How do I accomplish this kind of budgeting/resource allocation?

[Patrick Allmond]

I know what I want to do with the resources but I cannot get MS Project to
do the math correctly.

I have a resource. Since people are not productive 100% of the time I need
that resource to be at around 70-75% effective in MS Project. In truth they
will be on the job 8 hours a day. But for productivity calculcation I'd like
them to be less that 100%. The resource will not be working on anything
else.

At the same time the resource costs me a price per hour for an 8 hour day.
I'd like that to be figured out properly also. If the person charges me
$1/hour to work, I'd like to see that every day s/he is on the project costs
me $1. At the same time I need to see that an 8 hour task will actually take
more than one day, and cost me over $8.

I tried changing the % utilized on the resource but the cost does not get
figured out correctly. If I change it to 70% and schedule an hour task, the
project only shows that it costs me $0.70 . In reality that tasks costs me
more than a $1.

Thank you
Patrick

 

[John]

I know what I want to do with the resources but I cannot get MS Project to
do the math correctly.

I have a resource. Since people are not productive 100% of the time I need
that resource to be at around 70-75% effective in MS Project. In truth they
will be on the job 8 hours a day. But for productivity calculcation I'd like
them to be less that 100%. The resource will not be working on anything
else.

At the same time the resource costs me a price per hour for an 8 hour day.
I'd like that to be figured out properly also. If the person charges me
$1/hour to work, I'd like to see that every day s/he is on the project costs
me $1. At the same time I need to see that an 8 hour task will actually take
more than one day, and cost me over $8.

I tried changing the % utilized on the resource but the cost does not get
figured out correctly. If I change it to 70% and schedule an hour task, the
project only shows that it costs me $0.70 . In reality that tasks costs me
more than a $1.

Thank you
Patrick

Patrick,
In my humble opinion you are trying to calculate something that is not
really an issue in real life. Very few, if any, people are 100%
efficient and if they are it is probably for only a limited period of
time. It's kind of like worrying about the work not getting done during
off hours (e.g. lunch, potty breaks, sleep, etc.). Most plans are
created based on historical data or educated estimates which include the
inefficiencies that are part of our real world (even machines have down
time for breakage or maintenance). Unless you have a workforce that is
EXTREMELY inefficient it is not normally something to worry about - it
all works out in the end. Now, that's not to say that improving
efficiency is not worth the effort. Far from it. Improved efficiency
makes a company more competitive and therefore more profitable. I'm just
not sure its worth trying to incorporate efficiency factors into a
project plan - there are just so many other factors that will have a
much bigger impact (e.g. the planned design approach won't work, vendors
don't deliver on time, the "simple" re-flooring job turns out to involve
complete replacement of the subfloor due to unknown water damage, etc.)

Ok, off the soapbox. I guess if you really want to cover all bases I
would start as you did by adjusting the % allocation to whatever
efficiency factor you deem appropriate for each resource. Then in
addition, adjust the pay rate for that resource so you will get the cost
values you expect. For example, if the normal pay rate is $1/hr but the
resource is only 70% efficient, change the pay rate to $1.43/hr. A lot
of work - will it be worth it?

Hope this helps.
John
Project MVP

 

[Patrick Allmond]

John,

I appreciate your comments and they are headed. I was trying to balance my
experience (lack of 100% efficiency) with using my project plan as the
budget to ask for funds. The final bottom line number is what I will be
asking for to get this project.

I was experimenting and I think what the best approach for me is to leave a
resource at 100%, cut down the working day by two hours (from 8-5 to 8-3)
and increase the cost per hour as you suggest.

If I go back and pad my numbers for 'waste' if you will then I will have to
update EVERYTHING. I can just go change the resources costs and the
task/project costs get updated automatically. And my hours will still be
realistic in the plan.

Do you still think it is better to pad the numbers to account for waste in
this case?

Patrick

 

[Patrick Allmond]

That should have been "heeded"

John,

I appreciate your comments and they are headed. I was trying to balance my
experience (lack of 100% efficiency) with using my project plan as the
budget to ask for funds. The final bottom line number is what I will be
asking for to get this project.

I was experimenting and I think what the best approach for me is to leave
a resource at 100%, cut down the working day by two hours (from 8-5 to
8-3) and increase the cost per hour as you suggest.

If I go back and pad my numbers for 'waste' if you will then I will have
to update EVERYTHING. I can just go change the resources costs and the
task/project costs get updated automatically. And my hours will still be
realistic in the plan.

Do you still think it is better to pad the numbers to account for waste in
this case?

Patrick

 

[John]

That should have been "heeded"

Patrick,
Well I'm glad you went back to proofread what you wrote - even if it was
after the fact. Many people just don't care. I even had one guy tell me
it was too much effort to bother with capitalizing. And these people
work in a professional environment? Wow.

Sorry, it's kind of a hot button with me.

When users put together a plan to secure budget there is always a
certain amount of "gaming" going on between the performers and the
providers. Unfortunately it is a no win situation. It might work the
first time but pretty soon management (or a customer) figures out the
the numbers are padded and they set or negotiate a budget accordingly.
So the user pads the next plan a little more and so it goes. In the end,
the plan isn't worth much because it doesn't represent anything and no
matter what the project the budget is never enough anyway.

I'm not sure there is a real answer because you're going against human
nature. The best scenario is to establish a honest working relationship
among the performers, management and the customer. Communication is the
key. My suggestion - put together the most honest plan estimate you can.
Don't shortchange yourself but also don't "pad" the plan. If you
management and customer are worth their salt, they will respect the job
you need to do to make the plan successful, and that is a win-win
situation.

That's my two cents anyway.
John
Project MVP