What is Resource Allocation in Project Management?

 

Are you worried about resource allocation for your upcoming project?

 

Resources are often scarce while the demand is always greater. That’s why effective resource allocation is important for successful project management.

 

In this blog, we will go over all the necessary details of resource allocation in Software Project Management including what are the benefits of resource allocation in project management, and what mistakes to avoid as a project manager.

 

So, what are these resources, and how to allocate them?

 

In this blog, we will go over all the necessary details of resource allocation in project management including what are the benefits of resource allocation in project management, and what mistakes to avoid as a project manager.

 

 

What is Resource Allocation?

Resource allocation in project management, also called resource scheduling, is a process in which a manager supplies and distributes the funds and materials for various projects and tasks.

 

It is the initial and integral part of project management and strategic planning. Project managers need an effective resource allocation to support the goals of the company.

 

1. Soft Allocation

Soft Allocation is a method in which a Project Management Experts temporarily assigns the resources for a project until a resource manager makes a final decision. Soft allocation usually happens before a project starts or is not confirmed yet. It allows changes to be made in the future regarding specific people and positions assigned for each task.

 

2. Hard Allocation

Hard Allocation is when a project manager makes the final decision on which resources have to be allocated for a particular project. Hard allocation happens when a project is confirmed and resources are fully assigned for every task of the project.

 

3. Bottom-to-top Approach

The bottom-to-top approach is used for well-defined projects. In this method, resources are allocated based on clear and defined tasks of the project. A project manager follows this approach when:

 

1. A project has already been created
2. All tasks are identified
3. The timeline and duration of each task are fixed

 

4. Top-to-bottom Approach

The top-to-bottom approach is used for less-defined projects when the details are still being figured out. A project manager first books the resources for the project. Task planning is done as the project begins and details get clearer.

 

 

What are Resource Allocation Tools

Resource allocation tools help project managers to plan, allocate, and monitor resources effectively. Here are some of the popular resource allocation tools to incorporate in your project management:

 

1. Microsoft Project
2. Smart Sheet
3. Wrike
4. Trello 
5. Resource Guru
6. Monday.com
7. ClickUp
8. Float
9. TeamGantt
10. Asana
11. Teamdeck
12. Toggl Plan
13. Ganttic
14. Hub Planner 
15. Project Manager

 

 

Common Types of Resources Needed for Project Management

The following are the common resources needed for project management:

 

1.  Financial

To finance each phase of the project, a project manager assigns funds and budgets. This money may be used to buy other resources, pay salaries, or even make more investments during the project.

 

2. Physical

The physical resources needed in a project include equipment, materials, and workspace. These resources help in completing and giving practical shape to the project.

 

3. People

The total number of people, including team members, team leads, stakeholders, or contractors are included in this type of resource.

 

4. Technological

The technological resources needed for project management include the software required for monitoring project development, communication, task overviews, etc.

 

 

Why Resource Allocation is Important in Project Management?

An effective resource allocation is important for the successful completion of a project. Here are some of the reasons:

 

1. Cost-Effective Project

The successful completion of a project depends on the right and sufficient resources. The project manager can ensure the successful completion of a project by allocating resources effectively.

 

2. Ensuring Projects are Successful

While planning resource allocation, the project manager can reduce the overall budget of the project by distributing the available budget for each phase and each resource strategically.

 

3. Timely Delivery

Planning and allocating sufficient resources helps with the timely delivery of the project. When every phase has enough resources there will be no delay in the development of the project.

 

4. Improving the Quality of Products and Services

Proper resource allocation improves the quality of products and services so that your company can compete with other organizations in the market.

 

5. Improving Employee Productivity

When the employee has enough resources to complete the project it will boost their productivity as they won’t need to worry about resource deficiency.

 

 

How to Allocate Resources in Project Management?

Here are the five steps of the resource allocation process in project management:

 

1. Identify the Requirements of a Project

Before allocating resources to a project, it is important to understand and analyze the overall requirements of the project. A detailed analysis of the whole project, the number of people needed for a project, budget, software, etc., will help in allocating resources efficiently.

 

2. Assess Available Resources

Next, you have to assess the available resources required for the completion of the project. This involves assessing different team members based on their expertise and different tools needed for the project.

