How many employees do I need to complete the project on time? Am I on budget with procurement? What are the unplanned costs of my project? In order to be able to answer these and other questions, a cost management plan is carried out in projects to determine the best actions.
First, let’s start with a definition of the term ‘resource’. The resource is a generic term that can refer to either employees, material or financial resources within a project. And exactly these resources need to be planned as efficiently and effectively as possible in the interest of project success.
In order to help your company, we have created a free cost and resource planning Excel template for you.
What has to be considered when planning costs and resources?
Before planning costs and resources, a work breakdown structure needs to be created for the Gantt chart and bring the individual processes into a sequence. It’s important, however, to estimate the processing effort for each process.
As soon as the effort has been estimated, the resources and/or team members can be assigned to the individual processes. This is best carried out by the project manager together with the team. Once this is done for the next planning stage (e.g. milestone or sprint), you should take a closer look at each resource’s exposure profile.
Is a machine accidentally used in parallel or has a team member been over- or under-scheduled? If this is the case, they will need to adjust your planning or reconsider your resource allocation.
Capacity here is the keyword – the availability of a resource, including the available volume. For example, if an employee is scheduled for more than 100% of his or her capacity, this is referred to as overload. If this overload occurs because the person is dispatched for two competing or parallel operations, it is a resource conflict.
Resource conflicts can also arise across project boundaries. Is the employee still needed for tasks or do other projects in the company want to access the same resource at the same time? Another frequently used term in this context of project resource planning is the bottleneck resource. This is a resource that is only available in certain cases due to limited capacity or multiple loads.
The use of cost and resource planning tools
In practice, the project manager uses a tool for cost and resource planning. Project management software or Excel templates offer the possibility of carrying out work packages including resource management electronically.
The cost and resource planning Excel template can be used for small projects. As the project grows or it becomes more complex with many work packages, it’s advised to switch to project management or project planning software.
The great advantage of software programs is that they automatically detect conflicts related to resourcing and help resolve them using data analysis. In addition, the software automatically generates a Gantt chart including all dependencies.
How does the cost and resource planning Excel template work?
The cost and resource planning Excel template is a simple form to give you a quick overview of the costs incurred in your project. The template contains three tabs, the first tab Basic Data is used to enter your project-specific framework data. Here you can enter the general project data and the cost types (from internal and external personnel costs to material and license costs). Then you can assign the appropriate types, units and costs to project members, services and materials in the Resources area.
Under Types, you can differentiate between internal and external costs, whether the units are hourly rates (for persons) or lump sums. While the hourly rates are fixed for the duration of the project, the flat rates differentiate between planned costs and change costs.
In the second tab Overview plan you can enter all the work packages of your work breakdown structure. Name the corresponding work package, assign it to the corresponding WBS element, and assign the corresponding resource. However, you can only select resources that you have stored in the basic data. After, you will be able to enter the forecast quantity in the green area called ‘Planned costs’ and the corresponding price will be calculated automatically. If you need to make any modifications to the costs due to changes, then note their quantity in the red area ‘unplanned costs’. The field ‘Release on’ only affects the unplanned costs.
With cost and resource planning, we end our series of downloadable Excel templates to provide your company with a free alternative for planning small projects.
You can find our other free templates here: