DTU ProjectLab - User contributions [en-gb]

Resource Allocation in Project Management

2016-09-27T16:35:04Z

Davide.paganini:

=Introduction=

In project management, there exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity, and to ensure an
overall company efficiency in the long run. All companies face the same dilemma at one point: how best to
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating enough resources in the right places can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

This article will introduce different techniques and approaches used to optimize resource allocation. An explanation will be provided to guide PM's on how to best allocate resources.

=Resource Allocation=

The process of assigning and managing assets to support an organization's strategic goals is called resource allocation. In project Management, it is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company shall formulate and agree on its vision and goals, and proceed to accomplish them by setting objectives and working through each of them systematically. Once a strategy is drawn, it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage as each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resources must be moved to where they are needed the most. This is why resource allocation is at the core of each project, and why without a proper allocation, a project is destined to fail.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of a person's physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''': Wealth in the form of money or assets is a sign of the financial strength of an individual, organization, or nation, and is assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project. It is not only important to avoid allocating resource merely in terms of meeting milestones, but also important in terms of timing and utilization of scarce resources.

===Resource Allocation Problems===

*'''Time Limited''': Projects must be finished by an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be executed by remaining within specific levels of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assigning more tasks than what resources can handle within the standard work week. A company with multiple projects and a limited pool of resources often face this issue, which leads to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large, complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, and identifying the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time, and to schedule the activities in order to secure the most fluid achievable transition across usage levels. In other words, resource leveling operates to allocate resource efficiently to complete a project in in the given time period.

In resource leveling, resources should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

[[File:res_lev.jpg‎‎|thumb|center|520px|sub|Figure 9 - Resource Leveling]]

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram. (Figure 1)
It is the sequence of project activities that shows the sequential relationship between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction and the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different types of activities like an A,B,C run in series. I.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, so they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, which is the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activity's requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolonging the schedule, hiring more labor forces,etc.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart. (Figure 2)

"Is an instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

A Gantt chart, as seen in Figure 2, is a project planning tool used in project management. It is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task, and they are represented on a time-phased scheme. The expected time is represented by a horizontal bar whose left end represents the expected beginning of the task and the right end, the expected completion date. In the network diagram, tasks may run in sequence, parallel or overlap. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

===Prioritization Matrix===
"A prioritization matrix, as can be seen in Figure 3, is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits such as:
*Quantifying decisions with numeric rankings.
*Facilitating agreement on priorities.
*Providing a quick and reliable image to evaluate options.
*Aiding in the prioritization of complex issues.

====Steps====
Here a simple example to help understand the process of creating a Prioritization Matrix.

{|style="margin: 0 auto;"
| [[File:mtrx_1.jpg|thumb|300px|upright|sub|Figure 3 - Prioritization Matrix Steps]]
| [[File:mtrx_2.jpg|thumb|300px|upright|sub|Figure 4 - Prioritization Matrix Steps]]
| [[File:mtrx_3.jpg|thumb|300px|upright|sub|Figure 5 - Prioritization Matrix Steps]]
|}
{|style="margin: 0 auto;"
| [[File:mtrx_4.jpg|thumb|300px|upright|sub|Figure 6 - Prioritization Matrix Steps]]
| [[File:mtrx_5.jpg|thumb|300px|upright|sub|Figure 7 - Prioritization Matrix Steps]]
| [[File:mtrx_6.jpg|thumb|300px|upright|sub|Figure 8 - Prioritization Matrix Steps]]
|}

*1- Agree on the objectives to be reached and identify the key project stakeholders
It is necessary to ensure that the entire team working on the matrix is fully aligned on the ultimate objective.

*2- Identify which projects should be evaluated for prioritization. (Figure 4)
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal (Figure 5)
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation, Customer satisfaction, Improves Company image, Use of Technology, Improves Company Profitability, May be completed within timing goals, Investment Cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale. (Figure 6)
Judge the importance of each criteria comparing it with the other. These number will be arbitrary to an extent. However, by keeping them constant and applying them in a prioritization matrix, it is possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them on the agreed scale. (Figure 7)

*6- Compare the projects against the weighted criteria (Figure 8)
Once the importance of each criterion and project is stated, it is possible to evaluate how they relate with each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project and each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize.
In the given example the result is:

*Rank 1- Project 2
*Rank 2- Project 1
*Rank 3- Project 7
*Rank 4- Project 3
*Rank 5- Projects 5 & 6
*Rank 7- Project 8
*Rank 8- Project 4

It's immediately obvious at this point to evaluate which projects to work on first. The most important project is Project 2, with a score of 69, and the least important is Project 4, with a score of 17. During resource allocation it will be possible to distribute resources based on the priority of each projects compared to the others.
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

==Contingency==

In resource allocation is often critical to have a contingency plan. Contingency is a way to cope with uncertainty. When estimating resources, it is important to set aside a fund of the project to be used in case of an emergency. The amount of the funds should be determined based on the level of risk that the project faces, and on the project budget itself.
This contingency fund will be used to cover unforeseen increases in costs by absorbing the impacts of project uncertainty. Contingency shouldn't be used as primary alternative in mitigating risk, it should only be part of a complete and structured risk mitigation plan.

Determining the contingency fund requires an agreement between the project manager and the project owner. The first usually wants the contingency to be set high in order to permit greater flexibility, and be protected from uncertainty. on the other hand, the latter wants the contingency to be set low to maintain more control over the project. If the contingency is set too high, PMs may not be sufficiently involved, on the contrary, and if set too low, it will eventually bring managers to micromanage the project.

As stated above, determining the right amount of contingency is not simple. If a project belongs to a category that the company knows well it is possible to use historical data to calculate it. If a project is brand new with new technologies and innovative procedures, it is more probable that it would come with a higher risks, which would generate great uncertainty, and might require a more structured approach to define the amount of contingency. To overcome such problems, contingency can be calculated at a major task level instead of project level. Defining the amount to allocate this way would be easier as riskier tasks would require more money.<ref> National Research Council of the National Academies. “The Owner's Role in Project Risk Management” - Page 52</ref>

==Other Techniques==

===Linking Tasks===

Linking similar task between different projects. If a resource have been allocated to a task which is similar across different projects, it is possible to link these task. In this way a resource that appears to be over-allocated with tasks, can actually work simultaneously with activities that shares common similarities.

===Leaving Breathing Room===

Anticipating challenges is important when it comes to allocating resources. Project managers should carefully think ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals. However, in order not to under-allocate resources that could lead to a budget loss, a balance between breathing room and a quick approach to task must be achieved.

=Conclusions=

The process of resource allocation can be described as the company activity of placing its scarce resources in the best possible way. The strategy is to bring to customers, goods and services, who fully satisfy the expressed request, by matching their preferences to utilize the lowest possible production cost. Resource allocation is an ongoing process throughout a project's lifetime, and must be monitored to ensure an efficient use of resources and to identify all problems.

=Annotated Bibliography=

* Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.
**''A comprehensive manual of project management, containing different concepts, tools and techniques. The contribution to this article are mostly from Chapter 6,7 and 9.''

*Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management
**''A clear an concise overview of what is Project Prioritization and how to set priorities.''

=References=
<references />

Resource Allocation in Project Management

2016-09-27T15:25:41Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure an
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

In this article will be introduced different techniques and approaches to optimize resource allocation. An explanation will be provided to guide PM's on how to best allocate resources.

=Resource Allocation=

The process of assigning and managing assets to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company shall formulate and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to be moved where they are needed the most, that is why resource allocation is at the core of each projects and why, without a proper allocation, projects are destined to fail.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels. In other words, resource leveling operate to allocate resource efficiently to complete a project in in the given time period.

In resource leveling, resources, should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

[[File:res_lev.jpg‎‎|thumb|center|520px|sub|Figure 9 - Resource Leveling]]

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram. (Figure 1)
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart. (Figure 2)

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart, as can be seen in Figure 2, is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

===Prioritization Matrix===
"A prioritization matrix, as can be seen in Figure 3, is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====
Here a simple example to help understand the process of creating a Prioritization Matrix.

