5 essential Tips for Advancing Resource Management for Government Contractors

5 essential Tips for Advancing Resource Management for Government Contractors

Resource management plays a pivotal role in the success of any organization, especially for government contractors who navigate the intricate landscape of compliance requirements, cost tracking, and shifting priorities.

To optimize a GovCon’s resource management, company leadership must aim to advance the organization’s maturity in terms of culture, compliance, and data about resource utilization, planning, and strategy.

There are five key considerations your organization will want to follow to increase your resource management maturity. Adhering to these best practices can help ensure your organization remains both efficient and competitive in a challenging federal marketplace.

What is resource management maturity?

Resource management maturity refers to the level of sophistication and effectiveness with which an organization manages its resources, including human, financial, or technological resources.

For GovCons, resource management maturity matters because profit comes from maximizing the utilization of available resources. The less slack you have in your resources, the more you can make – especially in a Fixed Price or Time and Materials contract. Furthermore, GovCons need precise cost tracking and forecasting so they can create accurate proposals for new contracts that don’t cause them to lose the award by being too high or lose money on the contract by being too low.

Resource management maturity matters for GovCons because of strict federal compliance requirements along with a need for precise cost tracking and forecasting.

Understanding resource management maturity is the first step. The next one is to learn how to measure your GovCon’s maturity using a proven framework.

The resource management maturity model

The resource management maturity model is a structured framework designed to help organizations evaluate and improve their resource management practices.

This model specifically caters to the needs of GovCons, building upon five maturity levels that incorporate progressive refinements in aspects such as:

• Training

• Policies

• Tools

• Culture

Levels of the Resource Management Maturity Model

There are five maturity levels within the model. Every GovCon will fall within one of these five stages of resource management maturity:

1. Ad hoc: Little to no standardized processes.

2. Basic: Some processes are documented but not consistently applied.

3. Organizational: Standardized processes are defined and documented across the organization.

4. Quantitative: Metrics are in place to monitor processes, and adjustments are made based on data.

5. Continuous Improvement: Standard practices are embedded, with the organization proactively seeking ways to enhance efficiency and effectiveness.

Implementing superior resource management streamlines operations and significantly prepares your organization for a variety of audits, such as Earned Value Management System (EVMS) and Accounting System Audits.

Measuring success in resource management for government contractors

Increasing your overall resource management maturity creates tangible benefits for your business. Success in resource management can be measured both quantitatively and qualitatively through several key performance indicators (KPIs). Identifying and tracking these KPIs helps organizations assess their efficiency, effectiveness, and alignment with strategic objectives.

Here are the top three KPIs essential for GovCons:

1. Project profit margin

The project profit margin measures the profitability of government contracts. Companies that are more mature in resource management have higher margins more consistently.

2. Utilization rate

The utilization rate, particularly for labor-intensive contracts, indicates the percentage of billable hours out of the total available hours.

Utilization is simple when a resource is fully dedicated to a single contract or project, but many contractors must split time between multiple projects. This is when having maturity in resource management helps you maximize utilization.

3. Agility

One thing you need to run a large govcon at scale is agility in resource management. Flexibly moving resources around to multiple projects allows you to work on a wider variety of contracts and, therefore, expand your business.

Tracking these KPIs enables GovCons to identify areas of improvement, drive strategic decision-making, and ultimately achieve sustainable growth.

Five tips for increasing your resource management maturity

Enhancing your organization’s resource management maturity requires a strategic and deliberate approach. Below are five actionable tips to help your organization become more mature and advance through the aforementioned model:

1. Define clear objectives and develop a roadmap: Establish measurable goals for each maturity level and create a strategic roadmap that outlines steps, timelines, milestones, resource requirements, and responsibility assignments.

2. Invest in advanced technologies and ERP systems: Leverage integrated tools and systems like Unanet GovCon ERP to enhance visibility and control over resources, ensuring seamless data flow and informed decision-making.

3. Foster a culture of continuous improvement: Cultivate an agile and flexible organizational culture that values continuous learning, innovation, and constructive feedback to drive improvements in resource management practices.

4. Promote collaboration and communication: Encourage a collaborative work environment with robust information sharing and cross-functional communication to unify the organization's approach to resource management.

5. Combine metrics with qualitative feedback: Make sure to listen to your employees and follow your KPIs. Sometimes, implementing new procedures and policies can start impacting morale long before the numbers show up. Stay the course and stay focused on your ideal state of resource management in the future.

It all starts with a plan to assess how mature your resource management is currently and what it will take to improve. You can improve by knowing what metrics to measure and empowering your teams with the right systems to make doing business easy.

The benefits of achieving higher levels of resource management maturity are substantial. From improved project profitability to enhanced compliance and audit readiness, the advantages are clear. Start your journey today and take the first step towards advancing your resource management maturity.

Jacob Borgeson is senior product marketing manager at Unanet, a software company that provides enterprise resource planning and customer relationship management programs for organizations in government contracting, architecture, engineering, and construction. https://unanet.com/