Services organizations have limited resources and budgets to deliver on their projects. Project managers need to deploy the right resources to optimize billable utilization and stay profitable without overloading or overworking their resources or underperforming. However, that is easier said than done.
What Makes Resource Management Difficult?
Many organizations still use entry-level applications and disconnected spreadsheets to plan projects and assign resources. According to SPI’s recently-published 2021 Professional Services Maturity Benchmark Report(opens in new tab), achieving even a 4% higher utilization of resources can bring in the revenue needed to invest in a PSA (professional services automation) solution.
Project-based organizations are also under increasing pressure to deliver innovative and advanced products and services without adding costs to the budgets. However, without a solution that can actively monitor and report project health, revenue leakage, resource burnout, decreased quality and increased costs, you’ll limit project success, slow organizational growth and fall behind your competitors.
Organizations that use a PSA solution can improve their processes for greater resource and billable utilization on all their projects, large and small. Here are some ways that project-based organizations maximize utilization with an optimized project solution:
- Track and assign the right skills to the right project at the right time. For project managers to be successful at optimizing resources they need a way to search, track and allocate them, maximizing billable efforts and minimizing operational and administrative tasks. Doing so requires more than just ensuring project managers have enough headcount to accommodate the influx of work. To be resource-ready, you need to know what resources you have available and the skills and experience they possess. Having the right resources matched to the right task is truly what keeps projects on track and margins within the set budgets.
A PSA solution integrated with an ERP suite can link not only project resource skills data but also HR data to track costs of resources or even when that resource may be out of the office. Having detailed data on your resources — skills, rates, availability — can ensure that gaps are not missed and the right staff delivers the needed services.
- Improve planning. Planning work assignments is critical to resource management. It is also the most granular piece. Having the plans and processes in place — like a work breakdown structure — creates better visibility into the project. With a work breakdown structure, you can organize project tasks in a way that makes activities more manageable. You can also simplify task allocations while increasing efficiency and productivity.
Capacity and demand planning is another important way to optimize resource utilization. Done right, you can prioritize high value work with available resource capacity.
Finally, when ERP and PSA solutions are connected, more frequent and improved communication between team members ensures faster project completion and smoother operations, eliminating double bookings. It also helps to minimize labor burnout.
- Automate time and expense processes. Eliminating as much manual work from resources frees up valuable time that can be spent working on the task at hand. When time and expense management is automated through PSA software, it can significantly reduce administrative overhead, improve employee time tracking and simplify customer invoice preparations. That can lead to faster customer billing and greater profitability.
- View real-time analytics. Project and resource managers will confirm that there are few things worse than using spreadsheets and disconnected systems to manage resources. When project leaders are stuck juggling schedule conflicts and rates in spreadsheets, the project goes upside down rather quickly
Having a real-time view of data can fix most of these issues by giving project managers the ability to quickly run reports that show the teams’ current resource utilization. And monitoring performance can help them plan or even shift and reassign tasks if allocation issues arise.
Automating Project and Resource Management with OpenAir
When projects are unified through professional services automation (PSA) systems, you are better equipped to manage labor, cost of resources, billing rates, time and revenue. Automating this data allows teams to effectively monitor profitability so that organizations can be more competitive in the growing and competitive services industries.
NetSuite OpenAir(opens in new tab) makes project delivery much easier to manage. Not only does it help align project activities with company financials, but it also helps ensure that the right resources are assigned to the right tasks throughout the project lifecycle. You’re better equipped to deliver projects on time and within budget instead of relying on spreadsheets and the inherent revenue leakage created by data errors and disconnected project expenses.
To learn more about NetSuite OpenAir, watch this webinar(opens in new tab) on how to deliver projects efficiently and profitably.