What Is Resource Management and Why Is It Important?

By Indeed Editorial Team

Updated November 29, 2021 | Published January 5, 2021

Updated November 29, 2021

Published January 5, 2021

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Every business is responsible for the resources they use to conduct their operations. When companies effectively manage their physical properties, finances and staff, they can maximize efficiency and create a more successful work environment. In this article, we explain what resource management is and why it’s important, including the types of resource management and techniques.

What is resource management?

Resource management is the process of planning how you’ll use resources to maximize their effectiveness for your business. This involves identifying, organizing and allocating the tangible and intangible resources important to your company. A resource is everything a business needs to complete a project or task, including its employees.

Examples of resources companies manage include:

  • Intellectual property, such as ideas and inventions that come from staff members

  • The office, warehouse, retail storefront, manufacturing plant or other physical property the company uses

  • The technological tools for digital commerce, record keeping, collaboration and communication

  • Finances, which are typically managed through accounting and auditing

  • Equipment like machines and the tools necessary to complete daily work

Types of resource management

The main types of resource management include:

  • Human resource (HR) management: HR management involves hiring and reassigning employees, training staff members, overseeing performance metrics and supervising compensation and benefits.

  • Digital resource management: Information technology professionals manage digital resources like networks and software by tracking and maintaining each digital account, or asset.

  • Project resource management: Project managers plan and allocate resources based on the needs of a particular task or project, including anticipating scale.

Related: How To Handle Resource Constraints in Project Management

Why is resource management important?

Resource management helps optimize the use of a business’s assets. Companies can apply this process to organize almost any aspect of their business.

Here are some of the benefits of resource management:

  • Improves efficiencies: Resource management helps companies strategically maximize their resources for effective use through all aspects of the business.

  • Reduces waste: Allocating resources with a purpose allows employers to identify areas where resources can be better used or moved to increase their value.

  • Improves planning: Deliberately planning the use of resources allows businesses to anticipate problems before they occur. Through this practice, you can also ensure supply is enough to meet demand.

  • Encourages productivity: Properly allocated resources help business operations run smoothly and increase productivity in a company’s daily functions.

  • Promotes project completion: When businesses manage their resources wisely, staff members have what they need to implement and complete projects.

  • Helps determine resource availability: Businesses can actively track the number of resources available at any given time.

  • Aids tracking and reporting: You can better determine supply and demand by tracking how much of your resources are used.

Related: A Guide to Enterprise Resource Planning (ERP)

Common resource management techniques

Four resource management techniques businesses use are:

Resource allocation

Resource allocation is a technique to get the maximum benefit out of your available resources. This technique is useful for both physical and intangible resources. It means organizing available resources as efficiently as possible to complete projects. Businesses often use reports to help identify the best allocation of resources based on availability.

Resource leveling

This technique works to leverage inefficient or underused resources. For example, cross-training employees who show an aptitude for other areas within the business elevates an employee and taps a previously underused human resource. For physical resources, this could mean reducing waste by modifying production to better use materials.

Read more: ​​The Complete Guide To Resource Leveling

Resource forecasting

Project managers often use this method before starting a task to plan the scope of resources needed. They analyze all variables involved in using tangible and intangible resources. Resource forecasting also allows businesses to predict potential risks and unforeseen costs of a project.

Read more: Q&A: What Is Forecasting? Definition, Methods and Examples

Resource planning

Resource planning involves creating a step-by-step guide to help distribute resources. Companies across multiple industries do this with the help of software programs that allow resource planners and project managers to enter data for digital reporting. These plans involve detailed accounts of each resource needed, how the resource will be used and how they will be managed throughout a project.

Related: What a Resource Planning Template Is and How To Choose One

Resource management tools

Various resource management tools are available to assist with resource allocation, leveling, forecasting and planning, including:

  • Resource Management, Inc.: Focuses on HR, payroll and benefits resource management

  • Wrike: Cross-departmental collaboration with automation

  • Saviom: Resource scheduling replaces silos, plus capacity planning and optimization

  • The Digital Project Manager: Manages complex digital projects for teams and stakeholders

  • Planview: Focuses on strategic execution and enterprise agile planning

  • Forecast: An artificial intelligence-native platform to run all project operations

  • Mavenlink: Industry cloud for professional services and staffing optimization

  • Trello: Boards manage projects and tasks while improving productivity

  • Hive: Built by its users and includes a native chat feature

  • Jira: For planning, tracking and releasing software and other projects

  • Monday.com: Scales 200-plus workflows on one platform

  • Float: Capacity management that syncs with calendar tools, plus linked tasks and editing shortcuts

Please note that none of the companies mentioned in this article are affiliated with Indeed.

Read more: 12 Resource Management Tools

Explore more articles