{|style="margin: 0 auto;"
| [[File:mtrx_1.jpg|thumb|300px|upright|sub|Figure 3 - Prioritization Matrix Steps]]
| [[File:mtrx_2.jpg|thumb|300px|upright|sub|Figure 4 - Prioritization Matrix Steps]]
| [[File:mtrx_3.jpg|thumb|300px|upright|sub|Figure 5 - Prioritization Matrix Steps]]
|}
{|style="margin: 0 auto;"
| [[File:mtrx_4.jpg|thumb|300px|upright|sub|Figure 6 - Prioritization Matrix Steps]]
| [[File:mtrx_5.jpg|thumb|300px|upright|sub|Figure 7 - Prioritization Matrix Steps]]
| [[File:mtrx_6.jpg|thumb|300px|upright|sub|Figure 8 - Prioritization Matrix Steps]]
|}

*1- Agree on the objectives to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization. (Figure 4)
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal (Figure 5)
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation, Customer satisfaction, Improves Company image, Use of Technology, Improves Company Profitability, May be completed within timing goals, Investment Cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale. (Figure 6)
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the an agreed scale. (Figure 7)

*6- Compare the projects against the weighted criteria (Figure 8)
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize.
In the given example the result is:

*Rank 1- Project 2
*Rank 2- Project 1
*Rank 3- Project 7
*Rank 4- Project 3
*Rank 5- Projects 5 & 6
*Rank 7- Project 8
*Rank 8- Project 4

It's immediate at this point to see how the most important project will be Project 2, with a score of 69 and the least important, Project 4, with a score of 17. During resource allocation it will be possible to distribute resources based on the priority of each projects compared to the others.
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

==Contingency==

In resource allocation is often critical to have a contingency plan. Contingency is a way to cope with uncertainty, when estimating resources is important to set a fund aside of the project to be used in case of need. The amount of the fund should be determined based on the level of risk that the project faces and on the project budget itself.
This contingency fund will be used to cover unforeseen increases in costs by absorbing impacts of project uncertainty. Contingency shouldn't be used as primary alternative in mitigating risk, it should only be part of a complete and structure risk mitigation plan.

Determine the contingency fund requires an agreement between the project manager and the project owner. The first usually wants the contingency to be set high in order to permit great flexibility and be protected from uncertainty, on the other hand, the second, wants it to be set low to maintain control over the project. If the contingency is set too high PM's may not be sufficiently involved, on the contrary, if set too low will eventually bring managers to micromanage the project.

As stated above, determine the right amount of contingency is not simple. If a project belongs to a category that the company knows well it is possible to use historical data to calculate it. If a project is brand new, with new technologies and innovative procedures, it is more probable that it would come with a higher risks, this would generate great uncertainty and might require a more structured approach to define the amount of contingency. To overcome such problems contingency can be calculated at a major task level instead of project level. Defining the amount to allocate this way would be easier as riskier tasks would require more money.<ref> National Research Council of the National Academies. “The Owner's Rle in Project Risk Management” - Page 52</ref>

==Other Techniques==

===Linking Tasks===

Linking similar task between different projects. If a resource have been allocated to a task which is similar across different projects it is possible to link these task. In this way a resource that appears to be over-allocated with tasks, can actually work at the same time with activities that shares common similarities.

===Leaving Breathing Room===

Anticipate challenges is important when allocating resources, project managers should carefully thinking ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals. However, in order not to under-allocate resources, which could lead to a budget loss, a balance between breathing room and a quick approach to task must be achieved.

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

=Annotated Bibliography=

* Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.
**''A comprehensive manual of project management, containing different concepts, tools and techniques. The contribution to this article are mostly from Chapter 6,7 and 9.''

*Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management
**''A clear an concise overview of what is Project Prioritization and how to set priorities.''

=References=
<references />

Resource Allocation in Project Management

2016-09-27T15:23:17Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure an
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

In this article will be introduced different techniques and approaches to optimize resource allocation. An explanation will be provided to guide PM's on how to best allocate resources.

=Resource Allocation=

The process of assigning and managing assets to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company shall formulate and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to be moved where they are needed the most, that is why resource allocation is at the core of each projects and why, without a proper allocation, projects are destined to fail.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels. In other words, resource leveling operate to allocate resource efficiently to complete a project in in the given time period.

In resource leveling, resources, should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

[[File:res_lev.jpg‎‎|thumb|center|520px|sub|Figure 9 - Resource Leveling]]

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram. (Figure 1)
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart. (Figure 2)

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart, as can be seen in Figure 2, is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

===Prioritization Matrix===
"A prioritization matrix, as can be seen in Figure 3, is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====
Here a simple example to help understand the process of creating a Prioritization Matrix.

{|style="margin: 0 auto;"
| [[File:mtrx_1.jpg|thumb|300px|upright|sub|Figure 3 - Prioritization Matrix Steps]]
| [[File:mtrx_2.jpg|thumb|300px|upright|sub|Figure 4 - Prioritization Matrix Steps]]
| [[File:mtrx_3.jpg|thumb|300px|upright|sub|Figure 5 - Prioritization Matrix Steps]]
|}
{|style="margin: 0 auto;"
| [[File:mtrx_4.jpg|thumb|300px|upright|sub|Figure 6 - Prioritization Matrix Steps]]
| [[File:mtrx_5.jpg|thumb|300px|upright|sub|Figure 7 - Prioritization Matrix Steps]]
| [[File:mtrx_6.jpg|thumb|300px|upright|sub|Figure 8 - Prioritization Matrix Steps]]
|}

*1- Agree on the objectives to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization. (Figure 4)
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal (Figure 5)
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation, Customer satisfaction, Improves Company image, Use of Technology, Improves Company Profitability, May be completed within timing goals, Investment Cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale. (Figure 6)
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the an agreed scale. (Figure 7)

*6- Compare the projects against the weighted criteria (Figure 8)
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize.
In the given example the result is:

*Rank 1- Project 2
*Rank 2- Project 1
*Rank 3- Project 7
*Rank 4- Project 3
*Rank 5- Projects 5 & 6
*Rank 7- Project 8
*Rank 8- Project 4

It's immediate at this point to see how the most important project will be Project 2, with a score of 69 and the least important, Project 4, with a score of 17. During resource allocation it will be possible to distribute resources based on the priority of each projects compared to the others.
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

==Contingency==

In resource allocation is often critical to have a contingency plan. Contingency is a way to cope with uncertainty, when estimating resources is important to set a fund aside of the project to be used in case of need. The amount of the fund should be determined based on the level of risk that the project faces and on the project budget itself.
This contingency fund will be used to cover unforeseen increases in costs by absorbing impacts of project uncertainty. Contingency shouldn't be used as primary alternative in mitigating risk, it should only be part of a complete and structure risk mitigation plan.

Determine the contingency fund requires an agreement between the project manager and the project owner. The first usually wants the contingency to be set high in order to permit great flexibility and be protected from uncertainty, on the other hand, the second, wants it to be set low to maintain control over the project. If the contingency is set too high PM's may not be sufficiently involved, on the contrary, if set too low will eventually bring managers to micromanage the project.

As stated above, determine the right amount of contingency is not simple. If a project belongs to a category that the company knows well it is possible to use historical data to calculate it. If a project is brand new, with new technologies and innovative procedures, it is more probable that it would come with a higher risks, this would generate great uncertainty and might require a more structured approach to define the amount of contingency. To overcome such problems contingency can be calculated at a major task level instead of project level. Defining the amount to allocate this way would be easier as riskier tasks would require more money.<ref> National Research Council of the National Academies. “The Owner's Rle in Project Risk Management” - Page 52</ref>

==Other Techniques==

===Linking Tasks===

Linking similar task between different projects. If a resource have been allocated to a task which is similar across different projects it is possible to link these task. In this way a resource that appears to be over-allocated with tasks, can actually work at the same time with activities that shares common similarities.

===Leaving Breathing Room===

Anticipate challenges is important when allocating resources, project managers should carefully thinking ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals. However, in order not to under-allocate resources, which could lead to a budget loss, a balance between breathing room and a quick approach to task must be achieved.

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

==Annotated Bibliography==

* Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.
**''A comprehensive manual of project management, containing different concepts, tools and techniques. The contribution to this article are mostly from Chapter 6,7 and 9.''

*Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management
**''A clear an concise overview of what is Project Prioritization and how to set priorities.''

=References=
<references />

Resource Allocation in Project Management

2016-09-27T15:10:51Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure an
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

In this article will be introduced different techniques and approaches to optimize resource allocation. An explanation will be provided to guide PM's on how to best allocate resources.

