A healthy agency is always busy. On the other hand, an agency that’s overwhelmingly busy can spell disaster for both clients and employees. In fact, 51% of those in marketing fear burnout. As much as you’d like to provide everything for your clients, there’s only so much that can be done in a day with the resources on hand.
Agency capacity is the measure by which an agency can strike the right balance and not reach beyond its grasp. There are many different types of capacity planning to consider, and many tools and strategies that can help optimize the entire process. This article will look at all these and help you find the best strategy for your agency.
Simply put, capacity is how much an agency can deliver. Less simply, it’s the maximum level of output that an agency can realistically supply with the manpower, tools, and resources currently at its disposal. That said, there’s a lot that goes into defining what an agency can handle.
Capacity can be broken down into three distinct sub-categories:
Many factors directly and indirectly affect an agency’s current available capacity:
Managing time and resources effectively is one of the important aspects of success in business. The powerful capabilities of Bonsai help you to allocate work to your team and make sure workload is balanced. In addition, you’ll be able to track your budget, tasks and hours and get insights on your business profitability. You will have a clear picture of your team's performance and project's progress.
Here’s how Bonsai can streamline your workflow:
Bonsai allows your plans your team's capacity efficiently. This helps in distributing tasks and projects according to the team’s real capacity and not overloading them. By integrating time tracking with resource planning, Bonsai provides insights into how resources are allocated and utilized.
Using Bonsai for time tracking allows you to get an overview of time spent by your team on different tasks and projects. It enables the pinpointing of less performing areas and the adjusting of time spent that is being utilized effectively.
It is easy to produce detailed capacity reports as one of the features of Bonsai. These reports provide an in-depth look at your team's workload, project progress, and resource utilization, enabling you to make informed decisions about project timelines and resource allocation.
Watch this short demo to see how to set a team member capacity and see utilization reports:
In managing an agency's bandwidth, maxing out capacity can often be problematic. An effective solution is leveraging capacity planning software, which can ensure efficient time and resource allocation. This approach helps maintaining sustainable growth and preventing overcommitment.
An agency needs to know what it can handle and deliver, both now and in the future. This is where capacity planning comes in. Capacity planning is the formal process where an agency sits down and determines not only its current ability to handle projects, but also anticipates how it’ll need to change to meet demand.
Capacity planning is a careful balancing act between the present and anticipated future. Projects need attention now, but will incoming projects require redeployment of members and a reallocation of resources? There are no easy or universal answers. A good strategic understanding of the agency and trends in the marketplace is essential for proper planning.
Agency resources need to be managed effectively to close gaps. Workers spend only 27% of their day on skill-based tasks. Effective timekeeping should also be used to cut down on wasted time and underutilized team members.
There’s a lot that goes into effective capacity planning. If done correctly though, it means more productivity, higher profits, and happier clients.
Some often get confused between capacity and resource planning. This leads the two terms getting used interchangeably. They are, however, quite distinct. Capacity planning comes first in the decision process and looks at the agency’s ability to deliver within a time-frame.
Resource planning, on the other hand, is more concrete and looks at the resources needed to get a project done once accepted.
Every agency is different and its makeup may necessitate different methods of capacity planning. There isn’t one catch-all solution, but there are well-established ways of gauging capacity and planning for the future.
Here are five methods:
A capacity plan should never be an afterthought. The more you put in, the more robust the plan will be, and the better the outcomes. There are some key areas where particular focus is vital.
Inefficient capacity planning leads to poor use of team members’ skills and time. Some team members may become overburdened with the work of two or three people, or be forced to work overtime to meet impossible deadlines. Others may not be properly factored in to a project’s plan, and spend hours waiting for more work.
Capacity planning should do its best to nullify stress, underutilization, and the high staff turnover that may result from these. Project managers or seniors should constantly consult employees, understand their roles and responsibilities, and help them set attainable goals. Utilization should ideally not exceed 80% for account management and 90% for production level staff.
Project managers need to carefully allocate staff resources before any project begins, and consider the skills and number of the team chosen to execute it. This needs to be carried out throughout projects too, and any gaps that appear may need to be filled with team members from other projects or hired freelancers.
People feel more comfortable with plans if they’re constantly included in its planning and informed during its process. Capacity planning is no different. The agency or project manager should be open with team members about the goals of any undertaking.
This communication should also include regular capacity reviews with an agency’s project managers, traffic managers, financial department, and management. On the ground, regular team member feedback can also be invaluable and help avoid issues like scope creep. Constant planning, reviews, and resource allocation can identify problems as they arise, mitigate the unexpected, and improve overall efficiency.
