Imagine your project team as traffic on a freeway. When the traffic density (or resource utilization) is high, a minor crash has an immediate effect on traffic flow — slowing it dramatically or stopping it completely. And you don’t need 100% traffic density to see this effect. Traffic jams start appearing when roads reach utilization rates of 70% or more.
It’s the same with IT project resources. Overloading people usually backfires, reducing performance and increasing mistakes. Gartner research shows that teams with lower utilization can reduce the time it takes to deliver business value by 30% or more.
Project teams need capacity to plan, reflect and innovate
While a shortage of resources can be due to a lack of specific skills or a true shortage of numbers, the problem is often poor use of existing resources, says Robert Handler, Distinguished VP Analyst at Gartner.
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“Today’s IT staff tends to be overloaded with too much to do. This leaves them trying to do everything, but not especially well,” Handler says. “Project teams need capacity to plan, reflect and innovate.”
According to Gartner, program and portfolio management (PPM) leaders can follow four basic steps to optimize project resource utilization.
Learn more: The Program and Portolio Management Leader Role
Step 1. Determine capacity of resources available to do projects
Calculate the number of people available to do project work as full-time equivalents (FTEs), multiplied by their availability to work on projects.
Step 2. Determine hours of availability
Convert FTEs into hours and derive a true representation of availability. For example, after factoring in vacation, sick leave, training time and holidays, a person declared as 50% available for project work is actually available only 37% of a theoretical work year, or 760 hours.
Step 3. Set utilization targets
Calculate utilization targets for all project resources below 80%, and use that data to limit the number of active projects. While resources working below the target may seem inefficient, resources working above that target are likely to introduce costly delays and errors into the project.
Step 4: Limit or modify the queue
If you’ve ever waited for a table at a restaurant, even though you see empty tables, this was most likely a tactic to avoid overloading the servers and providing you with a horrible dining experience. The number of servers was a limiter to providing good service.
For the PPM office, the limiter must be when project resource utilization approaches 80%. Starting new projects when resources are at or above their targets may appease project stakeholders at the time, but downstream it’s sure to disappoint them, the project team, users and, potentially, a host of others.
The queue itself can be modified to make it more palatable and pleasant — in the restaurant example above, by moving patrons to the bar and offering specials.
A product management approach, with dedicated teams, queues and governance, is more effective when dealing with the constant change of digital business
In IT projects, applying more stringent selection and approval criteria can prevent lower-value items from being approved, keeping them out of the queue altogether.
Adding an effective gate review at the end of major project phases to check alignment with strategic objectives can also be used to stop projects from continuing and free up resources.
Creating multiple work queues may also help. Organizations often use a single project queue out of convenience, but too many small work items can clutter the project queue, sometimes unnecessarily slowing delivery.
A product management approach, with dedicated teams, queues and governance, is more effective when dealing with the constant change of digital business.
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