instantis resource management maturity model (white paper)

Copyright Instantis, Inc.

The Resource Management Maturity Model™

A Guide to Defining and Executing an

Effective Resource Management Strategy

Instantis, Inc. September 2011

Copyright Instantis, Inc.

Table of Contents

1. Introduction

2. Business Drivers and Benefits

2.1 Business Drivers

2.2 Benefits

3. Model Overview

3.1 Context

3.2 Levels and Dimensions

3.3 RIMM Summary View

3.4 Interpreting and Using the Model

4. Terminology

5. Detailed Level Descriptions

5.1 Level 1 – Work Visibility

5.2 Level 2 – Controlled Assignment

5.3 Level 3 – Governed Capacity

5.4 Level 4 – Schedule-Driven Availability

5.5 Level 5 – Granular Management

6. Summary and Key Takeaways

7. Next Steps

8. About Instantis

Copyright Instantis, Inc. Page 1

1. Introduction

The Resource Management Maturity Model™ (RMMM) enables organizations to define and

execute an effective resource management strategy. It accomplishes this by helping

stakeholders better align resource-related information needs with their level of project portfolio

management (PPM) process maturity and technology enablement.

OptimizedResource

Deployment

Information Needs

Process Maturity Technology

OptimizedResource

Deployment

Information Needs

Process Maturity Technology

The RMMM identifies a logical progression of resource management process sophistication

which is enumerated as five levels of maturity. Each level of maturity is described along seven

dimensions. Organizations can use the RMMM to ensure they can manage project resources

and capacity at the “just right” level of granularity for their business.

1 2 3 4 5

1

2

3

4

5

6

7

1 2 3 4 5

1

2

3

4

5

6

7

The RIMM was developed and refined in consultation with resource management practitioners

across multiple industries, internal deployment consultants and industry analysts. As such, it

represents a blend of:


1) Observations on how organizations actually manage resources based on significant

anecdotal evidence gathered from direct and indirect exposure to hundreds of resource

management scenarios, and;

2) Recommendations for how best to manage resources based on this collective

experience of successes and failures.

2. Business Drivers and Benefits

2.1 Business Drivers

There were several motivations for developing the RMMM. They include:

1. Business importance of resource management. Effective resource management is

vital for most organizations because resources represent a major, if not the primary, cost

of doing business. As a result, maximizing the return on investment in people is critical to

achieving strategic business and financial goals.

2. Track record of resource management initiative failures. Many organizations have

launched initiatives to improve their resource and capacity management process –

including implementing resource management software technology – and have failed.

The root of these failures is a fundamental misalignment between the granularity of the

level of information needed to make effective decisions (i.e., not too much information;

not too little information), the maturity of the process associated with the assignment and

tracking of resources, and the capabilities and the influence of the supporting resource

management software.

For example, the software may be designed to enable a resource management process

that is much more sophisticated than what is required to provide the right level of

information in a particular organization and it may assume a level of process maturity

that does not exist. Frequently, this mismatch is not apparent until after the software is

implemented.

3. Need for focused guidance. The RMMM fills a void in the PPM shared-knowledge and

best-practice landscape. While there are several excellent project and portfolio

management (PPM) maturity models available from high-quality sources – such as

Gartner, PM Solutions and the Project Management Institute – the scope of these


models is broader. There is little guidance available that is focused exclusively on

resource and capacity management issues.

Specifically, most organizations have recurring difficulty in answering some seemingly simple

and other more challenging questions from stakeholders such as:

• “What are these resources working on?”

• “Why is it so difficult to take on new projects?”

• “How come these resources are always overbooked, don’t you control how work

gets assigned to resources?”

• “Will we have enough available capacity in three months to take on these new

important projects?”

• “Do we have the right mix of skills to meet project demand?”

• “What is the cost of this group of resources for this month on this set of projects?”

• “How do I de-prioritize the work already under way to make room for new work?”

• “Can you spare this one critical resource for this period – it is really important?”

Guidance is needed in helping organizations focus on identifying and answering the most

important questions consistently and understand how to take measured steps in deploying the

“just right” level of supporting process and technology.

2.2 Benefits

The benefits organizations can expect to realize by adopting the Resource Management

Maturity Model are as follows:

1. Common Language: Provide resource managers, portfolio managers and business

executives in project-intensive organizations with a framework and common language

for communicating about resource management objectives, issues and outcomes.

2. Roadmap: Deliver a roadmap and a guide for stakeholders that helps them characterize

their current level of maturity and determine the optimal, aspirational level of maturity.

3. Clarity: Expose clearly the implications and consequences of aspiring to or operating at

a particular level of resource management maturity in areas like data gathering and

reporting requirements, software technology selection, governance infrastructure, and

resulting business benefits. Note that higher is not necessarily better for all

organizations.


4. Software Selection: Prepare stakeholders to make better assessments of PPM

software options for resource management and choose the solution that is best suited to

meet current and projected needs.

