Optimizing Utilization

Written by Kymberli Cassidy and Matt Van Vleet

If we want to be successful running a business in the services industry, it’s key that we are able to optimize the utilization of our people. We need to be able to match them to projects in a way that optimizes for three things: the people on our team, our clients, and our business. When we can look ahead and see how many people we have available and how many we will—or won’t—have available compared to our sales pipeline, then we can fill ours, and therefore, our clients’ needs accordingly.

Aligning With Opportunities

Utilization is a system and a process that is constantly providing forward-looking business visibility and the insights necessary to take action. For the business, utilization presents the challenge of trying to align new business opportunities with soon to be complete, or past opportunities. For example, if one project is ending and another will soon be starting, how can we predict exactly when it’s ending and what will carry forward, who is and isn’t available, and who we will need for the new project? If we have the right data built into our process, we can figure this all out, plus even plan to do some pre-work for upcoming projects if there is any. But we have to know about our gaps so we can address them and get it all started.

Or maybe we have people taking summer or holiday vacations in the same month. If we can see this data in advance, we can also see that we will be down a person the entire month and then address how to manage that in a way that doesn’t affect our budget. We may even find a way to manage time off that even improves our utilization.

Visibility & Time

It’s key to ensure we have both the right amount of visibility into who is available when and the right amount of time to plan ahead. We can’t get caught up in simply executing the work at hand; we also have to plan for what’s coming.

As a service business, a big challenge comes with the fact that we essentially sell hours of service. Once any billed time has passed, we can’t go back and change who we used for what. To get the most benefit out of our people’s time, we need to stay in a proactive stance.

Once we can see a full picture of what’s happening, we can find the right strategies for how to manage it. And the more clarity we have, the better. This also benefits our clients because, when we have a clear utilization strategy in mind, we can confidently sit down with them and show that we have their needs in mind too.

Aligning With Our People and Clients

Of course, it’s not all about the business—understanding our people is a big piece of the picture as well. We can gain this understanding in a few ways. First, with visibility into things like how long they have been on projects or on site with a client. When we take this into account, we can prevent having someone on the same client for years who’s getting burnt out and frustrated.

We also need to invest time to understand what our people are interested in doing. This way we can optimize by placing them on projects they like working on. When our people are engaged, happy, and excited about what they’re working on, it’s not only good for them, but it also helps the company and clients. Happy employees produce better output that makes for happier clients—and therefore a healthier business.

Maximizing Utilization So we know why we need to maximize utilization. But what are some of the ways we can do it? Some key factors to maximizing utilization are:

• Having a cadence that we stick to. We need to look at utilization in a regular interval so we can identify who is coming available in the next 3 mos—and what work we can match them to.

• Understand what our targets are and how we are driving toward the targets.What is our utilization percentage target? What is our hiring target? How many do we want on the bench? What are our revenue targets that drive our client and our sales, which drives our hiring?

• Who is going to take what action to change our various possibilities into reality?

Utilization is key to running a successful services business that impacts our people, our clients, and how we run our business. Having visibility, a cadence, and alignment around our utilization strategy as an organization enables us to tie together all three and make sure we’re on track for where we need to be.