 

3. Prioritize Resource Allocation

Now, the project manager needs to prioritize resource allocation. This is done based on various factors such as project deadlines, client requirements, budget constraints, etc.

 

4. Allocate Resources to Each Task

Resources are allocated to each task as the project manager matches identified resource requirements with the available resources.

 

5. Adjust Resource Allocation

The ongoing project may often require an adjustment in resources. This involves reassigning tasks to different team members to achieve quality results. It also involves changing the software or other technological equipment needed for the project.  

 

 

Who Allocates Resources in Project Management?  

A project manager is responsible for allocating resources in project management. The project manager may allocate different types of resources when planning the schedule, scope, and budget for a new project.

 

 

What are the Positive Impacts of Efficient Resource Allocation?

Efficient resource allocation brings the following positive impact:

• Streamlined Workflow
• Enhanced Productivity
• No Waste of the Budget
• Informed Decisions 
• Minimizes the Chances of Errors 
• Better Results

 

 

What are the Common Types of Mistakes a Project Manager makes in Resource Allocation?

The common types of mistakes a project manager makes in resource allocation are listed below:

 

• Poor understanding of project requirements
• Overallocation of resources
• Under-allocation of resources
• Failure to prioritize
• Lack of flexibility
• Poor or insufficient communication/ communication gap
• Ignoring the human factor
• Failing to use resource management tools

 

 

Resource Allocation Example

In the following example of resource allocation in a software development project, we have explained in detail how to use resources and develop a resource allocation plan.

 

1. Project Title: Developing a new mobile app for a company

 

2. Objective: To build a fully functional app within 6 months.

 

 

Resources:

 

• Team Members: 1 Project Manager, 2 Front-end Developers, 2 Back-end Developers, 1 UI/UX Designer, 1 Quality Assurance (QA) Tester.
   
• Budget: $100,000
   
• Time: 6 months
   
• Tools/Equipment: Development software, testing tools, project management software, etc.
   

 

Resource Allocation Plan:

 

      1. Time

• First 2 months: UI/UX Designer works on design mockups and prototypes.
   
• Simultaneously, the front-end and back-end developers start working on the basic architecture and layout.
   
• Month 3-4: Full-scale development with front-end and back-end developers working in parallel on different modules of the app.
   
• Month 5: Quality assurance and testing phase. The QA tester begins bug detection, and the developers fix issues.
   
• Month 6: Final revisions and deployment preparation.
   

      2. Personnel

• UI/UX Designer: 100% allocation in the first 2 months
  .
• Front-end and Back-end Developers: 80% on development tasks throughout months 1-4, then 50% on bug fixes in month 5.
   
• QA Tester: 100% allocated in month 5.
   
• Project Manager: 20% allocation for oversight and planning throughout the project.
   

      3. Budget

 

• Design Phase: $20,000 allocated for design tools, licenses, and payments to the UI/UX Designer.
   
• Development Phase: $60,000 for salaries and development tools for the developers.
   
• Testing and Deployment: $15,000 for QA and deployment tools.
   
• Miscellaneous/Buffer: $5,000 reserved for unexpected expenses.

 

 

What are the Resource Allocation Types?

There are generally two types of resource allocation:

 

1. Continuous – when resources are regularly assigned as the project continues. For instance, financial resources are required on a regular basis.

2. One-Time – when resources are allocated for one time in a project. For example equipment, software, and technology.

 

 

How does Resource Allocation Affect Project Timelines?

Through resource allocation, project managers prioritize important tasks first and assign resources accordingly. This ensures that all tasks are completed on time and project timelines are not affected in the long run.

 

 

How does Resource Allocation differ across Project Types?

Different types of projects have different goals, timelines, complexity, and teams. For example, resource allocation in an event management project won’t be the same as a construction project.

 

 

Conclusion

Resource allocation is an integral part of project management. It involves assigning different types of resources to complete any project and fulfill the goals of the company. A project manager needs to follow a few steps to efficiently allocate resources for a project. If rightly done, resource allocation has many benefits for the company in the long run. This blog also outlined a practical example of resource allocation in project management.