3. Model Overview

3.1 Context

The RMMM applies to resource-constrained environments including organizations that manage

a handful of resources as well as those that manage hundreds and even thousands of

resources. It is relevant across many industries and different project environments such as IT,

professional services and product development and delivery. However, it is not geared for

schedule/budget constrained environments where resource/capacity is not always an explicit

business driver (e.g., construction projects).

For the purposes of the RMMM, the resource management discipline, at its core, is primarily

concerned with managing the work assignments, time usage and cost of a set of resources.

Work is accomplished via the assignment and completion of project and non-project work,

although the emphasis is on project-oriented work. At the project level, Project Managers (PMs)

create a need to utilize individual resources based on project schedules and required roles and

skills. Line managers or resource managers have control over the supply and assignment of

resources. A governance structure may be put in place to oversee the entire process at the

portfolio and aggregate capacity and demand levels.

Effective resource management enhances project portfolio success by ensuring that projects

are staffed with the right resources (e.g., roles and skills) in a timely manner and that adequate

resources are available to address current needs and future demand. However, project success

depends on a number of other factors which are outside the scope of the RMMM. For example,

the definition and delivery of project goals, individual performance and contribution, scheduling

best practices and risk assessment and mitigation are not addressed by the RMMM.

3.2 Levels and Dimensions

The RMMM consists of five maturity levels. The specific characteristics of each level are

described along seven dimensions.


The five levels of resource maturity are listed below along with a simplified definition:

Resource Maturity

Model Level

Key Defining Characteristic(s):

Level 1: Work

Visibility

Organizations have visibility to who is working on what. However,

resources are assigned to work without any control or oversight.

Level 2: Controlled

Assignment

A formal resource assignment approval process is introduced. However,

approvals are informed only by resource availability information.

Level 3: Governed

Capacity

The focus shifts to capacity management and the introduction of project

priority considerations requiring more structured governance.

Level 4: Schedule-

driven Assignment

The resource assignment approval and capacity management processes

are driven by project schedules at the phase level.

Level 5: Granular

Management

Full task-level project schedule details are used to drive the resource

assignment and capacity management processes.

A brief definition of each dimension follows:

RMMM Dimension

Names

Definition

Assignment

Granularity

This is the level of detail at which resources are assigned to work. The

duration may be driven by dates at the project-, phase- or task-level. The

utilization may be a constant value or may be time varying for a specified

duration.

Project Roles This refers to any standardized and distinct roles played by a resource or

group of resources on a given project, such as project manager,


software developer, business analyst, etc. Roles allow the organization

to create attributes and policies for a group of resources, such as cost

rates, maximum number of assigned projects per role, etc.

Resource Cost This is the labor cost of a resource that results from a work assignment.

Resource cost may refer to planned cost or to actual cost. Cost may be

tracked for a time interval or at the project-, phase- and task-level.

Resource Approval This is the process of approving the assignment of a resource to work at

the particular level of assignment granularity. Note: This is a critical

dimension of resource management because it has implications for

required governance and process complexity.

Capacity Planning This is the strategic portfolio-level planning process aimed at ensuring

that the most important projects are resourced and that resource

utilization is optimized within the constraint of aggregate resource

capacity. This involves shifting and removing proposed and ongoing

projects; adding or removing resources; and then making the necessary

resource assignment adjustments to accommodate the higher priority

projects.

Governance This is the decision-making process and organizational body that

oversees the resource approval, portfolio prioritization, demand

management and capacity planning business processes.

Business Value This is the key business value that organizations can expect to realize at

a given level of maturity.


The assignment granularity dimension is a key maturity

level driver. Here is an illustration of the key attributes.

Level 1/2

Level 3

Level 4

A resources is assigned a fixed/constant utilization

percentage for the duration of the project

A resource’s utilization can vary within duration of

a project

A resource’s utilization can vary by project phase (driven by project WBS)

Level 5

S E

A resource’s utilization can vary by individual

project activity (driven by project WBS)

0%

50%

100%

0%

50%

100%

0%

50%

100%

0%

50%

100%

t


3.3 RMMM Summary View

Level 1 Level 2 Level 3 Level 4 Level 5

Work Visibility

Controlled Assignment

Governed Capacity

Schedule-Driven Availability

Granular Management

Assignment Granularity

Assignment at project level, fixed % Non Project work: fixed % of capacity

Assignment at project level, fixed % Non Project work: project placeholder

Assignment at project level, possibly non fixed % Non Project work: multiple project placeholders

Assignment at project schedule, phase level. Non Project work: phases in placeholder project

Assignment at project schedule, granular activity level Non Project work: ITSM integration, activities in placeholder project

Project Roles

Resources assigned as Project Manager and Team Member only

Resources assigned to differentiated roles; roles properties for cost rate etc.

