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6 Resource Utilization Metrics and How to Measure Them

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What is Resource Management?
6 Key Resource Utilization Metrics
SMART Goals and Resource Utilization Metrics
The Importance of Resource Utilization Metrics
How To Track Resource Utilization Metrics
Resource Management Software
Managing a Metric Ton Of Data
What is Resource Management?
Project resource management allows project managers to make the most out of their resources. It covers resource availability, resource allocation, as well as resource management. These topics can be described as follows:
Resource availability: The number of resources needed to complete a project, and their availability
Resource allocation: The allocation of resources to complete a given project.
Resource management: The optimization of resources during a project
Related: Resource Allocation Spreadsheets – Free Template + Simple Example
6 Key Resource Utilization Metrics
Resource managers and project managers analyze resource utilization metrics to determine which resources are being used, how they are used, and if their application is appropriate. The goal is to identify inefficient resource use and then to develop a strategy for improving resource utilization.
What are the most important performance metrics to track? This list is not complete. There might be other metrics or strategies that are better suited for your company, projects, or teams. These metrics should still be considered. These metrics are useful in determining if resources are being used optimally.
1. Resource Utilization
This is a breakdown of team members’ available hours and how they spend their time on each project. It is also known by the billable utilization rate.
This formula will help you determine your utilization rate.
Hours of work / Hours available = Utilization rate
This is the basis formula for utilization. It is important to define what is available. It doesn’t necessarily mean 40 hours per week. Everyone has meetings, projects, or other responsibilities. This utilization rate is calculated based on how much time a team member has been working on a project and how much they have been given for it. It can be compared to billable hours or available. Here’s an example:
36 hours of work / 40 hours available = 90 percent team member utilization rate
2. Ramp Speed
This is the time taken by a team member in order to achieve the desired resource utilization rate. If the ramp speed is too slow, the team members might need additional training and support.
3. Planned Value
This is not an actual value. It’s an estimate of planned project costs for a given period. Multiply the budget by the percentage of completed planned projects to calculate it.
4. Margin of Gross Profit
Gross profit margin is a measure for profitability. It is useful in determining which projects will be most profitable. This can be done by subtracting the revenue from the cost of selling goods. Divide this number by the revenue and multiply it with one hundred.
5. Resource Effort Variance
This metric measures the hours projected and the hours worked. This can be calculated per resource or project, or by department. This metric can be used to determine how many hours are required for a project. This data can be used to guide managers in project planning.
6. Variation in Resource Cost
Budgetary insights can be gained by analyzing cost variance. It is calculated by subtracting the project’s cost from its earned value. It is used to determine whether projects are within budget and how they impact earnings.
SMART Goals & Resource Utilization Metrics
It is important for project managers to monitor resource utilization metrics. It is also important to set and achieve goals. The goal setting and benchmarking will ensure that resources are properly used.