Nowadays, organizations across several industries rely on the successful integration of IT systems in order to succeed. A high quality digital product can be the key to standing out on the market, gaining a competitive advantage, or streamlining internal operations.

Research by McKinsey and Oxford University revealed that most IT projects experience cost and duration overruns. What surprised me the most when I looked over their findings was the fact that the larger the IT project (with over $15 million in terms of budget), the more likely it was to accumulate additional costs.

What does this mean?

Money cannot make up for inadequate project management. Currently, the need for project managers surpasses the industry's training capacity. Organizations are competing for seasoned professionals in hopes of gaining access to more accurate time and cost estimates.

While this role's popularity is soaring, project management is not without its challenges. Many of the processes are dated, and there are several repetitive tasks which could potentially be automated. Project managers need the time to take care of their teams and their stakeholders. Using adequate software can help them do just that.

Recent events have highlighted the importance of technology for project management practices. Many PMs have led their global and local teams using collaborative tools and videoconferencing programs. Within our design agency, we use several: Figma, Slack, Zeplin etc.

But implementing software solutions won't do much for the project management process if the PM doesn't have a solid background of soft and hard skills. A great PM is a talented communicator who also knows how to apply their time management skills to each project's unique task set.

How much does bad project management actually cost?

According to the report by McKinsey and Oxford, faulty project management costs companies $1 million dollars every 20 seconds. With stakes this high, it's no wonder that 17% of projects with unfavorable outcomes threaten the very existence of the companies responsible for them.

The monetary losses are doubled by emotional costs. Project managers are often overworked, and their many responsibilities are a source of stress.

How do we fix this mess?

1. A captain can't sail without the crew

While it might seem obvious, many forget that a project manager is only as good as their team. Recruiting great talent and incentivizing people to stay with the organization in the long run fosters a healthy professional environment.

2. Bite sized = manageable

By focusing on smaller delivery cycles followed by quality assurance, the PM is more in control of the project's scope. Handing off the relevant design or development deliverables on time helps build and maintain a great rapport with the stakeholders.

3. Check It Twice

In order to avoid excessive spending, more and more companies are conducting project audits. This allows them to determine whether they can afford to implement their ideas. Assessing need, cost, and feasibility before approaching a development team prevents project management death marches.

Wrap Up

Accurate estimates are extremely difficult to formulate. It takes time and experience to develop these skills, and the unique requirements of certain projects might still surprise PMs. With the cost of mismanagement being as high as $438 billion a year, organizations should invest more in the training of their project managers.