Resources assigned by role and skills at project level

Resources assigned by role and skills at phase level

Role to activity typing with RACI model; Training, certification tracking

Resource Cost

Planned cost at project level; Actual cost from timesheets at project level

Planned cost at project and time level; Actual cost from timesheets at project level

Also, plan vs. actual comparison, budget constraints

Planned cost at phase level; Actual cost from timesheets at phase level; EVM

Planned cost at granular activity level; Actual cost from timesheets at activity level; Full EVM; activity level budget constraints

Resource Approval

None, ad-hoc, first come first served; line mgr only

Resource Approval Workflow (RAW) at project, proposal level; approval based on availability

RAW at project level, possibly multiple per project; approval based on priorities

RAW at phase level

RAW at all activity levels

Capacity Planning

None Balanced utilization across resources

Resolve availability constraints by delaying, cancelling proposals, projects based on priority

Project phase schedules drive more detailed resource availability views; capacity planning can delay projects at phase level

Resolve availability constraints by delay/shift at activity level with PM involvement

Governance None Resource or line manager; mostly FIFO demand mgmt

Governance body prioritizes portfolio. Oversees capacity planning and demand mgmt.

Governance body actions rely on up- -to-date project phase schedule information

Governance body actions rely on up-to-date full project schedule information

Business Value

Who is working on what; Over-utilization made visible

Controlled and balanced resource utilization, availability.

Higher priority projects preferentially resourced; resourcing responsive to changing business priorities

Enhanced ability to resource excess demand with existing capacity

Maximized ability to resource excess demand with existing capacity


3.4 Interpreting and Using the Model

For a given level of maturity, the characteristics at each dimension (in terms of assignment

complexity, governance, desired business value, etc.) are linked together by the logic of what

successful organizations actually do or should do to achieve their resource management goals.

For example, at Level 1 the absence of Resource Approval implies the absence of a Capacity

Planning and Governance process. At Level 3, a governance body is required to decide project

priorities which, in turn, are a pre-requisite to implement Capacity Planning. As a result, in

general, it is recommended that organizations implement all of the processes and dimensions

associated with each maturity level before pursuing the next level.

However, some organizations may be at one level of maturity along some dimensions while at

other levels of maturity along other dimensions described by the model. And, during the course

of this journey, organizations may continue to operate at different levels of maturity for a given

dimension than suggested by the model. For example, at Level 2, some organizations may be

operating at Level 3 in terms of Assignment Granularity, but are better characterized as Level 2

organization because there is no governance structure.

A key value of the RMMM is in helping organizations expose whether or not these variances

from the best practices represented by the model are:

(1) The result of conscious and valid organizational decisions (based on unique organizational

factors such as corporate culture, industry context or other considerations), or

(2) Symptomatic of issues or areas of dysfunction that need to be addressed. For example, it

makes little sense for an organization to invest heavily in a Capacity Planning process without

putting in place a governance structure that can also perform demand management.

A fundamental tenet of the RMMM is that higher is not necessarily better. Most organizations

will find Level 3 to be the optimal target. Organizations need to be careful before setting their

sights on Level 4 since it entails additional process complexity which may not be justified by the

business benefits. Very few organizations will find Level 5 to be the optimal level at which to

operate simply because of the potentially onerous information and supporting technology

complexity and process maturity demands. Typically, this level of maturity is appropriate for

specific types of resource-intensive scenarios where resource scheduling sophistication is

critical.


Finally, it is important to note that the RMMM makes clear what an organization must do in order

to operate successfully at each level. However, by itself, it can not prescribe the right level of

maturity for your organization. That, of course, depends on a number of case-specific factors

such as industry context, organizational culture, leadership style and technology experience.

The probability of successful implementation of these processes must be the first guide to

selecting the desired level. The target business value at that level must be aligned with the

desired benefits. If not, the organization can take measured steps to implement the process and

organizational changes necessary to get to the next level.

4. Terminology

These are key terms and definitions used in this Model.

Key Terms Definition

Resource capacity This is the total time for a given resource that is intended to be managed.

The units of capacity are time per duration (e.g., 40 hours per week) or a

fraction (e.g., 50%) of an FTE (full-time equivalent). Usually,

organizations choose to subtract a fixed fraction of the capacity “off-the-

top” for non-project work and choose to track in detail the utilization for

project work. For example, a 40 hour per week employee that has 20%

of the capacity set aside for non-project work has capacity designated as

32 hours per week. As an alternate example, an organization may view

the capacity as 40 hours per week and track the utilization for both

project work and non-project work in this 40 hour per week capacity.

Some organizations may also choose to reduce resource capacity by

time not available for non-work such as vacations and holidays.

Resource capacity can be aggregated across a group of resources (e.g.,

by organization, by role).

Resource utilization This is the sum total of a resource’s assignment to work for a given

duration. The work includes only project work if the capacity is defined to

exclude non-project work as describe above, and vice versa. Utilization

has units of time per duration (e.g., hours per day) or a fraction of

capacity (e.g., a resource may be used 20 hours per week or 50% of


capacity on a project). Utilization may be specified as an effort that is

spread evenly over the given duration (e.g., a resource is used for 100

hours for the duration of the project or 20 hours for the duration of a

phase of a project). At a further level of detail, the effort specified may be

un-even (e.g., a resource is used 10 hours in week 1 and 40 hours in

week 4 of a project). The Resource Assignment dimension describes the

granularity of the per-project utilization that is typical for each maturity

level.

