleneck surfaces.
The queue itself can be modified to make it more palatable. Take the restaurant example, customers can be moved to the bar and offered drinks and specials to make their experience more pleasant.
Queue modification is another key area PPM leaders need to consider. Using 80 per cent resource utilisation as the limiting factor is not a silver bullet, so the following queue modification techniques can also be used to augment the 80 per cent utilisation limiter.
Tighten selection and approval criteria
Demand for projects will likely surpass the capacity that’s actually available. However, the whole purpose of project portfolio management is to allocate scarce resources to often competing objectives in order to optimise value. Over allocating resources sub-optimises value. Making selection and approval criteria more rigorous can very well remove lower-value items from being approved, keeping them out of the queue altogether. As such, the approval criteria needs to be adequately stringent, reviewed and adjusted if necessary.
Make use of gates
Stage or toll gates are often used as criteria to move items from a queue to a work centre. Gates can also be applied to prevent items from continuing. Doing this frees resources to work on more projects.
Changing the way queues are prioritised can also yield better results. In some cases, work items are managed first-in, first-out. In others, they are ranked and managed in priority order. Important jobs might be set to minimise the costs associated with delays, while still achieving a reasonable threshold.
Alternative work queues
Creating multiple work queues can also help. Organisations often use a single project queue out of convenience, but too many small work items can clutter the project queue, sometimes unnecessarily slowing delivery. Alternative work queues can be particularly useful when dealing with systems or business areas that are constantly changing, out of necessity.
Overall, overloading human resources supporting project portfolios backfires, reducing performance and increasing mistakes. PPM leaders must maintain reserve resource capacity to get more done by working less. PPM leaders looking to evolve their portfolio and resource management need to identify their theoretical maximum capacity for project work by capturing real resource information, and use that capacity as a starting point to guide active project work. It’s important to avoid overloading resources and this can be achieved by setting limits on work queues where it matters most —approved project delivery.
Robert Handler, Distinguished VP Analyst, Gartner