Resource Forecasting Defined: Why You Need It Now

Understanding what resource forecasting is, why it’s important to the success of your business, and how to apply forecasting properly can help you more effectively utilize your resources to meet the needs of your clients.

What Is Resource Forecasting?

Resource forecasting is the prediction of your company’s future project demands on your talent pool. It is more than just educated guesses, it’s the sum of everything currently happening in an organization that can be measured. Effective, dependable resource forecasting will utilize insights from several different data sources across the business to provide an accurate view of your company’s future resource needs, including:

1. Sales Pipeline – This will show the type, size, and timeline of future projects currently being worked on by the sales department. Knowing what types of projects are inbound will help you identify what resources will be required and when in the coming weeks and months.

2. Project Planning – As projects are broken down into tasks, each with their own timelines, deliverables, and required skills, future demands will be more easily determined. Understanding what projects are currently in the works and what is needed from teams is critical for accurate forecasting.

3. Resource Management – The ability to see how the scope of the work your teams are allocated to along with availability in their schedules provides actionable details for resource forecasts that go beyond simply knowing that projects will need work soon.

4. Time Tracking – Knowing where your team members are currently spending their time helps determine if team members are over or under utilized and provides insight into the availability and amount of flexibility within their schedules. There’s only so much time in the work week and knowing what’s to come requires making informed hiring and assignment decisions.

Why Is Resource Forecasting Important?

It can be easy for companies and managers to rely on their instincts or trends found in past work. The increasing unpredictability of industries and the tighter timelines for projects makes the ability to predict future demands for your business more critical than ever. As a result, resource forecasting has played an increasingly important role in many different aspects of day-to-day operations of professional services businesses.

1. Project Staffing

The first and most critically important result of accurate resource forecasting can be found in project staffing. When your sales team is close to closing a deal, they will make certain promises to prospective clients about when and how a project will be delivered. Accurate forecasting will help resource managers meet those promises, as well as help your sales team provide timelines that match up with resource capabilities. Forecasting will also help prevent clashes between project needs, helping to balance team members’ schedules so that constant behind the scenes shuffling is not required to keep projects moving forward.

2. Hiring Needs

Sometimes, the individuals on your team just can’t deliver all of the work ahead. Understanding imbalances between the people and skills you have access to and those that are needed will help inform your hiring and contractor needs. In addition, forecasting farther into the future will help your managers determine if a full-time, part-time, or contract hire will be needed to handle the tasks and the specific skills required to complete the work to be done. As a result, your company can scale to meet its demands in measurable, cost effective ways.

3. Industry Trends

Your company is not simply affected by how many clients you have at the moment, it’s shaped by the dynamics that are affecting your entire industry. Is the industry expanding thanks to newfound interest or geographies that have suddenly adopted a new way of working? Or are outdated ways of thinking shrinking the industry year by year? Good forecasting takes these elements into account and knows what’s happening in the ecosystem around your client base for more informed decisions that may reshape the way you work entirely.

4. Bottlenecks and Optimization

A project can only run at the speed your employees are capable of running. If vital team members are tied up in other projects when a new, urgent piece of work comes in, then you have a bottleneck on your hands that may only be solved by negatively impacting another project. Think of forecasting as putting train tracks right in front of a constantly running train. The better the forecast, the further ahead those tracks are being laid. The result is better optimization all around.

5. Burnout and Turnover

While so much of resource forecasting is devoted to fully leveraging your teams and projects, an added benefit is preventing turnover. Simply put, it can be easy for managers to over-leverage their workforce when a sudden influx of work that they didn’t anticipate comes in. While this may help keep projects rolling for a short period of time, it will inevitably put too much strain on your employees. And the result is that your team members will burn out. Knowing what’s coming and having the right people ready can keep your turnover rate low and help your employees maintain a healthy work/life balance.

Together, these insights into future demands will help you effectively determine the actions that managers and employees should take right now. When insights are available from a resource management platform that you can trust, the result is accurate forecasting that positively impacts every aspect of your business.

Do You Have Confidence In Your Resource Forecasting?

Having insight into the future needs of your resources for project delivery can prepare your business for anything, but it needs the right resource management platform. Learn how the Kantata Professional Services Cloud can change the future of your company.