Resource availability This is the difference between capacity and utilization for a given

duration. This is the time available for a resource to be assigned to more

work. Availability has units of time per duration (e.g., hours per week) or

fraction of capacity.

Resource demand This is the incremental potential work assignment for a given duration for

a resource driven from proposed projects or incremental work requests

associated with on-going projects. Demand may be greater or less than

the availability for a given duration.

Activity This is the generic name for any level of project work identified in a

project work breakdown schedule (WBS). The highest level activity of a

WBS is referred to here as a phase. Phases may be broken into a series

of lower-level activities such as tasks and deliverables.

Resource Approval Workflow (RAW)

This is the process by which a resource is assigned to work for a given

duration. The assignment may be for a proposed project (also known as

a proposal) or for incremental work associated with an ongoing project.

Broadly, the process has the following workflow:

1. Request Parameters: A request is made by the project manager for a

resource that contains:

a) A start and end date which defines the potential request duration.

Depending on the maturity level along the Resource Assignment

dimension, the duration may be determined by project start and

end dates, or some other significant dates within a project, or tied


to the dates of a specific phase of a project or a specific lower-level

activity of a project.

b) The effort (in units of hours/days/weeks, etc.) required from the

resource in the request duration. The effort may be represented as

the average percentage of time that that the resource is expected

to be utilized for the requested duration. The effort may also be

represented by specific hours, days, or weeks..

c) The resource request flexibility with regard to (1) a specific

named individual vs. anyone matching the role and skills

requirement and (2) availability requirements (e.g., only full-

duration availability is acceptable).

2. Request Routing: The request is sent to a specific person playing the

role of resource manager. In many organizations this may simply be

the resource’s direct line manager. There may be a distinct resource

manager for a set of roles or a set of resources.

3. Resource Approval/Denial: The resource manager may consult a

“heat map” of the resource being requested to determine availability

and additionally may consult project prioritization information. The

criteria to approve/deny the request depend on the maturity level.

The response may be a simple “approved/denied” or may have

nuances such as the ability to provide for partial approval or a hard

versus soft commitment.

4. Project Manager Next Steps: If the request is approved, the project

manager then proceeds to use the resource as desired for project

execution. If the request is denied, the project manager may have

various actions available to them depending on maturity level.


5. Detailed Level Descriptions

5.1 Level 1 – Work Visibility

Most organizations struggle with answering even the most basic question: “What are my people

working on?” At Level 1, this “Work Visibility” is the desired outcome. At this level, the first step

is to make a comprehensive list of the projects under way in the organization. Then, an

association is made between resources and projects. This exercise also usually reveals that

resource time is consumed by work outside of projects, often called “keep the lights on work”.

Non-project work is treated as simply a fixed fraction that is removed from the resource’s

capacity for project-work.

The minimal expectation is that projects have a planned start and end date and the per-project

utilization is a constant percentage for the duration of the project. If the project dates are

accurate and kept up to date, it is possible to create a reasonably complete, if not granular,

picture of the aggregate utilization of the resources. Since resource costs are known, it is also

possible to know the planned resource costs by project. There is also usually an interest in

knowing the actual costs and this is captured using time sheets which record actual time spent

by a resource on a project.

Here’s an illustration of assignment over-utilization risk

at Level 1

Demand for Resource A

time

Resource

Utilization (%)

25%

100%

S1 E1 S3 E3E2S2

Resources are assigned a fixed/constant utilization

percentage for the duration of the project

Project 1

Project 2

Project 3

50%

75%

time

Resource

Utilization (%)

25%

100%

Aggregate % Utilization for Resource A

75%

50%

S1 E1 S3 E3E2S2

At this level process maturity (assignment

granularity) there is a risk of resource over-

utilization.


A key defining characteristic of operating at Level 1 is that there is no formal and transparent

process by which resource assignment to projects is controlled. Resources are assigned to

projects ad hoc or simply by the line-manager’s approval instead taking a holistic view of all the

resources. This can result in over-booking and potentially “burning out” a given resource (see

illustration above). This can also result in projects not being successful because the resources

assigned to them in reality have no available time to work on the project. Likewise, it is also

possible to under-utilize certain resources while over-utilizing others.

Maturity Model Dimension

Level 1: Work Visibility Description


• A simple (but complete) list of projects with all associated resources is created.

• A resource’s utilization is assumed to be a constant percentage for the duration of the project (i.e., from project start to end date).

• Non-project work is modeled as a non-time-varying percentage of each resource’s capacity which may vary by resource.

Project Roles • Role specificity is minimal. Only project managers are identified.

Resource Cost • Only aggregate resource costs are planned.

