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Time is money. We’ve all heard this mantra of entrepreneurs at least once before. Small business owners know it’s true––the more time spent on a task, the less money you make. So how can you streamline your operations and become more efficient with your work if you have few resources and a small team?
Enter project management. As a small business owner, you are also a project manager. This means that it falls on you to continuously optimize and improve your small business’ day-to-day operations.
Delivering your services to clients in a timely, effective manner while staying within budget is your ultimate goal. With a limited budget and only a handful of employees, this is no easy task. Luckily, project management systems can give you the framework and guidance you need to be a more efficient project manager for your business.
Below, we’ll cover the main methodologies for project management. They range from broad ideas to specific processes, giving you plenty of options when it comes to choosing the right system for your small business. Read through each method to find out more about them or jump straight to our infographic or a visual look at these project management methodologies.
Originally created in 2001 by the Agile Manifesto, the Agile Project Management system was developed as a solution to the inadequacies of the older Waterfall Method.
Agile Project Management is not a specific process to be followed. Instead, it is a broad idea of project management, characterized by key values that help teams adapt to situations as they occur. It serves as an umbrella for several other project management methods, including Scrum, Kanban, and Lean.
Values of Agile Project Management:
Agile Project Management works best for teams who operate with a degree of unpredictability or frequent change. Often used for software, game development, or digital collaboration tools, Agile systems allow for a dynamic response to evolving requirements and give teams ongoing communication with their clients, cross-functional departments, and customers.
Agile Project Management works best when:
One of the most popular forms of Agile Project Management, Scrum systems work to improve communication and speed of development through cross-functional teamwork. However, Scrum Project Management is unique in that it focuses on short bursts of time to complete work.
Important values of Scrum Project Management include:
Scrum Project Management is unique in that it centers on specific sequential processes to complete work and accomplish team goals.
Scrum “events” or stages of work:
Scrum systems work best for small, cross-functional teams who prefer to operate with flexibility. As with other Agile Project Management methods, Scrum work is highly adaptable and relies on a cohesive team. In general, Scrum works when projects take less than a month to complete.
Scrum Project Management works best when:
Scrum Project Management is popular with employees and improves team collaboration. One case study found that Scrum increased team motivation and satisfaction and reduced development time by 75% for a Brazilian pharmaceutical company.
This is especially relevant for small business owners who know that keeping employee morale high is crucial for success.
Similar to Scrum, Kanban Project Management is a form of the Agile system. However, where Scrum focuses on time, Kanban Project Management focuses on organization.
The overall goal of the Kanban Project Management method is to achieve higher output with lower production times. The method originated in the 1940s on a Toyota manufacturing line in Japan and was created as a way to better compete with American car production.
The core principles of the Kanban Method are as follows:
The Kanban Method has six basic steps:
The focus of implementing the Kanban Project Management Method is on the Kanban Board. This can either be a physical or digital board and should be used to accurately track the flow of tasks in the system.
The three main sections of the Kanban Board are:
The main benefit of the Kanban Method is that it can be applied to any work process in virtually any industry without disrupting current practices. It is not a traditional project management method for software creation, but rather a method of improving personal or team work flow.
Kanban Project Management works best when:
Kanban Project Management can help companies manage projects that take up most of their resources. Teradata, an analytics and consulting services company, found Kanban Project Management preferable to Scrum after noticing that Scrum Management did not accommodate for larger projects. After implementing the Kanban Method, the Teradata team was able to complete a project one month early and under budget.
As the name implies, Lean Project Management focuses on efficiency. The goal of this type of Agile Project Management is to create the most value for customers and clients while reducing waste and using fewer resources.
The five principles of Lean Project Management are:
Waste as described by Lean Project Management:
For small business owners who need to save money wherever possible, the Kanban Project Management method could be a solution for projects that take the majority of company resources to execute.
By eliminating “waste” from a system, Lean Project Management gives teams and managers greater control over their process and allows them to look more closely at what adds value for customers.
Lean Project Management Method works best when:
Lean Project Management works well for financial institutions hoping to stand out from competitors. Boston Consulting Group found that banks see 15–25% improvement in efficiency using the Lean Method by cutting wait time in customer service. In fact, one bank was able to process customer transactions 30% more efficiently.
If your small business needs an improvement in overall efficiency, the Lean Project Management method could help you reduce unnecessary tasks and focus on those that really matter to the client.
