Whether you're working at a software company or a creative agency, you probably know very well that projects don't end when someone pushes the final commit to the code base or when the client replies with "looks...
As a company or team leader, you’re undoubtedly aware of the effect KPIs may have on your team’s morale and performance. Carefully selected performance indicators will help everyone on your team see if they’re on the right track. On top of that, they help keep everyone’s focus on metrics that matter and represent the project objectives well.
Typical human resources metrics include monitoring whether there’s high turnover or how much time it takes to fill vacant positions. On the other hand, resource management metrics will be closely connected to measuring the effects of resource planning and project management.
Monitoring your key metrics regularly is crucial, as it allows you to address problems right away and, potentially, save the project from going awry. Your staff will also appreciate the data-driven approach to resource management, as it means they’re likely to have more balanced schedules.
In the first part of this blog post, we’ll list a couple of essential metrics related to resource management. You’ll learn how they can be useful for you and where to take them from. Later, we’ll tell you a little bit about Teamdeck, a resource management app that makes it easy to track all of these metrics in your company.
Estimates vs. actuals
Comparing estimated values that you came up with at the project planning stage with the actual results is a great way to check if your project is going according to the plan. We recommend that you check both the amount of time your employees spend on a given project and the cost it generates. Then, compare it with your estimates.
Estimated vs. actual hours worked per team member
When planning a project and allocating resources, you estimate the number of hours every staff member will put into it. Once the project starts, you should regularly compare these estimates with the actual hours tracked by your team members.
How is that useful?
It’s an excellent method to spot early signs of project delays: if someone spends way more time on a given assignment than expected, it could significantly affect the project timeline. You can also use these metrics for strategic resource planning in your future projects. When you know everyone’s typical pace, it’s easier to estimate their time.
Estimated vs. actual cost per team member (resource cost variance)
Naturally, you also want to look at the costs generated by your team’s labor. Robust resource management tools like Teamdeck allow you to assign hourly or daily rates to each of the employees and create project cost reports based on them and your team’s timesheets.
How is that useful?
Understanding the current costs of your projects is crucial to keep your business profitable. Knowing that a given project is likely to end up being more expensive, you can act on that information. For instance, you can negotiate the budget with your client or alter the scope of the project.
Billable vs. non-billable hours
Speaking of profitability, you should also pay attention to the breakdown of billable and non-billable hours in your projects. Calculate both numbers and see how much of your team’s time is spent on non-billable activities like administrative tasks, all-hands meetings, or training sessions.
How is that useful?
If people record many non-billable hours, it could be a sign that you need to optimize some processes in your company. Perhaps you could organize fewer company-wide meetings? Alternatively, seeing a high percentage of project-related non-billable hours could be a reason to renegotiate some aspects of the contract with the client. For example, you could agree to treat some types of hours as billable even though you didn’t charge for them up to this point.
Resource capacity utilization is one of the most important metrics you could track in your company. After all, you don’t want your staff to be overworked, but you also don’t want to leave some people without assignments. There are two ways to calculate resource utilization, and you could use them at two different stages of the project life cycle.
When planning the project, calculate the planned utilization
The formula for planned utilization is simple. Take into account your employees’ estimated bookings (e.g., 50 hours per project per month) and divide it by people’s planned capacity (how much time they will be available for in a given period). Granted, running this calculation will be easier when you have a resource management app that stores resource capacity and bookings.
How is that useful?
Effective resource management is not possible when you don’t pay attention to creating balanced schedules for your team. Checking how your planned schedules look against your resources’ capacity is a must. At the project planning stage, you likely still have some room to maneuver. You can reallocate some people or divide the booking across more team members.
As the project happens, monitor actual utilization
This KPI is very similar to the previous one. The only difference is that, instead of booking, you take timesheets (actual hours) into consideration. As a result, you will get a percentage value of your team’s actual utilization.
How is that useful?
You should monitor resource utilization regularly. Unfortunately, it is often the case that work isn’t equally balanced across everyone. Some people simply have much more on their plates than others. However, it may turn out that you have resources who are perfectly equipped to complete a given job but were, for instance, overlooked at the resource planning stage. Obviously, people who have to work over their capacity may get frustrated and even eventually quit the job. Interestingly, people who are underutilized aren’t satisfied either.
How to measure resource management key performance indicators?
You can probably imagine that calculating all of these performance indicators in a spreadsheet would be tedious. Plus, the point of tracking resource management metrics is utilizing reliable data, which you don’t have access to when, for instance, your company doesn’t use time tracking or leave management systems.
The most efficient way of monitoring the aforementioned KPIs is to track them in a tool your company uses for resource management. There are several resource management tools available on the market, so you should be able to find the right one for your business. We’re exceptionally proud of Teamdeck, the app we’ve built when we realized there aren’t any agency-friendly solutions that combine resource scheduling, time tracking, and leave management.
How can Teamdeck help you track your resource management metrics? First of all, it’s an app where you can plan and manage your team’s work without hassle. There’s a resource calendar – a single source of truth regarding your teammates’:
- everyday availability
Using Teamdeck’s resource calendar, you can easily answer the following questions:
- Who’s working on which project?
- Do we have enough capacity to handle a new project?
- Who’s available to join my project (and has the necessary skills)?
- Who’s overworked, and who has time to take on more assignments?
Since you can see people’s timesheets in the resource calendar, there must be a way for them to track time. With Teamdeck, they can either use a convenient mobile time tracking app or enter their time entries manually to the calendar, e.g., at the end of each workday.
We have also designed leave management features to ensure maximum convenience for everyone involved. Each employee can send a vacation request with just a few clicks, directly from the resource calendar. People responsible for resource management also see this request in the app and can respond right away. All accepted vacations appear on the calendar immediately to avoid potential scheduling conflicts.
When it comes to measuring various KPIs, you’ll definitely enjoy Teamdeck’s reporting suite. We’ve designed it to help team leaders, project managers, and HR specialists create custom project and team reports.
You set up your report once, and then you can monitor it regularly throughout the project. The data will be updated automatically as people log in more time entries, bookings change, etc.
What’s important, you can enter values from outside Teamdeck to your reports, for instance, your resources’ hourly rates or projects’ budgets. Flexible formulas make it possible to carry out even more advanced analyses.
Would you like to give Teamdeck a go? You can sign up for free here. If you prefer to have a product demo first, book a call with Joanna, our customer success expert. She will be able to answer your questions and show you how you can track essential metrics with Teamdeck.