How Effective Project Management can Help Small Businesses

June 26, 2015

4:04 pm

It is essential for every business to reach project goals within budget and the given timeframe. By project goals we mean the business value of the project, as well as team’s efforts to deliver the most valuable assets within the timeframe and budget.

Achieving this is a big challenge for small businesses as they have fewer resources compared to large organizations. The process involves identifying the right project management method and applying it to accomplish your project goals; something that promotes effective interaction and collaboration between team members by helping them to:

  • Study and understand how to do the work
  • Complete the task
  • Identify the limitations and challenges
  • Take initiatives to resolve complications within its scope
  • Collaborate with other teams to accomplish a given task

In short, effective project management tools simplify collaboration and also encourage sharing information within the team and with clients/partners. It is imperative to choose the right tool for a successful project management implementation. For example, a project management system that requires detailed and rigid structures and thorough task descriptions will hardly work well in smaller organizations. In contrast, a system that combines high-quality reporting with flexible organization will be more effective.

But before exploring how effective project management can help small businesses to grow, let’s dig deeper into the subject.

What is Project Management?

Project Management Institute defines a project as “a temporary endeavor undertaken to create a unique product, service or result,” which must be delivered on-time and on-budget. Project management therefore “is the application of knowledge, skills, tools, and techniques to project activities to meet the project requirements.”

However, PMI’s definition of project management reflects waterfall methodology, which fails to provide flexibility and agility. It is task-driven and predictive and is not open to changes, rather it fixes a plan and follows it to the end. It therefore fails to address the complexities associated with the way small businesses work and collaborate.

What small businesses need is agile project management that helps them attain:

  • Better product quality
  • Enhanced team collaboration, and
  • Higher customer satisfaction

Why Implement Agile Project Management

Small businesses face a dynamic and complex business climate and requirement often change midway and demands increase abruptly. Unfortunately, small businesses are usually armed with nothing but fewer resources and tight budgets. They therefore need a solution that allows them to optimize every aspect of business and agile project management helps the do so.

It facilitates a more adaptive and more fluid environment. Besides, this highly iterative process allows better and constant communication between team members, stakeholders and customers. The advantages include quick delivery and better quality control.

If used well, agile project management provides an excellent way to tweak, refine, and create more effective methods of doing things and saving both your time and money in the process. The following are a few ways agile project management can help your small business grow.

1. Evaluate Project Progress in Real Time

By implementing an effective collaborative solution you can track project progress accurately. This is essential for the successful delivery of a given project, albeit challenging. Agile and kanban project management tools facilitate and promote better collaboration between team members so that they can find the best methods to develop and deliver the product(s) within the given timeframe and budget.

They also allow team members to collaborate with stakeholders, allowing the latter to inspect and adjust the product vision in order to ensure that the end-result is as valuable as possible. This, in turn, allows to respond to changes, if required, over following a pre-defined plan blindly.

2. Better Estimate Your Resource Capability

Successful delivery of a project requires proper resource capability planning. This allows you to analyse the impact of a given project on your available resource in real time. As a result, you can better manage customer expectations and improve your overall business productivity. Better yet, proper resource planning also helps you to reduce costs. In short, it provides everything you need to match and even exceed your customer service level agreements.

Resource capability planning is essential for every business, irrespective of its size. With the right plan you can have a clear and consistent visual representation of all projects-in-hand and how you are planning to deliver them. In addition, resource planning helps you to prioritize and select the right projects.

For any growing business, project prioritization is a vital factor in order to define a sensible and optimized order of work. It removes project failure by allowing you to make use of the scarcest resources and therefore helping you maximize your benefit. You can easily assess the potential ROI using project prioritization against the resource and expenditure that particular project demands.

3. Enhance Team Collaboration

Today, project management tools work beyond tracking time and creating reports and invoices. They work as collaborative solutions, allowing and encouraging your team members to share knowledge and work in synergy throughout the lifecycle of the project.

As a result, each team member makes contribution towards a common business goal instead of letting them pursue their own objectives. Your business therefore benefit from improved problem solving ability, greater innovation, and better efficiency in project delivery. This again, helps in reducing the organisational cost.

4. Improved Cost Control and Better Cash Flow

With little or no project management experience, it is almost impossible to generate a project budget, which is key to measure the progress and performance of a project. With project management tools you can easily and quickly create project budgets directly from your project estimates/plans.

Besides, you can monitor budget and have a real time and precise picture of your company’s current and future financial projections. Apart from improved cost control, project management tools ensure better cash flow. They allow you to fully automate the billing system and track the payment in real time. Using these tools, you can therefore reduce billing errors, improve cash flow, and maximize your revenues.

Conclusion

Project management is imperative for the success of any businesses, irrespective of it size. It not only ensures the successful delivery of the project but also help you deal with other aspects of your business that are crucial to your growth. Regardless of the evolution stage of your business, implementing the right project management tool is key to elevate your business to the next level.

Image Credit: Flickr/VFS Digital Design

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Sébastien Boyer is the product manager of Nutcache, a smart and simple project management tool for all size of businesses with time tracking, invoicing and expenses.

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