By: Jerry Manas
In the newly released Resource Management and Capacity Planning Benchmark Study, research is identifying best practices to avoid wasting resources on the wrong opportunities, leading to profit loss and missed market windows. Read more about the results from the study and how you can assess your company’s maturity level, determine what challenges you face, and leverage best practices shared by mature, successful companies.
According to the 3rd Product Portfolio Management Benchmark Study, published June 2012, product developers’ top pain points include too many projects for their available resources and decisions that go back and forth and/or are made late or ineffectively.¹ These are perennial issues for organizations far and wide. The newly released Resource Management and Capacity Planning Benchmark Study, designed to dig deeper into these commonly cited pain points, shows that primary causes are constant change, not having enough visibility into capacity, and ineffective demand prioritization, resulting in lost productivity, continued crisis mode operation, and delayed time to market.²
The study showcases input from more than 600 executives and managers from across the globe that control the human resources within their organization to deliver products, projects, and/or service engagements in the functional areas of IT, product development, services and/or enterprise project management offices (PMOs).
So as it appears that product developers are not alone in the challenges they face, the question becomes, “How can we learn from each other?” The bottom line of the study yields an undeniable truth: Organizations committed to mature business practices, technology, and processes solve more strategic problems and experience tangible business benefits.
Through the lens of a maturity model created specifically for the survey, the report describes organizations’ pain points and causes, business risks, software use, and best practices. The results show that, in employing the recommended best practices, organizations can move up the maturity scale from a state of chaos to a state of control and optimization.
“This study shows just how much risk businesses take on when they don’t address resource management and capacity planning challenges and continue to overcommit and underutilize their finite resources,” said Maureen Carlson, partner, Appleseed Partners. “The good news is that a quarter of organizations in this study are breaking through to solve more strategic problems than their counterparts facing chaos and basic supply and demand visibility issues.”
- Shared resources without centralized planning: 80 percent of respondents share resources across projects, teams, departments, and/or countries. However, only 45 percent report having a resource management and capacity planning function, resulting in resource misuse, misalignment, and cost and quality issues.
- Top maturity level evades most: Only five percent report being at the highest maturity level. Two-thirds of organizations are in early to mid-level maturity brackets.
- Top pain point is “constant change”: This is followed by “not enough visibility into capacity” and “ineffective demand prioritization.” Lower maturity organizations have less insight into demand as well, making project prioritization challenging.
- Top business risks are “lost productivity” and “remaining in crisis mode”: The risk of remaining in crisis mode reduces by half or more as organizations move up the maturity spectrum. Delayed time to market and wasting high-value resources on low-value projects tied for the third-highest business risk.
- Software usage varies by maturity level: 60 percent of mature organizations use enterprise software, and in particular project portfolio management (PPM) solutions, better enabling them to select the right opportunities and match the right people to them. By contrast, nearly 70 percent of less mature companies use spreadsheets and project tools as their primary tools, making basic visibility into demand or capacity challenging.
Mature Organizations Share Characteristics
The study finds key similarities and best practices in companies that are successfully bridging resource management and capacity planning to move from chaos to control. Mature organizations:
- Secure executive buy-in
- Have dedicated functions to run resource management and capacity planning activities
- Use project portfolio management software to optimize their resource capacity
As a result, these companies can better prioritize projects, see what people are working on, identify bottlenecks, and run what-if scenarios on demand to adapt to change. The business benefits include increased productivity, maximized revenue, and lower costs.
What does this mean for Product Development Organizations?
Forty four percent of respondents to this survey came from product development organizations. Next month we’ll share specifics about their responses as well as key takeaways and recommendations. In the meantime, much can be learned from the cross-functional findings in the full benchmark report.
Get your complimentary copy to assess your company’s maturity level, determine what challenges you face, and leverage best practices shared by mature, successful companies: Download here.
You can also get the 3rd Product Portfolio Management Benchmark Study to discover the challenges your peers and competitors are facing and what they’re doing to improve their situations.
By Jerry Manas
About the Study:
Appleseed Partners and OpenSky Research, independent research firms, commissioned by Planview, conducted the first in-depth benchmark study on the state of resource management and capacity planning at project based organizations. The survey, run during November and December 2012, garnered participation from more than 600 global executives and managers responsible for the planning and utilization of resources to deliver services, projects, and/or products for their organizations.
About the author:
Jerry Manas is the author of the best-sellers Napoleon on Project Management and Managing the Gray Areas. Throughout his career as an author, speaker, and consultant, Jerry has built a reputation for taking complex information and processes and making them clear and accessible. As Senior Editor at Planview, he applies this passion to developing best practices that help organizations achieve breakthrough performance across a framework of processes and roles. Jerry’s work has been highlighted in a variety of publications and he has appeared on radio programs nationwide. A prominent voice in the blogosphere, he is a founding member of the Project Management Institute’s New Media Council, which keeps abreast of trending topics.
Photo: Businessman hand working from Shutterstock.com
1 Third Product Portfolio Management Benchmark Study (2012)
2 Resource Management and Capacity Planning Benchmark Study (2013)