What is Project Management?

Project managers are in high demand. Learn what they do and more.

Eighty-three percent1 of organizations report that they can’t find qualified project managers to fill open positions.

While this is bad news for employers, it’s great news for job seekers and those looking to increase their salaries.

In fact, project managers make an average salary of $91,4402 and certified project managers make even more.

And nearly 16 million3 new project management positions will have been created between 2010 and 2020, and the industry will have grown by $6.61 trillion. Now is the perfect time to figure out whether or not project management is right for you.


If you’re interested in learning more about the job, keep reading. In this guide, you’ll get a comprehensive overview of the project management profession.

Project Management 101

We’re all project managers at some points in our lives. Whether it’s a quick undertaking, like organizing the garage over the weekend, or a complex, drawn-out one, like developing a website by the end of the year, these are temporary endeavors that have a definitive start and end date with goals in mind.

Projects, then, are just unique undertakings that have a definitive start and end date.

People often get project work confused with operations management or rather “business-as-usual.” Check out the chart below to understand the key differences.

Operations Management

  • Ongoing operations that are repeated
  • Team consistently works together
  • Maintains the business
  • Repeatable work
  • Fixed annual budget

Project Management

  • One-of-a-kind tasks have a completion date
  • Team disbands once work is done
  • Introduces change
  • Unique work
  • Custom budget based on required tasks and resources

Examples of projects4 include:

  • Building a new website
  • Opening or closing a business location
  • Making changes to the business to comply with regulation
  • Hosting an event
  • Launching a new app
  • Engineering a new building
  • Solving a business problem
  • Introducing a new business process or cultural change to the organization

Project Management Roles

When talking about project management, we often hear about the project manager, but of course, she isn’t the only person working on the project. Here are the various roles involved in a project. Some of these roles overlap with an individual wearing multiple hats.

Project Sponsor

Project sponsor

The project sponsor is accountable for the outcome or business impact of the project. She is often a high-up manager, who has a project idea that would benefit her department or team. You can think of the project sponsor as the customer of the project.

Project manager (PM)

The project manager is like the CEO of the project. They’re responsible for leading the team, organizing the work and tracking progress.

Project Manager
Supplier

Supplier

Suppliers are the people or organizations doing the actual work. They can be an internal team, like the engineering team, or they can be external freelancers. Normally they are expected to deliver one or more portions of the project.

Team member

A team member is anyone tasked with completing a task of the project.
Team Member
Stakeholder

Stakeholder

A stakeholder is a person or group of people with a vested interest or “stake” in the project. They may be directly involved in the project or they may be affected by the project result. Typically, the PM updates stakeholders throughout the project lifecycle, looking for feedback on deliverables and performance while also managing their expectations.

Client

Clients are the people to whom the project is delivered.

Client

Project Management in Practice

Good vs Quick vs Cheap

Now that you understand project management basics, let’s dive into how projects actually work.

Project Management Constraints

On any project, there will be competing constraints vying for the PM’s attention. It’s the PM’s job to juggle the needs of these constraints with with the desires of the project’s stakeholders and the overall goals of the project.

Triple Constraints

There are three primary constraints, known as the “triple constraints”.

Cost/Resources

This is the approved budget for the project or the business resources allocated to the project. It covers all the necessary expenses to deliver the project. A good PM makes sure not to overspend but also not to underspend. Many projects have a “use it or lose it” clause, which means you must spend everything in an allotted period of time or lose the remaining balance.

Scope/Quality

Whatever the project is aiming to achieve is the project scope. The scope is the purpose or reason behind the project. Quality refers to the standards and criteria that the project’s scope must meet for the result to perform effectively. The product must provide the expected functionality, solve the identified problem, and deliver the expected benefits and value.

Schedule/Timing

A project has a start and an end date. The organization expects the project to complete on time and has forecast the benefit from the project completion to be available by a certain date. Often these completion dates are tied to external milestones or events that cannot move. Some of the project activities can be conducted in parallel, but some must be done sequentially. The project manager and team must determine the best timing and sequence to complete the project.
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Additional Constraints

Risk

What could potentially go wrong if certain external events occurred? These are your risks. How likely is the event to occur? And what’s the impact it could have on the project? If the probability is too high, you should be proactive and create a plan to manage the risk.

