Why project management is important for an organization?
Budget. Project management helps keep projects on budget. A good project management plan identifies anticipated costs early on to develop a realistic budget. ... Coordinating tasks and clearly identifying goals or deliverable within phases reduces inefficiencies in time management that can result in being over-budget.
Project management is a growing field used increasingly by businesses of all sizes. As entrepreneurs and company executives deal with the daily responsibilities of managing an organization, it is important to use dedicated project managers to oversee projects from conception to completion. Understanding effective project management techniques helps organizations carry out large-scale projects on time, on budget and with minimal disruption to the rest of the business.
Temporary and Unique Venture
While a business is a continuous and ongoing operation, a project is a temporary venture aimed at producing a unique product, service or process. In many cases, this uniqueness means there aren't any blueprints or steps in place to develop the end product. Project managers have expertise and experience in creating plans to deliver these items. In addition, they seamlessly integrate resources across a company's departments and utilize communication, planning and budgeting skills to bring projects to completion.
Project Management Skills
Many business projects involve large-scale planning that affects every department or aspect of a business. Implementing the project may mean dealing with human resources, budgetary and supply constraints. Accredited project managers are skilled in project management techniques specific to dealing with one-time projects. They can create plans to manage interdependence and address resource conflict. Organizations that use project management to monitor and control processes and schedules can more effectively complete their projects on time and on budget.
Timeline
Creating a project timeline requires coordinating project activities in conjunction with the ongoing business activities. A project manager will identify and detail activities required in each phase of a project and lead teams with members of your staff to carry out each phase. Working within the parameters of a project management plan, a schedule sets out target dates for completion of tasks within each phase. The time line is directly correlated to the scope of a project.
Scope
Project management is imperative for organizations implementing wide-ranging or comprehensive projects. Scope refers to the breadth of a project, or how much of the business will be affected, and the bigger the project, the more details and planning are required to successfully bring it to fruition. Carrying out a wide-scale business endeavor requires careful coordination to ensure minimal impact on ongoing sales and production.
Budget
Project management helps keep projects on budget. A good project management plan identifies anticipated costs early on to develop a realistic budget. Using resource conflict solutions, project managers can minimize the effect of funding a new project on operating capital by optimizing the allocation of workers. Coordinating tasks and clearly identifying goals or deliverables within phases reduces inefficiencies in time management that can result in being over-budget.
10 Reasons why Project Management matters
Have you been watching the latest BBC Apprentice show? Each week, the candidates fight to be Project Manager in the hope that that it’s their time to shine and impress Lord Sugar and each week as the task evolves, sparks fly, bad decisions are made and the projects generally fail.
Most haven’t had any project management training or understand what is involved in order to keep a project on track. Is this why the programme has never had a certified and experienced Project manager candidate?
It all adds to more exciting viewing to see it all go wrong!
Project management is one of those things that looks easy until you try it.
The fundamentals of managing a project from start to finish require a team of individuals with different talents and skills. Those people are responsible for planning and executing the project objectives and that takes more than just labour and materials. Each project follows a Project Life Cycle. A sound project plan can mean the difference between success or failure. Each project follows a Project Life Cycle.
It’s a hard skill to master, but well worth learning. And here’s why:
- Defines a plan and organises chaos – projects are naturally chaotic. The primary business function of project management is organizing and planning projects to tame this chaos. A clear path mapped out from start to finish ensures the outcome meets the goals of your project.
- Establishes a schedule and plan – Without a schedule, a project has a higher probability of delays and cost overruns. A sound schedule is key to a successful project.
- Enforces and encourages teamwork – A project brings people together to share ideas and provide inspiration. Collaboration is the cornerstone to effective project planning and management.
- Maximises resources – Resources, whether financial or human, are expensive. By enforcing project management disciplines such as project tracking and risk management, all resources are used efficiently and economically.
- Manages Integration – Projects don’t happen in a vacuum. They need to be integrated with business processes, systems and organizations.
You can’t build a sales system that doesn’t integrate with your sales process and sales organization. It wouldn’t add much value. Integration is often key to project value.
Project management identifies and manages integration.
- Controls cost – some projects can cost a significant amount of money so on budget performance is essential. Using project management strategies greatly reduces the risk of budget overruns.
- Manages change – projects always happen in an environment in which nothing is constant except change. Managing change is a complex and daunting task. It is not optional. Project management manages change.
- Managing quality – Quality is the value of what you produce. Project management identifies, manages and controls quality. This results in a high quality product or service and a happy client.
- Retain and use knowledge – projects generate knowledge or at least they should. Knowledge represents a significant asset for most businesses. Left unmanaged knowledge tends to quickly fade. Project management ensures that knowledge is captured and managed.