• Allocation of planned costs to projects is possible.

• Timesheets are in place to capture actual costs of resources by project.

Resource Approval

• There is no resource approval process.

Capacity Planning

• There is no capacity planning process.

Governance • There is no governance structure.

Business Value • Answers “who is working on what”. Simple resource utilization and availability “heat maps” are possible that can help identify at-risk projects, resource burnout situations, cost reduction opportunities or availability to take on more projects.

Next Level When:

The organization decides to pursue the next level when there is a desire to pro-actively manage

the utilization of resources. Specifically, there is a recognized need to better balance work


between available resources and to avoid burn-out or project risks associated with and

inadequate resourcing process. The creation of a Resource Approval process is the key enabler

in progressing to the next level of maturity.

5.2 Level 2 – Controlled Assignment

Resource Approval is the critical dimension at Level 2. Specifically, the introduction of a process

by which resources are assigned to projects (i.e., a resource approval workflow or RAW) drives

the organization to mature its resource management process along several of the other

dimensions. A resource approval process eliminates the ad hoc nature by which resources are

associated with projects at Level 1.

For the newly introduced resource approval workflow (RAW), the level of assignment granularity

of the request is simply at the project level. This means that each request includes a start and

end date of the project and a fixed average percentage utilization over the duration of the

project. The resource manager performs approvals by consulting a heat map indicating the

availability for each resource and providing approvals only when the demand is less than the

availability. Some organizations may choose to define availability policies that resource

managers are expected to follow (e.g., a resource’s availability should never be less than 10%).

At Level 2 the Resource Approval Workflow (RAW)

ensures that Resource A is not over-utilized

Demand for Resource A

time

Resource

Utilization (%)

25%

100%

S1 E1 S3 E3E2S2

time

Resource

Utilization (%)

25%

100%


Project 1

Project 3

50%

75%

50%

75%

S1 E1 E2S2

Project 2

At Level 2, the RM can disapprove the request of

Resource A for assignment to Project 3 to avoid the over-utilization

scenario


At Level 2, note that the resource manager is approving/denying resource requests based on

the viewpoint of the resource availability without considering project priority. As a result,

resources can be consumed working on lower priority projects and there is no formal process to

redirect a previously assigned resource to a higher priority project. Also, a resource manager

that is considering multiple simultaneous requests for the same resource does not have the

objective, unbiased information needed to make a decision based on business value or priority.

This leads to resource approval being driven by “squeaky wheels”, personal favors and other

dubious factors rather than important considerations like strategic alignment.


Level 2 Controlled Assignment Description


• Resources are assigned at the project level and start and end dates of projects are managed with rigor.

• The per-project utilization is specified as a fixed percentage for the project duration.

Project Roles • A project team is defined consisting of specific roles and attributes (e.g., cost rates, standard percentage utilization per project).

• Standard project team templates by project type may exist.

Resource Cost • The organization is able to track planned resource costs by time and project.

• Actual costs are based on timesheets at the project level.

• There is no control of actual costs based on budgeted (planned) costs.

Resource Approval

• A RAW process is used to assign resources to projects only after a formal request is approved.

• The resource manager approves or denies requests based on availability of the requested resource or resource type (i.e. matching role, skill set).

• Project priority is not considered; requests may be approved on a first-come first-served basis.

Capacity Planning

• Existing aggregate-capacity total (by role, by resource) and aggregate utilization are visible and evenly balanced with relatively few instances of over-/under-utilization.

• There is no assurance that resources are being utilized on the highest business-value projects.

• There is no easy way accommodate new resource demands from higher value projects by de-prioritizing in-fight projects.


Governance • There is no governance structure to manage relative project priorities.

Business Value • The RAW process ensures that resources are not over/under-utilized, existing capacity is actively managed to a desired availability and that work is evenly distributed across the resources.

• It becomes clear if new demand can be resourced from existing availability or if additional resources are needed.

Next Level When:

At Level 2 an organization reaches a pain threshold and is compelled to mature to the next level

as a result of the inability to:

Focus on projects with greatest business impact

Dynamically respond to changing business priorities

Fulfill new demand by re-prioritizing existing projects instead of simply adding new resources

5.3 Level 3 – Governed Capacity

At Level 3 the critical dimension that comes into play is a governance structure that prioritizes

projects and thereby prioritizes existing resource utilization versus new resource demand. The

governance organization or steering committee may be referred to as the “Resource

Governance Committee” or “Portfolio Governance Committee” or go by other names. The

Committee is represented by stakeholders from both the demand side (projects ideas, requests

and proposals) and the supply side (resources), and the line of business executives who are

ultimately responsible for the success of the project portfolio. This structure, coupled with the

previously discussed RAW process, results in the ability to implement a “governed” capacity

planning process.