Clients also like to be kept in the loop. Providing them with regular reports and holding meetings about the process can help maintain a healthy relationship. An agency also needs to be honest and accurate in its reports and billing to maintain trust. Timekeeping reports are one way in which this can be achieved.
Good capacity planning always factors in the unexpected. Solid strategy can help identify and mitigate major risks with any undertaking that may impact available capacity. Prior challenges with similar jobs and a thorough understanding of the agency are also important. Effective communication with team members of all levels can produce insights and potential challenges that senior management may miss.
Despite the most stringent planning and deepest insight, there’ll always be something that nobody saw coming. The best way to mitigate unforeseen risk, is to factor it into every plan and project. Project managers should ensure that plans are robust, yet flexible enough to accommodate the unforeseen. Emergency funds should be kept in reserve and potential staff leave accommodated for accordingly.
In short, the total capacity should never be the benchmark that a plan or project is set to.
Capacity planning may sound like a lot of unnecessarily complicated work for little reward, but the benefits will become apparent over time.
Capacity planning relies not only on up-to-date information about the resources of an agency, but relies on past projects (with their successes and failures) to better prepare for the demand to come. The daily ins and outs of an agency are complex enough on their own without needing to reach into the past.
Many agencies have come to rely on automation for streamlined and efficient capacity planning. Spreadsheets and software have long been favored as ways to keep track of the many moving parts of a project. Indeed 92% of businesses that utilize project management successfully meet their objectives.
With the rise of cloud-based computing though, apps have been developed that allow for greater connectivity, and the frequent communication and collaboration that such detailed planning so often needs.
The best app offerings are those that don’t stop at project management or timekeeping, but offer multiple powerful features all rolled into one.
Bonsai is one such versatile example. Besides its robust project management and timekeeping, it also offers detailed invoicing capabilities and seamless integration with other software. With Bonsai you can easily track employee hours on past and present jobs, seamlessly compile these into reports for clients, and accurately monitor all projects and their progress.
Bonsai places all information into user-friendly interfaces and automates a wide variety of tasks. All data and information are centralized and easily shareable with team members too. It’s an app that will make your capacity planning that much easier.
Your agency's capacity can affect various aspects of your business, including client relationships and project deliverability. Crucial to this factor is formulating a well-thought-out pricing strategy that can support your agency's growth. Therefore, understanding how to balance your capacity and pricing is key to running a successful agency.
The best capacity planning requires a sound strategy to be effective. There are many well-known planning strategies to suit every agency’s needs. All have their own benefits and drawbacks, so the right choice will ultimately depend on your agency’s needs and composition.
This is a preemptive strategy that anticipates future increases in demand and prepares accordingly. The agency is then structured and resources allocated to meet this increased demand before it arrives. Predicting the future is a naturally risky strategy. Workers and resources pulled from current projects can remain unused and idle, should the expected demand not arrive.
As such, planners should have a thorough knowledge of the agency, its internal dynamics, and past jobs. They must also conduct a rigorous analysis of market and industry trends to make the most informed decision possible.
In direct contrast to the lead strategy, this lag strategy is reactive. This conservative approach focusses resources on the current tasks at hand and adjusts to demand if and when it arrives. While this may yield the best possible result for short-term goals, any sudden changes may leave the agency scrambling to find freelancers and squeeze funds.
The lag strategy is more immediately cost-effective and is ideal for agencies expecting little change in the status quo.
The match strategy works to meet demand as it arises, hence the name. It acts as a middle ground between the previous two strategies, but is anything but simple. A quick and effective response to demand is easier said than done, and match strategies require an exhaustive amount of research and insight into the markets and industry.
It also requires that agencies be flexible and able to adapt to rapid change. Available capacity must be constantly monitored for maximum efficiency. Employees and resources need to be allocated quickly so that supply never exceeds demand.
As every situation is different, planning capacity strategies are often changed to meet them. An agency may utilize a mix of all three strategies for different departments or projects. Some may switch to a lead strategy during times of growth, while falling back to a match strategy when the rush dies down.
Capacity planning is constant in name only and there are a variety of ways that it can be executed, depending on internal and external factors. Here are some of the major steps that an agency might follow to successfully implement their capacity plan:
Capacity planning isn’t an easy process and may need constant attention in order to maintain maximum effectiveness. The results are undeniable though. Find the plans that work for your agency and don’t be afraid to keep improving on them. Plan extensively, communicate openly, and use the right tools to get the job done.
The results of careful planning may not be visible right away, but your agency’s future will be all the brighter for it.
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