- Learning from failure – projects do fail. When they do, it is important to learn from the process. Project management ensures that lessons are learned from project success and failure.
The five main phases of the project life cycle are as follows:
START-UP This phase is where the project objectives are defined and the conceptual aspects of the project agreed. This may be the phase where a problem is identified and potential solutions suggested.
DEFINITION Once the project objectives have been clearly defined then the appraisal of the solutions is conducted in terms of risks, financial commitment and benefits. The scope of work is now defined in detail.
(6 Important considerations when defining your Project)
(6 Important considerations when defining your Project)
• Product breakdown structure (PBS)
• Work breakdown structure (WBS)
• Cost breakdown structure (CBS)
• Responsibility assignment matrix (RAM)
PLANNING This phase is where the project is broken down into manageable areas of work and planned in terms of time, cost and resources. This is a continuous process and will extend throughout the execution phase of the project.(6 Helpful hints when Planning your Project)
EXECUTION During this phase the work is implemented, controlled and monitored.
CLOSE-OUT The final phase of the project life cycle is close-out and demobilisation, where resources are reassigned, the project is handed over and the post-project review is carried out.(Project Close-out and handover – a general overview)
It is important to ensure the project life cycle used on your project is appropriate to the work being carried out and split into distinct and manageable phases.
The project life cycle also allows for the gate procedure to be used. This is a tried and tested method for delivering projects on time, within budget and to the expected quality targets. At each stage, approval is generally required from outside the project team before proceeding to the next stage.
The planning stage of a project is often too rushed or ill-considered. A good plan sets the team up for success. A poor plan sets them up for failure. Here are some important considerations to take into account when planning your project.
1. OVER-OPTIMISM– Human nature affects planning in many ways. Despite the awareness that new projects are delivered on schedule people tend to plan optimistically. It is important to be critical when developing resource and duration estimates and to be realistic. It is usually better to over deliver than miss your project end date. As a project schedule slips the common approach is to throw more resources at the project – usually at a higher cost – to recover the schedule. This is not an argument for ‘sand bagging’ and overestimating but it is an argument for realism and allowing risk contingency.
2. OWNING THE PLAN– The old argument of whether a project manager needs to understand the technical aspects of the work in order to manage the project or whether the discipline of good project management in itself is the important competence for a project manager. This argument also applies to project planning as a discipline. In a large project it is common for specialist project planners to be used who may, or may not, understand technical detail. These arguments will continue but the solution is for project managers and the project team to ‘own’ the plan rather than delegate the process. Every element of the schedule needs to be critically analysed, ensuring that those in the organisation with experience of similar projects or smaller work packages, develop a realistic plan. Click here for our suggested contents of the Project Management Plan.
3.THE PITFALLS OF PLANNING SOFTWARE– Today there is extensive desktop planning software available. These have become essential to plan and manage the data of large and complex projects. However, these tools cannot think and they cannot apply experience. The temptation to let the software tools do the work is significant. However, project managers need to challenge the plan in all aspects – the durations, the logic and the resourcing.
4.TIME, COST OR QUALITY?– Every project has different emphasis on time, cost or quality. For a project manager or project team to critically analyse the plan they must understand the project drivers and ensure the plan is ‘weighted accordingly’.For example, if the timescale is the key priority then realistic time estimates are essential.If the budget is fixed then minimising cost, sometimes at the expense of schedule, is essential. It is common when project teams challenge these project drivers for them to be told that cost, time and quality are all essential. However, some elements are always more important than others. To apply the same emphasis to all three in a project is to plan to fail. Uncertainty, risk and change is inevitable and the project manager has an ethical duty to understand the project drivers before committing to the project plan.
5. AVOIDING ‘REVERSE PLANNING’– It is not uncommon for a project manager to be given a delivery date, the budget and the quality perimeters before the project plan has been developed. This is applying reverse logic to the project plan and will set the project team up for failure. However, although sometimes reverse planning is inevitable, it is still the duty of the project manager to be honest with their organisation. This problem can be mitigated by publishing the risk management plan and be producing different planning scenarios for review. These techniques ensure that the project sponsor or organisation’s management are made aware of the risks and different scenarios that can be applied and the decision then ultimately rests with them.
6. LEVEL OF PLANNING– The level of detail that your project needs to be planned at will depend greatly on the size of the project, the amount of information that is available to the project and the amount of visibility and reporting that are required. In a large project it is important to provide a level of detail at which the project can be managed. Presenting the project sponsor or organisation with a complex plan involving many thousands of activities will remove clarity from the plan overall. We recommend a series of planning levels so managers at different levels can review information at the appropriate level of detail.
