As a professional service business, your people are your most valuable resource.
Your ability to acquire the right people and skills, assign them to the right tasks and jobs, and balance their workload determines how successfully you’re able to execute current and future jobs.
Like most things involved in running a business, this is easier said than done. Managing your people effectively requires a strategic resource management process.
In this blog post, we’ll introduce the concept of resource management and why it’s important for your business, how to determine if you need to improve resource management, and what systems you’ll need in place to get started.
What is resource management?
Resource management is a strategic approach by which a business manages their resources effectively.Resources include anything that is required to complete current or future jobs, from people to equipment. Resources vary based on industry and type of business – some examples include:
- Creative agency: Designers, freelancers, coding skills, video editing software
- Architecture firm: Project managers, interior designers, AutoCAD software
- IT consultancy: Software technicians, customer support representatives, computer equipment
In professional services, a business’s most valuable resources are often their people, knowledge, and time – therefore, this blog will focus on the people side of resource management.
When your business is first starting out (or has one to two employees), managing resources will often involve planning and staffing jobs using whiteboards, spreadsheets, and email. While you may be delivering successful projects, you’re likely not using your resources to their full potential and maximising your business’s success.
Effective resource management involves using systems and tools to plan, schedule, and allocate resources in the most efficient way possible to meet your organisation’s objectives. It requires businesses to track employee productivity, performance, and job progress and use that data to make informed resourcing decisions.
When it’s done right, resource management can have a noticeably positive impact on your business.
Why is resource management important for my small business?
From improving your bottom line to keeping your team happy, effectively managing your people is key to running a successful business.Some benefits of introducing a resource management strategy include:
- Higher profit margins: According to HRD (Human Resource Director), 85% of workers feel they do not live up to their full potential and their skills could be put to better use at work. When you’re able to organise your resources as efficiently as possible, you’re able to accomplish more with less, and turn a higher profit on jobs.
- Happier employees: Understanding each employee’s productivity enables you to schedule work in a way that prevents your team members from experiencing boredom (from being underutilised) and burnout (from being allocated too much work). Your resource management efforts can help employees maintain an optimum workload, resulting in a happier, healthier team.
- Retaining top talent: Unlike machines and equipment, your team has their own objectives and interests regarding the jobs they work on. Tracking your employees’ skill sets and career goals and matching them to projects that maximise development opportunities will allow you to maintain an engaged and dedicated team that is motivated to stick with your business for the long term.
- Identifying and resolving issues early on: Using efficient systems and processes to allocate and monitor resources helps you identify and resolve issues before they derail a job. For example, employee scheduling software tells you if employees are double-booked, if an employee is billing more hours than they’ve been allocated, and if critical job milestones have been missed.
- Informed decision-making: Taking a strategic approach to resource management and tracking how your resources are performing will give you the insights needed to make more informed business decisions. Whether it’s taking on a big, new project or deciding to hire a full-time employee or a freelancer, you’ll have the data to back up your decisions.
Many businesses can benefit from improved resource management – especially if you don’t yet have a formal strategy in place or if you’re experiencing specific business challenges.
Does my small business need a resource management strategy?
One way to determine if your business needs to manage resources more effectively is to look at the challenges you frequently face as you plan for and execute jobs.
These business challenges can be a result of poor resource management:
- Projects are often delayed or over budget
- Project time and cost estimates are often significantly inaccurate
- You often have to write off billable hours and don't invoice clients for all of the work completed on a job
- Specific employees are often bottlenecks on projects
- It takes too long to determine whether you have capacity to take on more work
- It takes too long to pull together necessary resources for upcoming projects
- Staff are often staying late and coming in early
In addition, lack of visibility into your team’s performance is a sign that you need to improve resource management. Asking the following questions can help determine if you have sufficient resource management systems in place:
- Does your team have the right skills and capacity to take on a new client project?
- Do you have sufficient resources to manage current and future jobs if people take vacation, get sick, or quit?
- Which individuals or teams have the most capacity to allocate to a new project?
- How long will it take to deliver on a specific project?
- Are employees operating under capacity and bored, or too busy and overworked?
If your business is experiencing any of these common issues and/or you can’t answer these questions accurately, you likely need to improve your resource management process. Fortunately, supporting your processes with the right software can help!
What systems & tools do I need to get started?
There’s a wide variety of tools that businesses use for resource management – from spreadsheets to specialised software – each with their own costs and advantages.
Ensure the system you’re using allows for the the following functionality:
- Time tracking: Tracking employee time is the foundation of an effective resource management strategy. With insight into how much time your employees are actually spending on tasks, you can calculate productivity and manage optimal utilisation, provide more accurate cost estimates, and forecast resource needs for future jobs. Your time tracking method should make it easy to accurately track and record how much time (both billable and non-billable) employees are spending on which tasks and jobs.
- Employee scheduling: To assign work to resources, you need to understand who has availability to take on work, whose schedule is at capacity, and where your schedule gaps are. Your scheduling system should be able to easily assign work to staff members, track task completion, and shift task assignment around as necessary.
- Job tracking: Once you’ve set out a plan and allocated resources for your job, you’ll need to track how the job is progressing, monitor deadlines, and make adjustments as you go. Your system should be able to track tasks that each employee is currently working on, which tasks have been completed and which are outstanding, and if you’re on schedule to deliver the job on time and on budget.
- Employee roles & skills database: Your ability to staff a job efficiently depends on how well you’re able to use the full range of your employees’ skills and match them to the right tasks (for example, your marketers may have design or coding skills you can leverage). Keeping track of employee roles and skills in your resource management system will help ensure you’re able to utilise resources to their full potential.
While spreadsheets can be a good tool to start with, you’ll run into roadblocks when projects increase in size and complexity (such as manual errors, wasted time, and outdated information) that will hold your business back.
Resource management software or an end-to-end job management solution will help automate and streamline how you manage your resources, enabling you to increase efficiency and take your business to the next level.
WorkflowMax all-in-one job management software will help you manage every aspect of your jobs, including time tracking, employee scheduling, and task management. Plus, it integrates with Planright, specialised resource management software.