Compliance

The conduct of some projects is governed by government, industry, or organizational regulations and procedures. These procedures limit the options available to the project manager and project team. Deviations from these procedures can have dire consequences with regulatory bodies.  

Communication

Unless you are doing that small project for yourself, such as cleaning the garage, there will be other team members, suppliers, stakeholders, and clients involved. The more people and organizations involved, the more difficult it is to maintain clear directions and manage expectations. This becomes exponentially more difficult when there are project team members who are located in multiple locations or who speak different languages.  

All constraints are dependent on each other

Let’s pretend that a key stakeholder wants to add functionality to the website your team is responsible for building. This functionality is outside the original scope of the project, which most likely means, you’ll need more time and resources to do it.

On the other hand, if your project budget was cut, you’ll most likely need to remove items from the original scope. Which means you need to communicate the new project plan, change expectations, and examine the risks that are added by deleting work.

Project management constraints – Whac-a-mole

In short, constraints are all dependent on each other. It’s like that game you played when you were little – Whac-a-mole. Every time you pop a mole back in, another mole pops out of another hole.

Project Management Lifecycle

All projects undergo a series of phases – four phases, to be exact.

1. Initiation Phase

The initiation stage of a project consists of getting the entire project group together – the team, its stakeholders, and other relevant parties to define the project’s goals, schedule constraints, and processes, such as how to communicate and procedures to follow. This is also the phase when the PM will draw up a project charter.

2. Planning Phase

Next, the work needs to be broken down into digestible chunks or deliverables with approximate timelines to complete each chunk. This can be visualized in a Gantt chart, which is the most commonly used chart for schedule purposes in project management. It can be used for project planning, but it’s best suited for tracking progress on a project.

Your chart will represent the order of tasks and how they are interdependent, which will provide you with a roadmap of the work through project completion.

3. Execution Phase

Once you have a roadmap, you can execute on it. The execution phase is when all of the work gets done. During this phase, you’ll monitor all of the work to ensure your project stays on track in terms of all your constraints, which we discussed above. When needed, you will create workarounds to resolve problems.

4. Closing Phase

After everything is complete, you’ll want to do a proper project post-mortem to understand what you achieved, and document and pass along useful learnings to the right teams.

During this phase, key stakeholders will approve the project and deliverables will be handed off to the clients and stakeholders.

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Project Management Processes

Processes facilitate your project through its lifecycle until the project deliverables and outcomes are complete. Here’s a few of the most common project management processes.

Scope Management

The project scope is the sum of all the work that must be done on the project. Scope management is focused on defining and controlling what must be done on the project and what does not need to be done.

Scope management processes are used throughout the project lifecycle. As soon as the project charter is set, the PM will begin to manage the project scope. The final steps of the project are to turn over the product, service, or result of the project to the customer or stakeholders. In short, it is to deliver the scope.

Schedule Management

Schedule management (or time management) is the process of creating, maintaining and communicating schedules for time and resources. And they’re used throughout most of the project lifecycle.

Schedule management usually takes an iterative (or agile) approach because, in most projects, the schedule is frequently updated or changed, and it helps ensure the project is delivered on time with the correct features.

Schedule management processes closely interact with each other and many of the other project management processes. Project time management (schedule) is one of the three triple constraints on a project – the others being scope and budget (or resources).

Budget Management

Budget management (or cost management) refers to managing and controlling project costs.

Or to be precise, “Project Cost Management includes the processes involved in planning, estimating, budgeting, financing, funding, managing, and controlling costs so that the project can be completed within the approved budget.”

Cost management is closely coupled with a company’s financial accounting system, and is often tailored to be compatible with such a system.

This process is used throughout most of the project lifecycle.

In some organizations, the financial accounting system requires that all cost management activities be conducted by a selected department or group. In those cases, the project costs management activities may be done by individuals who are not part of the project team.

Team Management

“Project Team Management includes the processes that organize, manage, and lead the project team.”

The team management (or the human resources management) processes guide the entire project team, including the core team, extended team and any other project team members.

Many of these processes must be used frequently throughout the project lifecycle.