=Resource Allocation=

The process of assigning and managing assets to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company shall formulate and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to be moved where they are needed the most, that is why resource allocation is at the core of each projects and why, without a proper allocation, projects are destined to fail.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels. In other words, resource leveling operate to allocate resource efficiently to complete a project in in the given time period.

In resource leveling, resources, should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

[[File:res_lev.jpg‎‎|thumb|center|520px|sub|Figure 9 - Resource Leveling]]

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram. (Figure 1)
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart. (Figure 2)

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart, as can be seen in Figure 2, is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

===Prioritization Matrix===
"A prioritization matrix, as can be seen in Figure 3, is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====
Here a simple example to help understand the process of creating a Prioritization Matrix.

{|style="margin: 0 auto;"
| [[File:mtrx_1.jpg|thumb|300px|upright|sub|Figure 3 - Prioritization Matrix Steps]]
| [[File:mtrx_2.jpg|thumb|300px|upright|sub|Figure 4 - Prioritization Matrix Steps]]
| [[File:mtrx_3.jpg|thumb|300px|upright|sub|Figure 5 - Prioritization Matrix Steps]]
|}
{|style="margin: 0 auto;"
| [[File:mtrx_4.jpg|thumb|300px|upright|sub|Figure 6 - Prioritization Matrix Steps]]
| [[File:mtrx_5.jpg|thumb|300px|upright|sub|Figure 7 - Prioritization Matrix Steps]]
| [[File:mtrx_6.jpg|thumb|300px|upright|sub|Figure 8 - Prioritization Matrix Steps]]
|}

*1- Agree on the objectives to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization. (Figure 4)
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal (Figure 5)
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation, Customer satisfaction, Improves Company image, Use of Technology, Improves Company Profitability, May be completed within timing goals, Investment Cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale. (Figure 6)
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the an agreed scale. (Figure 7)

*6- Compare the projects against the weighted criteria (Figure 8)
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize.
In the given example the result is:

*Rank 1- Project 2
*Rank 2- Project 1
*Rank 3- Project 7
*Rank 4- Project 3
*Rank 5- Projects 5 & 6
*Rank 7- Project 8
*Rank 8- Project 4

It's immediate at this point to see how the most important project will be Project 2, with a score of 69 and the least important, Project 4, with a score of 17. During resource allocation it will be possible to distribute resources based on the priority of each projects compared to the others.
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

==Contingency==

In resource allocation is often critical to have a contingency plan. Contingency is a way to cope with uncertainty, when estimating resources is important to set a fund aside of the project to be used in case of need. The amount of the fund should be determined based on the level of risk that the project faces and on the project budget itself.
This contingency fund will be used to cover unforeseen increases in costs by absorbing impacts of project uncertainty. Contingency shouldn't be used as primary alternative in mitigating risk, it should only be part of a complete and structure risk mitigation plan.

Determine the contingency fund requires an agreement between the project manager and the project owner. The first usually wants the contingency to be set high in order to permit great flexibility and be protected from uncertainty, on the other hand, the second, wants it to be set low to maintain control over the project. If the contingency is set too high PM's may not be sufficiently involved, on the contrary, if set too low will eventually bring managers to micromanage the project.

As stated above, determine the right amount of contingency is not simple. If a project belongs to a category that the company knows well it is possible to use historical data to calculate it. If a project is brand new, with new technologies and innovative procedures, it is more probable that it would come with a higher risks, this would generate great uncertainty and might require a more structured approach to define the amount of contingency. To overcome such problems contingency can be calculated at a major task level instead of project level. Defining the amount to allocate this way would be easier as riskier tasks would require more money.<ref> National Research Council of the National Academies. “The Owner's Rle in Project Risk Management” - Page 52</ref>

==Other Techniques==

===Linking Tasks===

Linking similar task between different projects. If a resource have been allocated to a task which is similar across different projects it is possible to link these task. In this way a resource that appears to be over-allocated with tasks, can actually work at the same time with activities that shares common similarities.

===Leaving Breathing Room===

Anticipate challenges is important when allocating resources, project managers should carefully thinking ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals. However, in order not to under-allocate resources, which could lead to a budget loss, a balance between breathing room and a quick approach to task must be achieved.

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

==Annotated Bibliography==

* Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.
**''A comprehensive manual of project management, containing different concepts, tools and techniques. The contribution to this article are mostly from Chapter 6,7 and 9.''

*Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management
**''A clear an concise overview of what is Project Prioritization and how to set priorities''

=References=
<references />

Resource Allocation in Project Management

2016-09-27T15:04:28Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure an
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

In this article will be introduced different techniques and approaches to optimize resource allocation. An explanation will be provided to guide PM's on how to best allocate resources.

=Resource Allocation=

The process of assigning and managing assets to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company shall formulate and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to be moved where they are needed the most, that is why resource allocation is at the core of each projects and why, without a proper allocation, projects are destined to fail.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels. In other words, resource leveling operate to allocate resource efficiently to complete a project in in the given time period.

In resource leveling, resources, should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

[[File:res_lev.jpg‎‎|thumb|center|520px|sub|Figure 9 - Resource Leveling]]

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram. (Figure 1)
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart. (Figure 2)

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart, as can be seen in Figure 2, is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

===Prioritization Matrix===
"A prioritization matrix, as can be seen in Figure 3, is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====
Here a simple example to help understand the process of creating a Prioritization Matrix.

{|style="margin: 0 auto;"
| [[File:mtrx_1.jpg|thumb|300px|upright|sub|Figure 3 - Prioritization Matrix Steps]]
| [[File:mtrx_2.jpg|thumb|300px|upright|sub|Figure 4 - Prioritization Matrix Steps]]
| [[File:mtrx_3.jpg|thumb|300px|upright|sub|Figure 5 - Prioritization Matrix Steps]]
|}
{|style="margin: 0 auto;"
| [[File:mtrx_4.jpg|thumb|300px|upright|sub|Figure 6 - Prioritization Matrix Steps]]
| [[File:mtrx_5.jpg|thumb|300px|upright|sub|Figure 7 - Prioritization Matrix Steps]]
| [[File:mtrx_6.jpg|thumb|300px|upright|sub|Figure 8 - Prioritization Matrix Steps]]
|}

*1- Agree on the objectives to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization. (Figure 4)
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal (Figure 5)
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation, Customer satisfaction, Improves Company image, Use of Technology, Improves Company Profitability, May be completed within timing goals, Investment Cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale. (Figure 6)
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the an agreed scale. (Figure 7)

*6- Compare the projects against the weighted criteria (Figure 8)
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize.
In the given example the result is:

*Rank 1- Project 2
*Rank 2- Project 1
*Rank 3- Project 7
*Rank 4- Project 3
*Rank 5- Projects 5 & 6
*Rank 7- Project 8
*Rank 8- Project 4

It's immediate at this point to see how the most important project will be Project 2, with a score of 69 and the least important, Project 4, with a score of 17. During resource allocation it will be possible to distribute resources based on the priority of each projects compared to the others.
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

==Contingency==

In resource allocation is often critical to have a contingency plan. Contingency is a way to cope with uncertainty, when estimating resources is important to set a fund aside of the project to be used in case of need. The amount of the fund should be determined based on the level of risk that the project faces and on the project budget itself.
This contingency fund will be used to cover unforeseen increases in costs by absorbing impacts of project uncertainty. Contingency shouldn't be used as primary alternative in mitigating risk, it should only be part of a complete and structure risk mitigation plan.

Determine the contingency fund requires an agreement between the project manager and the project owner. The first usually wants the contingency to be set high in order to permit great flexibility and be protected from uncertainty, on the other hand, the second, wants it to be set low to maintain control over the project. If the contingency is set too high PM's may not be sufficiently involved, on the contrary, if set too low will eventually bring managers to micromanage the project.

As stated above, determine the right amount of contingency is not simple. If a project belongs to a category that the company knows well it is possible to use historical data to calculate it. If a project is brand new, with new technologies and innovative procedures, it is more probable that it would come with a higher risks, this would generate great uncertainty and might require a more structured approach to define the amount of contingency. To overcome such problems contingency can be calculated at a major task level instead of project level. Defining the amount to allocate this way would be easier as riskier tasks would require more money.<ref> National Research Council of the National Academies. “The Owner's Rle in Project Risk Management” - Page 52</ref>

==Other Techniques==

===Linking Tasks===

Linking similar task between different projects. If a resource have been allocated to a task which is similar across different projects it is possible to link these task. In this way a resource that appears to be over-allocated with tasks, can actually work at the same time with activities that shares common similarities.

