Resource allocation helps resource managers schedule the best team for the job and streamline how work is assigned, based on resource availability.
Ideally, resource allocation should be fairly easy: you line up your projects ➡️ divvy up your people’s time ➡️ the project gets delivered ✅
Most articles on resource allocation will describe this process as if it represents the real world.
But in reality, what you are dealing with is:
- A team with a limited amount of time and a large number of requests
- Team members with paid time off, national holidays, unforeseen sickness
- A long list of projects you could potentially assign your people to (and more incoming)
- Your boss wanting you to deliver the project for Acme yesterday
Resource allocation is not as easy as it seems—yet thousands of our customers get it done daily while juggling the factors mentioned above.
Is it magic? Luck? Or is it the fact that they have solid resource allocation processes in place and the right tool for the job? 😉 You decide. In this guide, we’ll share and show you some effective resource allocation tactics we’ve sourced from our customers so you can successfully allocate your team’s time.
What is resource allocation in project management?
Resource allocation is the process of identifying and assigning available resources—including people, time, money, and equipment—to projects while considering a team’s availability, skill sets, and interests.
Usually, a resource manager, project manager, or team lead is in charge of allocating resources.
What do we mean by resources?
In the general sense, ‘resources’ usually refer to the tangible and intangible elements used to carry out a project, like team members, equipment, software, time, money, etc. But the term “resources” can obscure the fact that we are working with living, breathing people. So, in the rest of this guide, we are going to use language that shows the humans behind the work. For example, we’ll write “schedule your people’s time in your resource management tool” instead of “schedule your resources in your resource management tool.”
A resource allocation plan can look as simple as this👇🏿
Or look as detailed as this:
That being said, let’s make an important distinction between two terms that are often used interchangeably.
What is the difference between resource allocation and task allocation?
Resource allocation is not assigning project tasks to people. It focuses on identifying the right and available people for a specific project and deciding what amount of their time to assign to it.
After you’ve allocated your people’s time to projects, you move on to task allocation, which is assigning specific time blocks or hours to perform particular tasks within a project.
For example, your team has three projects to work on, and team members usually work 40 hours a week. So, you allocate a team member to work 20 hours on Task A and 10 hours each on Task B and Task C. That is resource allocation.
Once you’re done with that, you move on to the next phase by assigning specific tasks, e.g., building a wireframe or creating a mockup, to specific people. That is task allocation.
Resource allocation should be done in your resource management software, while your detailed task allocation should be done in your project management tool.
Resource management software provides information about the people on your team–their skills, interests, and availability– all crucial information needed for resource allocation.
4 signs you need to improve your resource allocation
Poor resource allocation can be glaring–bottlenecks that stall a project–or very subtle–overworked team members.
1. Your team is suffering from too much context switching
“One of the signals of poor resource allocation is a lot of context switching where a team member is regularly jumping between different projects and trying to juggle a lot of work at the same time,” says Colin Ross who leads the engineering team at Float.
It might seem like the multi-tasker is doing a good job, but the work might be subpar. “While multi-tasking can look efficient, in terms of output it’s never a good idea—there is little chance for the kind of deep focus generally needed to create high-quality work.”
2. Your team keeps running into bottlenecks
Frequent bottlenecks indicate that your people need to be allocated properly. Ross suggests looking out for “projects that are stalled because some critical resource is unavailable, thereby blocking the next stage.”
Suppose you have too many projects on pause because team members don’t have the capacity to finish their work. He suggests identifying the jobs necessary to complete a project and focusing on completing them first.
3. Your team has too many active projects
It is tempting and common to pursue new ideas or take on new projects without considering whether we can handle them.
Ross points out this is a sign of poor resource allocation: “Having too many projects taking place simultaneously is also a sign of inefficiency if the teams working on those projects are not partitioned.” More often than not, taking on too many projects compared to your actual capacity to do them can lead to the first two problems of bottlenecks and context switching.
4. You don’t have a single view of team capacity
An additional sign of poor resource allocation is a lack of a shared source of truth for who is working on what, and when. Here is Alice Winthrop, Senior Product Manager at Float: “If you don’t know what people are working on, what kind of utilization rate or capacity you have, then you have no way of knowing how well or poorly your people are being managed.”
How to allocate resources (the right way)
In project management, resources are allocated based on project requirements, budget constraints, timelines, and resource availability. This typically involves identifying the necessary human, financial, and material resources and assigning them to specific tasks or activities within the project plan.
At Float, we make listening to our customers– project planners and resource managers– a priority. This is why, after speaking with several of them, we came up with a set of steps they follow to allocate their people’s time to projects while juggling many variables.
