Managing the Project Resources (2021 Update)

Project managers must play close attention to resource management. They must assess the
project's needs, in terms of both materials and staffing, create organizational charts and
position descriptions, and acquire all of the necessary resources. Further, managing human
resources also requires interpersonal skills to build and manage teams.
In this course, you'll learn about planning, estimating, acquisition, and coordination of project
resources. You'll also explore meeting training and development needs, setting ground rules,
and strategies for mixing virtual and collocated team members. Finally, you'll learn how to
apply personnel and team performance assessments and conflict management skills.
Table of Contents
1. Managing the Project Resources (2021 Update)
2. Project Resource Management
3. Resource Management Planning Tools and Techniques
4. RACI Chart Components
5. Activity Resource Estimates
6. Tools and Techniques for Estimating Resources
7. Bottom-up Estimates
8. Resource Breakdown Structure (RBS)
9. Techniques for Controlling Resources
Managing the Project Resources (2021 Update)
[Video description begins] Topic title: Managing the Project Resources (2021
Update). [Video description ends]

Project resources are usually one of the top expenses on a project. So managing
them properly is important. In this course, you’ll learn how to plan, estimate,
acquire and coordinate necessary resources for a project; and the best practices
for developing and managing a project team.
Project Resource Management
[Topic title: Project Resource Management. Your host for the session is Barbara
Waters.]

Project resource management is comprised of identifying, acquiring, and managing

all of the resources necessary for a successful project. A project management team
plays an important role in resource management. This group may include any
number of people, depending on project management policies of an organization
and what the project dictates. For example, an organization may require many
people for larger projects or fewer people for smaller projects. The project manager
and project sponsor are always core members of the project management team.

Generally, the project manager has a few key responsibilities when it comes to
project resource management. First, they need to provide leadership. The project
manager guides the project team and provides required assistance. Helping to
ensure that all team members have the resources they require to complete their
work, and knowing what requirements must be met. Although all members of the
project management team share responsibilities for managing project resources. It's
the project manager who's expected to play the greatest role in managing the
project team.
Managing the project team has three key aspects. Acquiring the right team
members during the planning stage. Developing the members of the project team
and ensuring the team performs at the best possible level. And managing changes
to the project team throughout the life of the project. In addition to managing
human resources, the project manager is responsible for acquiring and managing
physical resources for the project. For example, effective project management
includes securing critical equipment and materials necessary for the project.

One of the challenges related to managing resources for a project is that project
teams are usually dynamic. In other words, individuals are brought onto a team as
the project progresses to meet specific requirements. And moved off the team once
their particular work is completed. Sometimes availability of physical resources
creates a challenge as well. Therefore, it's critical that project managers anticipate
materials, equipment, and infrastructure needs early on. So they may be secured
through contracts, assignments, or purchases.

Agile environments thrive on collaboration. And Agile methodology is particularly

useful for projects with a high level of variability. Because it's difficult, if not
impossible, to plan resources in advance for these types of projects due to the
changes to scope as the project progresses. Alternative resource acquisition options
should be explored, such as agreements with vendors for fast supply and lean
methods of delivery. Acquiring human resources can be a particular challenge. As
you should balance the efficiency and fast-paced nature of the environment with
the importance of encouraging ongoing collaboration among team members.
Resource Management Planning Tools and Techniques
[Video description begins] Topic title: Resource Management Planning Tools and
Techniques. Your host for the session is Barbara Waters. [Video description ends]

The tools and techniques used when planning project resources help clarify and
communicate team members' roles and responsibilities. They also ensure each
work package is assigned, so no work is overlooked, and that all necessary
resources are considered for tasks. Data representation techniques are very useful
for this. Methods include hierarchical charts, a responsibility assignment matrix,
and text-based formats. Hierarchical charts display information graphically in a top
down format to visually depict positions and relationships.

The organizational breakdown structure is an example of a hierarchical type

format. It shows the positions and reporting relationships for the entire project
team at a glance, in a graphic, top down view. The advantage of this tool is the
speed at which it enables you to find information, as long as you don't require a lot
of detail. Another example of a hierarchical chart is the resource breakdown
structure. Then there are matrix-based responsibility charts that show the links
between work that must be performed and the project team members who are
responsible for the work. Matrix-based responsibility charts, such as a
responsibility assignment matrix, make it easy for team members to check all the
project activities for which a particular person is responsible. Or all the people
associated with one deliverable. So they provide detailed information in an easy-
to-find format.

