In this study, a heuristic algorithm is developed to solve a resource-constrained scheduling problem. The problem involves multiple projects and multiple resource categories, and allows flexible resource allocation to each activity. The objective is to minimize the maximum completion time. The algorithm takes advantage of the basic structure of a heuristic algorithm, called the exchange heuristic, but employs different strategies on some critical steps of the original algorithm which have significant effects on the algorithm performance. The original algorithm and the modified algorithm were compared through an experimental investigation. The modified algorithm produces significantly shorter schedules than the original algorithm, though it requires up to three times more computation time.