Growth hungry small businesses today in the UK and indeed throughout the world face the challenge of balancing two competing objectives. Firstly, businesses must maintain and standardise current business processes in order to give your business the chance to get really good at what it does through experience curve effects. Greater business efficiency normally translates into a better customer experience and higher profits. Secondly, businesses must transform business operations in order to survive and compete in the future. How well we are able to achieve the right balance for our business will ultimately determine if we survive and go on to thrive or go the way of so many small businesses into market irrelevancy and insolvency.
You may well be thinking right now what has this got to do with project management? To understand that we first need to understand the fundamental differences between projects and day to day business operations. Whilst many of the skills required to manage your “business as usual” activities are the same as those needed to manage projects, there are some crucial differences. Amongst the most significant differences are that project work tends to be at least cross functional and often cross organisational and every project will be unique in some way rather than following the predictable pattern of business as usual. These characteristics of projects introduce opportunities and risks over and above those encountered in business as usual. In short, projects are riskier than day to day business, and therefore need a different management approach.
Projects are the means by which we introduce change in organisations. All businesses that are making any attempt to adapt to face future challenges have projects. Common examples of projects in small businesses may include setting up a company website, establishing the office in a new location, or implementing a new product but it can be any temporary activity or set of activities that have a specific output associated with it. Businesses increase their productive capacity one project at a time. Indeed, for ambitious small companies looking to grow and expand, the need to initiate the right projects and achieve the desired results is even more vital l than it is for huge national and multi-national businesses
Despite the obvious need for a project management (PM) approach, most small businesses don’t bother. This constitutes a huge missed opportunity as effective project management impacts the bottom line. For example, research by the CBP shows that project management improvement initiatives improve project performance by up to 50% for the first project and can continue for each new project if the business offers ongoing project management tools and support. We could emphasise this point further by citing the Standish Group, who in their CHAOS Report conservatively estimates that 20% of money spent on projects is wasted because companies don’t have a consistent approach to project management.