[Video description begins] The matrix-based responsibility chart displays. It

contains the Team Members, Research, Purchase, Implement, Test Software, Test
Data Transfer Rate, and Training column headers. [Video description ends] For
example, this matrix shows that L Woo is responsible for testing the data transfer
rate of software in a project. And training will be handled by both J Hernandez and
S Wood. The responsibility assignment matrix links work packages from the
project's work breakdown structure to the resources listed in the organizational
breakdown structure.

[Video description begins] It contains the Implement, Test Software, Test Data
Transfer Rate, Develop Training, Implement Training, and Evaluate Training
column headers. [Video description ends] A detailed matrix includes the bottom
level work packages from the work breakdown structure. So it contains a column
for each work package. A high level responsibility assignment matrix may show
key project phases or deliverables only, and list departments rather than
individuals. And using a text-based format, you can present detailed descriptions of
team member roles, responsibilities, and authority levels.

Documents that outline project roles and responsibilities using a text-based format
contain much of the same information as charts or matrices. But because you aren't
confined in terms of space, you can fit more detail regarding position titles,
competencies, qualifications, specific responsibilities, and authority. Position titles
help identify roles. Examples are level 1 engineer, project manager, lead writer,
and staff liaison. Competencies include the skills and knowledge required for
particular positions.

For example, a document may specify that the project manager needs seven years
experience in project work. A lead writer needs a humanities degree and a
minimum of five years experience in a writing position. A programmer may need
experience in particular coding languages. The qualifications section identifies
technical diplomas, degrees and years of experience, or other qualification sets that
are required for specific roles or positions. The responsibilities section specifies the
work that each project team member is expected to perform toward completing the
project's activities.

For example, a trainer may be expected to train ten recruits on safety practices
within the manufacturing department of the organization. The authority section
specifies who has the right to apply project resources, make decisions, and sign
approvals. For example, it may specify that a level 1 engineer is not authorized to
sign approvals, whereas a level 5 engineer can. Team members use information
from text-oriented documents to clarify expectations, accountability, decision-
making authority, and roles. The forms in which the information is recorded can
also be used as templates for future projects.

Besides data representation techniques, there are other tools and techniques that are
used when planning project resources. First of all, we have organizational theory,
which provides information about how individuals and teams behave. This
knowledge can be applied to the creation of roles and responsibilities within a
project. Every organization will be different in terms of how individuals respond to
change, perform, and develop relationships with coworkers. The final two tools
and techniques, expert judgment and meetings, are used in conjunction with other
tools and techniques.

For example, you could call together one or more experienced team members or
project managers to help you develop the responsibility assignment matrix for your
project. This meeting with subject matter experts would be very helpful in
producing the document.
RACI Chart Components
[Topic title: RACI Charts.] One of the tools and techniques you can use when
planning your project resources is data representation techniques. And one
especially useful method is the RACI chart. This lists work packages from the
work breakdown structure down one side. [These work packages are the Project
plan, Research, Purchase, Implement, Test Software, Test Data Transfer Rates,
Develop Training, Implement Training, and Evaluate Training.] And the names of
resources from the organizational breakdown structure across the top. [Some of
them are D. Alford, C. Hart, and L. Woo.]

One of four letters identifies each person's roles and responsibilities. The letter R
identifies the person who owns an activity or is responsible for performing the
work it includes. The letter A identifies who must sign off or approve work before
it is effective. In other words, the person who is accountable for successful
completion of a deliverable or work package. The letter C identifies who has the
information or the capability needed to complete a deliverable or a work package.
It shows who should be approached to provide input to the work or to decisions
that need to be made during an activity. The C stands for consult. The letter I
identifies who must be informed of the progress or results of an activity, or of
decisions associated with it. This person doesn't necessarily need to be consulted
before work on an activity starts.
Suppose you want to know who is responsible for testing the software in a
development project. To do this, you go to the Test Software row, and look across
until you find the letter R. In this case, F Philips is the person responsible for
testing software. A RACI chart helps ensure that each element of work in the
project scope is assigned to an individual who will be responsible for it. It presents
a lot of different information in a one-page, easy-to-use format. However, it doesn't
give any detail about positions or how to carry out the activities.