===Leaving Breathing Room===

Anticipate challenges is important when allocating resources, project managers should carefully thinking ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals. However, in order not to under-allocate resources, which could lead to a budget loss, a balance between breathing room and a quick approach to task must be achieved.

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

==Annotated Bibliography==

* Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.
**''A comprehensive manual of project management, containing different concepts, tools and techniques. The contribution from the book span across the whole article.

=References=
<references />

Resource Allocation in Project Management

2016-09-27T14:55:29Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure an
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

In this article will be introduced different techniques and approaches to optimize resource allocation. An explanation will be provided to guide PM's on how to best allocate resources.

=Resource Allocation=

The process of assigning and managing assets to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company shall formulate and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to be moved where they are needed the most, that is why resource allocation is at the core of each projects and why, without a proper allocation, projects are destined to fail.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels. In other words, resource leveling operate to allocate resource efficiently to complete a project in in the given time period.

In resource leveling, resources, should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

[[File:res_lev.jpg‎‎|thumb|center|520px|sub|Figure 9 - Resource Leveling]]

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram. (Figure 1)
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart. (Figure 2)

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart, as can be seen in Figure 2, is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

===Prioritization Matrix===
"A prioritization matrix, as can be seen in Figure 3, is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====
Here a simple example to help understand the process of creating a Prioritization Matrix.

{|style="margin: 0 auto;"
| [[File:mtrx_1.jpg|thumb|300px|upright|sub|Figure 3 - Prioritization Matrix Steps]]
| [[File:mtrx_2.jpg|thumb|300px|upright|sub|Figure 4 - Prioritization Matrix Steps]]
| [[File:mtrx_3.jpg|thumb|300px|upright|sub|Figure 5 - Prioritization Matrix Steps]]
|}
{|style="margin: 0 auto;"
| [[File:mtrx_4.jpg|thumb|300px|upright|sub|Figure 6 - Prioritization Matrix Steps]]
| [[File:mtrx_5.jpg|thumb|300px|upright|sub|Figure 7 - Prioritization Matrix Steps]]
| [[File:mtrx_6.jpg|thumb|300px|upright|sub|Figure 8 - Prioritization Matrix Steps]]
|}

*1- Agree on the objectives to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization. (Figure 4)
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal (Figure 5)
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation, Customer satisfaction, Improves Company image, Use of Technology, Improves Company Profitability, May be completed within timing goals, Investment Cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale. (Figure 6)
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the an agreed scale. (Figure 7)

*6- Compare the projects against the weighted criteria (Figure 8)
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize.
In the given example the result is:

*Rank 1- Project 2
*Rank 2- Project 1
*Rank 3- Project 7
*Rank 4- Project 3
*Rank 5- Projects 5 & 6
*Rank 7- Project 8
*Rank 8- Project 4

It's immediate at this point to see how the most important project will be Project 2, with a score of 69 and the least important, Project 4, with a score of 17. During resource allocation it will be possible to distribute resources based on the priority of each projects compared to the others.
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

==Contingency==

In resource allocation is often critical to have a contingency plan. Contingency is a way to cope with uncertainty, when estimating resources is important to set a fund aside of the project to be used in case of need. The amount of the fund should be determined based on the level of risk that the project faces and on the project budget itself.
This contingency fund will be used to cover unforeseen increases in costs by absorbing impacts of project uncertainty. Contingency shouldn't be used as primary alternative in mitigating risk, it should only be part of a complete and structure risk mitigation plan.

Determine the contingency fund requires an agreement between the project manager and the project owner. The first usually wants the contingency to be set high in order to permit great flexibility and be protected from uncertainty, on the other hand, the second, wants it to be set low to maintain control over the project. If the contingency is set too high PM's may not be sufficiently involved, on the contrary, if set too low will eventually bring managers to micromanage the project.

As stated above, determine the right amount of contingency is not simple. If a project belongs to a category that the company knows well it is possible to use historical data to calculate it. If a project is brand new, with new technologies and innovative procedures, it is more probable that it would come with a higher risks, this would generate great uncertainty and might require a more structured approach to define the amount of contingency. To overcome such problems contingency can be calculated at a major task level instead of project level. Defining the amount to allocate this way would be easier as riskier tasks would require more money.<ref> National Research Council of the National Academies. “The Owner's Rle in Project Risk Management” - Page 52</ref>

==Other Techniques==

===Linking Tasks===

Linking similar task between different projects. If a resource have been allocated to a task which is similar across different projects it is possible to link these task. In this way a resource that appears to be over-allocated with tasks, can actually work at the same time with activities that shares common similarities.

===Leaving Breathing Room===

Anticipate challenges is important when allocating resources, project managers should carefully thinking ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals. However, in order not to under-allocate resources, which could lead to a budget loss, a balance between breathing room and a quick approach to task must be achieved.

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

==Annotated Bibliography==

* Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.

*The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.

*National Research Council of the National Academies. “The Owner's Rle in Project Risk Management” - Page 52

=References=
<references />

Resource Allocation in Project Management

2016-09-27T14:39:42Z

Davide.paganini: /* Contingency */

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure a
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

In this article will be introduced different techniques and approaches to optimize resource allocation. A explanation will be provided to guide PM's on how to best allocate resources.

=Resource Allocation=

The process of assigning and managing assets in order to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company should formulates and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to be moved where they are needed the most, that is why resource allocation is at the core of each projects and why without a proper allocation projects are destined to fail. In the next paragraph it will be explained the different resources a project manager have to keep in consideration while starting up allocations.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels. In other words, resource leveling operate to allocate resource efficiently to complete a project in in the given time period.

In resource leveling, resources, should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

[[File:res_lev.jpg‎‎|thumb|center|520px|sub|Figure 9 - Resource Leveling]]

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram. (Figure 1)
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart. (Figure 2)

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart, as can be seen in Figure 2, is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

===Prioritization Matrix===
"A prioritization matrix, as can be seen in Figure 3, is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====
Here a simple example to help understand the process of creating a Prioritization Matrix.

{|style="margin: 0 auto;"
| [[File:mtrx_1.jpg|thumb|300px|upright|sub|Figure 3 - Prioritization Matrix Steps]]
| [[File:mtrx_2.jpg|thumb|300px|upright|sub|Figure 4 - Prioritization Matrix Steps]]
| [[File:mtrx_3.jpg|thumb|300px|upright|sub|Figure 5 - Prioritization Matrix Steps]]
|}
{|style="margin: 0 auto;"
| [[File:mtrx_4.jpg|thumb|300px|upright|sub|Figure 6 - Prioritization Matrix Steps]]
| [[File:mtrx_5.jpg|thumb|300px|upright|sub|Figure 7 - Prioritization Matrix Steps]]
| [[File:mtrx_6.jpg|thumb|300px|upright|sub|Figure 8 - Prioritization Matrix Steps]]
|}

*1- Agree on the objectives to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization. (Figure 4)
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal (Figure 5)
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation, Customer satisfaction, Improves Company image, Use of Technology, Improves Company Profitability, May be completed within timing goals, Investment Cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale. (Figure 6)
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the an agreed scale. (Figure 7)

*6- Compare the projects against the weighted criteria (Figure 8)
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize.
In the given example the result is:

*Rank 1- Project 2
*Rank 2- Project 1
*Rank 3- Project 7
*Rank 4- Project 3
*Rank 5- Projects 5 & 6
*Rank 7- Project 8
*Rank 8- Project 4

It's immediate at this point to see how the most important project will be Project 2, with a score of 69 and the least important, Project 4, with a score of 17. During resource allocation it will be possible to distribute resources based on the priority of each projects compared to the others.
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

==Contingency==

In resource allocation is often critical to have a contingency plan. Contingency is a way to cope with uncertainty, when estimating resources is important to set a fund aside of the project to be used in case of need. The amount of the fund should be determined based on the level of risk that the project faces and on the project budget itself.
This contingency fund will be used to cover unforeseen increases in costs by absorbing impacts of project uncertainty. Contingency shouldn't be used as primary alternative in mitigating risk, it should only be part of a complete and structure risk mitigation plan.

