Saturday, June 8, 2013

Does utilization reporting help or hinder the PSO?

No matter which organization I have been associated with, whether a Project Management Organization (PMO) or a Professional Services Organization (PSO), almost every resource has complained about entering their time in a tool that keeps track of utilization. This is especially true if resources must enter their time in two separate systems, which I agree is tedious. However, there is no better management tracking system for allocating and justifying resources than a resource utilization system.  Particularly when it comes to justification of additional staff, utilization reports can be the proof senior/executive management needs. And let’s face it; this is when the utilization system can be a benefit to the staff.

Justification and Allocation: Why do we need proof?
“Doesn’t management see that we are all very busy? Are they blind?” Well, yes they are, but not for the wrong reasons resources may think. You see, senior/executive management must contend and deal with the bottom line. They must contend with the organization meeting budgets regarding costs and profits. If they are not meeting those numbers, even a utilization report that proves resources are stretched beyond their breaking point will not convince management to add staff. This is a realization that all resources, not just Project Managers (PMs), must come to terms with. Now, if the organization is meeting or somewhat exceeding their profits, then a utilization report proving that additional resources will benefit the organization is justifiable. But that is the only beginning.
What are the benefits?
The Implementation Manager/Director must be able to not only justify the additional staff, but make the case of increased revenues or reduced issues facing the organization. An additional technical resource is easier to justify when reducing issues because of specific development need or a specialized software or hardware that does not exist in the organization.  Most likely this could be a temporary position until the project ends and can be turned over to the client. However, let’s look at this as senior/executive management would.
1.       Can we justify the additional budget?
2.       Can we justify the work or the effort?

3.       Is this a temporary or permanent position? (Hint: a temporary position may be     easier to attain)

4.       What specifically would that resource be working on and why is that resource needed for that (or those) project(s)?
All of these questions must be answered, maybe not in the order that I have suggested, but you must have an answer to all of them. And those answers must specifically answer the one question: Can they prove to senior/executive management that there is a justifiable reason that can be defended?
Is this too much effort for the additional staff?
It better not be, or do not bother senior/executive management with this request. You see, if you cannot justify the effort that is necessary to attain a new resource, how can you convince management that a new resource is necessary?  So, what I am trying to say is that the utilization system can be your best friend when it comes to requesting additional resources. I believe that the utilization system is worth the effort, even if there is more than one system. Make sure the system that senior/executive management looks at is the one that has all of the numbers in them on a weekly basis.
I look forward to your comments and I am sure that this controversial topic will lead to many comments.
I am open to discussion at any time on these blogs or anything else related to project management you would like to explore. If you would like to comment about this blog, please do so by posting on this blog or by responding in an email at Benny A. Recine. You may inspire a blog article. I look forward to your comments.  

1 comment:

  1. Excellent observation about tracking the profit of the organization, but careful allocation of costs to clients and even specific projects will deliver a clear picture of where you are making money and where you are essentially paying the client to do their work.