Is capacity planning the exact same thing as resource management? This question was asked to me in a job interview. I immediately wondered if it was a trick question. It’s not exactly the same thing. Many people confuse the concepts or use them interchangeably. Understanding the difference can help to avoid one of the biggest pitfalls in resource capacity planning, especially when it comes to professional services.
You will be better able to communicate, articulate, and evaluate the potential of your organization’s capacity planning.
What is the difference?
Although they are closely related, capacity planning and resource management can be seen as two distinct things. You can’t have both, but they will produce different results for you organization.
Resource management is the ability to ensure that you have enough resources to complete work. This is a simple way to ask if you have enough people to complete the project. However, it becomes more complicated when you consider resource allocation and utilization.
Capacity planning is, however, more of a match-up game than a strategic snapshot. Capacity planning is only possible when visibility and assessment are combined to understand and communicate the organization’s capabilities at any given moment.
Resource Capacity Planning, and the “Next Cool Thing”
It is important to understand the differences between capacity planning and resource management. In practice, however, it can be much more difficult to say no to projects, especially if it’s the “next coolest thing” that everyone, from C-level executives to product development to marketing team members, is eager to pursue.
We know better than anyone that there are many great ideas within organizations. However, it’s not as simple as it sounds to pursue these opportunities. These projects are what I call “the golden snitch” with a nod to Harry Potter. They seem so bright and shiny that we should all chase after them. We know that when we try and do too much with what we have, it often means that something else fails.
One example: A former organization I worked with was asked to submit a bid for the production of a component of a product line by a large national retailer. This was not just “the next cool thing”; it would have resulted in tens of million dollars in increased revenue. However, I was unable to handle the additional work until several programs were either put on hold or discontinued.
I had to write the note that all PMPs hate sending to the executive leadership team: “No. With all the other things we have to do, this is impossible. ” I was fortunate to have a solid understanding and the data to prove it impossible. I was able confidently to tell the CEO and CFO that it was time to decide what was most important. This is our ability. ”
If you don’t have the ability to assess your organization’s true capacity, you will be constantly being given more work than you can handle. You can’t allow new projects to take place until you can prove that you have the capacity to do so.
How to get there: Resource Capacity Planning Maturity
Although every project leader wants to be able to plan confidently, it is not an easy task. You can take steps now to improve your resource management and forecast (and then communicate) your resources.