Project management in business

Any enterprise has a cycle of its life from the birth of a business idea to the attenuation of activity. This cycle is considered a natural development. The trajectory of the path after reaching the stage of stability will depend on the art of business management.

Further growth is possible with the repetition of all stages or the death of the business. In market conditions, the rule is: “You can not stand still, you need to change.” If things are going consistently well in the organization, this is not a reason for the owner to breathe easy. For further development, new ideas become vital. These are new trends that can support and refresh an already implemented business. There may be a project for another line of business to diversify an existing business. In the current realities, new types of business are beginning to appear – ecosystems. Their origins are also project activities.

The difference between the project and the current operating activities of the organization is in the limitations imposed by its lifespan, material and human resources, and financing of the idea.

What can be the result of the project in business:

• a new service to complement an existing business;
• launching a new product on the market;
• a new line of business that is different from the existing one.

Small businesses often neglect the use of project activities in their work. The implementation of project management is often a time-consuming process, the effectiveness of which is difficult to assess at an early stage. Owners are reluctant to give authority to the wrong hands. The other extreme occurs when a businessman perceives project management as a magic tool that can solve all the difficulties on the way to increasing profits.

How good project management can help your business

The main goal of the project management system is to implement the development strategy on time for a certain amount of money. This establishes the necessary and sufficient level of quality. This management technique will help the owner to solve business problems in a shorter time, not to miss the time for the necessary strategic development.

How Project Management Achieves Goals

To successfully implement an idea according to the PMBOK Guide, the following management phases must be completed:

• Initiation.
• Planning.
• Performance.
• Control.
• Completion.

Each of the phases of managing this type of activity has its own content and its own methods of implementation.

Initiation phase

The life of a project begins with the recognition of its necessity. Initiation involves identifying a problem to be solved. Another option is to define the feature to be used.

The expected result is then predicted. The most common criterion is the financial performance of the project. When evaluating such results, it is necessary to cut off factors that the project manager cannot directly influence. Depreciation costs, accounting costs, tax burden, and other administrative costs should be removed from the analysis.

The method of evaluating the financial result can be based on the use of gross profitability ratios, taking into account only the direct costs of the project. If the result needs to be evaluated not only in monetary terms, it is necessary to use the Balanced scorecard methodology. In any case, the evaluation of the result of the activity is possible only if there is a measurable indicator of such success.

The stage of assessing the achievability of the expected result is often skipped altogether. You can’t act on the principle “the main thing is to get involved, and then come what may.” In this case, the organization may suffer losses due to the fact that it did not calculate the resources. Throwing all your energy into the development of an unsuccessful project, there is a chance to miss out on more successful options. Due to the poor quality of the completed project, the business may lose its business reputation.

The decision to start the implementation of a business idea is desirable to formalize official documents. This will justify the planning and preparatory steps.

The priority selection stage compares the importance of implementing the idea in the first place in relation to other current or potential directions.

The appointment of a manager gives him the necessary authority, but also gives him the responsibility for successful management.

A clear start time disciplines and mobilizes all areas of implementation.

After the parties have agreed on all stages of initiation, a “Project Charter” is drawn up.

Planning phase

The name of the phase fully reflects its essence. The purpose of planning is a model for the best implementation of a business idea. The main outcome of this phase is reflected in a document called the “Consolidated Project Implementation Plan”.

Planning objects in the project

Planning is a continuous process. During implementation, the plan is subject to refinement and detailing.

Based on the list of works, their relationship and the duration of each stage, a calendar plan is drawn up.

At the stage of allocation of resources and the team, an estimate, the budget of the project is drawn up. It also lays down the necessary composition of specialists that will be required to implement the plan.

The quality planning stage defines the standards and the means to achieve them.

Risk management is necessary for the team’s action plan in the face of emerging restrictions, a changed environment, and in the event of certain problems. It is advisable to draw up a risk register. It is compiled on the basis of a probability and impact matrix. By compiling such a register, the manager will be able to provide priority options for minimizing risks.

In case not all planned parameters of the project are achieved, it is necessary to estimate the probable value of the net present value. The method of scenario analysis is suitable for solving this problem.

Execution and control phases

During these phases, the greatest relevance for the manager is to quickly obtain reliable information about the progress of the plan. Information technologies come to the rescue in the form of computer control systems. The choice of management system can greatly affect the effectiveness of the team. Such systems are divided into specialized task managers (Basecamp, Redmine, JIRA, Worksection) and task trackers as part of CRM, for example, Bitrix24, Amo CRM, Megaplan.

Project Completion Phase

In this phase, there are nuances in various areas of project activity. When introducing a new product to the market, the completion phase cannot be at the stage of entering the product “to the market”. Its success must be tracked by the volume of demand, and performance indicators should be monitored. This will allow taking timely measures in accordance with the risk management strategy. Otherwise, the project will fail, and time to correct errors will be lost.

How to deal with a crisis situation while managing a project? – Infographics

Infographic provided by Wrike – Project Management System