The prioritization process involves determining (1) the relative priority between existing projects

and new proposals and (2) the relative priority between multiple projects running concurrently. A

few key elements of prioritization include setting up and standardizing assessment criteria in

high level categories like benefits, financial costs and risks. Benefits criteria may include, for

example, strategic alignment, financial return and customer satisfaction. Cost may have sub-

elements like project costs and opportunity costs. Risks might be financial, implementation or

market related. Project proposals are scored using consistent criteria and approvals are made


through a comparative assessment. New proposals for projects must follow a resource approval

workflow process (RAW), but at Level 3 the resource requests can be more effectively managed

by the resource managers based on the project prioritization information.

Level 3 introduces a governance structure which considers

project priority when approving project plans

time

Resource

Utilization (%)

25%

100%


75%

50%

S1 E1 S3 E3E2S2 time

25%

100%

Aggregate % Utilization for Resource A after Governance action

75%

50%

S1 E1 S3 E3E2S2

At Level 3 governance can cancel Project 2

and approve Project 3. This action removes a resource-related risk to

Project 3 which governance has

prioritized highest

time

25%

100%


75%

50%

S1 E1 S3 E3E2S2

This is the aggregate demand for resource A showing a period over-

utilization which represents a risk to

project 3

Project 1

Project 2

Project 3

At Level 3 a governance committee oversees the capacity planning process. It has full visibility

to aggregate utilization from existing projects and the incremental demand from new proposals

relative to aggregate capacity. This visibility should include a line-of-sight to any sub-set of

projects of interest and to any sub-set of roles and resources of interest. Based on priority and

resource availability information, the governance body has the ability to dynamically launch,

suspend, delay and cancel projects in order to balance capacity with demand in the most

impactful way to the organization. This is an ongoing and iterative process that reacts to

prioritization changes as business conditions dictate. Software technology should be used to

provide decision support using dynamic “what-if” scenario planning that allows examination of

the resource availability implications of different prioritization decisions. The committee also

decides whether the capacity of resources available for a particular role needs to be adjusted

upward or downward.

Level 3 represents the sweet spot of resource management maturity for most organizations

because it provides significant benefits in terms of enabling organizations to better align

resources with strategic priorities in the immediate term and over the course of a planning


horizon. At the same time, assigning resources at the project level of granularity (as opposed to

a lower level), avoids many of the pitfalls associated with Level 4 and Level 5 resource

management which drive resource management from the project work breakdown schedule.


Level 3 Governed Capacity Description


• Resources are still assigned at the project level.

• Project start and end dates are managed with rigor because these points bound resource assignments.

• Per-project resource utilization within projects can be adjusted upward or downward (i.e., not necessarily constant from start to end date).

• Non-project work may be planned using placeholder projects and multiple start/end-date intervals with variable percentage utilization.

• It is possible to integrate systems that track non-project work to better inform utilization calculations.

Project Roles • RAW process considers resource skills, capabilities, and training to fulfill resource requests.

Resource Cost • Planned resource costs by time and project can be tracked.

• Thus, total costs and per-resource costs can be computed for each project, for a project portfolio and for a given duration.

• Actual costs are computed from timesheets at the project level.

• The governance committee may institute a process to ensure that actual resource costs do not exceed planned costs.

Resource Approval

• The RAW process is not limited to a single request for the entire project duration.

• Multiple separate requests/approvals, each with different start/end dates and percentage utilization is possible.

• The resource manager approves or denies requests based on availability of individual requested or suitable alternative (e.g., matching skill set, location, cost rate, etc.).

• The resource manager can decide between competing resource requests based on the clearly defined project priorities.

• The PM may use the additional assignment granularity detail to request the resource for only part of the project duration.

• Alternately, the PM may appeal to the governance committee to invoke a capacity planning exercise.


Capacity Planning

• Existing aggregate capacity (by role and by resource) and the aggregate utilization is visible.

• Utilization is greater on higher-priority projects with the most business impact.

• Higher priority new demand is resourced ahead of lower priority new demand.

• If new demand exceeds availability, it is possible to fulfill this demand by re-prioritizing, delaying or cancelling existing projects without adding resources.

• “What-if” scenarios can be used to simulate the impact of re-prioritizing, delaying, and cancelling projects.

Governance • A governance structure oversees demand management, proposal and project prioritization and capacity planning.

Business Value • Organizations are better prepared to support business strategic

objectives now and within the planning horizon based on ability to free up resource capacity to accommodate higher priority projects now, as well as anticipate resource demand.

Next Level When:

Level 4 should be aspired to by organizations that have specific needs for understanding the

project schedule driven resource utilization and these needs outweigh the issues with process

and data complexity.

5.4 Level 4 – Schedule-Driven Availability

The critical element of the transition from a Level 3 to a Level 4 organization is the use of the

project schedule to drive project resource utilization. This occurs when simple average

utilization of a resource over a project’s duration is deemed to be too coarse a measure of

utilization. It is quite possible that certain resources are needed more in certain phases of a

project. For example, in a software development project, business analysts may be needed

more during a requirements phase while QA resources may be needed more intensively during

a testing phase.