To create a RACI chart, you follow three steps. One, list the project activities from
the work breakdown structure down the first column of the table. Two, list staff
members from the organizational breakdown structure across the top row as
column headings. And three, match activities with project staff roles and
responsibilities using the RACI attributes. To ensure that the right mix of roles is
assigned, it's best practice to ensure that only one person is assigned to the
accountability for each activity. Ideally, this person should not be the same person
who is assigned responsibility for the activity. You don't have to use the RACI
designations. You can create your own legend to communicate responsibilities
based on the nature of your project. For example, you could specify a legend that
assigns letters for those who are accountable, and to creators, updaters, and
reviewers.
Activity Resource Estimates
[Video description begins] Topic title: Activity Resource Estimates. Your host for
the session is Barbara Waters. [Video description ends]

Imagine what would happen if you didn't have enough information about what
resources were needed to get the project work done. You could end up with too
many people on a project, putting it over budget. Or people on the team may find
they don't have the equipment they need to get their tasks done, causing the
project to fall behind schedule. While planning your project resources, your
determine what resources are needed to complete a project. In other words, the
materials, people, equipment, and facilities required for each project activity.

Another purpose of resource planning is to gather information needed to create a

realistic schedule, and ultimately, a budget. In order to estimate the required
project resources, a project manager needs to consider a few different things. The
first is types of resources. A project manager needs to know all of the resources
required for each project activity. This includes physical resources, like computers,
and human resources, such as graphic designers. The identified resources are the
starting point for budgeting and scheduling.
The project manager also needs to determine the quantity of each required
resource. For example, how much concrete and how many construction workers
are needed to build a foundation for a school building project? This information is
important for scheduling, and later, for estimating costs. The project manager
needs to determine the skill sets that are required to perform each activity so
appropriate human resources can be identified. The level of skill required will
have an important impact on the budget. For example, if the project requires
technical drawings to be compiled, does this require an architect? Or is it
something that a technical draftsperson can do?

Finally, the project manager needs to determine who will be filling the roles on
the project team and if these people will be available when needed. Vacation
times, leave schedules, other work obligations, and other projects are taken into
consideration. This is critical for scheduling. Planning project resources is
important because resources, whether people, materials, or both, are typically
the largest expense you'll have on any project. The process of estimating the
resources for project activities is usually coordinated with estimating costs for the
budget.

Some helpful estimating techniques include analogous estimating, parametric

estimating, and bottom-up estimating. On one hand, knowing what resources are
required enables you to get a more precise estimate of what the project will cost.
So you can develop a realistic budget. However, on the other hand, you need to
make sure that the resources you identify are in line with what the project can
afford.

[Video description begins] Project Cost. [Video description ends] Usually, a project
starts out with a rough breakdown of the overall estimated costs. For a more
accurate estimation, you need to investigate further. And determine not only
which resources the project needs, but also how much you need of each resource.
For example, you need to know how many builders you need and the quantity of
materials, like bricks and cement, for a building project. You can then estimate
the costs of each of these resources and come up with a realistic and precise
budget. Most projects work with a limited budget for an ideal set of resources.
Because different resources have different price tags, you need to determine
what resources your project can afford.

[Video description begins] Project Budget. [Video description ends] For example,
can the project afford an architect whose rate is $100 per hour, or will you have
to go with the slightly less qualified architect who charges $75 per hour?
Alternatively, you could schedule the more qualified architect for 60% of the
required work and the less qualified architect for the remaining 40% of the work.
In addition to providing information that will be used to create the project
budget, planning for project resources provides information needed to create a
realistic project schedule. For example, if certain equipment or human resources
are available only on particular dates, this will affect when you can schedule
relevant activities.

Accurate estimates are important, and you may need to have meetings and
discussions with subject matter experts to ensure that all factors are being
considered.
Tools and Techniques for Estimating Resources
[Topic title: Tools and Techniques for Estimating Resources. Your host for the
session is Barbara Waters.]

Because it's not possible to predict the future, you can never be totally accurate in
identifying the resources that will be needed for project activities. However, by
using a wide range of tools and techniques, you can make the most of the
information at your disposal to come up with the best possible estimates. First of
all, there's expert judgment. Often, specialized knowledge of resources estimating
or project planning is required. Project managers can use their own expert
judgment when calculating what resources, or what quantity of these, will be
needed. They may also call on experts in a relevant field to assist in the estimation
process. Usually, there is more than one way to accomplish a task, and data
analysis is crucial.