The steps below are written with the assumption that you are looking to do resource allocation for several projects with a team of 20-50 people.
If that sounds like you, keep reading 👇🏿
At its core, efficient resource allocation focuses on two steps:
- Identifying what projects to prioritize
- Determining who is best and available to work on projects
Let us break it down.
Step 1. Identify what projects to prioritize
At any point in time, several projects are waiting to be done—but your team has a limited number of hours to work on them. This means you have to prioritize projects and spend time on the ones most impactful to your organization, whether in terms of improving revenue or client relationships.
For example, our customer, Emily Feliciano, the creative resource manager at Atlassian, deals with up to 60 resource requests every week. To help her prioritize the projects to allocate people’s time, she uses a set of questions based on urgency, business value, and cost.
- Are we mending a broken relationship with a client we really want to salvage?
- Is this a new opportunity to partner with a client we have been seeking for a long time?
- What is the priority of this work?
- What is the level of importance of getting this work accomplished?
- Is there flexibility in the timeline for us to deliver?
- Is there a large budget attached?
Ideally, tasks that contribute to the business, are urgent, and have bug budgets should be prioritized when allocating project resources.
Step 2. Determine who is best and available to work on projects
Once you know the projects you need to work on ASAP, you need to determine who is the best person who is both skilled and available to work on them.
Because you’re working with humans and not machines, you don’t just need to consider the amount of time they are available to work for: you also need to evaluate what projects excite or spark interest, and what your team is stellar at.
If you can balance the three, you’d have an enthusiastic crew willing to do their best to deliver successful projects—and who have enough time to do it, too.
Otherwise, you’d have a team of unmotivated people pushing out projects just for the sake of it.
Consider how your team’s skills align with a project
Do you have people with the right skills for the project? Do you need a generalist or a specialist? Or do you have to look outside your team and hire a freelancer?
Getting the people with the right skills to work on a project has two benefits: the job gets done well and probably faster than getting someone who doesn’t know how to do it (unless it is a training opportunity).
For example, if you’re doing an SEO audit for your website, ideally, you should work with an SEO specialist instead of working with a generalist digital marketer.
Identify team members who are available
Allocating people with insufficient time can lead to tasks being done poorly because of the rush to meet deadlines or constant context-switching. Your project might even grind to a halt because interconnected tasks are not delivered on time.
But by asking some questions before allocating work, you can avoid all of these problems:
- Does anyone have time off planned during the duration of projects?
- Is anyone on sick leave?
- Are any national holidays coming up?
- What are their work hours (e.g. are they working full-time or part-time)?
- How much of their time is already allocated to other projects?
- Can their current allocations be negotiated?
There’s a catch. If you try to answer these manually, especially if you have a large team, you might notice that it is an extremely tedious process, and you don’t have all the data you need.
It is best to use resource management software that gives you a full view of your team’s capacity so you can see at a glance who has PTO, is on sick leave, or has a national holiday coming up.
Align allocations with your team’s interests
During the resource allocation phase, don’t miss the chance to get your people to work on things that pique their interest or challenge them.
For example, you might have heard team members express a desire to work on a certain kind of project. Or, as a manager, you might proactively decide that they should try out new types of projects.
Resource allocation is an opportunity to assign your team members to projects that help them grow and develop their skills.
For example, our customer Jason Fisher at Flight Story makes sure he rotates the video editors and the team participating in shoots, so everyone on the team gets an opportunity to work on a variety of projects that interest them instead of just doing the same thing over and over again.
What to do when your resources aren’t enough
Sometimes, even with careful, strategic planning, your team might need to put in extra hours. While it’s not ideal, it happens.
Here are some guidelines to prevent your team from getting too overwhelmed in those cases:
- Try to limit the extra workload to a short time to avoid exhausting your team.
- Talk to your team about why the extra time is needed and what steps you’ll take to manage the workload, like finding extra help or hiring freelancers.
- Make an effort to find extra support to lighten the workload for your team.
A real-life example of resource allocation from Float’s engineering team
Back in September 2023, the engineering team at Float had several projects they needed to allocate the team’s time to:
- Short-term projects scheduled to be shipped before our annual team meetup in late September
- Long-term projects to be shipped after our annual team meetup.
To make them all happen, they had to consider several things, including resource constraints, projects to prioritize, and their existing workflow.
At that time, the team comprised eight engineers evenly distributed between the front and back end. Their time was divided between:
- Current ongoing work like the rollout of the cache API
- Ongoing work that required more time to finish, like the Timer and changes to our Project planning and Estimation features
- New work they wanted to start, like automating dependency updates
- Regular commitments like the Support Champion who analyzes customer issues and provides concise steps for solving issues and Release Manager who coordinates tasks and team members for a smooth release.
