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Whenever an organization takes on a project, the endgame is always to generate profitability. To achieve that profitability, the organization needs to make smart and strategic decisions while managing the project. However, making the right decisions in the moment is easier said than done, which is why organizations look for project management tools to help them out. But with so many tools out there, how do you know which tool will go beyond simple project management and help pave the way for profitability?
To understand this, we sat down with Elizabeth Harrin, an author, trainer, and award-winning blogger. Elizabeth has spent over 20 years in project management. Currently, she helps people effectively manage their projects by cutting through the complexity. She is also the brain behind A Girl’s Guide to Project Management and Project Management Rebels.
We sought her expertise to gain insights into project management practices and how you can use the right project management tool to deliver profitability for your organization.
Obstacles to Good Project Management At Enterprises
In recent years, there has been a definite shift towards project-based working across industries. Bain & Company, the consultancy firm, says that most work will become project-based by 2027.
This reflects how organizations are increasingly becoming aware of the decisive impact that project management can make in their business. Project management is not just about task allocation, scheduling, and budgeting.
Having worked with many enterprises in her career, Elizabeth is quite familiar with the difficulties of project management at larger enterprises. “There’s a misconception that large enterprises have a mature approach to project management by default, and in my experience, that isn’t true. Maturity has more to do with the level of challenge than the size of the organization.”
Elizabeth also notes, “Project management at a large enterprise organization is different because typically you have more layers of management and a greater number of internal stakeholders to communicate to.”
This is one of the reasons why larger organizations look for software that can deliver “a consistent view of the truth,” as Elizabeth puts it.
Resource tracking and allocation is another big challenge for project managers at larger firms. It is not always easy to know who is available to take on certain tasks, which makes formulating a project strategy harder. Elizabeth notes, “Managing the resource pool becomes a larger overhead because you can’t know everyone’s personal strengths and skills when you have a large team — at least, not in the way you can when your project delivery team is two or three people all working in the same office.”
Ultimately, the aim of all project managers is to ensure profitability. However, the way they manage their profitability can differ. As Elizabeth says:
“Different businesses will have different approaches to managing profitability. This will be outlined in the business case, and you’ll have success criteria or different ways of measuring what profitable looks like for the project (or the business in general). As a project team, it’s worth keeping an eye on whether you are on track to meet those expected ratios and taking action if not.”
No matter how you define and manage profitability, it helps to have the right project management software. The right tool will give you access to the right data in real time, giving you the opportunity to make proactive decisions for ensuring profitability. It is also worth noting that you may need to upgrade to better software as the needs arise. As you will learn in the next section, the needs of the organization can change as it grows. For larger organizations, a simple project management tool might no longer be effective at meeting their changing needs.
How Can a New Platform Increase Overall Project Profitability?
The short answer, as Elizabeth puts it, is “It depends.” Your choice of a project management tool can impact profitability in several ways. “The goal should be to have intuitive, easy-to-use project management tools that take virtually no time to update and have a straightforward learning curve,” Elizabeth says.
Elizabeth advises that organizations should look for tools that enable and streamline the decision-making process. “They should be able to surface insights and present data in a way that enables decision making without having to spend loads of time exporting data and then analyzing it in spreadsheets. That saves time, which ultimately means project managers and teams can get more done.” An AI-powered tool can easily analyze the data in real time and surface insights that can inform decision-makers quickly.
Transparency is another consideration. “In addition, tools that help with decision-making should make it easier to run the project and should make it easier to spot issues before they turn into major incidents. So tools can help improve profitability of the project by improving transparency,” Elizabeth shares. Knowing exactly what is going to happen can help project managers circumvent problems and keep the project on track.
