How do you approach resource allocation across multiple products when every product team feels they need more engineers?

Question

Accepted Answer

Resource allocation across a product portfolio is inherently a zero-sum game. Giving more engineers to one product means fewer for another. Every PM will make a compelling case for more resources, and every case will have genuine merit. The challenge is not determining whether each request is valid but deciding which investments produce the greatest return for the company as a whole.

Start by establishing transparent criteria for allocation decisions. Common criteria include strategic alignment, meaning how directly the investment supports company-level strategic priorities; expected return, measured through projected revenue, user growth, or cost savings; opportunity cost, meaning what happens if you do not invest; risk level, considering the probability of the expected return materializing; and dependencies, such as whether other products or initiatives depend on this investment being made.

Use a structured evaluation process. Have each product team submit a resource request that includes their proposed investment, the expected outcome with supporting data, the impact of not receiving the resources, and alternative approaches at lower resource levels. This forces teams to think about marginal returns rather than just asking for everything they want. A product that can achieve 80 percent of its goals with 60 percent of the requested resources might be a better allocation than one that needs 100 percent of its ask for any meaningful outcome.

Categorize investments by time horizon. A healthy portfolio balances near-term revenue generation, which typically goes to mature products, with medium-term growth, which goes to scaling products, and long-term bets, which go to new initiatives or platform investments. A common guideline is 70 percent to core business and incremental improvements, 20 percent to adjacent growth opportunities, and 10 percent to transformative bets. The exact ratios depend on company strategy and risk appetite.

Make allocation decisions at the leadership level, not through peer negotiation. When PMs negotiate resources among themselves, the best negotiators win rather than the best investments. Resource allocation is a leadership responsibility that requires the broader perspective and authority that portfolio-level decision makers possess.

Communicate decisions transparently. Every PM whose request was not fully funded should understand why: which criteria were decisive, how their request compared to others, and what would need to change for their allocation to increase in the next cycle. Opaque allocation decisions breed resentment and political behavior.

Review and adjust allocations quarterly. Markets change, products surprise to the upside or downside, and strategic priorities shift. A rigid annual allocation that cannot adapt to new information wastes resources. Build flexibility into the allocation by reserving a small pool, typically 10 to 15 percent, for reallocation based on quarterly performance reviews.

Track the outcomes of allocation decisions. If a product received significant investment and underdelivered, understand why and factor that into future decisions. If a product consistently over-delivers with modest resources, it may warrant a larger share. This accountability loop improves allocation quality over time.