Any successful project delivery hinges on intelligent resource management, which has come under significant strain since the pandemic altered established paradigms, resulting in trends like the Great Resignation and Quiet Quitting. But efficient project management has always been a challenging endeavor. Companies routinely face precarious situations and unforeseen challenges like abrupt changes to the project scope, shortages of skilled human resources, or team members quitting midway. Such challenges restrict an organization’s ability to complete projects on time and within the allocated budget. Thus, the need for effective resource forecasting.
What Is Resource Forecasting?
Resource forecasting is the process of predicting the quantum of resources a project will require in the future to ensure its timely completion, within the allocated budget. Organizations usually assess historical and current project data to anticipate hiring or talent retention needs. Plus, this process helps them foresee whether or not they need to reduce their headcount.
Resource forecasting helps organizations pinpoint the skill sets that their workforces may need to manage clients’ transient needs in the future. Simply put, resource forecasting enables organizations to match their resource demand with supply, thus ensuring that they always have a sufficient number of people to manage their projects. Aside from helping maintain a healthy proportion of resources pool to projects, resource forecasting also helps determine the headcount required from the current resource supply for future projects, their cumulative work hours and cost rates.
The Benefits of Resource Forecasting
Resource forecasting proffers several benefits to organizations. We have listed some of them below:
1. Finding the Right-fit Resources for Projects
Not all resources are alike. Each one of them has distinct skill sets that organizations can best utilize if they align them with the right project. Such an arrangement profoundly impacts employee engagement and project outcomes. Plus, changing resources midway can impact timelines and tarnish organizational reputation. Hence, clarity about the tasks and the task owners, such as full-time, part-time, and freelance resources, and the desired availability and requisite skill sets are critical for the success of any project.
2. Ensuring Adherence to the Budgetary Outlay
Resource forecasting is a great way to assess the probable cost of a project, as organizations can determine how much a project will cost. This assessment is achieved by granularly examining every project component, including workforce requirements, equipment and physical infrastructure, etc. Besides, factors like the number of resources, their availability, the proposed timelines for project completion, and the associated costs also shape the budgetary nuances.
3. Aligning Stakeholders
Any project involves several internal and external stakeholders, ranging from vendors, clients, organizational leadership, and resources working on a project themselves. Aligning these stakeholders and ensuring a broad agreement on the contours of timeline, costs, and headcount is time-consuming. However, resource forecasting allows all stakeholders, especially the leadership, to envisage how much a project may cost and enables team leaders to obtain swifter approvals, as the data presented is scientific and not speculative.
4. Plugging-in Revenue Leakage
Revenue leakage affects organizations of all sizes, as business leaders globally and across industries consider it a lingering organizational concern that impacts project profitability. Faulty and manual processes prone to errors, and inadequate data and planning are the most common reasons for a lower-than-expected bottom line. Resource forecasting allows organizations to envisage a longer-term trajectory and account for all unforeseen circumstances related to their workforce to make prudent allocation and hiring decisions. This preemptive approach plugs in revenue leakages, significantly enhancing project profitability.
How Polaris PSA Can Help
Organizations are increasingly deploying Professional Services Automation (PSA) tools for better resource forecasting. The shift toward automated processes from manual forecasting methods has expedited since the pandemic forced organizations worldwide to switch to remote and hybrid workplace ecosystems. Polaris PSA is one such tool. The world’s first self-driving PSA, Polaris PSA, employs advanced AI/ML (Artificial Intelligence/ Machine Learning) technology to analyze real-time data and deliver actionable recommendations that keep projects, resources, and finances on track. It offers a single source of truth for all projects, resources, and billing information.
Some of its key features are listed below.
1. Intelligent Resource Management
Organizations can leverage AI/ML-powered Polaris PSA to manage resources on autopilot and optimize business growth. Polaris ‘Smartmatch’ automatically weighs resources’ ongoing engagements and their skill sets and provides intelligent recommendations on the best fit for a project’s requirements. In addition, its resourcing workflows enable seamless collaboration between resource managers and project managers. Polaris also offers complex and customized selection criteria, enabling project leaders and managers to prioritize specific skill sets when requesting resources, so that they can allocate the best resources to each project.
2. Cost-optimized Resource Allocation
Polaris enables organizations to account for user schedules, time off, and other important details when distributing allocated hours to days, allowing for more optimized resource allocation. This feature offers project managers and team leaders long-term visibility into their resources’ availability and reduces the likelihood of project delays.
3. Smart Task Management and Powerful Financial Management
Organizations can experience greater clarity and ease of use while managing project tasks by leveraging an industry-leading, intuitive project interface. Polaris also helps eliminate revenue leakage and increases profitability with real-time visibility into project budgets. It is an intelligent tool that considers direct and indirect variables like utilization and margins. It helps organizations assess compatible rates for all project resources. Companies can use this information to bid for projects, ensuring profitability from the onset.
4. Skills & Certification Management
Organizations can leverage Polaris PSA’s skills and certification management feature to assess their employees’ skills, certificates and expertise levels as desired. Plus, they can easily manage skills and certification updates with attestations. Polaris PSA also features a skills catalog function that allows the creation of a reference catalog of skills needed by each role.
Organizations can also conduct skills-based assignments to fully leverage the skills and expertise of their resources, while initiating and fulfilling resource requests. Polaris PSA enables organizations to manage hiring and training needs by helping project managers analyze resource availability by skill set, further enabling them to proactively hire or retrain resources and meet future demand.
Resource forecasting is an essential aspect of project management. Thus, organizations should consider PSA tools to better manage new-age workplaces and more complex projects to gain a competitive advantage in the longer run.