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How to Optimize the Productivity and Profitability of ResourcesThe Professional Services View of the Resource Management and Capacity Planning Study

Maureen CarlsonChief Researcher, Appleseed Partners

Steve BeaumontSRP Solution Marketing Manager, Planview

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PresentersMaureen CarlsonChief Researcher, Appleseed Partners

• Partner at Appleseed Partners• 20 years experience in market research• Specialty in B2B technology

Steve BeaumontSRP Solution Marketing Manager, Planview

• 25-years experience as a management consultant• Years with Deloitte, Coopers & Lybrand, and E&Y• Currently owns the client-perspective for the Planview

Services Resource Planning (SRP) technology solution

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Study Background

Why?“Too many projects for our resources!”

We need to maximize productivity of our resources

Who?Surveyed more than 600 globally-based executives responsible for project-based resources, 26% (154) from professional services organizations

How?Appleseed Partners and Opensky Research conducted the survey commissioned by Planview. Initial phone survey that informed an online survey conducted in late 2012

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Let’s Define Terms

• Capacity Planning

– Capacity planning addresses the need to take human and non-human(e.g. facilities, equipment) resource constraints into account in the sequencing and prioritization of projects.

• Resource Management

– The essential ongoing or in-flight tactical assignment of personnel to planned and unscheduled activities.

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Maturity Model: Capacity PlanningCapacity Planning Maturity Levels

Level 5 - Optimized • Planning is continually monitored based on up-to-date capacity and demand data

• Can run scenarios to manage change and prioritization• Can apply most valuable resources to the highest value projects

Level 4 - Managed • Effective planning process with visibility of role-level demand before work is committed

• Can balance organization-wide capacity against prioritized pipeline• Still difficult to adapt to changes and reprioritize

Level 3 – Limited • High-level visibility of how resources align with demand• Not a complete or repeatable process

Level 2 – Ad-hoc • Visibility is limited and relies on ad-hoc processes• Not feasible to consolidate resource visibility across groups/projects

Level 1 – Basic • Very limited understanding of capacity or demand• No process for visibility

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Maturity Model: Resource ManagementResource Management Maturity Levels

Level 5 - Optimized • Mature work and activity planning process. Detailed task-level schedules, cost information• Formal process to request and approve by role and skill• Adapt to change and iterate effectively; PMs ensure resource assignments on projects are

current and accurate, resource feedback

Level 4 - Managed • Detailed project schedules with short-term named assignments• Resource requests are at the role level; assignments at task level• Global resource visibility, but difficult to adapt to change• Ability to select from low-cost resource pools/offshore

Level 3 – Limited • Project-or phase-level named resource assignment, simple role-based planning• Visibility into the projects each person is working on/percent time allocated, no roll-off

dates• Actual time completed captured, little on upcoming assignments

Level 2 – Ad-hoc • Track high-level deliverables or key milestones against a project• Informally coordinate availability and assignment by generic role

Level 1 – Basic • Unable to view workload and activities from resource perspective• Basic understanding of how resources are group by role• Assignments made verbally, resources often overbooked or idle

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Detailed Research

Pain Points

Pain Causes

Business Risks

Best Practices

Based on MaturityLevel

Before and AfterSoftware

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Pain Causes

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Business Risks

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State of Resource Management and Capacity Planning

• Constant change: delivering talent effectively given ever-changing demand• Poor visibility and reporting into capacity and demand• Unclear strategic goals making prioritization challenging

Pains

• Lost productivity; resources not optimized or wasted on the wrong project• Lost revenue or increased costs due misalignment of resources or timelines• Decisions based on inaccurate data

Risks

• Streamlined and accurate resource forecasting and planning• Improved visibility into demand for timely, accurate resourcing• Reduce turnover, drive higher billing rates and increase client satisfaction• Leverage software more effectively

Opportunity

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Professional Services Perspectives

“Our biggest challenge is matching up the right talent with the right projects – knowing what skills our resources have and mapping them to projects.”

— PMO Manager, Information and Communications Technology Services

“Our greatest risk around resource management and capacity planning is that we have a discrepancy on required resources and assigned resources. This lowers margin and profitability by being too late on proper visibility.”

— Program Manager, Large Clinical Research Services Organization

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Six Characteristics of Mature Organizations

Use Services Resource Planning (SRP) software to automate process

Estimate and scope engagements well and have good supporting processes

Agree on top best practices: prioritization; what-if analysis; executive buy-in

Have a dedicated function to lead these activities

Meld top-down with bottom up approaches

Have insight into oncoming demand and the funnel

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Recommendation # 1

Just Do It: Increase Maturity Levels to Achieve Business Benefits

– Focusing on process improvements and using the right software solution increases the ability to allocate the right people to the right projects and improves project success

– Result/ROI: greater productivity for higher revenue per billable resource; satisfied and referencable clients; greater market share

– Step 1: Assess yourself on maturity spectrum, use lowest common denominator

– Step 2: Put a timeline in place

– Step 3: Install the function, utilize best practices outlined in the report, and measure

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Recommendation # 2

Minimizing Talent Drain: Build Executive Buy-In for Process Adoption

– Use executive language on the benefits of improvement from a financial perspective

– Underscore the importance of minimizing talent drain (it’s costly to find, hire and retain exceptional talent) and why better capacity planning and resource management helps – too many misaligned projects can equate to attrition

– Get executive support, then ask them to help communicate importance to the company

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Recommendation # 3

Round Hole Round Peg: Get the Right Software, and Use it to its Potential

– What’s the cost of free? Spreadsheets and desktop tools fail

– ERP were not designed to help with demand or capacity planning, nor with skills-based resource management (complimentary yes, a solution no!)

– Get the right solution for the complex job at hand, understand how Project Portfolio Management Solutions (or SRP solutions) differ and how to integrate with ERP for success

– Once software is in use, ensure users are leveraging at the right level of detail to maximize value

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Get the Report: How to Optimize the Productivity and Profitability of Resources

• Get the full report at Planview.com/Optimize

Rank your company on the maturity model Diagnose your top areas for focus Get the best practices of high maturity organizations Experience higher margin professional services success

• Free Bonus at Planview.com/Optimize

Get the entire 2013 Resource Management and Capacity Planning Benchmark

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