What is the importance of project management?

In early stage of “modern” project management, the importance of project management was directly interrelated to the nature of projects, typically military projects. Some of those projects were conceived during the cold war period. Since 80’s project management shifted toward a wider application in the private and public industry, especially in construction and engineering, even if some of the most powerful “tools” like Earned Value management was developed earlier, in 60′.

Nowadays, the interest in project management is driven by the need to carry out the companies’ projects quickly and effectively. From this perspective, project management becomes a way to implement the business strategy, as described below. There is currently no business sector that cannot be improved, both at strategically and operationally level, by a “modern” project management. But what is “modern” project management? The answer depends upon the type of business and industry sector as well as upon the role /position of the company in the supply chain. For example, in construction the project management needs of a company acting as a specialized subcontractor are different from those of an international company, working as a general contractor in the EPC environment. The subcontractor would probably receive project management requirements from the client; therefore, small companies, working as a subcontractor, need flexibility in adapting their project management methods to contractual requirements.

Similarly, organizations which act as a project-owner have different project management needs than EPC contractors. The Employer has to design the right project management “organization” to execute its capital programs.

Even the methodology is tuned on industry sector (for example traditional project management vs agile used in IT).

Another factor is the “nature” of business; H. Kerzner made a distinction between Project-driven vs Non-Project driven companies and this helps to figure out type and limits of project management system to be implemented in the company. Project-driven organizations sell projects and project management is a distinctive capability in the market.

Finally, there are methodological frameworks, like Total Cost Management, which can be implemented virtually on any business. In this framework company’s assets are managed through the projects, hence, project management becomes strategic.

Originally published on Quora: https://qr.ae/pGxE6k