Resource Forecasting: Why You Can't Live Without It

What is Resource Forecasting?

Resource forecasting is about predicting the future workload of your team. It answers questions like “How busy are we going to be?” and “Do we have the right resources to handle the work coming at us?” This workload can include customer projects, internal initiatives, individual continuing education, or a combination of these.

Why Does It Matter?

Once you have a sound resource forecasting process, you'll wonder how you managed without it. Here are three important corporate perspectives supported by resource forecasting:

1) Customer Experience Matters

If you aren’t considering your customers’ experience in everything you do, success will be an uphill battle.

Eric Wu, CEO of TaskRay, highlighted the critical importance of the early days of the customer relationship:

“According to the Marketing Sciences Institute, the first 90 to 120 days of a client relationship is the most tenuous period of a new client experience. If the onboarding process is performed properly, a strong relationship will be established to serve as the foundation for future business growth.”

You can damage your customer relationship if you:

• ​Fail to accurately set expectations on project start and finish dates
• ​Struggle to get their project started in a timely and efficient manner
• ​Swap resources in and out due to schedule and skill conflicts

Sound resource forecasting mitigates these risks, giving your customers an exceptional experience during onboarding, when it matters most.

2) Employee Retention

Resource forecasting supports your company culture by helping to achieve a good quality of life for employees, preventing burnout, and providing an interesting mix of work. If you can’t keep these promises, especially during busy times, you risk losing your people.

3) Innovation and Growth

Resource forecasting should include all important work types, both internal and external. Companies often neglect internal work compared to customer-facing projects. Your resource forecast should account for work needed to keep products and services fresh, as well as internal initiatives for process improvement and automation.

How Do You Do It?

First, you need a good way to keep track of your work. Using a project management tool that organizes projects and tasks in a user-friendly, centralized, and extensible manner provides a solid foundation for resource management.

There are various methods for resource forecasting, from simple to sophisticated:

1. 1.Count the number of tasks or maintain a schedule of availability per resource
2. 2.Sum total estimated hours of tasks by due date each week
3. 3.Distribute task hours into a predictable schedule that accounts for multi-week tasks
4. 4.Factor company holidays and individual time away into overall availability
5. 5.Overlay potential projects coming down the sales pipeline

It's fine to start simple and iterate as your business needs evolve. If you reach step 5, you have a strong method for managing in-flight projects and monitoring the future impact of deals in the sales pipeline on your team's capacity.

Kenny Ingram, consulting services manager with enterprise planning system vendor IFS, advises:

“Create a project plan as early as possible, ideally at the bidding stage. Lots of companies don’t do this, but the advantage is that you’ll have a project plan for every serious bid you’ve got out there and every live job—which gives you the fullest possible picture of your resource requirements.”

Reference: Wheatley, M. Future perfect. PM Network, 18(4), 38–44.