In modern businesses, project managers must effectively coordinate undertakings of varying sizes and degrees of complexity to improve a company’s profitability and expand its influence in the marketplace. Project managers commonly face the challenge of overseeing multiple endeavors with objectives that rarely overlap—such as directing a marketing project aimed at engaging customers while also supervising the implementation of company policy reforms designed to improve production operations. In order to manage these multifarious challenges and ensure that all projects achieve their stated outcomes in a cost-effective manner, the following tactics can be utilized by project managers to streamline the process of planning and facilitating projects.
Creating Measurable Goals and Objectives
Setting goals is an important component of successful project management, but ensuring that these goals are well-organized and precisely structured is essential to preventing chaos during the lifecycle of a project. The first step in the process is to generate a list of measurable objectives, clearly stating what outcomes need to be accomplished and thereby limiting the potential for the misinterpretation of goals. Next, project managers can make goals more achievable by organizing them in accordance with the relative strengths of employees, allowing each worker to align objectives with their individual capabilities. Finally, setting concrete and reasonable deadlines allows employees to manage their work and ensure they meet expectations. To further enhance the benefits of strategic goal setting, project managers should offer employees routine updates on their progress toward their goals, as this will grant them the opportunity to assess their effectiveness and adapt their operational strategies when necessary.
Cost Analysis and Management
Every component of an endeavor has the potential to contribute to or detract from the overall cost of the project. Thus, proficiency in cost management is vital to success in project management. The process begins with an economic evaluation, during which project managers determine the value of a proposed project by calculating the opportunity costs and potential return on investment of resources—such as time, employees and money. The project manager must identify whether sufficient capital funding for the project is even available, or if a loan will need to be obtained. By weighing these factors, project managers can provide their employers with data that dictates whether or not their projects are economically feasible, allowing them to make informed investments.
After an evaluation is carried out and a project is approved, project managers must then perform more in-depth cost management tasks, such as cost analysis and budgeting, to produce accurate forecasts of a project’s potential financial outcomes. Unlike the initial evaluation, which focuses more on determining if a project is possible, this phase of planning tasks project managers with establishing a standard budget that can be monitored to ensure financial goals are being met. This budget must also be amended to account for long-term probabilities, such as inflation and its impact on the cost of the project. Once the budget is established and the project is underway, the project manager is responsible for gathering, analyzing and reporting costs as they occur in an effort to adhere to the budget and keep costs under control. By managing costs, project managers ensure that, as operational goals are met, financial success remains a viable outcome for the project.
Risk Assessment and Mitigation
If a project manager lacks the capacity to assess and eliminate potentially significant threats before they can impact the firm’s operations, the success of the project may be compromised. For instance, tax amendments that increase a project’s procurement costs can negatively impact the firm’s bottom line; therefore, project managers should be aware of such factors and adjust the budget to accommodate increased spending on taxes. Following the initiation of an endeavor, a project manager must identify risk factors by assessing the social, economic and political environment in which his or her organization operates. There are several options that project managers can employ to mitigate these risks, depending on the degree of severity:
- Assume and accept. In this instance, managers inform employees of a risk factor that does not require immediate intervention, but should be monitored closely. Though this option may prove to be more cost-effective at times, project managers must always perform an extensive analysis to be certain that the presence of said risk does not pose a significant threat to the project.
- Monitor. Watch a risk factor closely, but do not take action unless employees observe changes that increase the threat level of the risk factor.
- Avoid. If a risk factor is proven capable of impacting a project, the project manager can avoid that risk by implementing organizational changes, such as adjustments to funding and scheduling, or alterations to technical processes. For instance, if a dangerous natural gas deposit is discovered in the path of an underground tunneling project, altering course to avoid the natural gas deposit—while potentially costly—mitigates the risks associated with tunneling through it.
- Control. Sometimes, the best way to neutralize the impact of a risk is to control it via direct or indirect means. In the example of the natural gas deposit, the project manager could determine that contracting specialized equipment for tunneling through the risky territory offers a sufficient amount of control over the risks, allowing the project to proceed as planned.
- Transfer. If the hazard is too overwhelming, project managers may choose to delegate responsibility for a project task to another stakeholder who is better equipped to handle the perceived risk. Revisiting the natural gas example, if there were a specific faction of the firm that specializes in addressing hazardous gas deposits, a project manager could push to re-assign the task to the appropriate team of employees.
Project Planning and Task Delegation
By being thorough during the project planning phase, project managers improve the likelihood of their proposals being approved by their superiors; beyond that, a well-structured project strategy amplifies the project team’s ability to achieve optimal productivity. As such, a strong project plan should specify the project’s budget and define how goals will be accomplished; it should then provide any guidelines employees may need to reference throughout the production cycle. Finally, the project plan should clearly articulate the overarching objective to employees by defining the major deliverables that must be produced. With the main goal defined, employees will need to understand their individual responsibility in attaining it, as well as how tasks will be delegated as the project progresses. Ideally, this plan should explicitly state what approach the project manager intends to take in order to achieve completion, allowing stakeholders to set expectations for how the project will progress.
Once the project is underway, project managers need to continually monitor employees to ensure that production remains organized and efficient. This includes regularly reassigning employees to job tasks that will allow them to achieve optimal output and planning efficient work schedules. Having a strong project plan ensures that the right personnel and procedures are in place, making projects far more likely to succeed.
Utilizing strong leadership tactics that incorporate cross-departmental communication and quality control techniques, such as Lean Six Sigma, can enhance a team’s efficiency. Six Sigma is a quality management system designed to improve the statistical likelihood of producing defect-free products by refining a team’s ability to identify and remove defective aspects of its business process. The “Lean” component of Six Sigma implies that a project manager will incorporate lean manufacturing principles into their management strategy. Simply put, lean manufacturing principles are business practices that aim to increase efficiency and improve product quality by continually monitoring each productive process either manually, or using dedicated software. When combined, these techniques can be balanced to enhance performance, communication and efficiency, resulting in tangible improvements to the quality of project outcomes.
Being a project manager entails closely monitoring each aspect of a project and delegating important tasks to the employees who can complete them most efficiently. While practicing business professionals may be able to employ these tactics at a basic level, advanced coursework in business administration can teach project managers to unify these concepts and thereby implement strategies that accelerate productivity without sacrificing quality. Through earning their Master of Business Administration, business professionals can learn how to avoid risks and maximize productivity when carrying out large-scale projects, ensuring the highest level of profitability for their respective firms.
As the nation’s oldest private military college, Norwich University has been a leader in innovative education since 1819. Through its online programs, Norwich delivers relevant and applicable curricula that allow its students to make a positive impact on their places of work and their communities.
Norwich University’s online Master of Business Administration (MBA) program helps create strong leaders well-versed in business management practices. Students can customize their MBA by choosing a concentration in construction management, finance, organizational leadership, project management, supply chain management & logistics, or energy management.
Featured Topics, Project Management Institute
Developing a risk management matrix for effective project planning – an empirical study, Project Management InstituteCost management, Project Management Institute