Effort Management

Effort Management is a new paradigm that combines processes of workforce capability planning and resource allocation.

In so doing, it provides powerful insights into an enterprise's future, and enables earlier intervention to ensure successful outcomes.

Effort Management is highly applicable to Project Based Enterprises (PBE’s) such as consultancies, PMO’s, contractors and software developers, <see more>, due to the complexities of the project environment. For many enterprises, this multi-dimensional challenge has proven too daunting. That’s understandable. One could liken it to juggling a varying number of balls while bouncing on a trampoline!

But that is about to change.

For projects to be successful, Project Outcomes of time, cost and quality will only be achieved with the sufficient provision of people. For a PBE to be successful, Enterprise Outcomes of people, project delivery and financial performance must be balanced and optimised.

And this is where Effort Management is key.

The management of people and project work in a PBE is a whole of enterprise mission, as it involves the workstreams of HR, project operations and management accounting, <see more>. That is to say, its purpose is to ensure the effective use of people across the entire enterprise, on all of its projects, while achieving whole of enterprise performance.

How is this achievable?

RESRODEL. This 'Resource Role Model' software is the first application of Effort Management principles to predict and resolve the complex challenges of enterprise project management.

Overview
Theory
Example
Overview

To maximise performance, Project Based Enterprises (PBE’s) must balance outcomes regarding people, project delivery and financial performance.

EM triangle@2x

The Effort Management theorem quantifies the relationship between Roles, Work and Resources into 3 forms of Effort called Demand, Capacity, Allocation. And it does this for each role.

Effort is spread over time into Demand, Capacity and Allocation profiles.

EM effort time chart@2x
3 tables@2x

Profiles are compared against one another, providing Enterprise Drivers called Capability, Utilisation and Assignment - period by period.

The theorem of Effort Management elegantly engages the complete and continuous relationship between inputs of Demand, Capacity and Allocation with outputs of Capacity, Utilisation and Assignment.

Workforce planning and resource allocation are no longer separate processes having been merged into this new paradigm of Effort Management.

Armed with such insights, managers are now able to act earlier and better optimise PBE outcomes for People, Project Delivery and Financial Performance.

Figure 6@2x
Theory

PBE Outcomes and Drivers

The mission of all Project Based Enterprise’s (PBE) is to apply resources to work to produce outcomes.

Enterprise Outcomes are based on People, Project Delivery and Financial Performance.

Enterprise Outcomes are successful when:

  • Projects are delivered on time with quality product (maintaining reputation)
  • Efficiency is achieved (leading to utilisation, value and profit)
  • People are not overworked (keeping work satisfying and sustainable)
To steer a PBE’s future and be successful, managers can have a profound impact when they can act early, having predicted: 
  • Ability to deliver
  • Efficiency
  • People’s workload 

This enables managers to better understand Enterprise Drivers called:

  • Capability – the ability to deliver on obligations, or opportunities
  • Utilisation – the efficient deployment of people
  • Assignment – the sufficient provision of people to work

Enterprise Drivers are interconnected. Maximise one, and two others will be compromised. For example, a PBE that absolutely minimises its people numbers will reduce cost and increase efficiency. (It will also increase profit). However, its ability to complete all of its project deliverables on time is compromised, even when its people work excessively hard.

To balance Enterprise Outcomes and optimise enterprise future, managers need the ability to forecast Enterprise Drivers.

tetrahedron2x
Balancing Enterprise Outcomes
To balance competing outcomes (People, Project Delivery and Financial Performance) mangers must proactively:
  • Increase or reduce:
    • People (numbers or availability)
    • Work
    • Allocation
  • Split alloaction among various people
  • Share People and/or work between sub-enterprises

Most enterprise resources can be categorised as either physical, financial or human. So, if ‘money’ quantifies financial resources in dollars and ‘weight’ quantifies physical resources in tonnes, how are 'human resources' quantified?

Furthermore, of Time, Cost and Quality Project Outcomes, there’s a fundamental factor that’s rarely quantified, let alone acknowledged, yet is a primary enabler of all project outcomes.

Humans contribute time to an enterprise’s productivity – time spent exerting themselves in an activity, applying effort, to enable an outcome.

‘Effort’ quantifies human resources (in units of time).

Human effort is at the heart of all productivity.

To optimise Enterprise Outcomes, effort must be managed.

Effort is more than an ‘enabler’, it also represents ‘burden’ and ‘transaction’. It occurs in the past and in the future. It can be ‘planned’ or can be ‘potential’.

Effort is also timeless. To say a task will take 100 hours does not imply ‘when’ or how long it will take. That depends on the Attendance i.e. number of people available for the task. Refer to Figure 4. Furthermore, people might work 1840 hours in a year, or 40 hours a week for an average 46 weeks, but again, ‘when’ cannot be inferred.

Effort exists in three forms called Demand, Capacity and Allocation, (Table 2) each quantifying the relation between Fundamental Entities (Table 1) called Roles, Work and Resources, shown in Figure 2 and described below. Effort is collated Role by Role.

Figure 2  - Quantifying Entity Relationships

 

EM triangle@2x
Definition of Effort:

A quantity of human exertion in the past, present or future.  Future effort can be described as exertion that will be either 'Required', 'Available', or 'Allotted'.

