Build a Resource Allocation System for Small Agencies
Most small agencies allocate resources like this: a project comes in, someone's available, they get assigned. Repeat.
By month three, you have people overallocated, people underutilized, and no idea who's available for what.
The cost of bad allocation is huge. Underutilized people feel disconnected. Overallocated people burn out.
Projects slip because the wrong person is assigned. A resource allocation system fixes all of this.
The Three Elements of Allocation
1. Resource visibility - Know who is available and when
2. Project needs clarity - Know what projects need and when
3. Matching rules - Know how to match people to projects optimally
Most agencies have none of these.
Build the Allocation Spreadsheet
Create a simple spreadsheet:
Columns:
- Employee name
- January
- February
- March
- Etc.
Rows:
- Alice (Designer)
- Bob (Developer)
- Carlos (PM)
- Etc.
For each person-month cell, enter percentage allocated:
- 0% = not allocated, available for new work
- 50% = halfway allocated, available for more work
- 100% = fully allocated
- 110% = overallocated (this person is taking on too much)
Example:
| Employee | Jan | Feb | Mar | Apr | May | Jun |
|---|---|---|---|---|---|---|
| Alice | 85% | 80% | 75% | 90% | 95% | 85% |
| Bob | 70% | 60% | 100% | 100% | 90% | 70% |
| Carlos | 75% | 75% | 75% | 75% | 75% | 75% |
Update this every week.
How To Calculate Allocation
For each person, list their active projects and estimated hours:
Alice:
- Client A: 25 hours/week (25/40 = 62.5%)
- Client B: 8 hours/week (8/40 = 20%)
- Internal training: 2 hours/week (2/40 = 5%)
- Total: 85%
This person is fairly allocated. They have 15% open capacity.
When a new project comes in, you check the allocation sheet. Alice has 15% capacity.
Can you fit the new project? If it's 20% capacity, she can take 15% and someone else takes 5%.
The Matching Rules
When a project comes in, allocate based on:
Rule 1: Match skill level to project complexity
Senior person on senior work. Junior person on junior work. Medium person on medium work.
Don't put your junior designer on a complex brand project. Don't waste your senior designer on icon design.
Rule 2: Balance workload
If Alice is 95% allocated and Bob is 60%, give the project to Bob.
Rule 3: Continuity when possible
If Alice worked on Client A before, assign her again. She knows the client and the work.
Rule 4: Development opportunity
If a junior person is ready to level up, give them a project that stretches them (with support from a senior).
Managing Overallocation
When someone hits 100%, they're fully booked. That's normal.
When someone hits 110%+, that's a problem. They're overallocated and likely burning out.
How to fix it:
Option 1: Move a project to someone else (if they have capacity) Option 2: Hire a contractor for overflow Option 3: Reduce project scope Option 4: Extend timeline
Don't let people stay above 105% for more than a month. It doesn't work.
Managing Underallocation
When someone is at 50% or below for multiple weeks, that's waste.
How to fix it:
Option 1: Give them a new project Option 2: Have them support an overallocated team member Option 3: Have them work on internal projects (training, process improvement, business dev) Option 4: Reevaluate if you need this person
Underallocated people are expensive and unmotivated. If you can't keep them busy, you hired too early or wrong.
Allocation By Project Phase
Most projects have phases:
- Discovery: low resource intensity
- Design: high resource intensity
- Development: high resource intensity
- Testing: medium resource intensity
- Deployment: low resource intensity
Your allocation should spike and dip as projects move through phases.
Example:
| Week | Project A | Project B | Project C | Total |
|---|---|---|---|---|
| 1 | 20% (discovery) | 0% | 0% | 20% |
| 2 | 40% (design) | 0% | 0% | 40% |
| 3 | 50% (design) | 20% (discovery) | 0% | 70% |
| 4 | 30% (dev) | 50% (design) | 0% | 80% |
| 5 | 30% (dev) | 50% (dev) | 20% (discovery) | 100% |
By planning phases, you can keep people consistently allocated without huge swings.
Use Tools to Track This
A spreadsheet works, but a real allocation tool is better. Tools like Mavenlink, Float, or similar let you:
- See allocation across people
- See conflicts (overallocations)
- See gaps (underallocations)
- Track actuals vs. plan
If you're managing 10+ people, get a tool. If you're at 5-10 people, a good spreadsheet works.
The Weekly Allocation Review
Every Monday, review allocation for the week:
Who's overallocated? - Who's underallocated?
Are new projects coming that we need to plan for? - Are projects on track or do we need to reallocate?
This 15-minute meeting prevents most allocation problems.
FAQ
How do I allocate when projects are unpredictable?
Plan for your average. If you typically have 3-5 projects running, allocate for that.
When there's a spike, use contractors. When there's a dip, do internal work.
Should I share the allocation sheet with the team?
Yes. People like knowing they're not overallocated. It also helps them plan. "I'm 80% allocated, so I have capacity for training" is motivating.
What if people claim they're 100% allocated but aren't delivering?
That's either bad allocation or a performance issue. Have a conversation.
"You're allocated to Client A and B. Can you walk me through what you're working on?" Usually reveals the issue (they're on too many projects, or they're procrastinating).
How far ahead should I plan allocation?
Plan 4-6 weeks out. Beyond that, too much changes. Monthly forecast is good enough.