Determine the contingency fund requires an agreement between the project manager and the project owner. The first usually wants the contingency to be set high in order to permit great flexibility and be protected from uncertainty, on the other hand, the second, wants it to be set low to maintain control over the project. If the contingency is set too high PM's may not be sufficiently involved, on the contrary, if set too low will eventually bring managers to micromanage the project.

As stated above, determine the right amount of contingency is not simple. If a project belongs to a category that the company knows well it is possible to use historical data to calculate it. If a project is brand new, with new technologies and innovative procedures, it is more probable that it would come with a higher risks, this would generate great uncertainty and might require a more structured approach to define the amount of contingency. To overcome such problems contingency can be calculated at a major task level instead of project level. Defining the amount to allocate this way would be easier as riskier tasks would require more money.<ref> National Research Council of the National Academies. “The Owner's Rle in Project Risk Management” - Page 52</ref>

==Other Techniques==

===Linking Tasks===

Linking similar task between different projects. If a resource have been allocated to a task which is similar across different projects it is possible to link these task. In this way a resource that appears to be over-allocated with tasks, can actually work at the same time with activities that shares common similarities.

===Leaving Breathing Room===

Anticipate challenges is important when allocating resources, project managers should carefully thinking ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals. However, in order not to under-allocate resources, which could lead to a budget loss, a balance between breathing room and a quick approach to task must be achieved.

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

==Annotated Bibliography==

* Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.
*The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.
*National Research Council of the National Academies. “The Owner's Rle in Project Risk Management” - Page 52

=References=
<references />

Resource Allocation in Project Management

2016-09-27T14:39:04Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure a
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

In this article will be introduced different techniques and approaches to optimize resource allocation. A explanation will be provided to guide PM's on how to best allocate resources.

=Resource Allocation=

The process of assigning and managing assets in order to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company should formulates and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to be moved where they are needed the most, that is why resource allocation is at the core of each projects and why without a proper allocation projects are destined to fail. In the next paragraph it will be explained the different resources a project manager have to keep in consideration while starting up allocations.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels. In other words, resource leveling operate to allocate resource efficiently to complete a project in in the given time period.

In resource leveling, resources, should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

[[File:res_lev.jpg‎‎|thumb|center|520px|sub|Figure 9 - Resource Leveling]]

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram. (Figure 1)
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart. (Figure 2)

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart, as can be seen in Figure 2, is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

===Prioritization Matrix===
"A prioritization matrix, as can be seen in Figure 3, is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====
Here a simple example to help understand the process of creating a Prioritization Matrix.

{|style="margin: 0 auto;"
| [[File:mtrx_1.jpg|thumb|300px|upright|sub|Figure 3 - Prioritization Matrix Steps]]
| [[File:mtrx_2.jpg|thumb|300px|upright|sub|Figure 4 - Prioritization Matrix Steps]]
| [[File:mtrx_3.jpg|thumb|300px|upright|sub|Figure 5 - Prioritization Matrix Steps]]
|}
{|style="margin: 0 auto;"
| [[File:mtrx_4.jpg|thumb|300px|upright|sub|Figure 6 - Prioritization Matrix Steps]]
| [[File:mtrx_5.jpg|thumb|300px|upright|sub|Figure 7 - Prioritization Matrix Steps]]
| [[File:mtrx_6.jpg|thumb|300px|upright|sub|Figure 8 - Prioritization Matrix Steps]]
|}

*1- Agree on the objectives to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization. (Figure 4)
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal (Figure 5)
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation, Customer satisfaction, Improves Company image, Use of Technology, Improves Company Profitability, May be completed within timing goals, Investment Cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale. (Figure 6)
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the an agreed scale. (Figure 7)

*6- Compare the projects against the weighted criteria (Figure 8)
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize.
In the given example the result is:

*Rank 1- Project 2
*Rank 2- Project 1
*Rank 3- Project 7
*Rank 4- Project 3
*Rank 5- Projects 5 & 6
*Rank 7- Project 8
*Rank 8- Project 4

It's immediate at this point to see how the most important project will be Project 2, with a score of 69 and the least important, Project 4, with a score of 17. During resource allocation it will be possible to distribute resources based on the priority of each projects compared to the others.
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

==Contingency==

In resource allocation is often critical to have a contingency plan. Contingency is a way to cope with uncertainty, when estimating resources is important to set a fund aside of the project to be used in case of need. The amount of the fund should be determined based on the level of risk that the project faces and on the project budget itself.
This contingency fund will be used to cover unforeseen increases in costs by absorbing impacts of project uncertainty. Contingency shouldn't be used as primary alternative in mitigating risk, it should only be part of a complete and structure risk mitigation plan.

Determine the contingency fund requires an agreement between the project manager and the project owner. The first usually wants the contingency to be set high in order to permit great flexibility and be protected from uncertainty, on the other hand, the second, wants it to be set low to maintain control over the project. If the contingency is set too high PM's may not be sufficiently involved, on the contrary, if set too low will eventually bring managers to micromanage the project.

As stated above, determine the right amount of contingency is not simple. If a project belongs to a category that the company knows well it is possible to use historical data to calculate it. If a project is brand new, with new technologies and innovative procedures, it is more probable that it would come with a higher risks, this would generate great uncertainty and might require a more structured approach to define the amount of contingency. To overcome such problems contingency can be calculated at a major task level instead of project level. Defining the amount to allocate this way would be much easier as riskier tasks would require more money.<ref> National Research Council of the National Academies. “The Owner's Rle in Project Risk Management” - Page 52</ref>

==Other Techniques==

===Linking Tasks===

Linking similar task between different projects. If a resource have been allocated to a task which is similar across different projects it is possible to link these task. In this way a resource that appears to be over-allocated with tasks, can actually work at the same time with activities that shares common similarities.

===Leaving Breathing Room===

Anticipate challenges is important when allocating resources, project managers should carefully thinking ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals. However, in order not to under-allocate resources, which could lead to a budget loss, a balance between breathing room and a quick approach to task must be achieved.

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

==Annotated Bibliography==

* Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.
*The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.
*National Research Council of the National Academies. “The Owner's Rle in Project Risk Management” - Page 52

=References=
<references />

File:Res lev.jpg

2016-09-27T13:42:01Z

Davide.paganini:

Resource Allocation in Project Management

2016-09-27T13:41:48Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure a
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

In this article will be introduced different techniques and approaches to optimize resource allocation. A explanation will be provided to guide PM's on how to best allocate resources.

=Resource Allocation=

The process of assigning and managing assets in order to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company should formulates and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to be moved where they are needed the most, that is why resource allocation is at the core of each projects and why without a proper allocation projects are destined to fail. In the next paragraph it will be explained the different resources a project manager have to keep in consideration while starting up allocations.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels. In other words, resource leveling operate to allocate resource efficiently to complete a project in in the given time period.

In resource leveling, resources, should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram. (Figure 1)
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart. (Figure 2)

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart, as can be seen in Figure 2, is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

===Prioritization Matrix===
"A prioritization matrix, as can be seen in Figure 3, is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====
Here a simple example to help understand the process of creating a Prioritization Matrix.

{|style="margin: 0 auto;"
| [[File:mtrx_1.jpg|thumb|300px|upright|sub|Figure 3 - Prioritization Matrix Steps]]
| [[File:mtrx_2.jpg|thumb|300px|upright|sub|Figure 4 - Prioritization Matrix Steps]]
| [[File:mtrx_3.jpg|thumb|300px|upright|sub|Figure 5 - Prioritization Matrix Steps]]
|}
{|style="margin: 0 auto;"
| [[File:mtrx_4.jpg|thumb|300px|upright|sub|Figure 6 - Prioritization Matrix Steps]]
| [[File:mtrx_5.jpg|thumb|300px|upright|sub|Figure 7 - Prioritization Matrix Steps]]
| [[File:mtrx_6.jpg|thumb|300px|upright|sub|Figure 8 - Prioritization Matrix Steps]]
|}

*1- Agree on the objectives to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization. (Figure 4)
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal (Figure 5)
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation, Customer satisfaction, Improves Company image, Use of Technology, Improves Company Profitability, May be completed within timing goals, Investment Cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale. (Figure 6)
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the an agreed scale. (Figure 7)

*6- Compare the projects against the weighted criteria (Figure 8)
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize.
In the given example the result is:

*Rank 1- Project 2
*Rank 2- Project 1
*Rank 3- Project 7
*Rank 4- Project 3
*Rank 5- Projects 5 & 6
*Rank 7- Project 8
*Rank 8- Project 4

It's immediate at this point to see how the most important project will be Project 2, with a score of 69 and the least important, Project 4, with a score of 17. During resource allocation it will be possible to distribute resources based on the priority of each projects compared to the others.
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

===Linking Tasks===

Linking similar task to different projects. If a resource have been allocated to a task which is similar across different projects it is possible to link these task. In this way a resource that appears to be over-allocated with tasks, can actually work at the same time with activities that shares common similarities.