First introduced in 1970, the Waterfall Project Management method uses a sequential pattern to move through the software development lifecycle.
Waterfall Project Management is a simple step-by-step process that follows six stages:
Some argue that the Waterfall method is too rigid for the fast-paced environment of today’s software development firms and agencies, leading to the emergence of Agile Project Management methods.
Waterfall Project Management works best when:
Waterfall Project Management shouldn’t be combined with other methods when system failure could be harmful to end users. On October 1, 2013, HealthCare.gov rolled out their website for the first time. Within 2 hours of launching, the website was down, leaving millions of Americans in the dark on their new health care coverage.
Project management systems for the website tried to combine Agile and Waterfall principles, a fatal mistake for a website with millions of users attempting to access at one time. Website users lost access to the site and were unable to register for potentially life-saving health insurance. The cost of the website inflated dramatically from $93.7 million to $1.7 billion, a disaster for HealthCare.gov.
Small business owners beware: trying to adapt Waterfall Project Management with Agile principles can be dangerous for end users, clients, and customers.
However, the Waterfall method is still commonly used around the world as an effective method of project management. In fact, one study found that it is still more widely used than Agile Project Management, with 53% of projects using Waterfall.
Six Sigma Project Management focuses on improving the quality of output. Originally coined by Motorola in the 1980s, Six Sigma Project Management has been used successfully across industries to streamline operations by using both statistical and empirical principles to manage quality. It can be added to other project management techniques to improve the overall process of a business.
Six Sigma Project Management is defined by the DMAIC roadmap, an outline of steps needed to complete a project:
The goal of Six Sigma Project Management is continuous improvement. The method uses statistical principles to look for areas of improvement and implement solutions in those areas.
More than half of all Fortune 500 companies use Six Sigma Project Management. General Electric implemented Six Sigma Project Management in 1995 after turning their focus towards product quality. After a five-year implementation period, General Electric reported $12 billion savings. Companies like Ford, Boeing, Amazon, and Samsung now incorporate Six Sigma into their processes as a result.
With large companies seeing great success under the Six Sigma framework, it’s likely that a small business could also benefit from the process.
PRINCE2, acronym for Projects in Controlled Environments, uses a product-based approach to define projects and divide them into manageable stages. It’s used primarily by the British government and private sector in the United Kingdom.
The PRINCE2 process has seven steps:
PRINCE2 can be applied to any project regardless of size, scope, or industry. It clearly defines roles within a team, establishes how a project should be managed, and holds management accountable for a project’s success.
PRINCE2 Project Management works best when:
PRINCE2 can help businesses minimize risk and error in current processes. VocaLink processes domestic and international payments in the UK, running nearly 91 million payments every day and 9 billion annually. The company adopted PRINCE2 Project Management to help minimize risk and eliminate potential errors in business systems with great success, seeing fewer missed transactions and greater control of small tasks.
If your small business is struggling to maintain control of details, adopting the PRINCE2 Project Management method could help eliminate errors.
For small businesses, project management can be a challenge. While large companies have nearly limitless resources and staff available to monitor departments and tasks, small business owners may be on their own or have only a small team to help them hit goals, meet deadlines, and keep customers happy.
This is why the right project management method is crucial to the success of your goals as a small business owner. So how do you know which one is right for you?
Every small business is different: teams, goals, culture, and clients all contribute to highly unique environments. So how do you choose a project management method to suit your specific needs?
When evaluating different methods of project management, consider these factors:
These factors play a significant role in the project management method that will work for your needs. Once you have evaluated and documented these, it’s time to test a method.
Follow these general steps to find and implement a project management method:
Check out the infographic below to learn everything you need to know about project management methodologies.
Remember: there is no one-size-fits-all method when it comes to small business project management. Always approach project management implementation with a critical eye, look for ways to streamline processes, and strive for continuous improvement in all areas of your small business for best results.
Digital Initiative | FinancesOnline | Agilest | Emerald Insight 1, 2 | Scrum Alliance | Software Advice | The Lean Way | Playbook HQ | Smartsheet | 6Sigma | Grey Campus | Project Manager | PMI | CIO | Clarizen | Digital Project Manager | nTask Manager | Agile Manifesto | University of Maryland | Gartner | Knowledge | PRINCE2