If you're Noah, and your ark is about to sink, look for the elephants first, because you can throw over a bunch of cats, dogs, squirrels, and everything else that is just a small animal and your ark will keep sinking. But if you can find one elephant to get overboard, you're in much better shape.

Vilfredo Pareto

So what are these typical ‘Generic causes’ creating all the hassle in Mid-term resource management? And if you have a Long-Term capacity planning and a Short-Term resource management plan, why even adding a third, Mid-Term planning, to the Portfolio agenda?

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If you have read our previous blog in this series, then you already know the answer. If not, please let me refresh your memory:

Each of the three ‘components’ has its own stakeholders and processes that get realized via tools and techniques to fulfill a specific purpose. Mid-Term resource management is bridging the gap between high-level, Long-Term capacity management and detailed Short-Term resource management. Trying to connect these two directly is like connecting your mobile phone charger to High-Voltage powerlines. It will provide immense sparks for a very short time, but it will burn the asset. Long-Term is too high-level and generic to immediately provide useful input to define the Short-Term detailed action plan. This way, it is necessary to put a transformer in between that fulfills the function of operational resource management, using the capacity planning as a reference, but is more action oriented.

Mid-Term resource management typically looks ahead 4 weeks to - 12 months, and therefore covers planning of upcoming projects and programs to be kicked-off within a fiscal year. This way it allows for alignment with the typical business and budget cycles. In contrast with Short-Term, Mid-Term offers a proactive planning of resources on functional level, the so called generic” resources, but does not forget the critical ones. Typical stakeholders for this process are project managers and program managers. They define a timing and the needed skills to successfully deliver their projects and programs. In addition, there are the line managers or resource managers for the acquisition (hiring) and allocation of the required resources.

Mid-Term Resource Management thoughts for overcoming common issues

  1. Poor or no resource management at all? It is an issue in the organizations’ culture
    When running a lean production plant, it is key to keep Work-In-Progress (WIP) levels as low as possible, while preventing resource overload. If we run our portfolio of projects, we need to act exactly the same. Because if processes, roles, and tools are missing, for clarifying upfront which resources are assigned to prioritized projects (while ensuring a continuous flow of projects), this will quickly result in a growing list of projects ‘in progress’. Projects, but also people working on them, will suffer from ‘management by decibels’ with a lot of powerplay, thus organizational politics*.

    Therefore, the success of any portfolio management starts with an organizational-wide culture agreeing on applying and respecting some basic resource management processes. There are plenty of best practices available to get started, just get in touch if you require some support.
    ! Side note: a separate blog will deal with specific Mid-Term resource management issues, in matrix organizations

  2. Mid-Term Resource Management is not ‘What’, but ‘When’

    If a potential dis-balance in resource demand and supply is recognized during the MT resource management process, we often see a reflex to start an internal debate on whether a project should continue or not. However, it is not the role, nor the authority level of Mid-Term resource management to decide over the ‘What’ of the portfolio, but the ‘When’. In other words: the best possible timing, taking resource constraints in consideration. It is the LT capacity planning, when properly performed, that decided upfront which capacity is available and assigned to the project or program at hand. If you want to prevent Mid-Term resource managers re-doing the LT capacity planning due to resource overload, provide them with a clear priority setting in the Long-Term capacity planning. This way, ‘urgent must have programs and projects’ are assured.

  3. Deal with capacity overload and stop denying
    When issues in the MT resource management plan are recognized, it is time to act and take decisions. In practice, this often means simply stopping certain project efforts for a moment, to ensure timely completion of others. Not taking a decision is in this case also a decision, but unfortunately a very ineffective and expensive one. Someone else will then decide on your behalf and you will lose control over it. All the efforts put in delayed projects, which should not have started previously in the first place, are a clear waste. Next to the fact that every extra project in parallel means reduction of team focus, thus even adding to the amount of waste. For this reason, clear governance must be in place with people empowered to take (often unpopular) decisions to delay a project start until sufficient project staffing can be assured.

  4. Projects do not start overnight
    Do not expect projects to start running immediately the day after the project budget has been approved. What’s the typical ‘flow’ to start a project?
    “The start of a planned project should be approved at least 2 to 3 months ahead of the planned start of the project execution”. During this time, a project manager needs to be assigned and the project team needs to be assembled, so they can prepare the project management plan together. Particularly, when working with yearly budgets, we often notice that the start date of the project is approved way too late. Sometimes especially during or after the first months of that same fiscal year, which will immediately cause:
    • Late project start-ups, and consequently: hardly any budget consumption at the start of the fiscal year
    • Creative ways to ensure full budget consumption at the end of the fiscal year, to avoid a budget cut for the next fiscal year, because (late) assigned budget is not fully spent.
  5. Managing risks means ‘Always having a plan B’

    Risk management means thinking ahead, and not simply waiting until the inevitable has happened; you manage risks before they occur. This not only means threats but also opportunities. Uncertainty can be linked to the resources themselves, their (un-)availability, but also to the way how we manage resources, the processes. When preparing a Mid-term resource baseline, create multiple scenario’s using different risk assumptions for the most critical components. Time will then show which scenario will be most likely, but it will not come as a surprise for stakeholders. Do not only double-check your team’s availability, but also have a plan B in case of some resource changes. Are other resources with comparable skills available? Is it possible to outsource some work (buy instead of build) or can an additional flexible staff be an alternative?

  6. Weak consolidation of resources? Use a shared resource pool with generic resources

    ‘The chain is as strong as its weakest link’, is particularly true when creating high-level project schedules. When performed in a structured way, it is often during the integration and consolidation effort that resource issues can already surface. When enabling this, some generic policies, roles, and processes need to be defined to ensure a basic quality level of all high-level resource availability and demand schedules.

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    To perform such a structured balancing exercise, an excel will not do the trick. High-level project plans should follow a certain prescribed structure and rules when scheduling resources. Project managers should be able to use a ‘shared resource pool’, where high-level availability of generic resources for project related work is visible. These generic resources are used to enable automated balancing of demand and supply (unless they are exclusively contracted for a specific project).

What did we learn?

  • Mid-Term resource management is not about whether we should do a certain project or not, but focus is more on the right timing by moving projects forward or backward in the planned schedule. It needs to perform a more detailed analysis, to assure sufficient resource availability, which will ensure a consistent flow of completed, ongoing and projects planned to start in the near future;
  • The MT demand and supply balancing needs to be done at least 2 months before a project starts;
  • Ensure timely approval of project start and budget; the project budget should be approved at least 2-3 months ahead of the planned start of the project executions;
  • The MT resource management process needs to provide high-level scheduling policies for projects, for ensuring qualitative realistic schedules, both for demand and supply.

Source: Zika-Viktorsson, A., Sundström, P., and Engwall, M. (2006), ‘Project Overload: An Exploratory Study of Work and Management in Multi-Project Settings,’ International Journal of Project Management, 24, 5, 385–394

What is next?

In our next blog we will take a closer look at Mid-term Resource management in specifically Matrix organizations. What are the typical challenges there and what do we advise for organizing this proactively in a better way for preventing these in a more proactive and structured way?

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Do you recognize some issues, or do you require some Portfolio & Resource Management support in general? Do not hesitate to get in touch!

Anton Zandhuis

Anton Zandhuis
Sr. Consultant NL & PM trainer

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