One useful method is alternative analysis, which is used to compare different ways
of carrying out scheduled activities. Using alternative analysis, you could
determine the best possible use of resources. For example, it may be possible to
use staff members with different skills or expertise, other suppliers, or alternative
equipment. Once you've selected the best alternative, you can quantify what
resources are required. Bottom-up estimating is another useful technique. [A flow
chart displays with New Drug as the root node.] It's when you break a project into
its component pieces of work, and then estimate the resources needed for each of
the pieces. [Some of the pieces are Project Management, Research Phase, Design
Phase, Lab Work, and Packaging.] When this has been done for all of the pieces,
you add up all the estimates to get a total.
Analogous estimating is another technique for estimating activity resources. You
can refer to previous similar project resource estimates to get an idea for estimated
needs for your current project. It's important to remember, this is a great technique
when you only have preliminary information, and need some quick, high level
estimates. Parametric estimating uses historical data combined with other variables
such as project parameters to produce more detailed estimates.

Two other tools and techniques you use to estimate activity resources are meetings
and project management information systems. Meetings are a useful technique for
eliciting input from project stakeholders on resources needed for particular
activities. Participants who typically take part include the project manager, the
project sponsor, select project team members, stakeholders, and any other relevant
individuals that can offer information. And a project management information
system, or PMIS, typically includes resource management software to help you
plan, organize, and manage project resources. Most modern applications enable
you to produce resource calendars, reports and charts that visually depict resource
availability, costs including rates, schedules, and assignments, and automate
resource optimization for your project.
Bottom-up Estimates
[Topic title: Bottom-up Estimates. Your host for the session is Barbara
Waters.] To get an accurate estimate of the resources needed for an entire project,
you need to know the resources required for each project activity. So how does an
organization estimate resources for a new type of project for which there is no
reliable resource data available? In such cases, it's best to use the bottom-up
estimating technique. With this technique, you quantify the resources required for
the smallest components of project activities.

[A flow chart displays with New Drug as the root node.] And work your way
gradually to the top to a total estimate of all the required resources. Bottom-up
estimating is based on realistic estimates. Small mistakes early in the estimation
process can add up to a large mistake in the total estimate you reach. Expert
judgment can help ensure you don't overlook anything and that estimates you make
are as accurate as possible. When estimating resources, it's also important to
consider whether some project activities depend on others. These dependencies
may affect how and when resources are used.

For example, in a construction project, a front-end loader and a bulldozer are

required for different tasks. If the tasks are to be done at the same time, two
machine operators are needed. But if they can be done at different times, one
operator can carry out both tasks. In this case, the hiring of operators is dependent
on whether the tasks must be done concurrently or not.
There are three simple steps in using the bottom-up estimating technique.
Decompose activities into smaller units of work, estimate resources for each piece
of work, and then aggregate all estimates into a total quantity. Let's use an example
to illustrate. Your company has developed a new product, and you're managing the
delivery of training on the new product to the company's 200 sales agents. In the
first step, you break down the training activities into more detail. [such as venue,
trainers, and training content.]

Regarding the training content, the agents need training on selling points for
marketing the product, such as the price, benefits, and uses of the new product. The
agents also need training in processing orders for the new product. You also
require a venue for training, a space that has computer stations for each trainee.
The marketing training will take about one hour with the order processing training
taking another hour. In the second step, you estimate the resources required for
each piece of work.

In this case, you'll use one conference room for training. The conference room has
enough computer work stations for ten trainees at a time. For each full day of
training, you estimate you need one marketing manager and one systems manager.
In the final step, you aggregate all estimates into a total quantity. You estimate
you'll require full-time use of one conference room. Because the conference room
can accommodate only ten trainees at a time, you estimate you need to hold 20
training sessions so that all 200 agents can attend training.
You've estimated that you need one marketing manager for each full day of
training. The marketing manager will conduct training for one hour in each
session. Because you've decided on 20 training sessions, this means you need the
marketing manager for 20 hours in total, or half the time worked by a full-time
employee. You've estimated that you need one systems manager for each full day
of training. The systems manager will conduct training for one hour in each
session.

Because you've decided on 20 training sessions, this means you need the systems
manager for 20 hours in total, or half the time worked by a full-time employee.
You aggregate these three resources to come up with the final estimated resources
you'll require for training. One full-time conference room and one full-time
employee, given that each manager is required for half the hours of one full-time
employee. To complete your estimation, you need to record the resource
availability, when the trainers and conference room are available.

