How many times have you had to urgently reallocate resources to a priority project, at the expense of another equally strategic one?
How many times have you had trouble justifying that you could not launch these three new tactical projects?
How many times have you felt the frustration of your interlocutors at your explanations, when you said “we can't do everything”?
For you, CIO, PMO, or project manager, poor capacity management leads to unpleasant situations and complicated relationships with the rest of the business. Not to mention the teams that can burn out by running behind all the rabbits...
For the company it is synonymous with a financial abyss. Mismanaging your resources means wasting a lot: delays and financial losses... not to mention the stress of such situations!
The solution? A well-thought-out Capacity Planning, which helps you avoid these pitfalls by optimizing the use of resources according to the changing priorities of your business.
However, at Airsaas, we know how easy it is to get lost along the way, and to end up creating either a gas factory... or nothing at all!
Don't panic! This guide gives you all the keys to building an effective Capacity Planning and controlling your production capacities : steps to follow, best practices and tools.
Start your dive into the Capacity Planning method by looking at its definition - just to get started on the right foot!
Capacity Planning is a method forassess, plan and ensure optimal resource management to meet the needs of the project portfolio /portfolio of a company's initiatives. This methodology takes into account the management of human and financial resources. This method can also be found under the names of capacity management, capacity management, or capacity plan.
The ultimate goal of Capacity Planning is toTo align the capacity available in the company with the expected demand, by finding the balance between the company's strategy and what it can actually produce over the period.
This methodology thus makes it possible to know what workload to assign to the teams, and whether more human resources are needed to carry out the projects.
Be careful not to confuse Capacity Planning with a simple method of short-term resource planning, where the company's capacity is matched with its current needs. Here, we want to predict the allocation of resources over a longer period of time, to meet future demand.
For a deeper definition of Capacity Planning, this is where it happens.
As a project manager, CIO or PMO, it is common to mix brushes between different concepts. However, here, it is important to understand the differences between demand planning and capacity planning.
On the one hand, Capacity Planning makes it possible to plan the resources necessary to meet needs already identified (on ongoing or validated projects), and to check whether or not the workload is passing on to the teams.
On the other hand, what is generally called demand planning (or demand management) consists in forecasting future demand for projects that arrive in the portfolio pipeline.
These two concepts have some differences:
However, despite their differences, these two methods are fundamentally complementary. On the one hand, by planning demand, you are answering the question “What projects should we do?” On the other hand, your capacity management answers the question “Can we do these projects?”
In short, demand management allows you to channel projects, to launch those that can really be carried out, rather than embarking on a thousand initiatives that, even if they are good, may well never succeed.
At Airsaas, we always recommend scheduling demand management meetings (or request reviews) every two weeks, to collect demand.
A good practice is to create duos by domain and solution - for example: HR IT Leader - HR Business Leader. The Business Leader analyzes the requests and exchanges every 15 days with its dedicated IT Leader, to qualify the requests and guide their treatment: already processed, request not in accordance with the objectives of the organization...
To go further Listen to the episode of our podcast where we talk about Flash Design with Isabelle Perussy.
So, Together, these methods balance needs and resources, and maximize operational efficiency. of the company.
To fully understand these differences, read our article “Demand Planning and Capacity Planning: What are the differences?”.
In an organization where business projects are mostly transversal, Capacity Planning becomes a crucial tool. How many projects, which nevertheless carry so much value for the company, are postponed month after month, due to the lack of transversal human resources planning?
In this context, a capacity makes it possible to collectively prioritize the projects to be carried out, by aligning everyone around a positive dynamic.
Thus, thanks to a well-oiled Capacity Planning, we observe:
In short, the Capacity Planning method means less waste of resources, more projects that reach the end, and more commitment from all your stakeholders.
Something to want to get started, isn't it?
Here you will find a summary of the various steps to create your own Capacity Planning. To go into detail, do not hesitate to read our article on the 7 steps to create your capacity plan.
First, it is necessary to create an organization by teams that correspond to homogeneous groups of skills. For example IT Security, IT data, IT infra, IT infrastructure, Finance, ERP, Corporate... this will allow you to break down your initiatives by homogeneous competence group, which is very practical for building capacity on a quarterly basis.
Then, for each group of homogeneous skills, Define run time and build time
Attention to this point: We must redefine the run and the build collectively. For example, it is dangerous to leave upgrade requests in the run: it is better to put them in the build. The run could rather be seen as first or second level support. Anything that creates value through “construction” is build - if not, how do you value it?
Then it's aboutidentify priority projects in view of the company's strategic objectives. To do this, you can rely on decisions made by the various professions and management, but also on historical company data, and market trends.
At this stage, closely compare the current capacity of the teams with the expected demand over the period. Here you can identify bottlenecks and teams that have more time.
Here, you get to the heart of Capacity Planning. It's about putting strategies in place to balance capacity and demand.
To do this, you can choose to modulate demand, by deprioritizing certain projects or deliverables at a later date or, on the contrary, by prioritizing other projects.