Team members change, roles change and outside factors can influence internal team performance and relationships. If there are people involved (and there are always people involved) these processes apply.

These processes are focused upon the project team and team issues. The team may be a small, intimate team, or it may be a large multi-cultural team who have never met in-person before.

In either case, team management processes should be used, but the amount of time and effort to achieve the process outputs and the number of tools and techniques needed may change dramatically.

In some cases, the project team, or a portion of it, may report directly to the project manager. In most cases though, they don’t, and when this is the case, the value of these processes is increased.

Although it should go without saying, ethical behavior is essential to maintain effectiveness with your project team. If they ever think you’re lying, stealing or cheating, it’s virtually impossible to ever regain their confidence.

Risk Management

Risk management processes guide the project manager and project team in the identification, analysis, response and control of risk.

While risk management should be practiced throughout the life of the project, the emphasis has a tendency to change. Early in the project there are many risks and uncertainties, but there are also many options for addressing those risks.

As the project progresses, the number of risks decreases because things that were uncertain become known. However, the ability to respond to risk and the magnitude of the risk impact increases because there is less time and resources left as you approach project completion.

Because of the unique nature of a project, there are uncertainties. There are things that have never been done a certain way, by this project team, to achieve the objectives for this project, in this time period and with these business conditions.

While a project manager normally manages the risk management process, they rely heavily on their project team members, who are often subject matter experts, to identify threats and opportunities.

Risk management is normally a standard part of every project team meeting. Because while it’s impossible to eliminate risk on a project, it can be managed.

Early in the project the emphasis needs to be on identifying all risks so that a project plan can be put in place that:

  1. Avoids threats
  2. Leverages opportunities
  3. Has risk response options built in for those threats that cannot be avoided.

Before the project plan is baselined,5 risk responses should be included for all major threats. As the project progresses, the emphasis shifts to finding early warnings of new risks and checking the efficacy of the original risk response.

Sometimes, you’ll hear about “known” risks and “unknown” risks.

Known risks are those that we’ve identified as a threat or opportunity, but the likelihood of occurrence is uncertain.

Unknown risks are risks that have not yet been identified.

In some cases, a category of risk can be identified, but the specific risk won’t be known until the project progresses. Examples include: weather delays on a construction project or software bugs on an IT project.

Communication Management

“Project Communication Management includes the processes that are required to ensure timely and appropriate planning, collection, creation, distribution, storage, retrieval, management, control, monitoring and the ultimate disposition of project information.”

Communication is at the heart of project management. Virtually everything a project manager does involves communication. In today’s world, there are a million ways to communicate online.

The project manager should use whatever technologies are commonly found among members of the project team and stakeholder community.

Project managers must be skilled at written and oral communication, formal presentations and informal discussions with all levels of the organization.

On some projects, the project manager will also need to be skilled at communicating with the public and press. One of the best core competencies a project manager can develop is good communication skills.

Stakeholder Management 

“Project stakeholder management includes the processes required to identify the people, groups, or organizations that could impact or be impacted by the project, to analyze stakeholder expectations and their impact on the project, and to develop appropriate management strategies for effectively engaging stakeholders in project decisions and execution.”

Project stakeholder management is concerned with communicating with project stakeholders in order to understand and meet their needs.

Stakeholders are engaged with the project from the very first day until the very last. Different stakeholders will take on a more important role at various stages of the project lifecycle.

Customers, or senior management, will initially approve or authorize the project, commencing the project management activities.

Customers, or users, will receive the final goal of the project near the end of the project and senior management should be involved with the lessons learned and project closeout activities.

Every project has stakeholders.

While stakeholders can be highly beneficial to a project, when they provide clarity and focus, and make rapid decisions, they can also create havoc, if they are disengaged, unclear and make conflicting decisions.

I have seen it go both ways.

The project manager needs to engage with all the key stakeholders, who influence the scope, resources and/or acceptance of the project. These key stakeholders must be well understood and their needs and concerns must be addressed as best they can while still keeping the project within its constraints. Doing so often requires strong interpersonal and communication skills.

Project Management Methodologies

A project management methodology is “a system of practices, techniques, procedures and rules used by those who work in a discipline.”

