Effectively utilizing every resource for long-term success takes consistent effort. Sometimes, resource utilization rates can slowly slip, which can negatively affect projects and profitability. Without constant diligence and a resource management solution that reports and helps to improve utilization rates, it’s easy for resources to become underutilized, without either managers or team members themselves noticing.
Stay on the lookout for the following four signs that can alert you to when your resources are becoming underutilized so that your business can start strengthening its resource management strategies and making the best use of each team member.
Sign 1: Increasingly Slim Project Margins
Properly utilizing each resource means that a company’s employees will become more profitable, making the most of their time, taking on new tasks that increase the amount of projects that can occur, and making more money for a business overall. Underutilized resources have more unnecessary bench time that takes away from project profitability and, in turn, slims profit margins, which will only continue to decrease over time. While some bench time and non-project work is necessary for every team member, too much can cause projects to cost more money than they make.
Course Correction: Get a detailed view of utilization rates for each resource and determine what your ideal utilization rate is for each team member. Afterward, begin assigning more tasks and deadlines as necessary to decrease benchtime and start strengthening margins.
Sign 2: Missed Project Deadlines
Setting correct deadlines and hitting them in a consistent, predictable manner requires each member of a team to be properly utilized. Frequently missing deadlines can mean that related resources are not being properly utilized and are not being effectively used in the projects that are depending on them to meet deadlines. If a company does not use Gantt charts or similar task-tracking solutions, project timelines and the work needed to keep them on track will veer off course.
Course Correction: Determine the exact tasks, related skills, and appropriate resources needed for a project before beginning work so that the right team members are assigned and kept on task until the project is completed.
Sign 3: Fast, Lopsided Burnout Rates
Poor resource utilization typically results in some team members being underutilized while others becoming overutilized. This can be seen in faster burnout rates seen in specific departments, teams, and positions. This can lead to quick turnover in specific areas of the company, destabilizing teams that are taking on more work than they should and frequently losing members due to being overworked.
Course Correction: Encourage feedback from team members regarding their workload and redistribute responsibilities to balance out tasks across the organization for less burnout and more equalized resource responsibilities. Normalized turnover rates will indicate that the workload is likely improving.
Sign 4: Lower Employee Satisfaction
Being underutilized may mean that team members do not experience a high level of burnout that comes from being overworked, but it also results in dissatisfaction with daily work life. Boredom, lack of focus, and less enthusiasm for daily tasks can all result from underutilization. These lower levels of employee satisfaction can have a negative impact on how resources approach their work, leading to further complications throughout an organization.
Course Correction: Send out regular employee satisfaction surveys that allow resources to voice their feelings on their work to see where improvements, including healthy utilization, are needed. Clear insights into utilization improvement needs can mean focused, consistently strong utilization rates for each resource.
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