But often, it will be more a matter of adjusting capacity. Several levers are available to you here: recruitment of human resources, training in the skills you need, outsourcing certain deliverables, implementing supporting technologies...
Various capacity adjustment strategies exist, including:
We recommend that you apply the last strategy, which is the most ROI without affecting your company's production capacity.
Now, implement the actions identified in the previous step. Also implement a tool that makes it possible to monitor the evolution of demand and capacity over time, so you can adjust Capacity Planning as needed.
Good news: we'll give you more information on the subject in the last part of this article!
Once your Capacity Planning is created, the question is whether it is generating the expected results.
To do this, track key performance metrics to know if your capacity plan is effective, such as:
Also, remember to bring your stakeholders together regularly to take stock of demand or resources - and then repeat each of these steps for good management of production capacity on an ongoing basis.
The previous steps give you a good methodological basis for creating your capacity plan. Now, discover best practices for creating a Capacity Planning that allows you to truly engage teams, and align them with strategic business goals.
If necessary, these keys to success (and others!) are detailed in our article on best practices for successful capacity planning.
Capacity Planning is necessarily political - because after all, prioritizing means giving up (even if only temporarily). So your primary objective should be this: to ensure that your Capacity Planning aligns everyone around the company's strategy.
To do this, go through a collective moment to align all stakeholders (including management and businesses) around this vision, and the resulting priorities in terms of deliverables.
During this collective moment, everyone can also identify the risks and dependencies between the different projects, and think about the real capacity that their team can allocate to each project.
To dig deeper into the subject, discover two collaborative methodologies for prioritization and organization:
With these methods, you avoid wasting your energy into one-to-one meetings, and instead capitalize on a big meeting where everyone lines up. Only good!
Deploy your Capacity Planning on a period longer than a week. Why? Because it allows you to get a capacity that is approximately right rather than precisely wrong.
Indeed, with the fluctuation of demand and capacity, a capacity at the scale of one week quickly becomes false, and must be revised nonstop.
With Capacity Planning at the scale of a quarter, semester or PI, you align yourself with the reality of the work that teams must provide.
What's more, organizing your project portfolio over a longer period of time creates positive pressure. The teams make sure to finish their deliverables before the end of the period, and to clearly define the needs they will have for the period to come.
Not to mention the fact that you are deleting a lot of useless meetings: all it takes is one meeting every month, and no longer a (painful) weekly meeting, so that everyone can focus on “doing it” and not on “meeting” anymore.
And of course, this does not prevent you from creating agendas on a per task basis and at the scale of one week for each team.
When establishing a Capacity Planning, it is common to get lost in the details of micro-tasks... which, in fact, should be the responsibility of each team's project management!
To avoid this, take a pragmatic approach, and design Capable of the deliverable, not the task. Faced with this Capacity Planning, each project manager then manages their own division of tasks - and you continue to manage your project portfolio in a macro way.
At the scale of a (small) team, and over a fairly short period of time, a Capacity Planning designed at the level of individuals can work. But if you want to define a capacity across your organization, you will quickly find yourself tearing your hair out...
So give priority a capacity that takes into account the capacity per team, not per individual. This allows you to focus on what really matters in the project management portfolio, namely: the build.
Attention: by team, here, we mean “a combination of homogeneous skills”. For example, you can choose to segment the IT team into several skill groups, separating IT Security, IT Data, and IT Integration. For the marketing department, you can segment resources between Content marketing team, CRM marketing team, and other marketers.
Thanks to this advice, your Capacity Planning becomes more flexible, and allows each team to adapt their workload to the planned schedule.
Plan in your Capacity Planning margins that make it possible to deal with the unexpected that every business encounters - because a project almost never goes as planned!
Therefore, adopt an iterative approach, by regularly convening your stakeholders to review your Capacity Planning. Again, this is what Quarter Plan and PI Planning methods allow you to do, which can be adapted to your organization.
If you have already implemented Capacity Planning, you know how quickly relying on an Excel table can become unmanageable. Good management requires a collaborative tool, capable of adapting to fluctuations in demand and variations in resources in real time.
It is precisely to support CIOs, PMOs and project managers in the management of their production capacity that we developed the Airsaas Capacity Planning feature.
With Airsaas, you are building a Capacity view per team over the period of your choice: quarter, semester or PI. This approach allows you to focus on building the business in real life. Each team enters directly into Airsaas the resources available to contribute to ongoing projects.
Then, simply simulate different scenarios to adjust resource allocation based on strategic priorities. With the Capacity View, you can instantly identify bottlenecks and additional resource needs.
Stop wasting precious time on complex and time-consuming follow-ups: adopt effective and pragmatic Capacity Planning with Airsaas!
You are now armed with all the steps and best practices to build your Capacity Planning. Request an Airsaas demo today, and make this task simple and collaborative, for capacity management that is truly aligned with your business strategy.