===Leaving Breathing Room===

Anticipate challenges is important when allocating resources, project managers should carefully thinking ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals. However, in order not to under-allocate resources, which could lead to a budget loss, a balance between breathing room and a quick approach to task must be achieved.

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

==Annotated Bibliography==

* Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.
*The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.

=References=
<references />

Resource Allocation in Project Management

2016-09-27T13:06:52Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure a
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

In this article will be introduced different techniques and approaches to optimize resource allocation. A explanation will be provided to guide PM's on how to best allocate resources.

=Resource Allocation=

The process of assigning and managing assets in order to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company should formulates and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to be moved where they are needed the most, that is why resource allocation is at the core of each projects and why without a proper allocation projects are destined to fail. In the next paragraph it will be explained the different resources a project manager have to keep in consideration while starting up allocations.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels.

In resource leveling resources should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram. (Figure 1)
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart. (Figure 2)

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart, as can be seen in Figure 2, is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

===Prioritization Matrix===
"A prioritization matrix, as can be seen in Figure 3, is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====
Here a simple example to help understand the process of creating a Prioritization Matrix.

{|style="margin: 0 auto;"
| [[File:mtrx_1.jpg|thumb|300px|upright|sub|Figure 3 - Prioritization Matrix Steps]]
| [[File:mtrx_2.jpg|thumb|300px|upright|sub|Figure 4 - Prioritization Matrix Steps]]
| [[File:mtrx_3.jpg|thumb|300px|upright|sub|Figure 5 - Prioritization Matrix Steps]]
|}
{|style="margin: 0 auto;"
| [[File:mtrx_4.jpg|thumb|300px|upright|sub|Figure 6 - Prioritization Matrix Steps]]
| [[File:mtrx_5.jpg|thumb|300px|upright|sub|Figure 7 - Prioritization Matrix Steps]]
| [[File:mtrx_6.jpg|thumb|300px|upright|sub|Figure 8 - Prioritization Matrix Steps]]
|}

*1- Agree on the objective to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization. (Figure 4)
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal (Figure 5)
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation, Customer satisfaction, Improves Company image, Use of Technology, Improves Company Profitability, May be completed within timing goals, Investment Cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale. (Figure 6)
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the an agreed scale. (Figure 7)

*6- Compare the projects against the weighted criteria (Figure 8)
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize. In the given example it is possible to see how the most important project will be Project 2, with a score of 69 and the least important, Project 4, with a score of 17.
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

===Linking Tasks===

Linking similar task to different projects. If a resource have been allocated to a task which is similar across different projects it is possible to link these task. In this way a resource that appears to be over-allocated with tasks, can actually work at the same time with activities that shares common similarities.

===Leaving Breathing Room===

Anticipate challenges is important when allocating resources, project managers should carefully thinking ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals. However, in order not to under-allocate resources, which could lead to a budget loss, a balance between breathing room and a quick approach to task must be achieved.

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

==Annotated Bibliography==

* Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.
*The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.

=References=
<references />

Resource Allocation in Project Management

2016-09-27T12:56:28Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure a
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

In this article will be introduced different techniques and approaches to optimize resource allocation. A explanation will be provided to guide PM's on how to best allocate resources.

=Resource Allocation=

The process of assigning and managing assets in order to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company should formulates and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to be moved where they are needed the most, that is why resource allocation is at the core of each projects and why without a proper allocation projects are destined to fail. In the next paragraph it will be explained the different resources a project manager have to keep in consideration while starting up allocations.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels.

In resource leveling resources should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram.
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart .

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart, as can be seen in Figure 2, is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

===Prioritization Matrix===
"A prioritization matrix, as can be seen in Figure 3, is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====

{|style="margin: 0 auto;"
| [[File:mtrx_1.jpg|thumb|300px|upright|sub|Figure 3 - Prioritization Matrix Steps]]
| [[File:mtrx_2.jpg|thumb|300px|upright|sub|Figure 4 - Prioritization Matrix Steps]]
| [[File:mtrx_3.jpg|thumb|300px|upright|sub|Figure 5 - Prioritization Matrix Steps]]
|}
{|style="margin: 0 auto;"
| [[File:mtrx_4.jpg|thumb|300px|upright|sub|Figure 6 - Prioritization Matrix Steps]]
| [[File:mtrx_5.jpg|thumb|300px|upright|sub|Figure 7 - Prioritization Matrix Steps]]
| [[File:mtrx_6.jpg|thumb|300px|upright|sub|Figure 8 - Prioritization Matrix Steps]]
|}

*1- Agree on the objective to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization.
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix. The Project must be listed as can be seen in Figure 4.

*3- Identify the criteria required to meet the goal (Figure 5)
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation, Customer satisfaction, Improves Company image, Use of Technology, Improves Company Profitability, May be completed within timing goals, Investment Cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale. (Figure 6)
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the an agreed scale. (Figure 7)

*6- Compare the projects against the weighted criteria (FIgure 8)
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize. In the given example it is possible to see how the most important project will be Project 2, with a score of 69 and the least important Project 4 with a score of 17.
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

===Linking Tasks===

Linking similar task to different projects. If a resource have been allocated to a task which is similar across different projects it is possible to link these task. In this way a resource that appears to be over-allocated with tasks, can actually work at the same time with activities that shares common similarities.

===Leaving Breathing Room===

Anticipate challenges is important when allocating resources, project managers should carefully thinking ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals. However, in order not to under-allocate resources, which could lead to a budget loss, a balance between breathing room and a quick approach to task must be achieved.

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

==Annotated Bibliography==

* Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.
*The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.

=References=
<references />

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2016-09-27T12:38:51Z

Davide.paganini:

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2016-09-27T12:38:46Z

Davide.paganini:

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2016-09-27T12:38:39Z

Davide.paganini:

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2016-09-27T12:38:32Z

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Davide.paganini:

Resource Allocation in Project Management

2016-09-27T11:57:23Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure a
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

In this article will be introduced different techniques and approaches to optimize resource allocation. A explanation will be provided to guide PM's on how to best allocate resources.

=Resource Allocation=

The process of assigning and managing assets in order to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company should formulates and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to be moved where they are needed the most, that is why resource allocation is at the core of each projects and why without a proper allocation projects are destined to fail. In the next paragraph it will be explained the different resources a project manager have to keep in consideration while starting up allocations.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels.

In resource leveling resources should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram.
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 1 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart .

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart, as can be seen in Figure 1, is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

[[File:Prior_matrx_example.PNG‎‎‎|thumb|420px|sub|Figure 2 - Prioritization Matrix Example]]
===Prioritization Matrix===
"A prioritization matrix, as can be seen in Figure 2, is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====

*1- Agree on the objective to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization.
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation

-Customer satisfaction

-Use of technology

-Potential Saving

-Investment cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale.
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the same scale used in step 4.

*6- Compare the projects against the weighted criteria
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

===Linking Tasks===

Linking similar task to different projects. If a resource have been allocated to a task which is similar across different projects it is possible to link these task. In this way a resource that appears to be over-allocated with tasks, can actually work at the same time with activities that shares common similarities.

===Leaving Breathing Room===

Anticipate challenges is important when allocating resources, project managers should carefully thinking ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals. However, in order not to under-allocate resources, which could lead to a budget loss, a balance between breathing room and a quick approach to task must be achieved.

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

==Annotated Bibliography==

* Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.
*The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.

=References=
<references />

Resource Allocation in Project Management

2016-09-16T14:32:16Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure an
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

=Resource Allocation=

The process of assigning and managing assets in order to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company should formulates and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to moved to where they are needed the most, that is why resource allocation is at the core of each projects, regardless of the field, without a proper allocation projects are destined to fail.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels.

In resource leveling resources should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram.
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart .

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

[[File:Prior_matrx_example.PNG‎‎‎|thumb|420px|sub|Figure 2 - Gantt Chart Example]]
===Prioritization Matrix===
"A prioritization matrix is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====

*1- Agree on the objective to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization.
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation

-Customer satisfaction

-Use of technology

-Potential Saving

-Investment cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale.
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the same scale used in step 4.

*6- Compare the projects against the weighted criteria
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

===Linking Tasks===

Linking similar task to different projects. If a resource have been allocated to a task which is similar across different projects it is possible to link these task. In this way a resource that appears to be over-allocated with tasks, can actually work at the same time with activities that shares common similarities.

===Leaving Breathing Room===

Anticipate challenges is important when allocating resources, project managers should carefully thinking ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals. However, in order not to under-allocate resources, which could lead to a budget loss, a balance between breathing room and a quick approach to task must be achieved.

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

=References=
<references />

Resource Allocation in Project Management

2016-09-16T14:30:22Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure an
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

=Resource Allocation=

The process of assigning and managing assets in order to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company should formulates and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to moved to where they are needed the most, that is why resource allocation is at the core of each projects, regardless of the field, without a proper allocation projects are destined to fail.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels.

In resource leveling resources should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram.
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart .

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

[[File:Prior_matrx_example.PNG‎‎‎|thumb|420px|sub|Figure 2 - Gantt Chart Example]]
===Prioritization Matrix===
"A prioritization matrix is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====

*1- Agree on the objective to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization.
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation

-Customer satisfaction

-Use of technology

-Potential Saving

-Investment cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale.
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the same scale used in step 4.

*6- Compare the projects against the weighted criteria
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

===Linking Tasks===

Linking similar task to different projects. If a resource have been allocated to a task which is similar across different projects it is possible to link these task. In this way a resource that appears to be over-allocated with tasks, similar but in different projects, the problem can be solved

===Leaving Breathing Room===

Anticipate challenges is important when allocating resources, project managers should carefully thinking ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals. However, in order not to under-allocate resources, which could lead to a budget loss, a balance between breathing room and a quick approach to task must be achieved.

===Avoid "Putting out Fires" approach to PM===

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

=References=
<references />

Resource Allocation in Project Management

2016-09-16T13:33:57Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure an
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

=Resource Allocation=

The process of assigning and managing assets in order to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company should formulates and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to moved to where they are needed the most, that is why resource allocation is at the core of each projects, regardless of the field, without a proper allocation projects are destined to fail.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels.

In resource leveling resources should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram.
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart .

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

[[File:Prior_matrx_example.PNG‎‎‎|thumb|420px|sub|Figure 2 - Gantt Chart Example]]
===Prioritization Matrix===
"A prioritization matrix is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====

*1- Agree on the objective to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization.
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation

-Customer satisfaction

-Use of technology

-Potential Saving

-Investment cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale.
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the same scale used in step 4.

*6- Compare the projects against the weighted criteria
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

===Linking Tasks===

Linking similar task to different projects. If a resource have been allocated to a task which is similar across different projects

===Leaving Breathing Room===

Anticipate challenges is important when allocating resources, project managers should carefully thinking ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals. However, in order not to under-allocate resources, which could lead to a budget loss, a balance between breathing room and a quick approach to task must be achieved.

===Avoid "Putting out Fires" approach to PM===

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

=References=
<references />

Resource Allocation in Project Management

2016-09-16T13:19:39Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure an
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

=Resource Allocation=

The process of assigning and managing assets in order to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company should formulates and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to moved to where they are needed the most, that is why resource allocation is at the core of each projects, regardless of the field, without a proper allocation projects are destined to fail.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels.

In resource leveling resources should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram.
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart .

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

[[File:Prior_matrx_example.PNG‎‎‎|thumb|420px|sub|Figure 2 - Gantt Chart Example]]
===Prioritization Matrix===
"A prioritization matrix is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====

*1- Agree on the objective to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization.
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation

-Customer satisfaction

-Use of technology

-Potential Saving

-Investment cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale.
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the same scale used in step 4.

*6- Compare the projects against the weighted criteria
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

===Linking Tasks===

Linking similar task to different projects. If a resource have been allocated to a task which is similar across different projects

===Leaving Breathing Room===

Anticipate challenges is important when allocating resources, project managers should carefully thinking ahead in order to foresee obstacles and constraints. It is then vital to leave breathing room between tasks to avoid unexpected expenses. When facing strict deadlines, it is necessary to focus energy on time management and in creating a clear timetable to achieve goals.

===Avoid "Putting out Fires" approach to PM===

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

=References=
<references />

Resource Allocation in Project Management

2016-09-16T11:59:30Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure an
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

=Resource Allocation=

The process of assigning and managing assets in order to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company should formulates and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to moved to where they are needed the most, that is why resource allocation is at the core of each projects, regardless of the field, without a proper allocation projects are destined to fail.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

==Resource Leveling==

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels.

In resource leveling resources should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram.
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart .

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

==Prioritize Projects==

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

[[File:Prior_matrx_example.PNG‎‎‎|thumb|420px|sub|Figure 2 - Gantt Chart Example]]
===Prioritization Matrix===
"A prioritization matrix is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====

*1- Agree on the objective to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization.
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation

-Customer satisfaction

-Use of technology

-Potential Saving

-Investment cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale.
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the same scale used in step 4.

*6- Compare the projects against the weighted criteria
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

===Linking Tasks===

Linking similar task to different projects. If a resource have been allocated to a task which is similar across different projects

===Leaving Breathing Room===

===Avoid "Putting out Fires" approach to PM===

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

=References=
<references />

Resource Allocation in Project Management

2016-09-16T11:58:24Z

Davide.paganini:

=Introduction=

In project management exists a tight connection between results and resources optimization. An
inadequate planning of resource allocation might lead to a non-manageable or non-reasonable budget
formulation.

Each organization must wisely allocate resources to avoid delays, rework, nonconformity and to ensure an
overall company efficiency in the long run. All companies face the same dilemma at one point, how best
allocate resources. Allocating resources to wrong ideas or projects that eventually fail will lead to wastage.
On the other hand, not allocating resources in the right ones can lead to even greater opportunity costs.
Under and over allocation are the main problems that arise in a non-planned resource allocation scenario.

Is critical to have a planned approach in RA to manage a project portfolio effectively. Being able to allocate
the correct resources, in terms of skills and quantity, to the right ideas, projects and products should be the
final goal of each project manager.

=Resource Allocation=

The process of assigning and managing assets in order to support an organization's strategic goals is called resource allocation. In project Management, is the scheduling of activities and resources required by those activities taking into consideration both the project time and the resource availability. It involves balancing competing commitments and priorities in order to determine the most effective course of action to best utilize a limited pool of resources and maximize the return on investment.

==Resource Allocation Process & Strategies==
Resource allocation begins with strategic planning. A company should formulates and agree on its vision and goals, and proceed in accomplishing them through setting objectives and working towards their achievement. Once a strategy is drawn it will be necessary to allocate sufficient resources to accomplish it. Project budgeting comes into play at this stage, each department will use an agreed budgeted fund to allocate resource for specific purposes, such as buying raw materials, hiring employees, etc. Resource will have to moved to where they are needed the most, that is why resource allocation is at the core of each projects, regardless of the field, without a proper allocation projects are destined to fail.

===Core Resources===

*'''Land''': Natural resource required in production process, land, mineral, forest, oil and water resources.

*'''Labour''': The aggregate of humans physical and mental effort used to generate goods and services. It is a primary factor in production. The labor force is determined by the adult population of a nation.

*'''Capital''':Wealth in the form of money or assets, sign of the financial strength of an individual, organization, or nation, and assumed to be available for development or investment.

===Allocation Decisions===

The basic allocation decisions begin with the choice of what is going to fund the project, it is important to avoid allocating resource merely in terms of meeting milestones, but also in terms of timing and utilization of scarce resources. The challenge

===Resource Allocation Problem===

*'''Time Limited''': Projects must be finished on an agreed time, using as few resources as possible.

*'''Resources Limited''': Projects must be execute by not exceeding specific level of resource usage or general resource constraints.

*'''Resource Over-allocation''': Assign more tasks than what resources can handle within the standard workweek time frame. A company with multiple projects and a limited pool of resources often risk to encounter this issue, this can lead to overtime and overspending on financial resources.