‘Why is project management important?’
is an interesting question that clients sometimes pose. They’ll ask: “Can’t we just brief the team doing the work and manage them ourselves? It’ll be loads cheaper.”
is an interesting question that clients sometimes pose. They’ll ask: “Can’t we just brief the team doing the work and manage them ourselves? It’ll be loads cheaper.”
They wonder if they really need project management because on paper it looks like an unnecessary tax and overhead as project managers don’t really deliver anything and often get in the way of what they want the team to do! So if all that’s true, why is project management important?
The truth is, running projects without good project management is a false economy. It’s often thought to be an unnecessary burden on the budget, and there’s no doubt it can be expensive – as much as 20% of the overall project budget. But can you afford to not have project management? Without it, what holds the team and client together? And without it, who is left to navigate through the ups and downs, clashes and catastrophes of projects?
Great project management means much more than keeping project management’s iron triangle in check, delivering on time, budget, and scope; it unites clients and teams, creates a vision for success and gets everyone on the same page of what’s needed to stay on track for success. When projects are managed properly, there’s a positive impact that reverberates beyond delivery of ‘the stuff’.
Why Is Project Management Important?
1. Strategic Alignment
Project management is important because it ensures what is being delivered, is right, and will deliver real value against the business opportunity.
Every client has strategic goals and the projects that we do for them advance those goals. Project management is important because it ensures there’s rigor in architecting projects properly so that they fit well within the broader context of our client’s strategic frameworks Good project management ensures that the goals of projects closely align with the strategic goals of the business.
In identifying a solid business case, and being methodical about calculating ROI, project management is important because it can help to ensure the right thing is delivered, that’s going to deliver real value.
Of course, as projects progress, it is possible that risks may emerge, that turn into issues or even the business strategy may change. But a project manager will ensure that the project is part of that realignment. Project management really matters here because projects that veer off course, or which fail to adapt to the business needs may end up being expensive and/or unnecessary.
2. Leadership
Project management is important because it brings leadership and direction to projects.
Without project management, a team can be like a ship without a rudder; moving but without direction, control or purpose. Leadership allows and enables a team to do their best work. Project management provides leadership and vision, motivation, removing roadblocks, coaching and inspiring the team to do their best work.
Project managers serve the team but also ensure clear lines of accountability. With a project manager in place there’s no confusion about who’s in charge and in control of whatever’s going on in a project. Project managers enforce process and keep everyone on the team in line too because ultimately they carry responsibility for whether the project fails or succeeds.
3. Clear Focus & Objectives
Project management is important because it ensures there’s a proper plan for executing on strategic goals.
Where project management is left to the team to work out by themselves, you’ll find teams work without proper briefs, projects lack focus, can have vague or nebulous objectives, and leave the team not quite sure what they’re supposed to be doing, or why.
As project managers, we position ourselves to prevent such a situation and drive the timely accomplishment of tasks, by breaking up a project into tasks for our teams. Oftentimes, the foresight to take such an approach is what differentiates good project management from bad. Breaking up into smaller chunks of work enables teams to remain focused on clear objectives, gear their efforts towards achieving the ultimate goal through the completion of smaller steps and to quickly identify risks, since risk management is important in project management.
Often a project’s goals have to change in line with a materializing risk. Again, without dedicated oversite and management, a project could swiftly falter but good project management (and a good project manager) is what enables the team to focus, and when necessary refocus, on their objectives.
4. Realistic Project Planning
Project management is important because it ensures proper expectations are set around what can be delivered, by when, and for how much
Without proper project management, budget estimates and project delivery timelines can be set that are over-ambitious or lacking in analogous estimating insight from similar projects. Ultimately this means without good project management, projects get delivered late, and over budget.
Effective project managers should be able to negotiate reasonable and achievable deadlines and milestones across stakeholders, teams, and management. Too often, the urgency placed on delivery compromises the necessary steps, and ultimately, the quality of the project’s outcome.
We all know that most tasks will take longer than initially anticipated; a good project manager is able to analyze and balance the available resources, with the required timeline, and develop a realistic schedule. Project management really matters when scheduling because it brings objectivity to the planning.
A good project manager creates a clear process, with achievable deadlines, that enables everyone within the project team to work within reasonable bounds, and not unreasonable expectations.
5. Quality Control
Projects management is important because it ensures the quality of whatever is being delivered, consistently hits the mark.
Projects are also usually under enormous pressure to be completed. Without a dedicated project manager, who has the support and buy-in of executive management, tasks are underestimated, schedules tightened and processes rushed. The result is bad quality output. Dedicated project management ensures that not only does a project have the time and resources to deliver, but also that the output is quality tested at every stage.