You could do this in a resource calendar or any other recording format. You also
record resource dependencies in the process, like the trainees being available and
all the training computers being in working order at the time of the training. In
summary, bottom-up estimating is the most accurate way of calculating resource
requirements. It's appropriate if reliable resource data is unavailable. Using this
technique, you break project activities into smaller components of work. Estimate
resource requirements for each component and then add the totals to get a final
estimate.
Resource Breakdown Structure (RBS)
[Topic title: Resource Breakdown Structure (RBS). Your host for the session is
Barbara Waters.]
The resource breakdown structure provides a hierarchical diagram of the resources
required for a project. [A flow chart displays with Direct Mail Campaign as its
root node. Under this root node are Human Resources, Equipment, and Materials
subnodes.] This structure has a number of qualities. It is visually simple, showing
resource information at a glance. It breaks resources into categories and resource
types. And it helps you organize project schedule data and report on resource
utilization information. Some of these qualities can be demonstrated in an example.

A project manager is working on a direct mail campaign. The project involves

mailing a product brochure to her organization's most loyal customers. The
resource breakdown structure groups resources into three categories, human
resources, equipment, and materials. With these groupings, she can plan and report
on resource usage. The human resources category lists all the people that will be
required to complete the project. A marketing manager will need to approve the
brochure at different stages. A content writer will write the text. A graphic designer
will handle the visual elements. And a printing press operator will oversee printing
when the brochure is finalized. The equipment category specifies the tools that will
be used to carry out the project work. In this case, the writer and designer will need
a computer each.
The brochure mockups must be printed on the office printer. The project manager
will need to use the telephone to confirm postal addresses with the recipients. And
a printing press will be needed for the final mass printing. The materials category
records the consumable items that will be used in the project. These include
envelopes to hold the brochures, address labels to go on the envelopes, and postage
stamps for sending to recipients. In another scenario, a project manager is working
on a one day workshop on effective advertising techniques.

[A flow chart displays with Advertising Workshop as its root node.] The project
manager groups the resources into four categories, human resources, equipment,
consumables, and logistics. He also includes budgeted costs, totals per category
and for the whole project are included. While estimating activity resource
requirements and estimating project costs are two separate processes, they are often
performed concurrently. A resource breakdown structure is helpful in both, since
you may have enough information about the project at this point to estimate your
cost at the same time as determining your resource requirements.

Although they look similar, a resource breakdown structure is not the same as a
work breakdown structure. A work breakdown structure, or WBS, decomposes a
project into manageable units of work. For example, in a multi-phase project,
elements in a WBS include project phases, deliverables, sub-deliverables, and
work packages. These represent all the activities in a project. A resource
breakdown structure, however, decomposes a project according to the resources
used. The building blocks are titled according to the role or position of human
resources, resource names, and equipment names.
Techniques for Controlling Resources
[Video description begins] Topic title: Techniques for Controlling Resources. Your
host for the session is Barbara Waters. [Video description ends]

There are several useful tools and techniques you use to control resources on
your project. Data analysis is used for several activities. And there are a few
different methods you might use, depending on the type of data analysis you
want to conduct. Alternatives analysis can help you choose the most appropriate
corrective action for resource utilization variances. While cost-benefit analysis can
help you determine the most cost effective corrective action for rectifying
resource overutilization.

Other data analysis methods you'll use to control resources include performance
reviews, which allow you to compare plan to actual resource utilization and cost.
And trend analysis, which can help you review performance over time to see if
there's an improvement or a deterioration in resource use and allocation for the
project. Problem solving is another vital technique you'll use to control resources
on a project. Whether a problem is internal or external, it will be critical to get
resource utilization back on track for the project as quickly as possible to avoid
schedule, cost or quality compromises.

Problem solving involves identifying, defining, investigating, analyzing, and solving

the problem. You then check the solution to ensure you've resolved the situation.
Interpersonal and team skills are also used throughout the project for controlling
resources. There will be times, for example, you'll have to negotiate for additional
resources, changes in physical resources or costs. You'll also use your influence to
resolve resource issues efficiently. And finally, a Project Management Information
System or PMIS is a valuable tool for control resource activities. Most modern
PMIS applications include software to automate many resource management and
scheduling tasks. Allowing you options for monitoring resource utilization
patterns and in real time.