Tracking billables will be another big piece of the puzzle. An organization cannot hope to maximize profitability if it fails to charge its clients correctly. Revenue leakage can cripple a business if left unchecked. Elizabeth suggests looking for tools that can “help improve profitability by ensuring no task remains uncharged (where it is appropriate to charge for the work). If you are in a professional services business where it’s important to track time and charge for the work that has been done, project management software that allows for task-level tracking will prompt you to capture all chargeable aspects. You don’t have to do more work, but you do stop leakage by making sure you charge for work that has been completed, and that can improve profitability. ”
When to Shift to a Better Platform for Project Management and Profitability
As organizations grow, they must adapt to newer work methodologies and better tools to streamline project management and maximize productivity and profitability. But when is the right time to do so? Having been in project management for decades, Elizabeth knows what signs to look for:
“Project management on spreadsheets is what many of us are used to, but the challenges come when you can’t prepare consolidated program or portfolio-level reporting for executives. A sign that you need to think about what project management tool you are using and whether it’s time to step up is when you are spending a lot of time creating manual reports or dashboards to meet the needs of senior management. That’s so time-consuming and ultimately a waste of skilled PMO or PM resources. Get tools to do the heavy lifting!”
When moving on from spreadsheets and other manual methods, organizations typically choose a simple project management tool that does basic tracking and resource scheduling. For a while, that tool may suffice. However, as the organization continues to grow, that tool will start feeling less and less useful. Project managers and team members alike may find themselves doing a lot more work to get what they need from the tool. That is the right time to move beyond a simple project management tool and start looking for a better and, perhaps, bigger tool.
Elizabeth agrees, “It’s time to start considering other tools when you can’t get what you want from the ones you have. I know that sounds simplistic, but you can tell that from the attitudes of the people using the software and the people receiving data from the software. For example, frustrations rise because people can’t extract what they need to do their jobs, or the reports aren’t suitable to support decision making.”
To overcome such new challenges, firms should start considering platforms with automation capabilities. An AI-enabled platform can help overcome the other frustration with simple PM tools, as noted by Elizabeth:
“The other frustration is not being able to see the work of an entire team in one view, or at least have resource planning and capacity management features available so you can predict when the team is going to be available to take on new work. That makes people annoyed, and it increases the amount of manual work provided. If your tools don’t give you the data, people end up resorting to manual workarounds (often spreadsheets), which takes up time — time that could be better spent serving clients.”
An AI-powered platform with powerful automation capabilities can do more than just track time and tasks. It can help you with resource planning and scheduling, tracking financials, running analytics and reporting, and more. It is even possible to do all of these and more in real time, enabling you to make proactive decisions to solve problems even before they appear.
Does Your Enterprise Need PSA Software?
For organizations operating in the professional services space, the choice of project management tool often boils down to selecting the right PSA software. Elizabeth agrees, “PSA software is a good choice if you work in an environment where you need transparent billing of time and have project resources in client-facing roles.”
A large professional services firm, especially one spread across multiple locations, will typically find it challenging to know everything that is going on inside. They have no visibility into all the work being done, making it difficult to formulate strategic decisions to drive profitability and growth. For them, Elizabeth says, “PSA software is good for providing a single view of what is happening in the organization, from pipeline projects to in-flight work, and providing data on the value of that portfolio — for example, project profitability and client profitability. That kind of data can shape your sales pipeline and make sure the team focuses on high-value work.”
A good PSA tool delivers real-time insights that help you run your organization while ensuring consistent execution of projects and optimized revenue and pricing. In short, it can help maximize the profitability of the organization.
Moving Towards Project Success and Profitability
We asked Elizabeth what would be the one tip she would give an organization to ensure their projects are successful:
“Success is in the eye of the beholder. If you want your projects to be successful, you have to define what success looks like and how you will know if you’ve got there. It’s not good enough to assume you know, or to assume that the classic triangle of time, cost, and quality is the right way to measure. Clients have their own definitions of success, and once you understand those, that provides the compass from which to navigate your project towards a successful conclusion.”
Ultimately, knowing how to manage projects is not enough. Project managers need the right tools and software platforms if they are to deliver profitable results and drive their organizations’ successes. For those in the professional services space, an AI-powered tool might just be the one they need.
We thank Elizabeth Harrin for taking the time to talk with us and share her invaluable insights into project management. You can find her at GirlsGuideToPM.com and on Twitter @girlsguidetopm.