Managing Resources

Many projects in our organisations tend to be set up without adequate planning and resources and lurch from one crisis to another as priorities are changed and resources diverted. In the section 'Do we need Programme Management?' we have already considered why it does not make strategic or economic sense to fund too many small independent projects that cannot achieve economies of scale.

In managing a programme you have the opportunity to ensure that resources are co-ordinated effectively across the whole range of projects. It may seem obvious (but it is nonetheless a common mistake) to state that this isn't achieved simply by acquiring a detailed set of resource requirements from each of the projects and adding them all up. This is akin to every small unit in your organisation having its own over-stocked stationery store or its own set of meeting rooms that are rarely used (yes we know both of these things happen more often than not).

There is no magic formula for getting resourcing right - it is a question of prioritisation and managing capacity. The starting point is the key milestones on each of the projects and the interdependencies between them.

Managing Budgets

We have already covered the topic of ensuring that project budgets are sufficiently flexible to cope with the realities of operating in a situation where you are doing something for the first time and are faced with a lot of uncertainties by setting Tolerance Limits for individual projects.

The section in the Risk Management infoKit on Costing Risk is essential reading for any Programme Manager. This provides you with a method for providing a realistic estimate of the likely cost of dealing with the major risks that could affect any of your projects. It also gives you a means of calculating necessary contingency for a range of minor risks that might occur. You now need to manage the budget for this effectively. Specific budget amounts to deal with major risks should only be released to individual Project Managers if the risk actually occurs. In other words this contingency you have set aside is not a 'slush' fund for them to draw on at will. Managed effectively this is a much more appropriate method of allocating resources than having multiple 'jam jars' of contingency funding in multiple small projects.

In the education sector the average Project Manager is likely to be given a budget (and if they are lucky a tolerance range) and asked to work within it. The budget is assigned on the institutional finance system and, unless the project spans financial years, the money is therefore 'available' from day one. Very large projects may be required to do more detailed expenditure profiling and at Programme level things again become more complicated because you really do need to consider the issue of cash flow.

Where projects are externally funded the grant may actually flow into the institution in small chunks either monthly or when key milestones are passed. Where, as often happens, there is a lot of procurement activity needed to get the projects off the ground, the organisation may have to fund this early expenditure from its own sources or by borrowing. For similar reasons projects running ahead of schedule could pose a problem if it means that bills have to be paid sooner than expected.

N.B. Projects running under budget can signal issues to be investigated as well as this may be a sign either that corners are being cut and that a check on quality might be necessary or that there has been inaccurate or sloppy estimating. If an underspend has been caused by inaccurate estimating then it may be that funds have been earmarked that could have been freed up for use elsewhere within the portfolio. Valuable work may have had to be postponed or even cancelled because of this.