At Level 4 project resources are assigned using high-level (e.g., phase-level) activity information

delineated in the projects WBS. Each phase has an associated utilization that results from the

phase start date, phase end date, and percent of capacity spent on the phase or total effort on


the phase. The summation of these attribute values over all the phases is aggregated to arrive

at the resource utilization for a given project.

At Level 4 phase-level demand info can lead to better resource utilization and assignment decisions

time

25%

100%

Aggregate % Utilization for Resource A (Level 1,2,3)

75%

50%

S1 E1 S3 E3E2S2

Aggregate % Utilization for Resource AAt Level 4, Phase level

detail for Project 2 allows us to fit Project 2 demand

into Resource A’s schedule w/out canceling

Project 2

Here we are at Level 1,2,3 resource demand

information which shows an over-utilization period.

Project 1

Project 2

Project 3

25%

100%

75%

50%

An organization may choose to be at Level 4 when this greater detail is meaningful and can

have a material impact on the capacity planning decisions. For example, Project 1 utilizes a

resource for 40 hours during a month and there appears to be an over-utilization in week 4 due

to new demand from Project 2 for the same resource for 40 hours in week 4. However, it turns

out that -- based on a phase-based assignment in Project 1 -- the utilization is entirely in week

1. Therefore, week 4 is not used by Project 1 and Project 2’s request can be approved. Thus,

the extra detail eliminated a “false-positive” over-utilization situation.

A second benefit is that it is possible for the capacity planning process to operate at the phase

level of a project rather than at the project level. In the above example, an alternate resolution

for the over-utilization may be that the particular phase of Project 2 that needs the resource in

week 4 is delayed, not the project as a whole. This phase delay may have no eventual impact

on the project’s business impact whereas delaying the entire project may not be acceptable.

Another benefit of WBS-driven resource management starting at Level 4 is that non-project

work items can also be tracked at a corresponding level of granularity concurrently with project

work. A placeholder project for non-project work can be created with each placeholder activity


corresponding to each work item and representing its duration and effort. This enables a unified

view of the detailed project and non-project work items that consume the time of each resource.

It is important to note that this places an incremental but significant burden on the project

managers to accurately maintain and update their phase dates, to accurately assign individual

resources to the relevant phases and to accurately provide utilization requirements by phase.

For example, a portfolio of 100 projects, with 5 phases per project, and 5 resources per phase,

requires that a total of 7,500 pieces of information (100x5x5x3) be kept up to date and accurate.

If the organization does not possess adequate process maturity, the dependent capacity

planning and governance processes will be driven from a mass of unreliable underlying

information.

A key challenge at Level 4 is that potential conflicts can result because the time horizons of the

strategic capacity planning process are mismatched with the day-to-day changes made by

project managers at the phase level. For example, the governance committee might meet and

decide that there is a severe resource shortage during a particular timeframe and decide to re-

assign resources, delay or cancel projects to relieve this shortage. It may then turn out that the

project manager coincidentally re-arranges the project schedule, freeing up resources that

appeared to governance to be in critical short supply, but the governance committee is not able

to react to this information until it meets at a later time.


Level 4 Schedule-driven Availability Description


• Resources are assigned at the phase level in the project WBS.

• The per-project resource utilization is an aggregate of the underlying per-phase utilization.

• Per-phase utilization attributes are phase start date, phase end date, percentage utilization or phase level effort.

• Non-project work may be planned using placeholder projects with each representing an item of non-project work.

Project Roles • Roles and resource skills are used during project phase assignments.

Resource Cost • Resource costs are planned at the phase level.

• Each phase has a total resource cost based on the WBS level assignment

• Phase level costs are totaled to determine project costs.


• Actual costs are derived from timesheets and actual time spent on each phase can be tracked.

• Additional processes may be used to control actual costs at a per-phase level to be limited to the planned costs.

• Earned Value Management is possible.

Resource Approval

• The RAW process is performed at the phase level.

• Each assignment to a phase must be approved through the RAW process along with the phase-level dates and percentage or effort information.

• Approvals are informed by resource availability and project priority.

Capacity Planning

• Aggregate utilization is the summation of all the project phase-level resource utilization rates from individual projects.

• Underlying data for all projects and phase schedule changes must be timely and accurately estimated to enable effective capacity planning.

Governance • A governance structure oversees portfolio management processes such as demand management, project/proposal prioritization and capacity planning.

• There is a potentially undesirable interplay between the project managers’ level of detail and granularity and the high-level governance committee strategic viewpoint.

Business Value • It may be possible to accommodate incremental demand with the same set of resources as a result of more detailed phase-level information.

• This greater detail may be vital in particular project-intensive and highly resource-constrained scenarios (e.g., can maximize billing rates in services delivery organizations).

Next Level When:

Organizations aspire to Level 5 when an even greater level of project schedule detail is deemed

necessary to perform effective resource management.

