Introduction

Project management is all about managing tasks carefully. Project management gained popularity in the last few decades due to its effectiveness as it helps the organizations to generate extra revenues and complete the tasks within given time. Project managers take salary for managing resources and time from the start till the end of the project.

Although, there are a lot of things to take care of in project management but resource allocation and time management are the two main tools or you may say building blocks without which it is simply impossible to complete the project successfully.

Why Resource Allocation is so important in Project Management?

By the word resources, I am referring to all the resources required for a project such as financial resources, natural resources, human resources etc. Resource allocation involves the planning of all the resources required for the project. It helps you to utilize only that much resources which are required. We all know that economy is going down these days which have resulted in a tough competition especially with regard to financial resources. The operating cost of doing business has increased. Companies have limited budget for projects so there is no margin for you to waste or misuse any material.

Project managers have to work in limited or even tight budgets. Everyone can perform well within huge budgets but only a professional and experienced project manager can manage to work in every situation. If you do resource allocation efficiently then it means your half project is already completed as resource allocation is the most important yet difficult part of project management. Being a project manager, you should know its importance so that you may not do any mistake while allocating the resources. One simple tip is to make the list of all the resources needed for project and then shortlist them to select only those which are most important.

Project Resource Allocation and Resource Management

The resources of an organization consist of people, materials, equipment, knowledge and time. Organizations typically have limited resources; therefore, tradeoffs on what project resources are expended and when are made every day within organizations. A resource allocation plan is an important tool in effective management of scarce resources.

The timing of the need of those resources can be and should be determined within the project schedules. A resource plan, which describes the type of resource needed and the timing of that need, is critical to effective resource management. As the project schedule changes, the resource plan must also be flexible enough to adjust as these changes occur.

A successful Project Manager must simultaneously manage the four basic elements of a project: resources, time, money, and most importantly, scope. All these elements are interrelated. Each must be managed effectively. All must be managed together if the project, and the project manager, is to be a success.

ResourcesPeople, equipment, material

TimeTask durations, dependencies, critical path

MoneyCosts, contingencies, profit

ScopeProject size, goals, requirements

Resource Management

Resource management is the efficient and effective deployment and allocation of an organization's resources when and where they are needed. Such resources may include financial resources, inventory, human skills, production resources, or information technology. Resource management includes planning, allocating and scheduling of resources to tasks, which typically include manpower, machines, money and materials. Resource management has an impact on schedules and budgets as well as resource leveling and smoothing.

In order to effectively manage resources, organizations must have data on resource demands forecasted by time period into the future, the resource configurations that will be required to meet those demands and the supply of resources, again forecasted into the future. Forecasts should be as far out as is reasonable. Resource leveling, as it relates to inventory, is a resource management technique aimed at keeping the stock of resources on hand level, reducing both excess inventories and shortages. In project management, resource leveling is scheduling decisions, which are driven by resource management concerns, such as limited resource availability. As opposed to leveling, resource smoothing may not delay the project completion date, only particular activities within their float.

Many organizations use professional services automation software tools to make resource management tasks more efficient and effective. The automated tools may include timesheet software and employee time tracking software, which calculate skill sets, experience and workload in selecting the most skilled employee in an organization to handle any specific project. This enables the organization to forecast future staffing requirements prior to project implementation.

In businesses where revenues are not dependent on product sales, such as legal, consulting, and engineering, organizations strive for minimal bench time. In these organizations, time and expenses are carefully tracked and billed to clients. In order to be sustainable, resources must be maximally utilized on billable time and activities. Effective resource management will optimize organization efficiency, minimize bench time and improve the bottom line.

Effective, proactive resource management delivers the utmost level of optimization and efficiency by enabling proactive allocation of resources based on business policies. At this level, implementation of business-policy oriented resource provisioning ensures that resources are provisioned in advance of business needs and in alignment with overall business priorities and objectives. This drives the highest possible resource utilization rates, while simultaneously minimizing business service and availability risk.