=Resource Allocation Techniques=

“The schedule produced for a project assumes that enough manpower and equipment is available to get the activities done as scheduled. This is not always the case, and in a large or complex project, it might not be obvious that a deficiency exists.” <ref> The Associated General Contractors of America(AGC) (1976). The Use of CPM In Construction.</ref>

“Resources required by activities are unlimited, while some resources are highly limited in practice. In most real construction projects, scheduling without considering resource limitations may result in a non-credible schedule, since the start-ability of activities is affected by resource availability.” <ref> Kim, Kyunghwan (2003). “A Resource-constrained CPM (RCPM) Scheduling and Control Technique with Multiple Calendars” - Virginia Polytechnic Institute and State University PHD. Dissertation. - https://theses.lib.vt.edu/theses/available/etd-06272003-143644/unrestricted/ETD.pdf. </ref>

There are different solutions and techniques to tackle the problem of resource allocation, identify the right one for a specific business is crucial to ensure the effectiveness of the procedure.

===Resource Leveling===

The aim of leveling resources is to minimize the variations in resource loading by "Shifting tasks within their slack allowances". <ref> Schwalbe, Kathy (2007). Information Technology Project Management 5th Edition.</ref>

The technique is applied to resolve conflicts and to create a smoother distribution of resources, determine the correct resource requirements to ensure availability at any given time and to schedule the activities in order to secure the smoothest achievable transition across usage levels.

In resource leveling resources should be assigned to those activities with:
*Minimum slack <ref> Scheduling projects: How to determine the critical path using activity slack calculations? - http://www.pmknowledgecenter.com/dynamic_scheduling/baseline/scheduling-projects-how-determine-critical-path-using-activity-slack-calculations - Online, Checked on 15/09/2016 </ref>
*Shortest duration
*Earlier start
*Most amount of successor tasks
*Highest resources requirement

====Steps====

[[File:Activity-Network-Diagram-Example-Chart-2.png‎|thumb|320px|sub|Figure 1 - Activity Network Diagram - Construction Building Example]]
*1- Create a project activity network diagram.
It is the sequence of project activities that shows the sequential relationships between them with arrows and nodes. This tool is widely used in project management and is required to identify a project’s critical path (used to determine the expected completion time of the project). The nodes represent the nine activities required to build a construction, the arrows that connect the different nodes show the process flow. [Figure 1] It is possible to identify different type of activities, A,B,C run in series, i.e. is not possible to proceed with the activity B if A is not completed. D,E,F run in parallel, they must all be completed before G or H can be executed. A network diagram is also essential in identify the critical path, the path which has the longest completion time. <ref> Six Sigma Daily (2012). “The Activity Network Diagram” - http://www.sixsigmadaily.com/the-activity-network-diagram/ - Online, Checked on 15/09/2016</ref>

*2- Create a table showing resource requirements, duration and available slack for each activity.
In order to allocate resources optimally and identify project resource gap it is important to have create a complete overview of each activities' requirements. This will help in identify the difference between available and required resources. This stage is crucial as different approaches can be taken, e.g. adding more resources, prolong the schedule, hire more labor force.
<ref> I.T. Toolkit. “How to Use Resource Leveling for Project Planning and Scheduling” - https://www.ittoolkit.com/how-to-it/projects/resource-leveling.html - Online, Checked on 15/09/2016</ref>

[[File:Gantt_chart_ex.gif‎‎|thumb|520px|sub|Figure 2 - Gantt Chart Example]]
*3-Develop a resource loading table or Gantt chart .

"Is a instrument that addresses the determination of realistic due dates and other important milestones for new customer orders, as well as the resource capacity levels that are a result of the actual set of orders in the system" <ref> Willem Hans, Elias (2001). “Resource Loading by branch-and-price Techniques” - Twente University Dissertation - https://www.utwente.nl/bms/iebis/staff/hans/phdhans.pdf - Online, Checked on 15/09/2016</ref>

Gantt chart is a project planning tool used in project management, it is used to show the timing of tasks necessary to fulfill project's requirements. Each line represent a different task and they are represented on a time-phased scheme, the expected time is represented by a horizontal bar where the left end represent the expected beginning of the task and the right end the expected completion date. As in the network diagram tasks may run in sequence, in parallel or overlapping. <ref> Durfee, W. (2008). “Project Planning and Gantt Charts” - University of Minnesota - http://www.me.umn.edu/courses/me2011/handouts/proj_planning.pdf - Online, Checked on 15/09/2016</ref>

===Prioritize Projects===

Organizations often struggle to balance a growing list of incoming projects while the need for core services continues. Prioritizing projects avoid pressure on individuals or teams in presence of over-allocation or task conflict. It is essential to decide how to prioritize projects and separate high priority projects from lower ones. A prioritization matrix can overcome such problems.

[[File:Prior_matrx_example.PNG‎‎‎|thumb|420px|sub|Figure 2 - Gantt Chart Example]]
====Prioritization Matrix====
"A prioritization matrix is a simple tool that provides a way to sort a diverse set of items into an order of importance." <ref> Gosenheimer, Carol. (2012). “Project Prioritization, A Structured Approach to Working on What Matters Most” - Office of Quality Improvement, University of Wisconsin-Madison, Division of Enrollment Management - https://oqi.wisc.edu/resourcelibrary/uploads/resources/Project_Prioritization_Guide_v_1.pdf - Online, Checked on 15/09/2016</ref>

A Prioritization matrix bring different benefits:
*Quantifies decisions with numeric rankings.
*Facilitates agreement on priorities.
*Provides a quick and reliable to evaluate options.
*Help in the prioritization of complex issues.

====Steps====

*1- Agree on the objective to be reached and identify the key project stakeholders
It is necessary to ensure that the whole team, working on the matrix, is fully aligned on the ultimate goal to achieve

*2- Identify which projects should be evaluated for prioritization.
The expertise and the knowledge of the involved participants are required to outline which projects should be compared on the prioritization matrix.

*3- Identify the criteria required to meet the goal
Create a list containing all the characteristics needed to achieve the prefixed objective. Through brainstorming and discussion the team should align on these criteria. Few examples:

-Ease of implementation

-Customer satisfaction

-Use of technology

-Potential Saving

-Investment cost

*4- Compare criteria importance by allocating a value to each criterion on a agreed scale.
Judge the importance of each criteria comparing it with the other. These number will results at some extent arbitrary. However, by keeping them constant and applying them in a prioritization matrix it will be possible to reach an accurate standard.

*5- Compare each project's impact on each criterion by rating them with the same scale used in step 4.

*6- Compare the projects against the weighted criteria
Once the importance of each criterion and project is stated is possible to evaluate how they meet each other. By multiplying each project rating with each criterion rating it is possible to retrieve the score for each project for each criterion.

*7- Compare the final result
Once all the scores are added up for each project is possible to outline which ones should be prioritize
<ref> Jain, Ankur. “Using a Criteria-Based Matrix to Prioritize IT Projects” - I, Six Sigma - https://www.isixsigma.com/operations/information-technology/applying-criteria-based-matrix-prioritize-it-projects/ - Online, Checked on 16/09/2016</ref>
<ref> Bonacorsi, Steven. (2011). “7 Steps to Using Prioritization Matrices” - PEX, Process Excellence Network - http://www.processexcellencenetwork.com/lean-six-sigma-business-transformation/articles/process-excellence-methodologies-using-prioritizat - Online, Checked on 16/09/2016</ref>

===Linking Tasks===

Linking similar task to different projects. If a resource have been allocated to a task which is similar across different projects

===Leaving Breathing Room===

===Avoid "Putting out Fires" approach to PM===

=Conclusions=

The process or resource allocation can be described as the company activity of placing in the best possible way its scarce resources. The strategy is to bring to customers, goods and services, whose fully satisfy the expressed request, by matching matching their preferences utilizing the lowest possible production cost. Resource allocation is an ongoing process through all the project span, it must be kept monitored to ensure efficient use of resource and identify all problems.

=References=
<references />

Resource Allocation in Project Management

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Resource Allocation in Project Management

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File:Prior matrx example.PNG

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Resource Allocation in Project Management

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File:Gantt chart ex.gif

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Resource Allocation in Project Management

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File:Activity-Network-Diagram-Example-Chart-2.png

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Resource Allocation in Project Management

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Resource Allocation in Project Management

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