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Profit & Growth Tips for Digital Agencies

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What's The Difference Between Project and Resource Management?

Posted by Laura Hernalsteen on Dec 18, 2015

Whats_The_Difference_Between_Project_and_Resource_Management.jpgAs your digital agency grows, it reaches a point where you’ll need to take on a more strategic role to ensure continued growth, and it becomes harder to keep track of your agency’s projects.

But you need to know that the work is still getting done, deadlines are being met, and understand how to maximise the agency’s profitability as you move forward.

Many agencies will rely on Project Management tools to keep staff motivated and the team on-track. But could Resource Management be a better way to balance your agency’s growing team and workload?

Today I’m looking at the difference between Project and Resource Management, and how each impacts your digital agency’s productivity and profitability.

What is Project Management?

Project Management (PM) is a way of planning and managing an individual project in terms of the tasks that need to be completed in order to achieve the end goal.

Project Management tools give a detailed look at the tasks that make up the project, so are great for managing a team’s workload – allocating tasks to specific team members, and setting deadlines. These tools are something that staff would consult during their working day to shape their priorities – in that way, they’re great for short term planning.

A common approach is to outline the project using tools like Gantt charts, breaking down the project into dozens of detailed tasks and sub-tasks with start and end dates, and displaying this visually so you can see how it should progress from start to finish. Alternatively, your agency might prefer an agile approach, and break the project into short sprints (normally up to a month in duration). You‘ll agree with your client the tasks you’ll be working on during this sprint from a backlog of outlined ideas.

These approaches work fine if you’ve just got one project on the go, but what happens when your team is working on several projects at once?

The single-project focus of Project Management means that PM tools are limited in their usefulness to anyone looking for strategic insight. Agency directors, like you, need to be able to take a step back and get an overview of all your ongoing projects, measure the profitability of each, and work out what you could change in the future to make projects more profitable. For this, there’s a better alternative: Resource Management.

What is Resource Management?

As its name suggests, Resource Management shifts the focus away from the tasks to be done, and on to the key resources required – budget, skills and time – to maximise the profitability of those tasks. Resource Management provides an overview of your agency’s resources, and how they are allocated to each project.

As a director, you can see which projects are on the go, whether they are running to time and budget, and who is working on what. It also helps you to identify any shortfall in resources, and redistribute or add more resources as necessary.

Your employees can track their time, like they would with a Project Management tool, but with a slight difference. When using a PM tool they might log their time spent on each sub-task in a project. This can become a time-consuming process and lead to your employees making lots of ‘educated guesses’ as to how long they spent working on what, especially on large projects with lots of closely linked sub-tasks.

In comparison, with a Resource Management tool they wouldn’t break their work down further than individual projects, making it quicker to log time. This will provide you with a summary of what is taking up the majority of your team’s time, which will help with high-level planning for the next stage of the project.

Unlike a Project Management tool, which goes into great detail about the work required for each project and the time taken, Resource Management tools show the ‘big picture’: perfect for informing your agency’s strategic decisions.

Should my Digital Agency use Project or Resource Management?

Project and Resource Management are two sides of the same coin, using different approaches to manage your team’s workload and helping to maximise your agency’s profitability. So the short answer is that you should use both, for different purposes.

Project Management tells Alexandra to "Write Email Body Copy" within the "Email Campaign" task list, for the "Mitsubishi Car Launch Project". When the project is complete, Project Management helps Alexandra's manager to see whether she spent appropriate time writing the email's body copy.

In comparison, Resource Management assesses whether Alexandra is the best person to work on the car launch project, and if so, leaves it to Alexandra's team to manage her workload with a Project Management methodology and tool of their choosing. Once the project is complete, Resource Management tells Alexandra's Managing Director that she spent a day on the Mitsubishi Car Launch Project overall, costing the company €400, and that a new junior hire, Leon, could do the same work for €200 next time.

Resource Management and Project Management are important, complimentary methodologies. Using both methodologies and tools in combination will help to maximise your digital agency’s productivity and profitability.

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