Capacity Planning and Resource Planning, similar but not the same
Sander Bots
Expert in edison365, Microsoft Teams/Project/Power BI, Smartsheet & Meisterplan

Capacity Planning and Resource Planning, similar but not the same

26-02-2021

We regularly see that Capacity Planning and Resource Planning are used interchangeably. Although they are similar, both are still very different processes with different aims and outcomes. Let’s sort this out once and for all and see how Meisterplan can support both processes.

Capacity Planning
Capacity planning is a resource management process that helps you determine if your organization has sufficient resources with the right roles or skills to execute the projects in your portfolio. In other words, it compares resource demand to resource capacity.

  • Resource Demand: the scheduled work for resources. This comes from projects, business as usual, etc.
  • Resource Capacity: the time resources are available to execute the work (minus holidays and other planned absence)

When speaking about capacity planning the demand and capacity are most often aggregated to the level of a primary role, skill or team.

Each organization has a limited capacity but is able to generate an infinite amount of work, meaning there is a squeeze as you can’t do everything. That’s where capacity planning comes in to play to balance demand and capacity. It can help you make decisions on which projects to execute, if you need to hire more people, or need to reschedule or cancel less important projects.

Meisterplan enables you to easily visualize the impact of demand coming from projects on the aggregated role demand. You see – at a glance – which roles are overallocated in which timeframe.

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Knowing this, you are able to make trade-offs. You need to determine which projects deliver the biggest value to your organization. By prioritizing them, you are able to allocate your resources to the right projects.

All projects in Meisterplan can be individually scored and ranked against each other. Together with a must-have and cut-off mechanism you can determine which projects must be executed and easily identify the ones you do not have sufficient capacity for.

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Now that we have a clear understanding of both capacity and demand, it’s time to dive into the possibilities of Capacity Planning. Some tactics to balance the capacity plan:

  • Create scenario’s
  • Change the priority of projects
  • Shift projects into periods where capacity is available
  • Hire additional resources

One of the biggest advantages of Meisterplan is the real-time impact you see on capacity when moving project.  Whether it’s in your actual portfolio or in a scenario, you directly see the consequences of delaying, extending or pausing projects.

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In summary, capacity planning is high-level and strategic or tactical. It’s about demand and capacity aggregated to the level of a role or team. It’s not about analyzing individual resources and whom will work on which tasks. Additionally, the capacity plan should look far enough into the future to give your organization an heads-up on the projects which are running in the next couple of months or quarters.

Resource Planning
Resource planning is a resource management process which still matches demand and capacity; however, it is used to coordinate and allocate resources to projects. In other words, identifying the team of people to work on a project.

Before creating a resource plan, you need to know which projects require which resources when and how much effort is required. Ideally this is managed via a resource request process where a project manager requests a role and the resource manager allocates a person to the project.

Just as with capacity planning when you have visibility on the demand, you need to match it with capacity. The big difference though, is that you are now looking into the details and actually allocate a resource to a project.

This process is also supported by Meisterplan. Once the role demand on project level has been created, it can be staffed with one or more persons. The Staff Role feature directly shows you which person is the best match for the project based on role, skills and availability.

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By using reports you can drill-down on the individual and see in detail when the resource is allocated to which projects and for how much effort. Next to this, you can quickly see over and under allocations.

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To summarize, resource planning is detailed and operational. It’s about analyzing individual resources and making sure the work gets executed. Next to this, a resource plan should focus on the near future, especially when change on your projects and resource pool is likely to happen.

Similar but not the same
With a clear understanding of both capacity planning and resource planning we can conclude that they both compare resource demand with capacity, but on different levels and with different goals.

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We can also conclude that the results of the capacity planning process feed directly into the resource planning process. When both are fully aligned with each other you will enable your organization with insights to make strategic decisions which directly drill down into the operational execution of your project portfolio.

By syncing both processes, and supporting them with Meisterplan, you will directly gain the benefits of knowing for sure your roadmap is feasible on the long term and being able to execute it in the near future.

Do you want to see this in action? Feel free to contact us!