As a CIO or PMO, you juggle a large portfolio of projects on a daily basis, in which you have to manage both ongoing projects, but also incoming requests.
However, no matter how much you plan the available resources as much as possible, prioritize the various projects, align the teams... the demand keeps coming in, and all your schedule ends up going downhill.
What if one of the answers to this daily challenge was in two words: Capacity Planning?
In this article, find out a clear definition of Capacity Planning, as well as its basic principles to start managing the capacity of your resources with the greatest care.
The definition of a Capacity Planning is simple. It's abouta method for evaluating, planning, and managing the resources needed to meet the needs of an organization, over a given period of time to come. In French, we also talk about capacity management, or capacity management.
The main objective of Capacity Planning is toalign the capacity available in the company with the demand collected. Thanks to this approach, you prioritize your projects strategically, by launching the right initiatives, at the right time, and with the right resources.
So, with a well-developed Capacity Planning, you can answer questions like:
In this sense, this method is ideal for organizations that need to manage a large portfolio of projects, and who need to find the balance between the company's strategy and the reality of what it can achieve over a given time. The good news: it is possible to do Capacity Planning for any sector of activity - IT, retail, industry... or any type of project: IT project, headquarters move project, implementation of a new HR process...
At Airsaas, we generally focus on human resources - which is the most complex element to manage in a capacity plan, at a time when the majority of business transformation projects are cross-cutting.
Thanks to Capacity Planning, you can better allocate your available resources according to business priorities, and thus avoid waste.
How many projects have you already had to abandon, how many projects slide from month to month due to lack of sufficient resources, or a good prioritization of initiatives? Your Capacity Planning allows you to obtain a global vision of resources over the coming period, which makes it possible to limit delays on your projects.
By forecasting team workloads, you can anticipate bottlenecks or, conversely, the recruitment or outsourcing needs that you may need to move your projects forward.
To design a Capacity Planning that works, you must necessarily prioritize the resources to be allocated to the various projects. This methodology invites you to prioritize the progress of projects based on your company's strategic goals - your management will love it!
Your Capacity Planning makes it possible to predict what budget should be allocated to each project or each team, and therefore, to anticipate the costs to be expected. Better overall budget management is up to you.
As a result of all the previous benefits: better forecasting makes it possible to better distribute the tasks and deliverables to be carried out, and therefore, to optimize everyone's productivity.
Thanks to your Capacity Planning, all your stakeholders, from management to employees in all teams, are more satisfied with the way you manage projects.
On the one hand, you improve your skills management by assigning the right tasks to the right resources. Result: teams no longer face an overload of work, and are more valued according to their real skills. Enough to make your employee satisfaction blossom.
On the other side (that of the end customers), you deliver the expected product or service as soon as possible. And since it is produced with the best resources available, its quality is optimal.
And for the IT teams, no more regular harassment to launch this project, which is so important for businesses, which you must always put off until tomorrow because you have not been able to prioritize it in the roadmap!
You now know the definition of Capacity Planning, and its benefits. So where do you start to deploy it in your business?
First of all, you need to identify your company's current capacity in terms of human skills and bandwidth to allocate to projects.
This step requires you to have a precise vision of the current use of these resources, on planned or ongoing projects, as well as on daily work outside of its projects.
When doing your Capacity Planning, you will quickly notice that the most complex element to manage is the estimation of the workload available to each individual, and therefore, the time they will be able to spend on projects.
When you analyze your team's bandwidth, identify everyone's recurring tasks and group them into dedicated blocks of time, such as half-days. This approach allows you to focus effort and improve efficiency, rather than simply distributing tasks over time, or managing by percentage of availability.
At this stage, you can also identify bottlenecks that are already present in projects, which Capacity Planning will solve.
In a second step, the objective is toidentify projects that need resources in the future, over a given period, and to estimate the resources that should be dedicated to it.
To do this, base yourself on the vision of the global business strategy, projects that are in the process of framing or at the stage of discussion. This vision guides the prioritization of projects in your portfolio: it is therefore it that justifies you prioritizing certain resources on this or that project. We know it: it's easier said than done, but that's the objective!
Historical data on past projects is often difficult to obtain (unless you already have Airsaas in place, of course). But a key point for good Capacity Planning is to analyze the overall pace of the organization and that of each specific area — HR, finance, IT, operations, etc.
Each function has cycles and constraints that directly influence the time available for projects. For example:
If you don't take these natural rhythms into account, you risk assigning unrealistic burdens to teams, leading to delays and loss of efficiency. By understanding these variations, you can better anticipate actual availability and plan projects accordingly.
To explore the subject further, go to our article “Demand Planning and Capacity Planning: What are the differences?”.
At this stage, you get to the bulk of Capacity Planning: you must align capacity and demand based on strategic goals of your organization.
To do this, you have several strategies in your arsenal:
In any case, as part of a very broad project portfolio, be ready: this alignment between capacity and demand will often require negotiation with business lines and management. Good practice: align everyone on the priorities to be established, using methodologies like the PI Planning Or the Quarter Plan.
These methods require moving from planning over a short period of time (per week or month) to projecting over a longer period of time, such as a quarter, semester, or Program Increment (PI). By doing so, you ensure that you are creating a capacity adapted to the scale of your organization and the transversality of your projects.
And remember that the whole art of Capacity Planning is based on implementing flexible AND synchronous planning that can adapt to organizational or strategic changes. A big challenge, but worth the effort!
To go further, discover the key steps to create your capacity plan.
Once your Capacity Planning is established, it is not a question of leaving it as it is. With the variation in demand, and the available resources that fluctuate, your capacity will necessarily change over time. Hence the interest in monitoring and adjusting it on an ongoing basis.
First, use Key Performance Indicators (KPIs) to assess the effectiveness of Capacity Planning, such as:
At the same time, set up regular checkpoints to adjust demand management and capacity planning over time.
And for a successful Capacity Planning, apply our best practices for successful capacity planning.
Setting up a capacity is often a cumbersome and time-consuming process. Many businesses do this on an Excel spreadsheet, which is generally impossible to maintain over time later.
So should we completely abandon the idea of having a truly effective capacity plan?
Not really. To respond to this problem, at Airsaas, we have a bias: we prefer to have a capacity that is approximately right rather than precisely false. And it is to put this bias into music that we have developed a team Capacity Planning platform.
Thanks to Airsas:
On the Airsaas platform, the Capacity view is simple and actionable. It helps you know what the capacity is in each team, what deliverables are hampering the progress of your projects, and what your needs for additional resources are.
Result: you set up a pragmatic capacity, at the macro level, which makes it possible to prioritize with Top Management which projects to launch or not. This does not prevent you, at the same time, once your projects are organized over time, from producing a capacity for the person over a maximum of 2 to 3 months... that you can really maintain!
Enough to make better decisions in terms of prioritization and capacity planning.
Interested in Airsaas' Team Capacity Planning solution? Request a demo today, and streamline your project portfolio management while creating engagement in your teams.