A methodology, or a project management system, helps those in the organization involved with projects to know what to expect. The definition of best practices and templates will normally speed up a project, and improve its overall quality.

A project management methodology is created by an organization to establish a pattern for a type of project. If your project fits that type, you should follow the pattern or methodology.

How to develop a project management methodology

To develop a methodology, consider industry best practices for the type of project you’re managing. Also, look to examples of that type of project that went well in your organization previously.

Don’t automatically adopt the best practices published in books or on blogs. You must use good judgement because there’s a culture that must accompany any methodology for it to be successful.

If your organization has a “hero-based” culture, don’t adopt a methodology that requires strict process discipline. If your culture is data-driven, rely on analytical project management approaches, not one that requires extensive team meetings and collaboration.

For a methodology to succeed, senior management must understand the methodology and how they are involved with projects.

Senior managers, who routinely direct the project teams to do things that violate the methodology, will ensure that it’s not followed. If senior management wants to change the methodology, change it.

It is better to have an imperfect methodology that is followed than no methodology at all.

Sequential (Waterfall)

One of the most prominent project management methodologies is the sequential (or waterfall) methodology.

Waterfall approach

The waterfall model is a sequential (non-iterative) design process, in which progress is seen as flowing steadily downwards (like a waterfall) through the phases of conception, initiation, analysis, design, construction, testing, production/implementation and maintenance.

This means that team members can’t move onto the next step in the process until the step before it is complete. Because this process goes in a specific order, team members can’t go back to a previous step without starting from scratch, which means there’s no room for errors or changes.

The waterfall model allows no room for changes or errors; therefore, project managers must plan extensively in the beginning and then carefully follow the plan.

Waterfall Advantages

  • Because the waterfall approach requires detailed record keeping, future projects can be improved.
  • Everything is crystal clear to the client from the beginning. They know exactly what they’ll get and for how much.
  • Thanks to waterfall’s strong documentation, you don’t have to worry about employee turnover ruining a project.
  • Easier to manage.

Waterfall Disadvantages

  • Team members can’t go back to a previous stage, once a phase has been completed.
  • Because this methodology relies heavily on the initial requirements, if the requirements are bad in any respect, the project will fail.
  • If a requirement error is detected or a change must happen, the project has to start from square one.
  • The entire project isn’t tested until the very end.
  • This method doesn’t take into account the evolving needs of the client. What if a client realizes they need more features than they initially thought? The project will be delivered late and it will increase the budget.
  • Takes longer.

When should you use the waterfall approach?

  • When you have a very clear picture of what the deliverable is.
  • When clients can’t change the project scope, once the project begins.
  • When speed is not key to the project’s success.

Agile

The agile approach has become increasingly popular – as a solution to the disadvantages of the waterfall methodology. This approach favors an incremental, iterative process, as opposed to a sequential one.

Agile approach

Instead of extensive planning and design up front, agile methodologies allow for changing requirements over time by using cross-functional teams – incorporating planners, designers, developers and testers – who work on successive iterations of the project over fixed time periods. The work is organized into a backlog that is prioritized into exact priority order based on business (or user) value.

Agile Advantages

  • This approach allows for changes to be made after the initial planning phase.
  • It’s easier to add features so you can stay up-to-date in your industry.
  • Short feedback-loops ensure you’re not building something people won’t want.
  • Because testing is conducted at the end of each sprint, bugs are fixed before the end of the project.
  • Because agile projects are so well tested, the project can be launched at the end of any cycle, making it more likely to meet its launch date.

Agile Disadvantages

  • If a poor PM is in charge, the project can become a series of many short sprints, leading to the project coming in late and over budget.
  • At the beginning of a big project, it can be difficult to assess the effort and resources required up-front.
  • Because the project doesn’t have a definitive plan, the final project can be very different from what was initially intended.

When should you use the agile methodology?

  • When speed trumps quality.
  • When clients want to change the scope of the project.
  • When there’s no perfectly defined deliverable.
  • When you have an adept team that is flexible and can think independently.
  • When the project is for a rapidly changing industry.

Sources

1
Building high-performance project talent
2
Project manager salaries
3
Project management between 2010 + 2020
4
Project management guide
5
Baseline (definition)