Good project management demands gated phases where teams can assess the output for quality, applicability, and ROI. Project management is of key importance to Quality Assurance because it allows for a staggered and phased process, creating time for teams to examine and test their outputs at every step along the way.
6. Risk Management
Project management is important because it ensures risks are properly managed and mitigated against to avoid becoming issues.
Risk management is critical to project success. The temptation is just to sweep them under the carpet, never talk about them to the client and hope for the best. But having a robust process around the identification, management and mitigation of risk is what helps prevent risks from becoming issues.
Good project management practice requires project managers to carefully analyze all potential risks to the project, quantify them, develop a mitigation plan against them, and a contingency plan should any of them materialize. Naturally, risks should be prioritized according to the likelihood of them occurring, and appropriate responses are allocated per risk. Good project management matters in this regard, because projects never go to plan, and how we deal with change and adapt our plans is a key to delivering projects successfully.
7. Orderly Process1
Project management is important because it ensures the right people do the right things, at the right time – it ensures proper project process is followed throughout the project lifecycle.
Surprisingly, many large and well-known companies have reactive planning processes. But reactivity – as opposed to proactivity – can often cause projects to go into survival mode. This is a when teams fracture, tasks duplicate, and planning becomes reactive creating inefficiency and frustration in the team.
Proper planning and process can make a massive difference as the team knows who’s doing what, when, and how. Proper process helps to clarify roles, streamline processes and inputs, anticipate risks, and creates the checks and balances to ensure the project is continually aligned with the overall strategy. Project management matters here because without an orderly, easily understood process, companies risk project failure, attrition of employee trust and resource wastage.
8. Continuous Oversight
Project management is important because it ensures a project’s progress is tracked and reported properly.
Status reporting might sound boring and unnecessary – and if everything’s going to plan, it can just feel like documentation for documentation’s sake. But continuous project oversight, ensuring that a project is tracking properly against the original plan, is critical to ensuring that a project stays on track.
When proper oversight and project reporting is in place it makes it easy to see when a project is beginning to deviate from its intended course. The earlier you’re able to spot project deviation, the easier it is to course correct.
Good project managers will regularly generate easily digestible progress or status reports that enable stakeholders to track the project. Typically these status reports will provide insights into the work that was completed and planned, the hours utilized and how they track against those planned, how the project is tracking against milestones, risks, assumptions, issues and dependencies and any outputs of the project as it proceeds.
This data is invaluable not only for tracking progress but helps clients gain the trust of other stakeholders in their organization, giving them easy oversight of a project’s progress.
9. Subject Matter Expertise
Project management is important because someone needs to be able to understand if everyone’s doing what they should.
With a few years experience under their belt, project managers will know a little about a lot of aspects of delivering the projects they manage. They’ll know everything about the work that their teams execute; the platforms and systems they use, and the possibilities and limitations, and the kinds of issues that typically occur.
Having this kind of subject matter expertise means they can have intelligent and informed conversations with clients, team, stakeholders, and suppliers. They’re well equipped to be the hub of communication on a project, ensuring that as the project flows between different teams and phases of work, nothing gets forgotten about or overlooked.
Without subject matter expertise through project management, you can find a project becomes unbalanced – the creatives ignore the limitations of technology or the developers forget the creative vision of the project. Project management keeps the team focussed on the overarching vision and brings everyone together forcing the right compromises to make the project a success.
10. Managing and Learning from Succes and Failure
Project management is important because it learns from the successes and failures of the past.
Project management can break bad habits and when you’re delivering projects, it’s important to not make the same mistakes twice. Project managers use retrospectives or post project reviews to consider what went well, what didn’t go so well and what should be done differently for the next project.
This produces a valuable set of documentation that becomes a record of “dos and don’ts” going forward, enabling the organization to learn from failures and success. Without this learning, teams will often keep making the same mistakes, time and time again. These retrospectives are great documents to use at a project kickoff meeting to remind the team about failures such as underestimating projects, and successes such as the benefits of a solid process or the importance of keeping time sheet reporting up to date!
Summary of Why Is Project Management Important
So why is project management important? Without it, teams and clients are exposed to chaotic management, unclear objectives, a lack of resources, unrealistic planning, high risk, poor quality deliverables, projects going over budget and delivered late.
Great project management matters because it delivers success. Project management creates and enables happy, motivated teams who know their work matters, so do their best work. And that project management enabled team ensures the right stuff is delivered; stuff that delivers real return on investment, and that makes happy clients.