- Ongoing hiring process involving several engineers.
To strike a compromise between competing tasks and decide what allocation of time went to what, the team referred back to Float’s Principles for Success and the Product Vision.
As a result, product-led and engineering-led work received the most hours, while tasks related to marketing and customer success were allocated less time.
While allocating work, the team also paid attention to each member’s interests and strengths. For example, one of the engineers, Guido, had experience and interest in performance engineering, which made him the best engineer to handle lazy computation on our schedule.
Throughout the resource allocation discussions, open communication was encouraged by using a public Slack channel. The plan itself was shared in Notion, allowing everyone to contribute and fine-tune it collaboratively.
How to handle resource allocation problems
Even if you adopt all the right tools and follow resource allocation best practices, you will probably still run into problems. Hiccups are going to happen, so it's best to be prepared!
Let's take a look at some of the top challenges project managers face and how to overcome them.
The project scope changes
You did your best to plan resources for your upcoming projects, but there's still the chance of scope creep. Maybe the tasks were more extensive than expected or required skills you didn't account for.
You need to be nimble and adjust your resource planning accordingly when this happens. To prevent scope creep, you should:
- Ensure project scopes are always transparent and defined
- Set clear and defined project goals
- Strive to do your best work, but don't be a perfectionist if it will cause delays
- Build a work plan that guides your course of action
- Create a system that allows workers to greenlight change requests and revisions
- Monitor team performance to ensure everything is on track
- Use all the tools at your disposal to speed up progress
Sometimes it’s impossible to avoid scope creep. In such cases, having a scope change process helps you adapt fast and get back on course. It may look something like this:
- Submit a specific form to document change requests (in writing)
- Analyze the revision request to understand the scope creep thoroughly
- Get approval from the main stakeholders
- Document the approved scope changes in writing
Resources become unavailable
Uncontrollable outside forces prevent scarce resources from showing up as expected. A worker’s car breaks down, and they can’t get to the office. Or maybe they have other priorities in the organization that trumps working on a task you assigned them. What matters is what you do next.
Work quickly to find a replacement within your talent pool. If there’s no one available with the skills you need, hiring a freelancer or contractor may be the best option. You can prevent this in the future by looking at task dependencies. Investigate other responsibilities team members have that may pull them away from the project.
Have a backup resource allocation strategy if they are unavailable for whatever reason. One option is to have a pool of freelancers you can count on to fill in gaps on a whim.
Resources need to be shared
It’s common for projects to share the same resources. This is especially true in smaller organizations that can't afford to hire an extensive staff roster. As you can imagine, shared resources can lead to issues that bog down the pipeline. Project bottlenecks may occur if resources are spread too thin.
Use your resource allocation software to spot gaps in advance. Closely monitor the workloads of team members who move between several departments. It’s the best way to prevent over-allocating resources and burnout.
Unexpected delays occur
A delay can hit when you least expect it. People get sick, labor shortages arise, and miscommunication happens. That’s when scope creep may rear its ugly head. Some issues are within your control, and others, not so much.
The most straightforward way to deal with issues is to try your best to prevent them in the first place. You can:
- Schedule tasks based on skill, not just time. An expert or specialist works faster. Using Float, you can create custom skill tags for team members so you can find the right person for the job in seconds.
- Avoid overloading team members with too many other priorities—especially if the task depends on them to move through the pipeline.
- Offer flexible hours. Some employees work more productively outside of traditional working hours.
- Map out project timelines, break them into phases, and track progress. Software helps to pinpoint potential delays before they become bottlenecks.
The more organized and transparent your resource allocation, the easier it is for everyone to take accountability for their role.
Use resource management software for efficient resource allocation
Most of our customers switch from using spreadsheets or project management tools for resource allocation because they encounter one (or all) of the following:
- Their team grew and the spreadsheet became inadequate
- They need to do a lot of manual updating
- They couldn’t tell the accurate availability of resources
If you can relate to these, it means you need to switch to a resource management tool. We might be a bit biased on this point because Float is a resource management software, but hear us out.
Because resource management tools have all the features you need for allocating your people’s time, they make the process less cumbersome and more accurate. For example:
- They’ll give you an updated overview of your team’s schedule up-to-date, complete with their availability to facilitate informed decision-making
- You’ll be able to save details about your team, like their skills and work hours, and note their interests
- As your project progresses, you can see how other projects might affect their availability
(and yes, if you’re wondering, Float does all three. And many more.)
If you want to find the best option, take a look at this list of the best resource management software we curated for you, complete with feature and pricing comparisons.
And if we’ve already convinced you to give Float a try, sign up for a free trial 🙌.
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