Here are Three Reasons to Plan for Reserve Resources

Sunday, August 6, 2017, 6:00 AM | Leave Comment

When a project is first defined, you rarely know exactly all the resources you will need. As the project initially progresses, however, you start to define the scope, assumptions, deliverables, approach, etc. This gives you enough information to put together an initial estimate of the resources required for the project.

So far, this is nothing new. All projects have some level of uncertainty. If possible, you account for the estimating uncertainty through the use of a contingency budget, or by adding an uncertainty factor in your base budget estimates.

The nature of some projects requires that the project manager take this contingency even farther. On some projects, you must actually plan for what the contingency resources look like and how you will get them when needed. These could be labor or non-labor resources, such as hardware, equipment or supplies.

There will be a couple times when you need to plan ahead for reserve resources.

  1. Time is of the essence

    In your deadline date is critical and cannot be moved, you may not have time to look for new resources when you first realize you need them.

    You may have to have already made plans for where they are and how to acquire them.

    Having resources identified and in reserve would allow you to move quickly if you determined more were necessary.

  2. High incremental costs for additional resources

    You may have resources that are less expensive when purchased in bulk, but very expensive when purchased incrementally.

    For instance, if the solution you are building requires new equipment, you may find that the price per unit is less as you purchase more units.

    Let’s say that you estimate you will need 100 units. Depending on your estimating uncertainty, you may choose to purchase 110 instead, and have ten units in reserve.

    You would do this because the price to purchase the extra ten units now (as a part of the bulk order) is much less expensive that having to purchase ten units later, when the incremental cost would be much higher.

  3. Long lead times for specialty resources

    Sometimes there is a long lead-time to acquire hard-to-find specialty resources.

    You may need to have them in reserve if needed. For example, you may work with consulting firms ahead of time to find specialty resources, such as experts in some obscure tool, with the understanding that the requirement is not 100% firm.

    The firms can work ahead of time to locate these people and try to have someone available on short notice in case you need them later on the project.

These are reasons why you should consider planning ahead of time for contingency resources. The need for project reserves would typically be identified and managed through the risk management process, with reserve resources being a response to a specifically identified resource risks.

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This column is © copyright to and originally appeared in their weekly project management tip newsletter.

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