Effective project management that directs employees in meeting goals without exceeding budgets helps businesses save millions. Poor project management, on the other hand, can result in cost and schedule overruns. Organizations that don’t use proven project management methodologies waste 28 times more money than their counterparts. To learn more, check out the infographic below created by Norwich University’s Online Master of Business Administration program.
The Value of Efficient Project Management
By adopting a project management approach for even the smallest programs, companies follow a framework that outlines specific activities, resources, and timelines. This methodology allows companies to control costs, maximize resources, increase efficiency, and reduce risk.
The Importance of Efficient Project Management
According to the Project Management Institute, 9.9% of every dollar was wasted due to poor project performance in 2018, translating to $99 million for every $1 billion invested. The survey also reported just 58% of organizations understood the value of project management.
Key Performance Indicators of Projects
According to a 2018 survey completed by the Project Management Institute (PMI), organizations with a high level of maturity in project management approaches completed projects that hit their original goals 78% of the time. They also completed projects within budget 67% of the time and completed them on time at a 64% clip. These companies also experienced just a 12% failure rate.
The PMI survey also pinpointed key recurring causes of project failures that included changes in organizational priorities, changes in project objectives, and inaccurate requirements gathering.
Popular Project Management Methodologies
Companies such as Toyota and Motorola tested various project management methodologies to help them address complex problems and improve productivity. When properly applied and implemented, each project management methodology offers unique benefits.
The Scrum methodology was introduced in a Harvard Business Review article in 1986 by Hirotaka Takeuchi and Ikujiro Nonaka. The process involves creating a product backlog, enabling sprint planning, providing a sprint backlog, reviewing sprint progress, analyzing product increment, and conducting sprint retrospective. The benefits of this approach include an increased ability to adjust to changing priorities and increased visibility into projects. This methodology is best used in software development or in the management of retail logistics, events, and other projects requiring flexibility.
Six Sigma was created in 1986 by Bill Smith and Bob Galvin of Motorola with the goal of improving quality and decreasing defects to a statistically insignificant level. Its components consist of defining opportunity, measuring performance, analyzing opportunity, improving performance, and controlling performance. Benefits of this project management methodology include improved customer satisfaction, reduced costs, and enhanced productivity. Optimal uses of this approach are eliminating waste, reducing product defects, and defining the cause or problem.
Originating from a 1956 symposium on advanced programming, Waterfall involves capturing requirements in a document, creating models to analyze the docs, designing systems, coding, testing, installing, and, then, performing system maintenance. This approach is optimum for small projects involving one or two people, and when steps of the project are known. Waterfall is an ideal methodology for the completion of manufacturing and construction projects.
Agile was originally discussed in a 2001 paper titled “Manifesto for Agile Software Development” , which was authored by 17 software developers. It builds a flow process through a project, beginning by prioritizing projects and, then, constructing, testing, and finalizing the project before releasing the final iteration into production. Its benefits include increases in productivity, transparency, and flexibility. Agile is typically used in software development, financial service, and professional services.
Lean was used by Henry Ford to automate the process of building cars. It works by specifying the project’s value, mapping the value stream, making value flow by eliminating waste, moving the project forward based on customer demand, and embracing continuous improvement. The benefits include reducing lead time, lowering of overall costs, and enhancing product quality. The methodology is used to oversee manufacturing, manage construction projects, and work in education.
Kanban was created by Tailchi Ohno, an industrial engineer at Toyota in the 1940s. It works with the placement, organization, and manipulation of Kanban cards that divide projects into different stages and teams. Benefits include its adaptability to change, efficiency increase, and user-friendliness. This methodology is best applied to storyboarding user stories or backlog planning in software development.
Project Management Tools
As remote work increases, project management tools are in high demand. Platforms like Lucidchart, Asana, and Wrike allow users to customize a project management approach.
Lucidchart’s capabilities include improving DevOps processes, defining the software development life cycle, and mapping the customer journey. It helps promote a smooth user experience and collaboration.
Jira Software creates user stories and issues, plans sprints, and custom workflows. It helps reduce or eliminate miscommunication and simplifies tracking bugs.
Asana files and tracks bug reports and sprints; plans and manages content calendars, campaigns, and product launches; and manages the hiring and onboarding processes. In addition to its availability as an app, Asana integrates with numerous services and stores files in a central location.
Wrike provides the capacity to generate real-time reports, customize dashboards, share interactive reports, schedule notifications, and create custom workflows. It improves productivity and simplifies planning.
A Plan for Project Efficiency
In today’s evolving business environment, adopting a project management methodology can help organizations achieve goals and stay competitive. A variety of platforms are available that empower and support teams by providing them with the tools needed for project success.
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Project Management, Asana
Jira Software, Atlassian
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5 Benefits of Agile Project Management, Kanbanize
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The Ultimate Guide to… Kanban, ProjectManager.com
Lean Project Management, Project Management Institute
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Swimming Up the Waterfall, Project Management Institute
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What Is a Product Backlog?, Scrum.org
What Is a Sprint Backlog?, Scrum.org
What Is a Sprint Retrospective?, Srum.org
Benefits of Using Scrum, ScrumAlliance