5.5 Level 5 – Granular Management

At Level 5, resource management and capacity planning is driven by the complete and full

levels of WBS activity detail. Each activity has an associated utilization that results from the

activity start date, activity end date, and percent of capacity spent on the activity or total effort


on the activity. The summation of these attribute values over all the phases is aggregated to

arrive at the resource utilization for a given project.

This may be necessary when the phase level information about resource utilization is too coarse

and full project schedule detail is necessary and meaningful to the business. Another benefit of

is that non-project work items can be tracked at fuller detail with a placeholder activity

corresponding to each work item and representing its duration and effort. This enables a unified

view of the detailed project and non-project work items that consume the time of each resource.

This places a very significant burden on the project managers to accurately maintain and update

their activity dates, to accurately assign individual resources to the relevant activities and to

accurately provide utilization requirements by activity.

For example, a portfolio of 100 projects, with 30 activities per project, and 2 resources per

activity, requires that a total of 18,000 pieces of information (100x30x2x3) be kept up to date

and accurate. For most organizations, it is extremely difficult to accurately maintain this amount

of information. As a result, most organizations that attempt to operate at this level fail under the

weight and burden of additional process complexity (unless the number of projects and

resources is small).

Many resource management software solutions require organizations to supply this granular

detail to feed the higher level capacity planning and governance processes. This is a key reason

why these software implementations are not successful.


Level 5 Granular Management Description


• The complete WBS activity detail feeds into the per-project utilization.

• Non-project considers information derived from IT service management system integration (e.g., trouble tickets) and granular non-project work item visibility.

Project Roles • The RACI model (Responsible-Accountable-Consulted-Informed) may be used to further classify the types of activity-resources assignments.

• This may have implications for activity-resource demand. For example, resources designated as “responsible” for a project activity assignment may trigger a level of resource (time/effort) utilization while a resource designated as “informed” may not.


Resource Cost • Resource costs are planned at the detailed resource-activity level.

• Each activity has a total resource cost based on the WBS level assignment and the activity level costs are totaled to determine project costs.

• RACI may be used to further specify different cost rates based on assignment type.

• Actual costs are derived from timesheets and actual time spent on each activity can be tracked.

• Additional processes may exist to control actual costs at a per-activity level limited to the planned costs or a specified not-to-exceed planned cost.

Resource Approval

• Resource approvals are performed at the individual activity level and are informed by resource availability and project priority.

Capacity Planning

• The aggregate utilization is driven by a summation of all the project activity-level resource utilization.

• The underlying data for all projects on all phase schedule changes must be accurately estimated and timely to enable effective capacity planning.

Governance • The governance process and body needs to be prepared to react to more dynamic and constantly changing project schedule details.

Business Value • It may be possible to accommodate even more demand with the same set of resources because of the more detailed activity level information.


6. Summary and Key Takeaways

Here are the key conclusions:

• The level “Assignment Granularity” detail is the key model driver. The level of granularity

an organization chooses to plan and track effort largely drives where it should be along

other maturity model dimensions.

• There is a “chasm” between maturity levels 3 and 4. Many organizations pre-maturely

rush to Level 4 -- which includes activity-level effort roll ups -- and fail.

• For most organizations, Level 3 is the sweet spot to strive for providing “just right”

process sophistication given the level of information needed by the business to make

effective resource-related decisions.

• Systems should be configured to align with the level of process maturity and not

encourage IT organizations to bite off more functionality than they can chew.

RMMM Pictorial Summary

At Level 1 there is a

uncontrolled resource grab

Level 2 introduces a resource

approval workflow

At Level 3 a governance body

considers project priority

Level 4,5 considers project

activity-level demand

RMMM Pictorial Summary


7. Next Steps

• Assess your own company’s level of existing process maturity and see where it fits in the

Maturity Model. You may do this internally by benchmarking with other companies or

with the help of a consulting firm.

• Examine the business benefits at your company’s maturity level.

• If the additional business benefits of going to the next level are important, perform a gap

analysis and identify what critical “dimensions” need to progress at your level of maturity.

• Communicate the findings to others in your company and get buy-in to fix the gaps.

• Lay out a roadmap of how your company should get to the next level and work towards

getting there.

• Contact Instantis if you need software technology help with your resource and capacity

management initiative.

8. About Instantis

Instantis, Inc. is a leading SaaS-based provider of Enterprise Project & Portfolio Management

(EPPM) software used by business process and IT leaders to improve strategy execution and

financial performance. Leading global corporations like Abbott, DuPont, France Telecom, Lilly,

National Grid and Xerox rely on a single system called EnterpriseTrack to fulfill the distinctive

requirements of their strategic project portfolios such as IT, PMO, product development, Lean

Six Sigma and sustainability. EnterpriseTrack features comprehensive resource and capacity

management functionality that can be configured to support organizations needs across the

spectrum of resource information needs and process maturity levels.

instantis resource management maturity model (white paper)

Documents

level of maturity

resource managers

critical resource

level of process maturity

capacity management

project management institute

right level of information

capacity management