When time cost quality outcomes are threatened
Either, or:
A.  More effort is exerted by existing people working faster, harder and longer.
  • Typically caused by:
    • pride or acceptance of delivery responsibility
    • support of their team
    • perceived career preservation
    • expectations or management’s 
  • Commonly occurring in:
    • professional consultancies  
    • advertising agencies
    • junior medical practitioners 
    • management positions
B. There is compromise of project outcomes in:
  • time and/or
  • quality and/or
  • scope
Table 1 - Fundamental Entities
Fundamental EntitiesDescriptionExample
Rolesa generic group of people with common skills and abilities, capability of undertaking a specific function Construction Supervisor, Editors, Database Architect, Junior Bridge Designer
ResourcesIndividual people, each being capable one or more RolesBill Bent, Simone Cider, Peter Pink
Work an activity with a tangible deliverable or outcome, often to be completed within a specific timeframesupervising the construction of a bridge, editing a book, developing a database schema, designing a bridge

Table 2   -Types of Effort

Effort TypesDescriptionExample
Demand Tally of 'Required' effort estimated for a Role to undertake Work
  • We need 130 hours of surveying for all our projects next week
  • It will take 3 front-end developers 4 weeks (120 hrs per week) to complete all the webpages .
Capacity Tally of 'Available' Resources able to fulfil a common Role
  • We have 120 hours of surveyors available next week
  • We have total of 4 front-end developers (160 hours per week) with capacity for next 6 weeks
Allocation Tally of 'Allotted' effort for work assigned to all Resources with a common Role
  • Our surveyors have been assigned 80 hours for work next week
  • Only 2 front-end developers have been give work

Effort can be expressed in Hours, Days, Weeks, Months, or in an equivalent Attendance per period expressed as Full Time Equivalents (FTEs) or %.

Effort Profiles

Figure 3 - Demand, Capacity and Allocation Effort Profiles

 

EM effort time chart@2x

Effort does not occur in a single moment and must be spread over time, into Demand, Capacity and Allocation Profiles.

Demand and Allocation Profiles, for each enterprise Role, are derived from the tallies of Demand and Allocation profiles, for each Role, from each Activity. Demand and Allocation Profiles for each Activity are created by spreading their total quantum throughout an activity’s duration. Demand and Allocation Profile quantum for each period represents Attendance (i.e. number of people for the activity) and is inversely proportional to Duration. 

Figure 4 - Activity Effort, Attendance and Duration

 

Activity effort@1x

Capacity Profiles are derived from the availability of people acting in a specific Role, which is continuous, unless there are Exceptions when people are temporarily absent or part time.

Enterprise Drivers

Comparing Effort Profiles against one another provides powerful insights into the Enterprise’s future with Enterprise Drivers called Capability, Assignment and Utilisation. Refer to Table 3 for specific details

Figure 5 Enterprise Drivers - comparing Effort Profiles

 

3 ED tables@1x

Enterprise Drivers are also expressed numerically, for each period, as either Gap, Gap % or Ratio (e.g. 16 hours, 10% or 0.9 respectively.) Refer to ‘Quick Scenario’ below.

Table 3 - Enterprise Drivers

Enterprise Drivers Forecast Metric Effort Profile Comparison
MetricDescriptionNumerator Denominator
CapabilityAbilityAbility to deliver obligations, or opportunities CapacityDemand
Utilisation Efficiency Efficient deployment of people Allocation Capacity
Assignment Workload Sufficient provision of people to work Demand Allocation

Continuous and Complete

The process and theorem for Effort Management elegantly engage the complete and continuous relationship between inputs of Demand, Capacity and Allocation with output of Capacity, Utilisation and Assignment.

Workforce planning and resource allocation are no longer separate processes, as the relationship between Role and Resource have been permanently merged to into this new paradigm.

With this information, Enterprise managers can now predict, Role by Role, their enterprise's ability to deliver, their efficiency and people’s workload. Armed with such insights, managers are now able to act earlier and better optimise Enterprise outcomes for People, Project Delivery and Financial Performance.

Figure 6@2x
Example

 

An enterprise employs many people in several Roles, to work on multiple projects. Role X’s future Demand, Capacity and Allocation is forecast and aggregated for the whole enterprise, month by month. Enterprise Drivers are calculated and their implications assessed for further action, as per Table 4. Figure 6, represents period effort and drivers for the enterprise graphically, in slices of time, month by month (we like to call the ‘ toblerone of time’). Where:

  • Month 31 presents an ideal scenario where there’s and equal balance between Demand and Capacity, and the allocation of people to work has been completely efficient. This implies the enterprise will be in complete balance and all Enterprise Outcomes have been optimized.
  • Month 30 however, represents the common scenario where there is more people than work where the ability to deliver is high, and there will be low utilization.
  • Month 32 is the opposite to Month 30, where there are too few people for the work, and despite a major over allocation and stretching of people it appears inadequate for the excessive amount of work to be that demanded in the period.

Table 4 - Effort and Enterprise Drivers for Role X (People per Month)

EM Example table_edited-1

Figure 7 - Effort and drivers in slices of time

Figure 6x3@1x

This new paradigm of Effort Management described above is embodied in the ‘resource role model’ we called RESRODEL. Created specifically for Project Based Enterprises (PBE’s), RESRODEL empowers Project Based Enterprises of all kinds to efficiently plan people numbers and project work, to deliver your potential.